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Detsky Mir Sales Grew by Almost a Third in Q2

Detsky Mir Group (the “Group”, “Detsky Mir” or the “Company”, MOEX: DSKY), the largest omnichannel children’s goods retailer in Russia and Kazakhstan, announces its operating results for the second quarter and the first half ended 30 June 2021.

Q2 2021 Operating Highlights

  • The Group’s gross merchandise value (GMV) increased by 32.2% to RUB 41.9 bn (incl. VAT).
  • Total online sales in Russia increased by 20.1% to RUB 11.7 bn (incl. VAT):
    • Online share in Russia amounted to 29.3%.
  • Sales of private labels and direct imports in Russia grew by 31.2%, accounting for 48.0% of total sales (+1.2 p.p. year-on-year).
  • Detsky Mir opened 49 new stores: 19 Detsky Mir stores, 27 Detmir Pickup stores and three Zoozavr stores.
  • The total number of Group stores amounted to 929 stores (+9.3% year-on-year), across 378 cities and towns in Russia, Kazakhstan and Belarus.
  • The Group’s selling space increased by 8.4% to 922,000 sq. m, the total space of the retail chains amounted to 1,148,000 sq. m.

1H 2021 Operating Highlights

  • The Group’s gross merchandise value (GMV) increased by 23.6% to RUB 81.5 bn (incl. VAT).
  • Total online sales in Russia increased by 42.4% to RUB 22.5 bn (incl. VAT):
    • Online share in Russia amounted to 28.9%.
  • Sales of private labels and direct imports in Russia grew by 25.3%, accounting for 44.3% of total sales (+1.5 p.p. year-on-year).
  • Detsky Mir opened 61 new stores: 27 Detsky Mir stores, 29 Detmir Pickup stores and five Zoozavr stores.
  • The total number of partner pickup points and parcel lockers increased 3.5x to 20,800 year-to-date.  
  • The total warehouse space was 146,000 sq. m.

Q2 2021 Key Events

  • Detsky Mir’s shareholders approved the distribution of the entire net profit for Q4 2020 as a final dividend, totaling RUB 4.5 bn or RUB 6.07 per ordinary share. The total value of paid dividends for 2020 amounts to RUB 8.2 bn or RUB 11.15 per ordinary share.
  • Detsky Mir’s shareholders elected a new Board of Directors, including the new independent director David Rönnberg, 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 Company website.
  • The Company launched its second regional distribution center – an 8,000 sq. m facility in Kazan operating from Russian Post’s fulfillment center. The distribution center’s throughput will reach up to 250,000 orders per month.
  • Andrey Osokin was appointed as Marketing Director and Member of the Management Board at the Company. Mr. Osokin boasts an over 14-year track record in marketing and e-commerce at companies such as, Otto Group Russia and Baon-Desam.

Sustainability Achievements (ESG)

  • Detsky Mir has approved its Policy on Chemicals and Environmental Protection, 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.
  • 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’s private label goods.
  • The Detsky Mir Charitable Foundation donated more than 2.7 m gifts to disadvantaged children, along with one tonne of pet food to animal shelters.
  • Detsky Mir Group was awarded a prize in the Social Responsibility category of the Retail Week Awards 2021, while the Detsky Mir Charitable Foundation won the Best Russian Social Project 2021 award.
  • All Detsky Mir Group stores comply with all COVID-19 protocols, with couriers delivering online orders provided with necessary personal protective equipment.

Maria Davydova, CEO of PJSC Detsky Mir:

“1H 2021 was one of the most successful periods seen in the last few years: the Group’s total sales increased by 23.6% to RUB 81.5 billion, and we were able to restore sales in the retail sector, all while maintaining a high growth momentum in the online segment. We also expect a marked increase in operating income (adjusted EBITDA) for the period of at least 25%.   

“Our key strategic priority is to further consolidate the children’s goods market by digitizing sales, expanding the selection of private labels and growing our 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 customers. To achieve these ambitious goals, our team plans to accelerate the development of the Zoozavr brand in the pet supplies market and explore new verticals for growth.

“Detsky Mir is in a stable financial position, consistently generating sufficient cash flow to achieve its strategic goals and maintain its dividend policy. The combination of double-digit growth and strong dividends is one of Detsky Mir’s key drivers of additional shareholder value; in line with this, we distributed the entire net profit for 2020 – RUB 8.2 billion – as dividends.”

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For additional information:

 Julia Polikarpova        

Head of Public Relations        

Tel.: +7 495 781 08 08, ext. 2041

Sergey Levitskiy

Head of Investor Relations

Tel.: + 7 495 781 08 08, ext. 2315