{"id":1992,"date":"2021-08-25T09:01:00","date_gmt":"2021-08-25T06:01:00","guid":{"rendered":"https:\/\/ir.detmir.ru\/en\/2021\/08\/25\/detsky-mir-grows-adjusted-ebitda-29-3-in-1h-2021\/"},"modified":"2021-08-25T09:01:00","modified_gmt":"2021-08-25T06:01:00","slug":"detsky-mir-grows-adjusted-ebitda-29-3-in-1h-2021","status":"publish","type":"post","link":"https:\/\/ir.detmir.ru\/en\/press-centre\/news\/detsky-mir-grows-adjusted-ebitda-29-3-in-1h-2021\/","title":{"rendered":"Detsky Mir Grows Adjusted EBITDA 29.3% in 1H 2021"},"content":{"rendered":"<p><strong>Moscow, Russia, 25&nbsp;August 2021&nbsp;\u2013 <\/strong>Detsky Mir Group (\u201cDetsky Mir\u201d or the \u201cCompany\u201d, MOEX: DSKY), the largest children\u2019s goods retailer in Russia and Kazakhstan, announces its unaudited financial results in accordance with International Financial Reporting Standards (IFRS) for the second quarter and the first half of the year, ended 30&nbsp;June 2021. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<\/p>\n<p><strong>Q2\u00a02021 Operating Highlights<\/strong><\/p>\n<ul>\n<li><strong>The Group\u2019s gross merchandise value (GMV)<\/strong> increased 32.2% to RUB\u00a041.9\u00a0bn (incl. VAT).<\/li>\n<li><strong>Total online sales<\/strong><sup> <\/sup>in Russia increased 20.1%\u00a0to RUB\u00a011.7\u00a0bn (incl. VAT); the <strong>share of online sales<\/strong> stood at 29.3%.<\/li>\n<li><strong>The Group\u2019s revenue <\/strong>increased 29.6% to RUB\u00a037.4\u00a0bn.<\/li>\n<li><strong>Gross profit<\/strong> increased 34.3% to RUB\u00a011.9\u00a0bn, with a<strong> gross margin <\/strong>of 31.9% (+1.1\u00a0p.p. year-on-year).<\/li>\n<li><strong>SG&amp;A<\/strong> as a percentage of revenue increased 1.8\u00a0p.p. to 20.2%.<\/li>\n<li><strong>Adjusted EBITDA<\/strong> increased 24.2% to RUB\u00a04.4\u00a0bn; <strong>adjusted EBITDA margin<\/strong> was 11.8% (\u20130.5 p.p. year-on-year). <strong>EBITDA<\/strong> totaled RUB\u00a05.5\u00a0bn (+55.3% year-on-year).<\/li>\n<li><strong>Adjusted net profit <\/strong>amounted to RUB\u00a02.8\u00a0bn vs. RUB\u00a01.4\u00a0bn in the same period last year; <strong>net profit<\/strong> totaled RUB\u00a03.9\u00a0bn.<\/li>\n<li><strong>The net debt\/adjusted EBITDA LTM ratio <\/strong>stood at 1.3x as at June 2021-end vs. 1.6x at June 2020-end. <strong>Net debt<\/strong> was RUB\u00a023.7\u00a0bn (\u20135.0% year-on-year).<\/li>\n<li><strong>The Company opened 49\u00a0new stores: <\/strong>19\u00a0Detsky Mir branded stores, 27\u00a0Detmir Pickup stores and 3\u00a0Zoozavr stores.<\/li>\n<li><strong>The total number of Group stores <\/strong>amounted to 929 (+9.3% year-on-year), across 378\u00a0cities and towns in Russia, Kazakhstan and Belarus.<\/li>\n<li><strong>The Group\u2019s total selling space<\/strong> increased 8.4% to 922,000\u00a0sq.\u00a0m, while <strong>the total floor space of stores<\/strong> amounted to 1,148,000 sq.\u00a0m.<\/li>\n<\/ul>\n<p><strong>1H 2021 Financial Highlights<\/strong><strong><\/strong><\/p>\n<ul>\n<li><strong>The Group\u2019s GMV<\/strong> increased 23.6% to RUB&nbsp;81.5&nbsp;bn (incl. VAT).<\/li>\n<li><strong>Total online sales<\/strong><strong> <\/strong>increased 42.4%&nbsp;to RUB&nbsp;22.5&nbsp;bn (incl. VAT); the <strong>share of online sales<\/strong> was 28.9%.<\/li>\n<li><strong>The Group\u2019s revenue <\/strong>increased 22.0% to RUB&nbsp;73.1&nbsp;bn.<\/li>\n<li><strong>Gross profit<\/strong> increased 25.1% to RUB&nbsp;22.5&nbsp;bn, with a<strong> gross margin <\/strong>of 30.8% (+0.7&nbsp;p.p. year-on-year).<\/li>\n<li><strong>Share of SG&amp;A<\/strong> as a percentage of revenue grew 0.3&nbsp;p.p. to 20.6%.<\/li>\n<li><strong>Adjusted EBITDA<\/strong><strong><sup> <\/sup><\/strong>increased 29.3% to RUB&nbsp;7.5&nbsp;bn; <strong>adjusted EBITDA margin<\/strong> was 10.3% (+0.6 p.p. year-on-year). <strong>EBITDA<\/strong> totaled RUB&nbsp;8.3&nbsp;bn (+52.4% year-on-year).<\/li>\n<li><strong>Adjusted net profit <\/strong>was RUB&nbsp;4.3&nbsp;bn vs. RUB&nbsp;1.4&nbsp;bn in the same period last year; <strong>net profit<\/strong> stood at RUB&nbsp;5.2&nbsp;bn.<\/li>\n<li><strong>Sales of private labels and direct imports in Russia<\/strong> grew 25.3%, accounting for 44.3% of total sales (+1.5&nbsp;p.p. year-on-year).<\/li>\n<li><strong>The Company opened 61&nbsp;new stores:<\/strong> 24&nbsp;Detsky Mir branded stores, 33&nbsp;Detmir Pickup stores and 4&nbsp;Zoozavr stores.<\/li>\n<li><strong>The number of partner pickup points and parcel lockers <\/strong>increased 3.5x to 20,800 year-to-date.&nbsp;<\/li>\n<li><strong>Total warehouse space<\/strong> was 146,000&nbsp;sq.&nbsp;m.<\/li>\n<\/ul>\n<p><strong>Q2&nbsp;2021 Key Events<\/strong><\/p>\n<ul>\n<li>Detsky Mir\u2019s shareholders approved the distribution of the entire net profit for Q4&nbsp;2020 as a final dividend, totaling RUB&nbsp;4.5&nbsp;bn, or RUB&nbsp;6.07 per ordinary share. The total value of paid dividends for 2020 amounts to RUB&nbsp;8.2&nbsp;bn, or RUB&nbsp;11.15&nbsp;per ordinary share.<\/li>\n<li>Detsky Mir\u2019s shareholders elected a new Board of Directors, including the new independent director David R\u00f6nnberg, four incumbent independent directors and five incumbent non-executive directors. More information on the members of the Board and its committees is available on the <a href=\"https:\/\/ir.detmir.ru\/en\/board-of-directors\/\">Company website<\/a>.<\/li>\n<li>The Company launched its second regional distribution center&nbsp;\u2013 an 8,000&nbsp;sq.&nbsp;m facility in Kazan operating from Russian Post\u2019s fulfillment center. The distribution center\u2019s throughput will reach up to 250,000&nbsp;orders per month.<\/li>\n<li>Andrey Osokin was appointed Marketing Director and Member of the Management Board at the Company. Mr.&nbsp;Osokin boasts an over 14-year track record in marketing and e-commerce at companies such as Goods.ru, Otto Group Russia and Baon-Desam.<\/li>\n<\/ul>\n<p><strong>Key Events After the Reporting Date<\/strong><\/p>\n<ul>\n<li>Detsky Mir has decided to strengthen its C-suite&nbsp;team, driven by the fast pace at which the Company\u2019s new ambitious strategy, business verticals and digital transformation are being implemented and deployed. Anna Garmanova, Chief Financial Officer (CFO) at Detsky Mir, left the Company effective 1&nbsp;August 2021. Andrey Spivak took up the roles of CFO and Member of the Management Board from 16&nbsp;August. Mr.&nbsp;Spivak has over 19&nbsp;years of experience in retail and FMCG (Magnit, X5 Retail Group, Wrigley Ukraine and Wrigley Russia). Sergey Li was appointed Chief Operating Officer (COO) and Member of the Management Board from 15&nbsp;July. Mr. Li has over 17 years of experience in retail (M.Video-Eldorado, M.Video, Sulpak (Kazakhstan) and Philips). Another appointment was Mikhail Makhyanov, starting as Head of Investor Relations from 16&nbsp;August. Mr.&nbsp;Makhyanov has more than seven years of experience working at public companies and in capital markets (Polyus and Renaissance Capital).<\/li>\n<\/ul>\n<p><strong>ESG Highlights<\/strong><strong><\/strong><\/p>\n<ul>\n<li>Detsky Mir has approved its <a href=\"https:\/\/corp.detmir.ru\/wp-content\/uploads\/2021\/06\/Chemicals-and-Environmental-Protection-Policy.pdf\">Policy on Chemicals and Environmental Protection<\/a>, which aims to ensure that chemicals are used responsibly in the production of goods purchased by the Company. In line with this policy, Detsky Mir suppliers are required to comply with an approved list of chemicals that may not be used to produce products purchased by the Company.<\/li>\n<li>Detsky Mir has developed a methodology and set of standards for auditing suppliers for compliance with sustainability principles. The goal for 2021 is to carry out the first ESG audit of the Russian manufacturers that produce Detsky Mir\u2019s private label goods.<\/li>\n<li>The Detsky Mir Charitable Foundation donated more than 2.7&nbsp;m gifts to disadvantaged children, along with one tonne of pet food to animal shelters.<\/li>\n<li>Detsky Mir Group was awarded a prize in the Social Responsibility category of the Retail Week Awards&nbsp;2021, while the Detsky Mir Charitable Foundation won the Best Russian Social Project&nbsp;2021 award.<\/li>\n<li>Over the first six months of 2021, almost two&nbsp;tonnes of waste from shoe and textile manufacturing were collected and handed over for recycling to the Dmitrov RTI Plant, the largest waste recycling enterprise in Russia.<\/li>\n<li>Every Detsky Mir Group store complies with all COVID-19 protocols, with couriers delivering online orders provided with the necessary personal protective equipment.<\/li>\n<\/ul>\n<p><strong>Maria Davydova, CEO of PJSC&nbsp;Detsky Mir:<\/strong><strong><\/strong><\/p>\n<p><em>\u201cThe results of 1H\u00a02021 once again prove Detsky Mir to be the recognized leader in the children\u2019s goods market, with the Group\u2019s GMV increasing 23.6% to RUB\u00a081.5\u00a0bn. The Company continues to deliver strong performance both online and offline. Our key strategic priority is to further consolidate the children\u2019s goods market by digitizing sales, expanding our selection of private label brands, growing our own marketplace, improving the customer experience, launching new services and strengthening our logistics and retail infrastructure. We will press ahead with transforming the Company into a leading multi-vertical digital retailer and driving up share-of-wallet among Russian shoppers. To achieve these ambitious goals, we have strengthened our C-suite\u00a0team with experts who have relevant experience in delivering retail digitalization and integrating best-in-class solutions.\u201d<\/em><\/p>\n<p><a href=\"https:\/\/ir.detmir.ru\/en\/wp-content\/uploads\/sites\/3\/2021\/08\/DSKY_Q2_2021_IFRS_ENG-1.pdf\">View the full press release<\/a><\/p>\n<p><strong>For additional information:<\/strong><\/p>\n<p><strong>&nbsp;Julia Polikarpova<\/strong>&nbsp;&nbsp; &nbsp; &nbsp; &nbsp;<\/p>\n<p>Head of Public Relations &nbsp; &nbsp; &nbsp; &nbsp;<\/p>\n<p>Tel.: +7 495 781 08 08, ext. 2041 &nbsp; &nbsp; &nbsp; &nbsp;<\/p>\n<p>upolikarpova@detmir.ru<\/p>\n<p><strong><strong>Mikhail Makhyanov<\/strong><\/strong><\/p>\n<p>Head of Investor Relations<\/p>\n<p>Tel.: + 7 495 781 08 08, ext. 2315<\/p>\n<p>mmakhyanov@detmir.ru<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Detsky Mir Group announces its unaudited financial results in accordance with International Financial Reporting Standards (IFRS) for the second quarter and the first half of the year, ended 30 June 2021.  <\/p>\n","protected":false},"author":1,"featured_media":1991,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"_links":{"self":[{"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/posts\/1992"}],"collection":[{"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/comments?post=1992"}],"version-history":[{"count":0,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/posts\/1992\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/media\/1991"}],"wp:attachment":[{"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/media?parent=1992"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/categories?post=1992"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ir.detmir.ru\/en\/wp-json\/wp\/v2\/tags?post=1992"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}