Russian retailer X5 Retail Group has posted a 3.7% increase in like-for-like sales in the fourth quarter of its financial year, as well as a 13.4% sales growth contribution from increased selling space.
Fourth quarter sales at the group totalled RUB 420.9 billion (€5.59 billion), of which RUB 326.5 billion was recorded at its Pyaterochka stores (+18.1%), RUB 67.2 billon was recorded at Perekrestok (+23.0%), and RUB 26.1 billion was recorded at Karusel (+0.5%).
Its Pyaterochka chain saw a 0.8% increase in average basket value in the fourth quarter, while Perekrestok saw a 0.8% decline, and Karusel posted a 3.1% increase.
For full-year 2018, X5 reported a 1.5% increase in like-for-like sales, as well as a 17.0% sales growth contribution from a 18.0% rise in selling space.
Net retail sales for Pyaterochka and Perekrestok increased by 19.7% and 23.5% year-on-year, respectively, and grew by 1.7% year-on-year at Karusel.
Overall group sales for the year were RUB 1.525 trillion (€20.24 billion).
Macro Challenges
“Our focus on smart expansion and operational excellence helped X5 to deliver 18.5% year-on-year growth in net retail sales, despite continued macro challenges facing the Russian food retail sector. Real income growth was near zero in 2018 and food inflation remained low for most of the year, starting to accelerate only in the third quarter," said X5 chief executive Igor Shekhterman.
“In this environment, we achieved growth in LFL sales, traffic and basket at the group level. Our core formats Pyaterochka and Perekrestok continued to make solid positive contributions to higher net retail sales. LFL traffic growth accelerated in Q4 2018 at both core formats compared to the previous quarter."
X5 added 2,310 net new stores in the full year, with 746 new stores in the final quarter of the year. Growth in net selling space for the full year was 18%, compared to 27.4% the year previous.
It also grew its omni-channel offering, with its Perekrestok Online platform expanding into St Petersburg and Moscow over the year, with orders exceeding 408,000 over the course of the year.
Looking Forward
Looking ahead to the coming year, Shekhterman described the Russian retail environment as "challenging", but added that X5 is maintaining its "focus on building Russia’s leading modern food retail business and evolving to remain at the forefront of the sector in the long term.
"While continuously seeking to expand the channels through which we can reach our customers, we also remain focused on efficiency and operational excellence.”
© 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.
