Investor Presentaiton
5
Asset Light Sustainable Business Model
Providing Attractive Shareholder Return
Attractive New Store Economics and Disciplined
Roll-out...
■Capex of c. RUB 13m per 1 standard DM store
Strict investment criteria
Detsky Mir
RETAIL
CHAIN
... Resulting in Strong Returns¹...
2013
2014
2015
2016
2017
Revenue Growth
30%
26%
33%
31%
22%
IRR hurdle rate of 40% on 7-year cash flows (not
accounting for terminal value)
Selling Space Growth
10%
22%
26%
21%
15%
Total maturity period - 18-24 months
■ Targeted EBITDA breakeven in 4 months after a store
opening
Adj. EBITDA², RUBbn
2.8
4.5
6.2
8.2
10.7
■ Payback period of 2.5-3.0 years
B ...Supported by Well-Controlled Rental Costs...
D
■ Primarily locations in high-traffic modern shopping malls
■Mostly more than 5-year rental agreements with fixed annual
increases
Unilateral termination rights for Detsky Mir (with reasonable
notice periods)
...and a Leading ROIC5 in Global Retail Context
CY20166 (%)
Capex, RUBbn
(0.8)
(1.9)
(5.3)
(1.7)
(2.5)
Pividends, RUBbn
(0.4)
(1.9)
(3.0)
(4.4)
(4.8)
Adj. Net Debt³/Adj. EBITDA²
1.8x
0.6x
1.7x
1.4x
1,0x
Adjusted ROIC4.5
56%
88%
78%
61%
86%
79
Median: 21
5
61
39
28
29
25
21 17
16
19 18
15
9
Median: 19
Median: 32
63
80
49
تنا
36
28
19
17
CLICKS
POKA
RENNER
CCC
Detsky Mir
| High Performance Specialty Retailers
RaiaDrogasil
bm
Liverpool XXL LPP
five BEL°W
MATHHT
OLENTA
>X5
PLACH
carter's
JUMB9
Baby Bunting
mothercare
Для мам и малышей
Russian Food Retailers
Children's Goods Retailers
Source: Companies disclosures and reporting
1 The Group's consolidated financial statements for 2013 under US GAAP and 2014-2017 under IFRS. For the line items and the
years presented, there was no difference between the calculation of numbers or presentation under US GAAP and IFRS
2 Adj. EBITDA is calculated as profit for the year before income tax, FX gain/loss, gain on acquisition of controlling interest in
associate, impairment of goodwill, net finance expense, D&A, adjusted for the one-off effect relating to disposal of the Yakimanka
building in 2014, as well as share-based compensation and cash bonuses under the LTI program
3 Adj. Net Debt is calculated as total borrowings (long term borrowings and short-term borrowings and current portion of long-term
borrowings) less cash and cash equivalents adjusted for amounts receivable under the loan issued to CJSC "DM-Finance"
4 Calculated as operating profit divided by average capital invested (simple average of capital invested as at the
respective dates). Capital invested is calculated as net debt plus total equity (deficit)
5 Invested capital is adjusted for amounts receivable under a loan granted to CJSC "DM-Finance", carrying amount of
Yakimanka building and, for the year ended 31 December 2015, the net book value of the building occupied by the
Bekasovo distribution centre and its equipment (which was completed in 2015, but was not operational for most of
2015). Operating profit is adjusted for LTI expense
6 Calendarized to December year end
19View entire presentation