Belarus-based Eurotorg, the company's biggest retailer, has said that it expects 'positive trends' in the country's macroeconomic environment to continue, boosting both the retail segment and Eurotorg in particular.
The retailer made the forecast as it published its audited consolidated financial results under IFRS 16, for the year to end December 2018.
For the full year, Eurotorg posted a 15.3% year-on-year increase in revenue to BYN 4.5 billion (€1.91 billion).
Net retail sales increased by 14.5% for the year, reaching BYN 4.1 billion, supported by 'moderate' like-for-like sales growth, the retailer said. Adjusted EBITDA was up 7.1% to BYN 398 million (€169 million).
Positive Dynamics
"Despite the rapid expansion of our store roll-out programme and new businesses put some pressure on the EBITDA margin, we were able nonetheless to maintain positive EBITDA dynamics during 2018 as a whole," commented Eurotorg CEO Andrei Zubkou.
“Looking forward, the macro environment in Belarus remains stable, with incomes continuing to increase. We expect the positive trends to continue to be supportive for the further growth of the retail segment and Eutorog’s business in particular, as the country’s dominant modern retail format player," Zubkou added.
The retailer said that in 2019 it will 'continue to seek out opportunities to reduce indebtedness and further optimise our debt portfolio', following what it described as 'significant progress' in 2018 in terms of reducing overall leverage and reducing the share of foreign-currency debt in the overall portfolio.
Eurotorg opened a net 362 stores in 2018, bringing the total number of outlets to 862 as of 31 December.
Diversification
As well as the grocery segment, in which the retailer is focusing on developing smaller formats, the group diversified during the year, with the consolidation of its drugstore chain, Magia, in June, and the expansion of its e-commerce operations, E-dostavka.by and Gipermall.by.
"On a combined basis, two online grocery services generated 3.6 million orders in 2018, putting Eurotorg among the leading companies on this indicator not only in Belarus, but also in Eastern Europe," said Zubkou. "We achieved the significant landmark of 5% of total retail sales from e-commerce during the fourth quarter, and we expect e-commerce to continue growing rapidly for many years to come."
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
