Russian grocery retailer Magnit has booked a 142% jump in first-half profit, driven partly by higher sales.

Magnit said today (24 July) its net profit for the six months to the end of June rose to US$339.6m. Sales increased by 33%, climbing to RUB207.6bn (US$6.78bn).

During the period the company opened 262 convenience stores, eight hypermarkets, two Magnit Family store and 141 cosmetics shops. Same-store sales were up 3.5%, the group revealed.

The company's strong performance suggests it is continuing to make gains on market leader X5 Retail Group, which has struggled to grow sales as it transitions its strategy to focus on organic growth.

Commenting on the results, CEO Sergey Galitskiy said: "We've done a hell of a job!"

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OJSC "Magnit" announces unaudited 1H 2012 results

Krasnodar, July 24, 2012: OJSC "Magnit" (the "Company"; MICEX and LSE: MGNT) is pleased to announce its unaudited 1H 2012 financial results prepared in accordance with IFRS[1].

During 1H 2012 the Company added (net) 413 stores (262 convenience stores, 8 hypermarkets, 2 "Magnit Family" stores and 141 cosmetics stores) and increased its selling space by 31.42% in comparison to 1H 2011 from 1,612.85 thousand sq. m. to 2,119.53 thousand sq. m. The total store base as of June 30, 2012 reached 5,722 stores (5,268 convenience stores, 98 hypermarkets, 5 "Magnit Family" stores and 351 cosmetics stores).

Revenue in rubles increased by 32.57% YoY from 156,595.52 million RUR in 1H 2011 to 207,602.53 million RUR in 1H 2012. The top line growth was due to an increase in selling space as well as to a 3.5% increase of like-for-like sales (excl. VAT). Revenue growth in dollar terms amounted to 23.85%: from US$ 5,470.74 million to US$ 6,775.76 million.[2]

Gross margin grew from 22.61% in 1H 2011 to 25.58% in 1H 2012. Gross profit in rubles increased by 49.97% from 35,412.01 million RUR (US$ 1,237.14 million) to 53,108.86 million RUR (US$ 1,733.37 million).

EBITDA increased by 99.97% from 10,275.01 million RUR (US$ 358.96 million) in 1H 2011 to 20,546.92 million RUR (US$ 670.61 million) in 1H 2012. EBITDA margin in 1H 2012 amounted to 9.90% which is 3.34% above the figure of 1H 2011 (6.56%).

1H 2012 net income increased by 158.97% and amounted to 10,403.75 million RUR (US$ 339.56 million) vs. 4,017.37 million RUR (US$ 140.35 million) in 1H 2011.

Sergey Galitskiy, the Company's CEO, provided the following comments on the published results:

"We've done a hell of a job!"