DIXY ups expansion plan for 2012 to at least 320 more stores

MOSCOW. Sept 5 (Interfax) - OJSC DIXY Group (RTS: DIXY) has increased its projection of the number of stores it will open this year to 320.

"We have now opened around 220 new stores, and I think that we can open at least 320 new stores this year," DIXY President Ilya Yakubson said during a Wednesday conference call.

Company management's earlier prediction was the opening of 250-300 new stores in 2012.

Even though the company will be opening more than originally planned, management has not lowered its forecast for DIXY's EBITDA (earnings before interest, taxes, depreciation, and amortization) margin for this year.

"We have said that with the opening of 250-300 stores our EBITDA margin will be in the neighborhood of 6%, or possibly higher. We don't think that an impact will be felt from the additional 20-30 stores. So we continue to think that the EBITDA margin will remain at that level," DIXY General Director Fyodor Rybasov said.

The company's EBITDA margin for last year was 6.3%. It will be less this year due to a faster rate of expansion, company management has said.

Yakubson also confirmed on Wednesday the previous forecast for sales revenue growth this year of 20%-25% and capital expenditures of 10 billion rubles.

DIXY manages an eponymous chain of convenience stores, Megamart hypermarkets, and Minimart supermarkets. The company wrapped up the purchase in June of last year of the Victoria chain and its convenience stores Kvartal, Dyoshevo, and Semeinaya kopilka, and supermarkets Victoria.

As of June 30, DIXY had 1,276 stores in all, including 1,222 conveniences stores (1,036 of which were operating under the DIXY tradename).

DIXY opened 184 stores in the first half of this year, twice as many as it did during the same six months of last year and also substantially over target, the company has said.

The company owns some 15% of the stores it operates, while the rest are located in rental premises, Yakubson said. That ratio is attributable to the fact that over the past three years DIXY has pursued an active course of development by rental. Starting next year, the retailer plans to begin a program for increasing the proportion of owned premises in its total chain, he said.

DIXY released its second-quarter financials to IFRS on Wednesday. Q2 net profits were down 62.3% at 145 million rubles (an Interfax consensus forecast had anticipated a profit drop to 251 million rubles). EBITDA was up 37.8% at 2.08 billion rubles and sales revenues 70.5% at 36.13 billion rubles.

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