Page 95 - bne IntelliNews Russia Country report May 2017

9.2.5 Retail corporate news
O’Key 1Q17 operating results show revenue growth hits record low 0.5% y/y. Revenues grew 0.5% y/y to RUB 42.8bn while headline LFL lost 4.9% y/y. The hypermarket and supermarket base remained flat Q/q while selling space added 5% y/y to 623,611sqm. The weak results saw the lowest ever revenues growth rate and one of the weakest LFL figures. For 2017, the company guides for revenues in the hypermarket and supermarket businesses to grow in the low single digits, while discounters are to see revenues double. Net openings are to reach twenty for discounters and two for hypers and supers.
Vodka billionaire Yuri Shefler has a thirst for a fight. The exiled Russian tycoon and his lawyers were back in a Dutch court on May 17, trying to wrest full control of the vodka brand Stolichnaya from the Kremlin in a battle that stretches back more than a decade. A decision by a Rotterdam court in 2015 forced Shefler’s company Spirits International (SPI) to hand over some trademark rights to the Russian government. The ruling also led to SPI having to halt the sale of Stolichnaya and Moskovskaya vodka in Holland, Belgium and Luxembourg. SPI had been hoping to overturn that ruling with a decision on May 17 relating to 13 European jurisdictions, but the court in The Hague deferred final judgement. This is the first time that a European court is weighing in on the ownership of national trademarks in both EU and non-EU countries. If the Dutch court finds in favour of Russia, SPI argues it would create a dangerous precedent for EU law and would taint the normally business friendly reputation of the Netherlands.
9.2.6 Agriculture corporate news
9.2.7 TMT corporate news
Cherkizovo Group reports strong 1Q17 IFRS results . Net revenue rose 13% y/y to RUB21bn. The poultry and pork segments were the most significant growth drivers, with average price increases of 5% and 10%, respectively. The pork segment's performance was also boosted by a 12% y/y rise in production volumes. EBITDA jumped more than five times to RUB3.7bn, with implied EBITDA margin at 17.8% vs 3.9% a year ago. This is partly a result of a stronger ruble. Net profit was RUB1.9bn vs a RUB0.4bn loss a year ago. Net debt stood at RUB38.6bn.
Ukrainian sanctions imposed on Russian internet services majors Yandex and Mail.ru Group on May 15 will affect a significant part of their audience and to some extent limit expansion opportunities of the companies, according to analysts. Ukrainian authorities extended the country's sanctions against Russia by blacklisting 1,228 individuals and 468 legal entities, which include popular Russian social media sites with millions of users like social network Vkontakte (VK), e-mail portals, software companies and television stations. VTB Capital analysts estimated on May 17 that Mail.ru Group generated around 52% of first-quarter revenues and 91% of Ebitda from its social networks. However, the Russian bank notes that audience monetisation is likely lower in Ukraine than it is in Russia for both Yandex and Mail.ru Group. According to Kommersant daily, VK has 16mn monthly average users (MAU), or around 16% of its audience in Ukraine, with other social network
95 RUSSIA Country Report May 2017 www.intellinews.com