Magnit PJSC: Magnit Starts Piloting Discounters

MAGNIT PJSC (MGNT) 
Magnit Starts Piloting Discounters 
 
21-Jul-2020 / 10:00 MSK 
Dissemination of a Regulatory Announcement, transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
Press-Release | Krasnodar | July 21, 2020 
 
Magnit Starts Piloting Discounters 
 
     The Company has launched the first three stores under the new format to 
assess its performance and decide on potential full-scale roll-out. Magnit's 
discounter concept implies a store with an area of up to 300 sq. m operating 
in a predominantly residential area and offering a high-demand assortment of 
     around 1,800 SKUs with a strong focus on private labels and low regular 
                                                                     prices. 
 
?rasnodar, July 21, 2020: Magnit PJSC (MOEX and LSE: MGNT; the Company), one 
  of Russia's leading retailers, continues to pilot additional store formats 
     to cover the maximum number of the most relevant shopping missions. The 
discounter concept is aimed at price-sensitive consumers who frequently make 
               minor purchases of traditional goods or stock up on products. 
 
  The three pilot stores were opened in Samara, Kamyshin in Volgograd region 
and Staraya Kulatka village in Ulyanovsk region, replacing three convenience 
   stores in the locations that fit the new concept. The newly "reformatted" 
 outlets have a comparatively limited assortment of around 1,800 high-demand 
  SKUs with a dominant share of the entry price segment (around 65% of total 
     assortment), private labels (around 18% of total assortment), and value 
packs: fruits, vegetables, dry foods, dairy, confections, baby food, drinks, 
                                  pet food, household chemicals, and others. 
 
   The format will follow "EDLP" ("everyday low price") policy providing its 
customers low regular prices even without any promotions. The new stores aim 
 to have the best customer attractiveness within a particular catchment area 
     in terms of pricing, exhibiting all characteristics of a discounter. In 
 addition to that, they follow fairly simple zoning principles and have only 
 a basic equipment setup. At the same time, customer service remains at high 
          level and meets all the requirements of a modern affordable store. 
 
   The concept of the format implies an optimized staffing level compared to 
         the convenience stores, and will require significantly less capital 
            expenditures for opening, including investments into repairs and 
      refurbishment. As part of the pilot that will last for several months, 
        Magnit plans to closely examine customer feedback with regard to the 
  assortment and service. If the results are positive, the Company will then 
  plan to fine-tune the CVP for the format and decide on potential roll-out. 
 
"As we have seen over the last years, there is a growing customer demand for 
   the convenience concept with limited assortment of quality private labels 
     and entry price articles at low regular prices. Here, discounters are a 
    perfect fit in order to satisfy the basic needs for fast-moving consumer 
 goods. I believe, given our competitive strengths, including own production 
capabilities, Magnit is the best positioned to capture this customer demand, 
   while achieving acceptable returns on investments"- said Ruslan Ismailov, 
                                Magnit Deputy CEO and Retail Chain Director. 
 
For further information, please contact: 
 
Dmitry Kovalenko 
 
Director for Investor Relations 
 
Email: [e-mail] 
 
Office: [phone] 
 
Dina Chistyak 
 
Director for Investor Relations 
 
Email: [e-mail] 
 
Office: [phone] x 15101 
 
Media Inquiries 
 
Media Relations Department 
 
Email: [e-mail] 
 
Note to editors: 
 
   Public Joint Stock Company "Magnit" is one of Russia's leading retailers. 
  Founded in 1994, the company is headquartered in the southern Russian city 
 of Krasnodar. As of March 31, 2020, Magnit operated 38 distribution centres 
  and 20,860 stores (14,594 convenience, 472 supermarkets and 5,794 drogerie 
       stores) in 3,718 cities and towns throughout 7 federal regions of the 
                                                         Russian Federation. 
 
In accordance with the audited IFRS results for FY 2019, Magnit had revenues 
of RUB 1,369 billion and an EBITDA of RUB 147 billion. Magnit's local shares 
   are traded on the Moscow Exchange (MOEX: MGNT) and its GDRs on the London 
Stock Exchange (LSE: MGNT) and it has a credit rating from Standard & Poor's 
                                                                      of BB. 
 
ISIN:           US55953Q2021 
Category Code:  MSCU 
TIDM:           MGNT 
LEI Code:       2534009KKPTVL99W2Y12 
OAM Categories: 3.1. Additional regulated information required to be 
                disclosed under the laws of a Member State 
Sequence No.:   76856 
EQS News ID:    1098035 
 
End of Announcement EQS News Service 
 
 

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July 21, 2020 03:00 ET (07:00 GMT)