Russia’s X5 Retail Group reports 5.7% increase in like-for-like sales in Q1 2020

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X5 Retail Group, the leading Russian food retailer that operates the Pyaterochka, Perekrestok and Karusel retail chains has reported a 5.7% increase in like-for-like sales in the first quarter of 2020.

Stores are well stocked

X5 reports its express delivery online services for X5’s Perekrestok.ru and Pyaterochka stores surged as the coronavirus situation developed in March. The number of orders delivered by Perekrestok.ru exceeded 8,700 on peak days, while the express delivery service from Pyaterochka stores is handling around 10,000 orders per day.

LFL traffic and basket growth accelerated in Q1 2020 to 3.7% and 1.9% (4.9% and 2.0% unadjusted for a leap year effect) y-o-y, respectively, compared with Q4 2019. In January-February, LFL traffic was the main driver of LFL sales growth, while in March LFL basket became the main driver due to stocking up by consumers amid the COVID-19 situation.

Net retail sales for X5’s core formats, Pyaterochka and Perekrestok, increased by 17.4% and 21.3% y-o-y, respectively in Q1 2020. Growth in January-February was strong at 14.8% for Pyaterochka and 19.4% for Perekrestok. However, elevated trading volumes in March made the largest contribution to quarterly sales, driven by stockpiling by consumers in the early weeks of self-quarantining.

Net retail sales at X5’s Karusel hypermarkets decreased by 18.8% y-o-y in Q1 2020 due to the closure of 16 hypermarkets and the transfer of two stores to Perekrestok, in line with the format’s transformation plan.

In the face of the constantly changing situation surrounding the spread of COVID-19, X5 said it has been able to meet the rapid growth in demand caused by consumers stocking up before the lockdown was announced in Russia on 28 March 2020.

The retailer said its supply chain has been operating smoothly and stores remain open and well-stocked, while also protecting employees and customers.

X5 has introduced measures such as mandatory body temperature checks for all employees entering its premises (stores, distribution centres, offices), and has provided masks and disposable gloves to operational personnel, introduced additional disinfection hours daily for all stores as well as additional disinfection in stores during working hours.

The retailer has also added floor markings to indicate a safe social distance for shoppers. X5 said its logistics operations proved fit to handle the massive growth in volume of high demand goods during peak times and early moves to increase stocks of these goods ensured good availability of products at all times.

In the event that a member of its operational personnel tests positive for COVID-19, X5 said it has developed internal procedures that aim to minimise the negative impact on its operations by creating extra operational teams/shifts for store and logistics operations.

“Our store and logistics personnel are on the front line for delivering an uninterrupted supply of food to more than 70 million people in Russia,” X5 said. “We recognise their work and dedication, and we are profoundly thankful to our store and logistics workers who continue to perform during the lockdown period.”

X5 added it has stepped up community support efforts, including price discounts for volunteers who help the most vulnerable citizens, food donations through our Basket of Kindness programme, free delivery service for pensioners in Moscow via its Pyaterochka express delivery, as well as supplying 550 ready-made meals for free every day from its Smart Kitchen to the medical staff at four Moscow hospitals.

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