Lenta Ltd, one of the largest retail chains in Russia, has announced that its total sales grew 19.2% to €5.2bn (Rub 365.2bn) in 2017. The company's adjusted EBITDA grew 11.8% to c.€510m (Rub 35.5bn), with a margin of 9.7%, with the net profit achieving €190m (Rub 13.3bn). A successful conclusion of the year results from Lenta's rapid expansion program. The company has opened 40 new hypermarkets and 49 new supermarkets in 2017, taking the total number of hypermarkets to 231 and supermarkets to 97.
Organic growth remains the core of Lenta's expansion strategy in 2018. The company has revealed its plans to open over 20 new hypermarkets and 50 new supermarkets later this year.
Lenta has launched a co-branded loyalty programme with Raiffeisenbank which combines the existing Lenta loyalty programme benefits with the bank's bonus point cashbacks. The company has also launched a new private label range ("Bonvida") for professional customers.
Lenta's Chief Executive Officer, Jan Dunning said: "Once again, Lenta delivered strong growth and profitability in 2017, with sales up 19% and an EBITDA margin of 9.7% - against the backdrop of a challenging market environment. We continued to make progress with improving supplier conditions and supply-chain efficiency combined with strict cost control, although this came in combination with growing promotion share and a deflationary environment. During 2017, Lenta's management team launched a series of initiatives including improvements in assortment, marketing and communication to support sales and these have started to pay off, delivering an uplift in sales growth and positive operating leverage. We will continue and build on these initiatives as well as driving efficiency still further, improving our competitiveness and the returns on new stores. All this, combined with stabilization of the economy makes us confident that Lenta will be able to sustain strong growth and market-leading profitability in 2018. The Company will continue organic expansion in hypermarket and supermarket formats. Our past acquisitions have proven to be very successful and we will continue looking for value accretive opportunities in parallel with organic growth".
