O`KEY Group S.A. (LSE, MOEX: OKEY, the “Group” or the “Company”), one of Russia’s leading food retailers, has announced its unaudited operating results for the second quarter (Q2) and the first six months (H1) of 2022.
Q2 2022 OPERATING HIGHLIGHTS
Group net retail revenue rose by 11.5% YoY to RUB 49.6 bn, driven mainly by discounters’ LFL performance and O’KEY’s online sales growth and supported by discounter and hypermarket openings.
O`KEY hypermarkets’ net retail revenue declined slightly to RUB 35.4 bn in Q2 2022 vs RUB 36.0 bn in Q2 2021 mainly due to geopolitical and macroeconomic turmoil that resulted in lower traffic to shopping malls and changes in the product mix on the shelves compared to the same period last year. However, that was largely offset by the additional revenue of four newly opened O’KEY hypermarkets in April 2022.
- O’KEY total online sales grew by 42.8% YoY to RUB 1.4 bn and accounted for 4.0% of O`KEY’s net retail revenue in Q2 2022.
- DA! discounters accelerated their revenue growth in Q2 2022, both year-on-year and quarter-on-quarter, again delivering one of the fastest paces in the industry thanks to better brand recognition and a well-balanced product mix based on private labels. DA! showed an impressive 68.5% YoY net retail revenue growth to RUB 14.1 bn. This was driven by a 37.1% LFL net retail revenue increase and a 33.7% YoY growth in the chain’s selling space.
- DA! discounters’ share in the Group’s net retail revenue increased by 9.7 pps YoY to 28.5%.
- The Group expects that the discounters and online business will remain the Company’s main growth drivers in the medium term.
H1 2022 OPERATING HIGHLIGHTS
- Group net retail revenue increased by 10.4% YoY to RUB 96.8 bn.
- O`KEY hypermarkets’ net retail revenue declined by 1.1% YoY to RUB 71.3 bn.
- O’KEY total online sales grew by 53.6% YoY to RUB 3.0 bn and reached 4.3% of O`KEY's net retail revenue.
- DA! discounters’ net retail revenue rose by 63.2% YoY to RUB 25.5 bn, driven by a 35.2% LFL net retail revenue growth and the chain’s expansion.
KEY EVENTS AFTER THE REPORTING DATE
- In July 2022, Expert RA affirmed the credit rating of ”ruA-“ with a Stable outlook for O`KEY LLC, the main operating subsidiary of O`KEY Group S.A. The rating agency noted an improvement in the Group’s revenue and EBITDA, with the discounters' EBITDA more than doubling in the financial year 2021.