Russian retail giant Lenta has posted a 13.6% growth in retail sales to RUB 392.1 billion (€5.27 billion) in its financial year 2018.
Total sales increased by 13.2% to RUB 413.6 billion (€5.56 billion), while its wholesale business saw growth of 6%.
Like-for-like sales were up 1.3% with the group seeing a significant improvement in the fourth quarter.
Adjusted EBITDA for FY 2018 was up 2.0% to RUB 36.2 billion (€490 million) (2017: RUB 35.5 billion), with a margin of 8.8%.
'A Challenging Year'
Lenta chief executive, Herman Tinga, said, "This was a challenging year for the company, given pressure from the weak macro and consumer environment, but we finished the year with positive performance and trends.
"Strong operating cash flows and lower capex enabled us to come very close to positive free cash flow."
Highlights
In 2018, the retail giant launched 13 new hypermarkets and 38 new supermarkets and entered four new cities.
It added more than 20,000 square metres of warehouse space in FY 2018 to support volume growth.
In the fourth quarter of 2018, it introduced the Lenta mobile app to offer customers personalised deals and new shopping experience.
The app has been downloaded by more than 1.4 million customers since its launch.
Outlook
In 2019, the retailer will continue to focus on organic growth, and open around eight new hypermarkets and seven supermarkets.
It will also consider attractive acquisition opportunities as a part of its expansion strategy.
The company expects capital expenditures of about RUB 15 billion (€200 million) in the new financial year.
A significant amount of this money will be spent in building new supply-chain infrastructure in Moscow and Saint-Petersburg, and to expand the capacity of its existing distribution centre in Novosibirsk.
© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Dayeeta Das. Click subscribe to sign up to ESM: European Supermarket Magazine.
