Russian X5 Retail Group opens two distribution centres in the Voronezh Region

Voronezh, Russia, 2015-6-29 — /EPR Retail News/ — X5 Retail Group, a leading Russian food retailer, announced today the opening of two distribution centres (“DC”) in the Voronezh Region. The state-ofthe-art logistics facilities, Ramon and Chernozemye, are expected to strengthen ties between food producers and consumers from seven Black Earth Belt regions, helping to increase the volume of products from local suppliers.

The Ramon facility (39,500 sqm) will handle goods for Pyaterochka stores across the Voronezh, Tambov, Lipetsk, Belgorod, Kursk, Orel and Bryansk regions.

The Chernozemye Distribution Centre (11,500 sq m) will focus on servicing the Perekrestok and Karusel chains in the Voronezh, Tambov, Lipetsk, Belgorod and Kursk regions, as well as the Volgograd Region from next year

Voronezh Region Governor Alexey Gordeev, Х5 Retail Group Government Relations Director Stanislav Naumov and General Director of Pyaterochka retail chain Olga Naumova laid the groundwork for development of the two logistics facilities at a meeting before the opening ceremony. The meeting participants discussed how Russia’s leading agricultural region in terms of production output may benefit from the extensive development of the X5 logistics network. They also noted how the retail industry should seek to ensure advanced retail services for the local community.

Х5 Retail Group invited over 20 major suppliers from the Voronezh Region to attend the opening ceremony, as the launch of the new logistics facilities offers them significant opportunities to develop cooperation with the Pyaterochka, Perekrestok and Karusel chains, while also materially reducing logistics costs and boosting supplies to X5 stores.

The centralisation of the supply chain will also help to increase the share of local suppliers in the product mix offered by X5 stores in the Voronezh Region. Whereas this share is currently above 25% of total retail turnover, the bulk of products sold by X5 retail chain stores are of Russian origin and come from a variety of regions.

The Voronezh Region now hosts 67 Pyaterochka stores, three Perekrestok supermarkets and two Karusel hypermarkets. These employ over 1,250 local residents, with the opening of the two X5 distribution centres creating an additional 950 jobs. On top of that, X5 is planning to open 25 new Pyaterochka stores in the region in 2015, meaning the chain’s total headcount in the Voronezh Region will increase to more than 2,500 employees.

In 2013, X5 started implementing a logistics separation strategy with a view to splitting product flows for convenience stores from the flows for supermarkets and hypermarkets. Single format DCs are instrumental in maximising product traffic centralisation, streamlining deliveries and in-store product ranges. The logistics separation across X5’s retail chains is scheduled to be completed in 2015.

Note to Editors:
X5 Retail Group N.V. (LSE: FIVE, Fitch – ‘BB’, Moody’s – ‘B1’, S&P – ‘BB-’) is a leading Russian food retailer. The Company operates several retail formats: the chain of proximity stores under the Pyaterochka brand, the supermarket chain under the Perekrestok brand, the hypermarket chain under the Karusel brand and Express convenience stores under various brands.

As of 31 March 2015, X5 had 5,639 Company-operated stores. It has the leading market position in both Moscow and St. Petersburg and a significant presence in the European part of Russia. Its store base includes 4,958 Pyaterochka proximity stores, 405 Perekrestok supermarkets, 83 Karusel hypermarkets and 193 convenience stores. The Company operates 33 DCs and 1,407 Company-owned trucks across the Russian Federation.

For the full year 2014, revenue totaled RUB 633,873 mln (USD 16,498 mln), EBITDA reached RUB 45,860 mln (USD 1,194 mln), and profit for the period amounted to RUB 12,691 mln (USD 330 mln).

X5’s Shareholder structure is as follows: Alfa Group – 47.86%, founders of Pyaterochka – 14.43%, X5 Directors – 0.04%, treasury shares – 0.04%, free float – 37.63%.

For further details please contact
Maxim Novikov
Head of Investor Relations
Tel.: +7 (495) 502-9783
e-mail: Maxim.Novikov@x5.ru

Anastasiya Kvon
IR Director
Tel.: +7 (495) 792-3511
e-mail: Anastasiya.Kvon@x5.ru