X5 posts 1Q 2011 net profit of $97 million

X5 posts 1Q 2011 net profit of $97 million under IFRS
Russian retail group, X5, has posted a 1Q 2011 net profit of $97 million under IFRS.

The net result is up 23% year on year, with 1Q EBITDA climbing 57% year on year to $281.1 million, on the back of a 51% year on year jump in net sales to $3.845 billion.

X5 noted a 12% increase in like for like sales, with a 17% increase from organic store expansion, coupled with supermarkets experiencing a 9% increase in traffic and 10% basket increase, with consumers moving upmarket as Russia’s economic rebound continued to take hold.

X5 Retail Group CEO, Andrei Gusev, highlighted thestepped up organic growth, along with the fast tracked integration of the Kopeika chain purchased in 2010, which will see 650 former Kopeyka stores rebranded in 2011 with sales traffic and margin improvements to Pyaterochka levels expected by 2012. He also reiterated plans to continue X5’s focus on organic growth.

“We are focused on organic growth with plans for opening approximately 540 stores this year. Organic performance in the first quarter benefited from new stores and LFL sales at discounters and a strong recovery in supermarkets thanks to trading up by consumers.”

X5 CFO Kieran Balfealso noted that the improved fiscal outlook would see the Group working quickly to restructure its financial position.

“We are focused on strengthening cash generation through a combination of top-line growth, operational efficiency and working capital improvement. Our objective is to optimize operating cash flows which will help to fund our CAPEX program and gradually de-risk the balance sheet, and we expect substantial progress on these areas by the end of 2011.”