NOVOSIBIRSK, Russia, August 13, 2013 /PRNewswire/ --
Obuv Rossii, which manages the retail footwear brands Westfalika, Peshekhod and Emilia Estra, announces its financial results for 1H according to Russian Accounting Standards.
- Revenue increased by 87% compared to the same period in 2012 to RUB 1.95 billion;
- Net profit was up 160% compared to 1H 2012 to RUB 203 million;
- EBITDA rose 2.3 fold to RUB 338 million;
- EBITDA margin reached 17.3%.
The significant growth in profits and EBITDA is attributable to qualitative changes in the product range, with an increase in the share of more expensive footwear in collections (by more than 50%); growth in sales of the high margin goods category - accessories (now accounting for 12% of revenue); and also an expansion of the Westfalika retail chain in the shopping center format and development of new financial services for customers - the provision of microloans.
Obuv Rossii CEO Anton Titov comments: "In addition to our plans to achieve a dynamic expansion of the retail network, we are successfully implementing a customer loyalty program, increasing the number of repeat purchases and requests for installment payments and microloans. All these factors are enabling us to increase the profitability of the business and our margins."
In 1H 2013 the company opened 32 stores within the framework of the annual investment program, which stipulates the opening of more than 60 trading outlets and investments of RUB 700 million, and accessed the markets of 10 new cities and new regions, such as Khanty-Mansi Autonomous Okrug, the Republic of Buryatiya and Zabaykalsky Krai. New stores opened in Moscow are primarily Westfalika stores in the shopping center format. In March Obuv Rossii introduced a new format in Moscow and opened a store at the Filion Shopping Center. The company assesses the total capacity of Russia's capital for the Westfalika brand at 80 stores.
In April, Obuv Rossii announced a five-year investment program on the expansion of the chain through 2018. As part of the program, the Company will invest RUB 6 billion in the opening of new stores in 2013-2017. Obuv Rossii plans to increase the size of its retail network by 250% to 650 stores, with revenues rising 450% to RUB 18.5 billion. The program will be financed with borrowings and internal funds. In May 2013 the Moscow Exchange admitted trading of the exchange bonds of Obuv Rossii with a total volume of RUB 5 billion. Three bond issues will be placed over the next three years.
Payment by installments and micro financing constitute a significant revenue and profit growth driver. In 1H 2013 Obuv Rossii drew up 126,000 installment payment contracts with a total value of RUB 590 million, an increase of 30% on the same period in 2012. The company issued cash loans worth RUB 633 million, while the interest income of the Group totaled RUB 277 million. The new microloan service is generating demand from customers - over the first six months of 2013 every second customer signed up for repeat microloan contract. According to the company's plans, the financing provided to store customers (trade credits - installment payments; and cash loans) is expected to reach RUB 4 billion in 2013.
About the company
Obuv Rossii is a Russia-wide footwear merchant and is among the top five footwear retailers in the country. The company was founded in 2003 and its headquarters are located in Novosibirsk. The company's core business areas are wholesale and retail sales of footwear and related accessories as well as footwear production. Obuv Rossii is developing two footwear retail chains - Westfalika (a mono-brand in the middle price segment) and Peshekhod (a multi-brand footwear supermarket) as well as the fashion brand Emilia Estra, which offers inexpensive accessories. Today the company has a presence in more than 70 cities across Russia and more than 220 stores. The Russian rating agency Expert RA has assigned the company a credit rating of A, a high level of reliability. The company's revenues in 2012 amounted to RUB 3.3 billion, and revenues in 2013 are expected to reach RUB 5 billion. For more information about the company, visit its corporate website http://www.obuvrus.ru.
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SOURCE Obuv Rossii