O'KEY Group has reported a 0.7% increase in retail revenue in the third quarter to RUB 40,854 mln from RUB 40,565 mln.
In the past nine month period Group net retail revenue increased by 2.0% year-on-year, from RUB 122,976 mln to RUB 125,443 mln.
Miodrag Borojevic, Chief Executive Officer of the hypermarket and supermarket segment, said:
"In the third quarter, the economic environment remained subdued despite the first signs of recovery coming into view in the last two months. Selling space growth has accelerated across the market putting considerable pressure on our like-for-like traffic. This, combined with the closure of inefficient stores conducted earlier this year, was ultimately reflected in the decline of net retail revenue by 2.1% YoY.
Nevertheless, we remain firmly committed to our strategy aimed at increasing efficiency and profitability. During the quarter, our team continued to take further steps to improve business effectiveness, maintaining a focus on the modernization of our assortment structure and pricing policy, further development of logistics centralization, along with optimization of processes at the store and head office level. We also continued to strengthen the team by taking on board several strong managers with extensive experience in sales operations and commerce. We believe that recently launched initiatives, combined with better consumption trends, will support our top line in Q4'17. We have already seen our LFLs turning positive towards the end of October.
I strongly believe that by continuing to deliver progress on our strategic priorities we remain on track to build an efficient and modern company, which creates value for its shareholders."
Armin Burger, Chief Executive Officer of the discounter segment, added:
"During the third quarter, our discounters continued to demonstrate further growth with net retail revenue increasing by 76% YoY. The consistently strong performance of our LFL numbers is largely attributable to our unique discounter concept in the Russian market, aimed at continuous evolution to adapt to the changing needs of consumers. We continue to enhance our range of private label products and modernize our in-store layout, so as to increase the overall attractiveness of our discounters."