O`KEY GROUP REPORTS AUDITED FINANCIAL RESULTS FOR FY 2023

O'KEY Group S.A. (OKEY) O`KEY GROUP REPORTS AUDITED FINANCIAL RESULTS FOR FY 2023 19-Apr-2024 / 18:30 CET/CEST Press release 19 April 2024 O`KEY GROUP REPORTS AUDITED FINANCIAL RESULTS FOR FY 2023 O`KEY Group S.A. (AIX, LSE, MOEX: OKEY, the “Group”), one of Russia’s leading food retailers, has announced its financial results for the full year of 2023 based on audited consolidated financial statements. All materials published by the Group are available on its website okeygroup.lu. All results are according to IFRS 16, unless stated otherwise. FY 2023 financial highlights Total Group revenue increased by 2.8% YoY to RUB 207.9 bn driven mainly by DA! discounters’ retail revenue growth. Group gross profit rose by 1.8% YoY to RUB 47.7 bn, while gross margin declined slightly YoY to 22.9%, mainly due to increased transportation costs offset partially by reduced shrinkage costs. Group EBITDA remained flat YoY at RUB 17.0 bn, while EBITDA margin decreased by 0.2pps YoY to 8.2%, mainly on the back of the abovementioned gross margin decline. Despite temporary pressure on profitability from the SG&A expenses of immature discounter stores, DA! discounters demonstrated a 20.3% YoY EBITDA growth and a 0.1 pps YoY increase in EBITDA margin in FY 2023. The Group reported net loss of RUB 2.9 bn in FY 2023 compared to a RUB 0.2 bn net profit in FY 2022 mainly due to a non-cash foreign exchange loss and an increase in finance costs. Group profit and losses highlights in FY 2023 RUB mln 2023 2022 ∆ YoY, % Total Group revenue 207,865 202,171 2.8% O`KEY 143,980 148,824 (3.3%) DA! 63,885 53,347 19.8% Gross profit 47,660 46,808 1.8% Gross profit margin, % 22.9% 23.2% (0.3pps) Selling, general and administrative expenses (42,516) (40,390) 5.3% SG&A, % of revenue 20.5% 20.0% 0.5pps Other operating expenses, net (292) (667) (56.3%) Finance costs, net (7,267) (5,642) 28.8% Foreign exchange (loss)/gain (1,074) 313 n/a Net (loss)/profit (2,878) 242 n/a Group EBITDA 17,026 17,020 - Group EBITDA margin, % 8.2% 8.4% (0.2pps) O`KEY EBITDA 12,643 13,377 (5.5%) O`KEY EBITDA margin, % 8.8% 9.0% (0.2pps) DA! EBITDA 4,383 3,643 20.3% DA! EBITDA margin, % 6.9% 6.8% 0.1pps Group revenue RUB mln 2023 2022 ∆ YoY, % Total Group revenue 207,865 202,171 2.8% Retail revenue 205,772 200,201 2.8% O`KEY 141,947 146,904 (3.4%) DA! 63,825 53,297 19.8% Rental income 2,093 1,970 6.2% Total Group revenue increased by 2.8% YoY to RUB 207,865 mln driven mainly by DA! discounters’ retail revenue growth in FY 2023. The Group’s rental income increased by 6.2% YoY to RUB 2,093 mln in FY 2023. For more details regarding the net retail revenue dynamics in FY 2023, please refer to the Group’s Q4 2023 Trading Update. Group gross profit In FY 2023, Group gross profit increased by 1.8% YoY to RUB 47,660 mln, while gross margin decreased slightly YoY to 22.9%, mainly on the back of increased logistics costs offset partially by reduced shrinkage costs, as a percentage of revenue. Group selling, general and administrative expenses RUB mln 2023 % of revenue 2022 % of revenue ∆ YoY, pps Personnel costs 17,649 8.5% 16,850 8.3% 0.2 Depreciation and amortisation 11,069 5.3% 10,662 5.3% - Communication and utilities 5,355 2.6% 4,587 2.3% 0.3 Advertising and marketing 2,200 1.1% 2,296 1.1% - Repairs and maintenance 1,780 0.9% 1,582 0.8% 0.1 Insurance and bank commissions 1,348 0.6% 1,260 0.6% - Security expenses 771 0.4% 785 0.4% - Operating taxes 718 0.3% 766 0.4% (0.1) Legal and professional expenses 674 0.3% 651 0.3% - Materials and supplies 441 0.2% 460 0.2% - Operating leases 440 0.2% 448 0.2% - Other costs 74 0.0% 43 0.0% - Total SG&A expenses 42,516 20.5% 40,390 20.0% 0.5 The Group’s total SG&A expenses increased by 5.3% YoY to RUB 42,516 mln in FY 2023. SG&A expenses as a percentage of revenue rose by 0.5 pps YoY to 20.5% in FY 2023. The increase was mainly due to the temporary rise in personnel costs, communication and utilities expenses, and repairs and maintenance expenses as a percentage of revenue related to the discounter segment growth. In FY 2023, personnel costs increased by 4.7% YoY to RUB 17,649 mln and, as a percentage of revenue, by 0.2 pps YoY to 8.5%. The growth was mainly associated with new discounter openings and salary indexation. Communication and utilities expenses grew by 16.7% YoY to RUB 5,355 mln, and by 0.3 pps YoY as a percentage of revenue in FY 2023, mainly due to tariff inflation and discounter chain growth. Repairs and maintenance expenses increased by 12.5% YoY to RUB 1,780 mln, and by 0.1 pps YoY as a percentage of revenue in FY 2023, largely as a result of the discounter chain growth. Group EBITDA was almost flat YoY at RUB 17,026 mln, while EBITDA margin decreased by 0.2 pps YoY to 8.2% in FY 2023. In FY 2023, Depreciation and amortisation increased by 3.8% YoY to RUB 11,069 mln mainly as a result of the discounter chain expansion. Net finance costs increased by 28.8%, or by RUB 1,625 mln, YoY to RUB 7,267 mln in FY 2023. A substantial part of this growth (RUB 416 mln) was attributable to the right-of-use assets’ foreseeable period of use reassessment related to the Group’s long-term lease contracts (in accordance with IFRS 16). Another part of the net finance costs YoY growth (RUB 1,023 mln) came from the average net credit portfolio increase as a result of the discounter chain expansion and the weighted average rate growth on the back of the Bank of Russia interest rate increase. The latter affected new facilities and issued bonds in terms of the interest rates and a small part of the Group’s credit portfolio such as credit lines with floating interest rates. In FY 2023, net foreign exchange loss amounted to RUB 1,074 mln compared to a RUB 313 mln gain in FY 2022. The loss resulted from Russian rouble devaluation in FY 2023, and was largely attributable to intragroup US dollar-denominated loans, as well as lease contracts denominated in foreign currencies. Losses from import operations had a relatively small impact on the Group’s results. Net foreign exchange loss has a non-cash nature. Consequently, the Group reported a RUB 2,878 mln net loss in FY 2023 compared to the profit of RUB 242 mln in FY 2022. Group cash flow RUB mln 2023 2022 Net cash from operating activities  15,276  12,958 Net cash (used in) investing activities (4,341) (6,468) Net cash (used in) financing activities (11,158) (3,885) Net (decrease) / increase in cash and cash equivalents (223)  2,605 Effect of exchange rate on cash and cash equivalents (30) (274) Net cash from operating activities amounted to RUB 15,276 mln in FY 2023 compared to RUB 12,958 mln in FY 2022. The increase was due to revenue growth and efficient working capital management. Net cash used in investing activities amounted to RUB 4,341 mln in FY 2023, showing a decrease in comparison with RUB 6,468 mln in FY 2022. In FY 2023, the Group invested over RUB 2,000 mln (excluding VAT) in the hypermarket business development and store renovation, and over RUB 2,800 mln (excluding VAT) in the development of its discounter business. Net cash used in financing activities amounted to RUB 11,158 mln in FY 2023 compared to RUB 3,885 mln in FY 2022. Such evolution was due to the Group's regular credit portfolio refinancing in FY 2023. As of 31 December 2023, the Group had RUB 16,560 mln worth of available credit lines in Russian roubles with fixed and floating interest rates. If necessary, proceeds from these facilities may be used to finance operating and investing activities. Group net debt position RUB mln As of 31 December 2023 As of 31 December 2022 EBITDA 17,026 17,020 Total debt 47,131 45,486 Short-term debt1 6,003 9,961 Long-term debt 41,128 35,525 Cash & cash equivalents 11,526 11,779 Net debt 35,606 33,707 Total lease liabilities 26,722 22,545 Short-term lease liabilities 5,962 5,621 Long-term lease liabilities 20,760 16,924 Total interest-bearing liabilities (net of сash & сash equivalents) 62,328 56,251 Total interest-bearing liabilities (net of сash & сash equivalents) / EBITDA 3.66x 3.30x [1] Short-term debt does not include interest accrued on loans and borrowings. As of 31 December 2023, the total interest-bearing liabilities (net of cash) to EBITDA ratio grew to 3.66x from 3.30x as of 31 December 2022. The growth was mainly due to an increase in long-term lease liabilities attributable to the right-of-use assets’ foreseeable period of use reassessment (in accordance with IFRS 16), as well as long-term debt increase. Group audited consolidated IFRS report The Group’s audited report, including the full set of audited IFRS financial statements, can be found at https://www.okeygroup.lu/investors/result-center/ifrs-statements/. For more information, please contact:  For investors Natalya Belyavskaya Head of Investor Relations [phone], ext. 266 [e-mail] www.okeygroup.lu ABOUT O`KEY GROUP O`KEY Group S.A. (AIX, LSE, MOEX: OKEY) is one of the leading grocery retailers in Russia, operating hypermarkets under the O`KEY brand and discounters under the DA! brand. As of 31 December 2023, the Group operated 297 stores across Russia (77 hypermarkets and 220 discounters) with a total selling space of 663,865 sq m. O`KEY opened its first hypermarket in St Petersburg in 2002 and has since demonstrated continuous growth. It was the first Russian food retailer to launch e-commerce operations offering a full range of hypermarket products for home delivery. The Group operates e-commerce pick-up and delivery points in 36 O’KEY hypermarkets: twelve in Moscow, nineteen in St Petersburg, one in Sochi, and four in Krasnodar. In 2015, we launched the first discount chain in Russia under the DA! brand. The Group operates five distribution centres in Russia – three in Moscow and two in St Petersburg – and employs 19,200 people. In 2023, the Group’s revenue amounted to RUB 207.9 bn, and EBITDA stood at RUB 17.0 bn. The O`KEY Group shareholder structure is as follows: NISEMAX Co Ltd – 49.11%. GSU Ltd – 34.14%, free-float and other holders – 16.75%. DISCLAIMER These materials contain statements about future events and expectations that are forward-looking statements. These statements typically include words such as ‘expects’ and ‘anticipates’ and words of similar import. Any statement in these materials that is not a statement of historical fact is a forward-looking statement that involves known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. None of the future projections, expectations, estimates or prospects in this announcement should be taken as forecasts or promises, nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in this announcement. We assume no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. 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ISIN:	US6708662019
Category Code:	FR
TIDM:	OKEY
LEI Code:	213800133YYU23T4L791
Sequence No.:	316873
EQS News ID:	1885119

End of Announcement	EQS News Service