Lenta increases net profit 3.8% to 4.5 billion rubles in H1, below forecast
MOSCOW. Aug 30 (Interfax) - Retailer Lenta posted a net profit of 4.5 billion rubles for H1 2017, up 3.8% year-on-year, the company said.
This figure is lower than the 4.8 billion rubles predicted by the consensus forecast.
EBITDA was 15.623 billion rubles, rising 14.2%. EBITDA margin fell to 9.6% from 9.8% in H1, as forecast by the company.
The company also said that gross margin fell to 21.7%, down 0.15 percentage points compared to H1 2016 as better supplier terms, supply chain improvements, shrinkage and more efficient in-store production were offset by investments in prices and a one-off effect of around 0.9 billion rubles as a result of the new Trade Law.
"The major effect came from later recognition of promo compensation and supply chain income which became part of the net-net purchase price realized on sale of products whereas previously this income was realized when the applicable services were invoiced. As supply chain income is now realized on sales, Lenta also decided to activate supply chain cost first and realize these costs on sales as well, as required under IFRS," the company said.
Selling, General and Administrative expenses rose to 15.9% of sales, up 0.4 percentage points year-on-year.
Capex in H1 was 10 billion rubles, 38.3% lower than last year at 16.1 billion rubles reflecting lower investments in land acquisition and store construction. Net cash generated from operating activities, before net interest and income taxes paid was 7.3 billion rubles compared to 7.2 billion rubles last year. Net interest expenses rose 21.3% to 5.4 billion rubles from 4.5 billion rubles last year due to the increase in the average level of borrowings despite the lower cost of debt.
Net debt as of June 30, 2017 was 98.3 billion rubles and the net debt/EBITDA ratio was 2.9x.
The company earlier reported revenue of 163.5 billion rubles, up 16.7% from 140.1 billion rubles in H1 last year.
