M of Video El Dorado

M.Video is one of the largest Russian retail chains selling electronics and household appliances. M.video has been operating since 1993. In November 2007, OJSC M.video Company became the first Russian company in the electronics retail sector whose shares are traded on the stock market. Currently, trading in the company's shares is carried out on the largest Russian stock exchanges - RTS and MICEX (ticker: MVID).

Shareholders

According to Interfax, as of December 31, 2023, SFI owns 10.37% of M.Video shares. Among other shareholders of the company - MKOOO Erikaria (owns 50%, at the end of 2023, the beneficiary of MKOOO was hidden, before that the main owner was Said Gutseriev), Media-Saturn-Holding (15%).

Management

Alexander Tynkovan is the president of M.video.

Performance indicators

2024: Growth of video card sales in the Russian market by 233% in the first half of the year

M.Video-Eldorado Group analyzed the statistics of video card sales in the first half of 2024 in the sales channels of M.Video-Eldorado. According to data for 6 months, they turned out to be 233% higher in monetary terms compared to the same period in 2023. The company announced this on July 8, 2024.

The top 5 most popular models from buyers included MSI RTX 4060 VENTUS 2X, GA Palit NE63060019K9-190AD, GA MSI GF RTX 4060 Ti VENTUS 2X Bl 8G OC, MSI RTX 4070 SUPER 12G VENTUS 3X OC and GA Palit NE63060T19K9-190AD

Gamers are actively updating their video cards for a number of reasons. First, prices for the RTX 4000 series have stabilized and become more affordable compared to 2023. Secondly, in 2024, many major game releases are released. So the addition for the game Elden Ring has already been released, which is comparable in terms of the amount of content to a separate major game. And in the fall, even more potential hits are expected - among them are Star Wars Outlaws, the next part of Test Drive Unlimited, Assasin's Creed Shadows, Kingdome Come Delivery 2 and many others. In addition, powerful graphics accelerators are needed not only by gamers, but also by those who actively work with content, artificial intelligence and other products that require a large computer power. All these factors are actively driving video card sales up, said Sergey Mezin, head of the Development of Games and the Gaming Community Department of the M.Video-Eldorado Group.

2023

30.7% loss reduction

At the end of 2023, the net loss of M.Video-Eldorado amounted to approximately 5.2 billion rubles. For comparison, a year earlier, losses were estimated at 7.6 billion rubles. Thus, on an annualized basis, losses decreased by 30.7%. The relevant data are provided in the financial report published on March 12, 2024.

Total sales of the group in 2023 increased by 11% year-on-year - up to 540 billion rubles (including VAT). We are talking about the GMV (Gross Merchandise Value) indicator: it includes purchases in retail stores (including pickup orders), paid and delivered to home online orders, as well as paid shipments from warehouses to legal entities. Online sales accounted for 71% of the GMV, an increase of 18% year-on-year to 386 billion rubles.

Net loss of M.Video-Eldorado amounted to approximately 5.2 billion rubles

In 2023, M.Video-Eldorado's revenue reached 434.4 billion rubles, rising 7.9% year-on-year. It is noted that growth was achieved due to the expansion of tools and sales channels, the opening of new stores while continuing to restore demand for household appliances and electronics. During 2023, the sales network continued to expand due to the opening of 62 stores in a new compact format, including in 15 new cities where the group was not previously represented. It is also said that the company is expanding its grocery range: the number of goods presented in stores and on online platforms increased by 22% compared to the end of 2022 - to more than 191 thousand items.

As of December 31, 2023, the total debt of M.Video-Eldorado decreased year-on-year by 9.2 billion rubles and amounted to 86.4 billion rubles, while cash and cash equivalents at the end of the reporting period are estimated at 18.7 billion rubles.^[1]

The share of sales of own brands and exclusive products reached 15%

M.Video-Eldorado continues to develop a differentiating range of household appliances and electronics. In 2023, its own brands, as well as partner brands, lines and goods, represented only in M.Video and Eldorado, accounted for 15% of the company's total sales, and in the fourth quarter the indicator reached 18%, including due to the start of sales of Carrera household appliances - the Group became a brand supplier on the Russian market. M.Video-Eldorado reported this on February 14, 2024.

M.Video-Eldorado provides customers with a wide selection of household appliances and electronics in all major categories for various requests and budgets, including premium goods and new items. To develop the assortment, the company expands direct cooperation with manufacturers and distributors, helps new players enter the market, uses import operations, the share of which in 2023 reached the optimal 30%, scales its own marketplace, and also strengthens the direction of the differentiating assortment.

Шаблон:Quote 'author = said Oleg Muravyov, Commercial Director of M.Video-Eldorado Group.

One of the key events of 2023 in this direction was the launch of the Carrera brand, which helps us expand the offer of productive household appliances with a special design in the context of the departure of a number of major global manufacturers from the Russian market. The sale of household appliances is traditionally characterized by a high involvement of consumers in the purchase process, while we see that Russians are actively considering buying a wider range of brands and "newcomers" are often in preference already higher. I am sure that the Carrera brand, originally developed in Germany, due to its bright and modern design, reliability, power, interesting functions, will appeal to Russian buyers, bring vivid impressions to their lives, will become a source of comfort. "

Among the products that highlight M.Video-Eldorado on the market and are presented in two networks, for example, equipment from Toshiba, Grundig, Thunderobot, Artel, TVs from Candy, game accessories Lunacy, a series of foldable smartphones from Oppo. Within the framework of STM technology, the Group offers in several dozen categories affordable everyday goods with popular characteristics - large and small household appliances, as well as accessories.

In 2024, it is planned to expand the Carrera range to more than 30 categories of household appliances for home, kitchen, care and self-care, as well as accessories.

Year-end sales growth of 11%

M.Video-Eldorado Group on February 7, 2024 shared with TAdviser the combined unaudited total sales indicators (GMV, gross merchandise value) for the fourth quarter and 12 months ended December 31, 2023. Total sales of the Group for the reporting year increased by 11% to 540.4 billion rubles (s), VAT while total online sales increased by 18% to 386 billion rubles (incl. VAT), accounting for 71% of the Group's GMV.

At the end of December 2023, the M.Video-Eldorado chain of stores amounted to 1,242 stores of all formats (+ 34 new stores in the fourth quarter) in more than 370 cities of Russia. During 2023, the company opened 62 M.Video stores in a compact format and plans to further scale it in key ones. regions According to the interim results, already open stores of the new format demonstrate better performance in terms of turnover than was originally planned. In 2024, it is expected to open at least 100 M.Video stores, mainly in a compact format.

In turn, total sales (GMV) in the fourth quarter of 2023 increased by 43% year-on-year to a record 181.1 billion rubles (including VAT). According to the company, this happened against the background of seasonal purchasing activity, as well as due to the expansion of the assortment, tools and sales channels, the opening of new stores while continuing to restore demand for household appliances and electronics. The company's turnover exceeded the indicators similar to the period of 2021. The fourth quarter, a high season, accounted for more than 33% of total sales for 2023. Total online sales increased by 55% to 132.5 billion rubles (including VAT), accounting for 73% of the group's GMV.

As a result of the restoration of supplies and expansion of the range, the group significantly increased sales of goods in high demand in the fourth quarter during Black Friday and the New Year's high season. The total number of SKUs presented on the group's online platforms and in stores has grown by 22% since the beginning of the year - to more than 191 thousand items. In many categories, M.Video-Eldorado showed growth above the market. Thus, sales of flat-screen TVs increased by 40%, tablets - by more than 60%, washing machines - by 35%, kitchen equipment - by 45%. In the 4th quarter, sales of brands from China, Turkey, as well as Russia, Belarus and Uzbekistan continued to grow. At the same time, the share of own import purchases stabilized at the target level ~ 30%, and the share of a unique assortment for the market, including its own brands, brands, lines and goods presented only at M.Video-Eldorado, reached 18% of the turnover.

Traffic, including online and stores, in the fourth quarter of 2023 remained at a comparable level year-on-year, with a simultaneous increase in conversion to purchase, and amounted to about 340 million visits. The dynamics of the customer base in the fourth quarter of 2023 was on average 7.4% better than in the comparable period of 2022. The growth in the number of new clients for the year amounted to 14%, thus the share of new clients in the group's portfolio amounted to 25%, which is a great contribution to the development of further sales. The group also worked effectively with the overall customer base, reactivating 24% more inactive customers (who did not purchase for more than 12 months) in the reporting quarter than in 2022. In general, according to the results of 2023, the growth of this segment amounted to 15%.

Traffic growth mobile application in the buyer was 4%. The total installations of M.Video user mobile applications Dorado increased by 30% compared to 2022, exceeding 66 million. Sales at own electronics marketplace grew 1.6 times year-on-year in the reporting quarter as the number of sellers more than doubled and the company's affordable assortment expanded.

The group's credit sales, which are characterized by a higher average check, grew by 78% in Q4, increasing its share in sales by 3 pp to 16%. The Group sells all financial products offered to customers through its subsidiary Direct Credit.

In the reporting quarter, the company significantly changed the basic rules of the loyalty program in order to improve the effectiveness of this program. In particular, as part of the changes, customers were able to use their bonus rubles for 365 days (previously up to 180), the average accrual increased from 3% to 4.5%, and the maximum possible deduction of bonus rubles decreased from 50% to 30%. Thus, already in the fourth quarter, the company was able to increase the average check by more than 25%, while maintaining the penetration of the loyalty program at more than 90%.

As part of the development of its own service line, the group expanded the fleet of vehicles under the operating leasing model by trucks of Russian manufacturers to more than 200 cars. The staff of service specialists exceeded 600 people.

M.Video-Eldorado expects a significant decrease in debt burden and a return to a moderate level of Net debt/Ebitda at the end of 2023 below 3.5x, as well as a further decrease in this indicator by the end of 2024.

Growth of Marketplace turnover by 2 times

M.Video Group Dorado - February 6, 2024 shared the results of the development of its own Marketplace electronic engineers and related goods. At the end of 2023, the platform's turnover doubled year-on-year, which was facilitated by an increase in the number of partners, the development of the site's capabilities and the expansion of the range of new categories of complementary goods. More. here

Growth in Marketplace turnover by 3 times in the first quarter

M.Video-Eldorado Group continues to develop its own electronics marketplace. At the end of the first quarter of 2023, the platform's turnover more than tripled compared to the same period in 2022. The share of the site in the company's online sales doubled to 11%, which was facilitated by the attraction of new sellers, 20% of which work for USN, and the expansion of the range to 120 thousand items of equipment and complimentary goods. The company announced this on April 26, 2023. Read more here.

2022: Decrease in sales by 14.3% to 488.9 billion rubles

Total sales of the M.Video-Eldorado group in 2022 amounted to 488.9 billion rubles, which is 14.3% less than a year earlier. Revenue fell by 15.5%, to 402.4 billion rubles. Adjusted net loss according to international financial reporting standards (IFRS) decreased by 10.2%, to 6.7 billion rubles. The retailer announced such data on May 2, 2023.

As of December 31, 2022, the total debt of M.Video-Eldorado increased year-on-year by 26.5 billion rubles and reached 95.7 billion rubles, while cash and cash equivalents at the end of the reporting period increased by 18.1 billion rubles compared to December 31, 2021 to 30.2 billion rubles.

The group's net debt at the end of 2022 increased by 8.4 billion rubles. year-to-year and amounted to 65.5 billion rubles. The main reasons for the growth of net debt are the launch of parallel imports and the need to advance imported supplies in conditions of low penetration of financial instruments due to an unstable geopolitical situation, M.Video-Eldorado reports.

It also says that the share of the mobile platform, including buyer and seller applications, in the total turnover increased by 3 percentage points and reached 48%, including as a result of the transfer of users from the website to mobile products. Installations of user mobile applications M.Video and Eldorado increased by 73% compared to last year, reaching 51 million, the average monthly number of active users (MAU) increased by 33%.

Traffic, including online and stores, amounted to 1.3 billion visits, falling by a moderate 7.2% year-on-year amid general turbulence and a decrease in shopping center traffic due to the departure of a number of companies from the Russian market. At the same time, traffic in the client's mobile application increased by 32% year-on-year, reaching 35% of the total traffic.

In 2022, the M.Video-Eldorado group, as noted by its press service, generally retained the scale of the network, despite the suspension of expansion due to the high level of uncertainty in the market situation. The 32-store reduction was driven by regular processes to close underperforming stores and was at levels comparable to previous periods, the company said.

2021

Group revenue growth by 12.9% to 476,364 million rubles

On March 5, 2022, M.Video-Eldorado Group shared with TAdviser audited consolidated financial results prepared in accordance with International Financial Reporting Standards (IFRS) for the year ended December 31, 2021. The Group's revenue for the reporting period increased by 12.9% yoy to RUB 476,364 million. According to representatives of M.Video-Eldorado, this was also due to a steady increase in total online sales (+ 28.8% year-on-year), an increase in the number of OneRetail customers (+ 23.4% year-on-year) with a higher average check, an increase in the turnover of the mobile platform by 67.1% due to the attraction of new customers.

The following also contributed to the increase in profit:

• transfer users from the website to mobile solutions, launch new and update existing digital products that help improve customer experience and monetization.
• expansion of the network to 184 new stores and access to more than 90 new cities;
• strengthening the Group's position in premium and innovative electronics categories by working with the range and retail formats. The share of premium and innovative assortment in the total volume of GMV M.Video-Eldorado increased to 22.2%;
• increased demand for household durable appliances and home office goods due to the preservation of a remote or hybrid mode of operation and study for a significant part of the population of large cities in 2021, as well as an active increase in demand for smartphones, other products of the mobile ecosystem and related accessories;
• expansion of the range of household appliances and electronics 2.4 times to almost 185,000 product items due to an increase in direct contracts with suppliers, expansion of the line of goods under their own brands and integration of the range of the SberMegaMarket marketplace (formerly goods.ru) according to the whitelabel model;
• continued growth in sales of services (+ 38%), including sales of certificates (+ 43%), insurance (+ 38%) and digital services (+ 35%).

Gross profit decreased by 4.0% year-on-year to RUB 95,191 million (RUB 95,250 million under IFRS 16), gross margin decreased by 3.5 pp to 20.0%. Among the factors that influenced the decrease in these indicators, the group named:

• growth of the Group's promo activity against the background of increased price pressure from competitors in the online segment;
• maintaining periodic spot purchases in order to maintain high sales growth rates and sufficient assortment and inventory levels against the background of an ongoing shortage of certain categories and models of equipment and electronic components for their production;
• continued growth of the share of digital categories of goods in the structure of demand (smartphones, laptops and other products for organizing a home office), which have a margin below the average for the group;
• increase in the cost of the logistics component in purchase prices.

At the same time, the group's net profit decreased by 20.9% to 8,651 million rubles. (and by 63.1% to 3,325 million rubles. According to IFRS 16). According to M.Video-Eldorado estimates, this was mainly due to a decrease in gross margin and an increase in financial expenses against the background of an increase in the loan portfolio, which was partially compensated by the optimization of the cost of funding due to the successful placement of bonds.

EBITDA, in turn, increased by 2.3% year-on-year and reached 27,495 million rubles, EBITDA margin decreased by 0.6 percentage points. year-on-year and amounted to 5.8% in 2021. The decrease in EBITDA margin is mainly due to a decrease in gross margin due to the factors mentioned above. EBITDA takes into account income and expenses of a one-time nature: income received due to revaluation of goods.ru assets; profit from the sale of goods.ru; income received in connection with the forgiveness of a subsidized loan received in 2020 under the program of state support for industries most affected by the pandemic; changes in the estimated estimates of the calculation of the reserve for the sale of goods; expenses for personal protective equipment. The effect of total net one-time revenues on EBITDA amounted to 10,080 million rubles. in 2021.

The Group's adjusted EBITDA fell 38.8% year-on-year to RUB 17,414 million (RUB 33,576 million under IFRS 16). Adjusted EBITDA margin was 3.7% (7.0% under IFRS 16).

Commercial, general and administrative expenses (SG&A) excluding depreciation amounted to 77,872 million rubles. and decreased as a percentage of revenue by 0.8 percentage points. year-on-year to 16.3%. The main contribution to the decrease was personnel costs due to the high base of 2020 and rental costs due to changes in accounting estimates for rent.

According to the group, the key factors in the change in operating expenses were:

• decrease in personnel costs by 0.4 percentage points to 5.9% of revenue against the background of a high base in 2020 due to a one-time payment of compensation of 1.3 billion rubles. Management based on the decision of the Board of Directors for the successful implementation of the project on crisis management related to COVID-19;
• decrease in rental and utility expenses by 1.2 pp to 4.0% of revenue as a result of changes in accounting estimates for lease. The Group carried out an analysis of leases for which it considered adjustments for the uniform recognition of lease costs. As a result of the massive revision of the terms of the lease agreements in 2020, the Group concluded that there are no grounds for further accrual of this adjustment and that there are every grounds for writing off accumulated liabilities;
• growth in advertising and marketing costs in percentage of revenue by 0.3 percentage points. to 1.7% against the background of the low base of 2020 due to the conservation of a number of projects, which was due to the pandemic. The dynamics of advertising costs was also influenced by increased price competition and the growing geographical presence of the group, the development of new client services;
• an increase in warehouse services costs by 0.1 percentage points to 1.1% of revenue, which was associated with an increase in storage volumes in leased distribution centers to support sales and an increase in tariffs for 3PL operators for storage and processing of goods;
• an increase in repair and maintenance costs by 0.1 percentage points. up to 0.5% against the background of the growth of the store chain and optimization of costs in 2020 due to the COVID-19 pandemic;
• an increase in other expenses by 0.2 pp to 1.6%, which reflects the low base of 2020 due to measures to optimize costs due to the COVID-19 pandemic (including IT, office costs, packaging and materials costs), increased costs for legal and consulting services (including the development of the company's strategy, the sale of goods.ru, SPO, acquisition of Direct Credit).

Depreciation expenses increased to RUB 8,867 million in the reporting period from RUB 8,194 million a year earlier due to investments in the retail chain of stores and the company's IT infrastructure.

As of December 31, 2021, the total debt of M.Video-Eldorado Group increased year-on-year by 21,209 million rubles. and amounted to 69,138 million rubles, including due to the growth of investments in digital transformation and the acceleration of expansion into new cities.

Cash and cash equivalents at the end of the reporting period increased by RUB 4,608 million compared to December 31, 2020 and amounted to RUB 12,053 million. The group's net debt at the end of the year increased by 16,601 million rubles. and amounted to 57,085 million rubles. All debt obligations of the group are denominated in rubles. The average rate of the debt portfolio showed dynamics significantly lower than the comparable growth of the key rate of the Central Bank in 2021.

As a result, the net debt/EBITDA ratio as of December 31, 2021 was 2.06x - an increase of 0.62x compared to December 31, 2020.

According to Enrique Fernandez, General Director of M.Video-Eldorado Group, the company uses all its expertise, knowledge and competencies to support the "most constructive" development of the consumer electronics and household appliances market in Russia in the current situation, to protect the interests of buyers and employees.

Stores and online platforms of both brands operate as usual, taking into account the restrictions that have arisen over the past week, and in the face of a high degree of uncertainty, we try to maintain competitive and reasonable prices. We are also negotiating with our financial partners to develop optimal formats and tools for work this year, "said the head of M.Video-Eldorado." We plan to revise our forecasts for 2022 and the medium term as the situation normalizes and after the analysis of various scenarios is completed. "

Sales of M.Video-Eldorado grew by 13.1%

Sales of M.Video-Eldorado in 2021 increased by 13.1% compared to 2020 and reached 570.7 billion rubles (including VAT). This volume is 30% higher than in 2019, when there was no COVID-19 coronavirus pandemic .

Speaking of sales, the retailer means the GMV (gross merchandise value) indicator, which includes purchases in retail stores (including pickup orders), paid and delivered to home online orders, as well as paid shipments from warehouses to legal entities. GMVs include sales of goods and services that can be in-house and agency. The growth of this indicator in the company was associated with the development of the mobile platform, an increase in the frequency of purchases and the average check, as well as the growth of the chain of stores.

The average annual growth rate of GMV for 2020 and 2021 amounted to 14.2%, which corresponds to the long-term strategy of the company, according to which expansion plans have already been successfully implemented, stores have been opened in 92 new cities, - said the CEO of M. Video-Eldorado Enrique Fernandez.

According to him, the expansion of the group's presence in the regions allows it to actively increase the penetration of online sales within the omnichannel model.

Total online sales of M.Video-Eldorado in 2021 increased by 28.8% compared to 2020 and amounted to 386.9 billion rubles (including VAT), taking a share of 67.8% of the GMV of the entire group. At the same time, the turnover of the mobile platform increased by 67.1% to 257.6 billion rubles and amounted to 66.6% of total online sales.

The average check of M.Video-Eldorado amounted to 9,805 rubles in 2021, an increase of 9% by 2020, primarily due to consumer interest in technology in higher price segments.

According to the company, at the end of December, the chain of stores consisted of 1258 points of all formats, in total 2021 new stores were opened in 184 city in 371 (for the first time in 92 cities).^[2]

Adoption of dividend policy

On February 9, 2021, M.video PJSC (hereinafter referred to as M.Video-Eldorado Group, M.Video-Eldorado, the "Company" or the "Group") announced that the company's Board of Directors had approved a dividend policy.

M.Video-Eldorado plans to send at least 100% of net profit under IFRS 17 to dividend payments

The recommendations of the Board of Directors regarding dividends will be determined by the ratio of net debt by IFRS (IAS) 17 to EBITDA by IFRS (IAS) 17 at the end of the last reporting year at or less than 2.0

If the ratio of net debt by IFRS (IAS 17) to EBITDA by IFRS (IAS 17) of the company at the end of the last reporting year exceeds 2.0, the level of dividend payment will be determined taking into account factors relevant to the Board of Directors at the time of the decision

The company intends to make dividend payments twice a year. The Group plans to pay the first dividends under this policy based on the results of its operations for 2020, taking into account the payment of interim dividends in the amount of RUB 5.4 billion in December 2020, which corresponded to 100% of consolidated net profit under IFRS 17 for the six months ended 30 June 2020.

As an element of the Company's new development strategy, the new dividend policy reflects the strengthening of the Group's financial results and will complement the Company's long-term growth goals.

The amended dividend policy, which provides for the payment of at least 100% of net profit under IFRS 17, reflects the company's focus on capital allocation and regular dividend payments to shareholders. The policy fully takes into account the capital structure of the company and its capital expenditure needs, including all strategic initiatives and further digital transformation, and provides flexibility to ensure financial stability in the implementation of the new strategy. At the same time, the policy provides a more transparent mechanism for investors to assess potential dividend income.

{{quote 'author = Commented by Said Gutseriev, Chairman of the Board of Directors of M.Video-Eldorado Group.|Thanks to the digital transformation launched as part of the OneRetail strategy, the company managed to take advantage of the accelerated transition of consumers online during 2020. Online sales of the Group doubled in 2020, while the company increased its market share against the background of GMV growth by 15% yoy-yoy.

We expect that M.Video-Eldorado Group will continue to leverage its developed digital business and loyal customer base, along with a large-scale federal retail network and logistics infrastructure, to realize the significant growth opportunities we see in the consumer electronics market in Russia. For February 2021, M.Video-Eldorado Group is on the verge of another stage of growth, the driving force of which is the company's updated strategy. We anticipate that the company will sustainably generate significant cash flow, allowing us to direct substantial resources towards investing in further growth while sharing our success with investors.

In addition to the ambitious strategic goals set by the Board of Directors to management, we also adopted a dividend policy that will allow shareholders to become beneficiaries of this growth. I am convinced that this step will help make the Company more transparent and predictable in the eyes of shareholders. }}

Information Technology

Separate article - Information technologies in M.Video - Eldorado

History

2024

The main shareholder of M.Video was the general director of the company

The main shareholder of M.Video was the general director of the company Bilan Uzhakhov. The retailer announced this on July 24, 2024.

As a result of the buyback of shares, the top management of the company (management buy-out) became the majority shareholder of the M.Video - Eldorado group Bilan Uzhakhov, who has been the CEO of the company for a long time, - quotes Interfax"" the words of a representative of the retailer.

General Director of M.Video Bilan Uzhakhov became the main shareholder of the company

The group added that changes in the shareholder structure will increase the efficiency of corporate governance and focus on the entire management to strengthen the operating model, increase market share and improve financial results.

It is clarified that by July 2024, Bilan Uzhakhov owns 53.633% of the shares of PJSC through a number of companies, including MKOOO Erikaria (directly owns 50% of PJSC). The beneficiary of this ICSAF was hidden by the beginning of 2024, before that Said Gutseriev was the main owner.^[3]

According to Article 75 "Repurchase of shares by the company at the request of shareholders" of Federal Law N 208-FZ "On Joint Stock Companies," a shareholder whose share has exceeded 50% must make a mandatory offer to repurchase the remaining shares.

Such an offer can follow within 35 days, the price must be not lower than the weighted average, determined by the results of trading for six months.

According to analysts at BCS World of Investments, the change of the controlling shareholder may to some extent facilitate cross-border purchases of the company, which have become more difficult for the entire market in recent months.

The main question is whether the transaction will be followed by an offer to buy out the shares of other shareholders. However, in our understanding, such an obligation does not arise, since ownership through a number of companies. It is also unknown how the transaction price relates to the market price of shares, experts say.

Issue of shares worth 1.8 billion rubles, dilution of the share of shareholders

M.Video-Eldorado Group announced an additional issue of shares in the amount of 1.8 billion rubles, which will lead to an increase in the authorized capital of the company by 17%. On July 2, 2024, the Central Bank of Russia registered this issue, which involves the placement of 30 million new shares by open subscription.

According to Interfax, the authorized capital of M.Video by the beginning of July 2024 is 1.797 billion rubles and is divided into 179.77 million shares with a face value of 10 rubles each. After the completion of the additional issue, the total number of shares of the company will reach 209.77 million units.

M.Video-Eldorado announced an additional issue of shares in the amount of 1.8 billion rubles

Representatives of M.Video-Eldorado said that the company has the right to place shares at any time during the year. When choosing the placement date, management will take into account the current market conditions and quotes on the Moscow Exchange in order to attract as many investors as possible.

An additional share issue is a process where a company issues additional shares for sale on the market or in favor of individual investors. In this case, the shares of existing shareholders in the company are eroded.

One of the key shareholders who expressed preliminary consent to the acquisition of the entire additional issue was the investment holding PJSC EsEfAi (SFI). By early 2024, SFI owned a 10.37% stake in the retailer.

BCS Investment World analysts give a negative assessment to M.Video-Eldorado shares. They point to the continuing strategic and credit risks, as well as the likely absence of dividend payments in the medium term. The target price of the company's shares on the horizon of the year, in their opinion, is 190 rubles per share.^[4]

Announcement of a 17% increase in the share capital

On May 13, 2024, M.Video announced its decision to place 30 million shares by open subscription, as a result of which the retailer's authorized capital will be increased by 17%.

The transaction will improve financial liquidity indicators and maintain flexibility in making operational, financial and investment decisions, M.Video said in a statement.

M.Video announced the decision to place 30 million shares by open subscription

It also follows from it that one of the largest shareholders, SFI holding, can acquire the entire volume of shares placed on an additional issue. According to Anna Garmanova, Financial Director of M.Video-Eldorado Group, the funds raised during the placement will be used to develop the company and achieve the target level of debt burden in terms of net debt/EBITDA.

By May 13, 2024, the authorized capital of M.Video is 1.797 billion rubles, it is divided into 179.77 million shares worth 10 rubles. By the beginning of 2024, the total amount of loans and other financial obligations of the group amounted to 86.44 billion rubles, the ratio of net debt to EBITDA was 3.2x. High debt burden and depreciation generate the bulk of the group's loss - at the end of 2023, it amounted to 6.6 billion rubles, Garmanova explained in a conversation with RBC.

According to her, the deal will take place closer to the middle of the summer of 2024. The priority of participation in the purchase of shares will be given to minority shareholders and retail investors, Garmanova said.

She also noted that according to the legislation in force by May 2024, existing shareholders have a preemptive right to purchase shares, institutional and retail investors will be offered them as part of a standard exchange offering.

On the news about M.Video's plans to conduct an additional issue of shares by open subscription, the company's shares rose slightly in price on May 13, 2024.^[5]

2023

Opening of 62 M. Video stores of compact format in a year

In 2023, M.Video-Eldorado Group expanded its presence in key regions of Russia and entered 15 new cities, opening 62 stores of M.Video compact format with an area of ​ ​ 500-600 square meters. meters and a vertical storage system for equipment, as well as three standard points of sale 1-1.5 thousand square meters. meters. The company announced this on January 31, 2024. At the end of 2023, the retailer's chain reached 1,242 retail facilities. In 2024, the company plans to increase the pace of regional expansion - it expects to open more than 100 more M.Video stores, most of which will have a compact concept demonstrating efficiency.

In 2023, the Group resumed the program of regional discoveries and introduced a new format of compact stores of M.Video. (500-600 sq. meters) is half that of stores with a traditional area (1-1.5 thousand sq. meters), with an assortment available to customers (about 4,500 items, including large life) comparable due to the location of goods in tiers, and the volume of investments in the opening is up to three times lower, with a higher turnover from 1 sq. meter. In compact retail outlets, customers can access the usual set of services, services and consultations, as well as the opportunity to receive an online order within 15 minutes.

The developed concept of compact stores allows the company to flexibly approach the expansion of its physical presence, opens up additional opportunities and locations for choosing retail space in the commercial real estate market. In 2023, with the help of a smaller format, M. Video-Eldorado strengthened the network in key regions, and also first appeared in 15 settlements of the Russian Federation (Ishimbay, Votkinsk, Tulun, Kopeisk, Shadrinsk, etc.). In addition, in 2023, the retailer expanded its network of co-branded stores, and as of January 2024 there are about 60 of them. They are based on Eldorado stores and are reinforced by the M.Video brand. The format combines all our advantages for customers in one location: services and services, unified access to bonus programs, promotions and stock.

Шаблон:Quote 'author = said Group Network Development Director M.Video-Eldorado Boris Ogarkov.

Logo change

In December 2023, M.Video changed its logo. As part of the rebranding, the letter "M," which had remained unchanged in the company's logo since 1994, became larger. The word "video" is now in words and typeface, not handwritten, as in the previous logo.

Increase in the number of stores accepting machinery for processing by 2.5 times

Since 2019, the number of retail stores of M.Video Dorado, receiving equipment for processing as of the end of August 2023, has grown 2.5 times to 836 throughout. to the country During this time, buyers of M.Video-Eldorado collected 260,000 devices and 9.5 million batteries. You can get acquainted in detail with the results of the study "M.Video-Eldorado" and the Association "SKO Electronics - Recycling" here.

Shipment of 687 tons of electronic waste from buyers for processing in six months

M.Video-Eldorado Group on July 26, 2023 shared the results of the development of the federal program for environmentally friendly processing of electronic waste in the first 6 months of 2023. Buyers of the two networks handed over about 2 million batteries and 27 thousand devices for disposal, which exceeded the figure for the same period in 2022 by almost 20%.

In January-June, buyers of M.Video-Eldorado transferred 647 tons of equipment (27 thousand devices) and 40 tons of batteries (2 million units) for environmentally friendly processing. The delivered electronic waste by composition is ferrous metals (38%), plastics (30%), copper (7%), glass (5%), aluminum (5%), printed circuit boards (3%), as well as other materials (12%), for example, ceramics and rubber. The driver of the program was the expansion of services for the export of outdated and unnecessary large household appliances from customer homes, the demand for which increased by more than 2.5 times.

Шаблон:Quote 'author = said Oksana Platonova, Head of Environmental Projects at Retail of M.Video-Eldorado Group.

The most active equipment was handed over by residents, Moscow,, and St. Petersburg Novosibirsk. Nizhny Novgorod Kazan The most rented devices were washing machines, refrigerators, stoves,, mobile phones teapots, TVs vacuum cleaners, auto gadgets and appliances computer , as well as accessories.

The program to collect outdated or out-of-service equipment for processing has been implemented since 2019 together with the Association "SKO Electronics-Disposal." All electronics received from customers are registered in an automated end-to-end IRM system (the company's own IT product) and sent to one of nine licensed plants.

Launch of M.Kompact stores format

On April 4, 2023, M.Video-Eldorado announced the resumption of the development of the retail network and expansion into the regions. In the first quarter of 2023, the M.Video brand began testing a different format of stores - M.Kompact with a large assortment of digital and household appliances located on an area of ​ ​ 500-600 square meters. meters.

This format has an assortment comparable to standard stores available "here and now" - about 4.5 thousand models of household appliances and electronics in the trading floor. At the same time, retail facilities require three times less investment in opening due to a different approach to design and design. Stores use vertical trading equipment, which allows you to present more goods per meter of retail space on several tiers, including large-sized equipment.

Three M.Kompact stores have already appeared in Moscow, Zelenodolsk and Kazan, in the near future several more stores will open, including in Ishimbay and Votkinsk, where the Group's stores will appear for the first time.

Шаблон:Quote 'author = said Director for Network Development and Operation of M.Video-Eldorado Group Boris Ogarkov.

Theft by an employee of iPhone smartphones for 2 million rubles to pay for skins for Counter-Strike

On March 30, 2023, it became known that the storekeeper M.Video stole 15 Apple iPhones from his employer for a total of approximately 2 million rubles. He needed the money to cover the loans he took out to buy skins in the multiplayer game Counter-Strike: Global Offensive (CS: GO).

According to the Telegram channel Shot, 19-year-old Kirill from Serpukhov near Moscow acquired several colored shells for weapons in CS: GO. At the same time, he did not have enough of his own funds to pay for virtual values ​ ​ and took microloans in the amount of about 300 thousand rubles. However, then the young man began to track down collectors demanding to repay the debt.

The enterprising gamer employee was not at a loss and decided to surround his own warehouse. At night, he carried out nine iPhones and McBook, but he was immediately spotted by the police on the cameras, - says the publication of the Telegram channel Shot.

Cyril, as noted, returned the stolen goods to the store, and the employer for some reason did not dismiss him. Then the young man again decided to steal: he stole a dozen iPhone devices, which he then sold for 320 thousand rubles to pay off debts. After that, Cyril went to the police and confessed to everything. Law enforcement officers decide what preventive measures should be applied to the fraudster. Whether the young man will continue to work at M.Video is not reported.

Some skins in CS: GO can cost hundreds of thousands of dollars. This is due to their exclusivity and high demand from members of the gaming community. In addition, individual users purchase rare virtual items in order to resell them in the future at a higher price. Valve is not going to stop supporting Counter-Strike: Global Offensive, and therefore investing in skins can bring good profits^[6]

Appointment of Dmitry Lazarev as E-Commerce Director

At the end of March 2023, it was announced the appointment of Dmitry Lazarev as the new director of e-commerce and digital experience of the group's client. " M of Video El Dorado In this position, the former CEO of the jewelry chain Sunlight will focus on improving services and tools for buyers in the online channel, increasing the efficiency of their attraction and retention, as well as finding new growth points for the digital direction "M.Video-Eldorado." Read more. here

2022

Processing over 8,000 tons of old equipment, batteries and packaging from goods

On January 16, 2023, M.Video-Eldorado announced the results of work on the implementation of eco-projects for 2022 as part of the ESG strategy. Since the launch of its own circular economy program in 2019, the company has transferred more than 8 thousand tons of old equipment, batteries and packaging from goods to licensed enterprises for processing. At the end of 2022, buyers M.Video and Eldorado brought to chain stores twice as many small household appliances as a year earlier, and also 1.5 times more often ordered the export of outdated or unnecessary large household appliances, both with the delivery of new goods and without purchases - using the launched ecotaxi service. The most rented devices in 2022 were washing machines, refrigerators and smartphones.

Despite the challenges of 2022, the Group retained the volume of equipment collection under the recycling programs of M.Video "Smart Processing" and Eldorado "Utilize Correctly" at the level of 2021. The program to collect obsolete or out-of-service equipment for processing has been implemented by M.Video-Eldorado since 2019 together with the Association "SKO Electronics-Utilization" on the basis of 9 licensed enterprises. In 2022, buyers transferred almost 1.5 thousand tons of unnecessary household appliances, as well as 60 tons of used batteries, for environmentally friendly recycling, which exceeded the 2021 figure by 18%. Over the year, with the help of fandomats, 12 thousand plastic bottles and aluminum cans were also collected in two pilot stores in Moscow.

Customers can rent small equipment, batteries and batteries for free in 30 cities and 770 stores of M.Video and Eldorado. The removal of unsuitable large-sized equipment is possible from home with the delivery of new goods using the service "Export of equipment for IVF processing." Compared to 2021, the number of purchases of such a service increased 1.5 times. On average, almost every twentieth delivery of large-sized equipment in 2022 was accompanied by the removal of old and unnecessary.

On the website of M.Video you can purchase an ecotaxis service for the export of old large-sized equipment of a number of categories. At the same time, it is not necessary to buy a new product. The service includes urgent departure of the car, dismantling of old equipment and the work of loaders.

The most rented devices in 2022 were washing machines, refrigerators, mobile phones, stoves, printers, televisions, including large diagonals, as well as accessories - headphones and cables. So, in 2022, customers were four times more likely to transfer televisions, synthesizers, ironing systems, mobile phones, headphones, blenders, humidifiers and coffee-making devices for environmentally friendly processing, six times more often - laptops and computer equipment. The owners of stylers and other hair styling devices showed the greatest interest in recycling, which were handed over almost nine times more than in 2021.

Most of the equipment and outdated power elements were transferred by residents of Moscow,, St. Petersburg, and Novosibirsk. Yaroslavl Samara The most eco-active in relation to 2021 were residents,,, and Rostov-on-Don. Novosibirsk Chelyabinsk Ulyanovsk Tyumen

As part of the sustainable development strategy, M.Video-Eldorado continued to achieve carbon neutrality, collect and dispose of equipment and materials generated during the trade process. The company transferred more than 4 thousand tons of packaging from goods (cardboard, film, tape and pallet) for processing to specialized enterprises, doubling this figure.

Шаблон:Quote 'author = said Oksana Platonova, Head of Environmental Projects at M.Video-Eldorado Group.

Шаблон:Quote 'author = added Vladislav Bondarev, Director of the Association "North Kazakhstan Electronics - Recycling."

Urban Regional Delivery Acceleration Plan

M.Video Dorado improves the efficiency of trade the infrastructure and converts part of the area of ​ ​ stores in the regions into local city warehouses. The facilities, called "Urban," will complement logistic the system of retailer about 70 regional distribution warehouses, central distribution warehouses (CCS) and cross-docks from which goods are sent to stores and customers. The company announced this on December 12, 2022.

The first pilot city warehouses were launched this year Volgograd and. In Tyumen 2023, they will be joined by,,, Chelyabinsk,, and Yakutsk Krasnoyarsk Barnaul Ryazan Samara other cities. countries

During 2023, the company plans to open 17 warehouses of the Urban format with an average area of ​ ​ 1-1.5 thousand square meters, which will house the main and most popular assortment of digital goods, accessories, and small household appliances. Convenient location within the city will allow such a warehouse to process courier deliveries and issue online sunsets, i.e. work as a point of issue. The company also plans to expand the range of equipment and complementary goods in cities by storing high-turnover goods of marketplace merchants M.Video-Eldorado in Urban warehouses.

Urban will also make it possible to distribute the load on the company's fleet - small household appliances will be delivered from stores and Urban warehouse by passenger cars, and large household appliances will begin to arrive directly to customers from regional distribution centers and stores by freight transport. The company continues to develop the delivery and installation of large household appliances in one visit, which saves customers time.

Шаблон:Quote 'author = said Ivan Popov, Head of Customer Delivery Processes Development at M.Video-Eldorado Group.

Opening of Eldorado + M.Video format stores in Togliatti and Ryazan

The co-branding concept of two retail brands with different positioning will combine the competitive qualities of M.Video and Eldorado in the service, assortment and promo. In Eldorado + M.Video stores, customers have access to the full range of the Group, the ability to order missing goods with delivery home or to any store of M.Video or Eldorado, receiving online orders from the platform of any brand, and using bonus rubles from two retailers. M.Video-Eldorado announced this on December 9, 2022.

To integrate and test joint stores, the Group has chosen two cities - Togliatti and Ryazan, nine Eldorado + M.Video stores have already started working in them on Eldorado sites, these are street retail and small formats with an area of ​ ​ up to 600 square meters. m and larger objects with a trading floor of more than 1,000 square meters. m The design of updated retail premises, unified advertising materials and identities were developed by the company's experts, taking into account the specifics of each of the retail brands.

M.Video-Eldorado develops One Retail format, providing customers with all the advantages of online shopping and the opportunity to test goods in person and get advice in stores. The share of total online sales in the turnover of M.Video-Eldorado in the first half of 2022 amounted to 67%. Within the framework of this approach, the group also combines pickup services for online orders - now customers can receive orders from the Eldorado website in M.Video stores. The company has integrated historically different CRM and trading systems with each other. in particular, the Eldorado site learned to display in real time information about the combined local flows and balances of goods required by the user in M.Video. Combining information about available goods in M.Video stores will significantly expand the choice for Eldorado customers - both in terms of assortment and pickup options. For a month and a half of the pilot project, on average, several tens of thousands of Russians have already used the service, most often cobranding pickup is used for smartphones, televisions, kitchen equipment, beauty and health products.

M.Video-Eldorado in 2022 consolidated the efforts of the two brands for the first time as part of the Black Friday promotional campaign and launched a common advertisement - since merging into one company, M.Video and Eldorado have always had separate positioning and their own creativity. The competition between the two brands for buyers and favorable prices was illustrated by a creative solution built on the aesthetics of wrestling.

{{quote 'author = said Sergey Li, Chief Operating Officer of M.Video-Eldorado Group. | Combining the strength of the two brands in a number of areas, including IT, back office, logistics and marketing, has already been converted into increased economic efficiency of the company and optimization of investments, as well as additional advantages for buyers. This pilot, according to our forecasts, can bring the synergy of M.Video-Eldorado to a different level, and is able to give retail a more rational use of its capabilities and more advantages for buyers. As part of the OneRetail concept, stores now provide not only a seamless transition for customers between online and offline, but also allow you to "travel" physically and emotionally between the infrastructures and drains of the two brands. M.Video will enrich the potential of Eldorado, will attract new buyers. The co-branding project, combined with the restructuring of part of the business processes, the integration of pickup delivery and loyalty programs, can increase store traffic by 10-15%. Based on the results of the pilot period and the assessment of feedback from consumers, we will decide to scale the new store format,}}

Launch of sales of charging stations for electric vehicles at M.Video-Eldorado

At the end of October 2022, M.Video-Eldorado launched the first retail sales of charging stations for. electric vehicles We are talking about equipment the Belarusian the company "." Vityaz More. here

Sending 50 freight cars of old equipment for recycling

The M.Video-Eldorado Group and the Electronics-Recycling Association of North Kazakhstan Region, which unites manufacturers, importers and responsible processors of household and computer equipment, have been implementing a federal program to create an infrastructure for the collection and disposal of electronic waste since 2019.

For 7 months of 2022, buyers of M.Video and Eldorado chains handed over 800 tons of unnecessary devices for shipment to licensed enterprises, including 33 tons of used batteries, which exceeded the 2019 figure by 10 times. The company M.Video-Eldorado announced this on September 13, 2022. M.Video-Eldorado also transferred for processing about 1 ton of its own equipment from the office and stores, as well as 1.2 thousand tons of packaging from the goods. As part of the Sustainability Strategy, the retailer plans to recycle 85% of its own waste.

In the first half of 2022, the recycling program became available in almost 70% of M.Video and Eldorado stores, and the total number of collection points increased by another 86 to 836 stores. In addition to the permanent program, both networks regularly host promotions when you can hand over old equipment and get a discount on a new one of the popular categories. Customers also have access to the export of large household appliances with subsequent disposal when delivering new goods.

Most of the equipment is transmitted by residents, Moscow,, and St. Petersburg Novosibirsk. Yaroslavl Samara Outdated power elements are actively handed over in,,, and. To Moscow St. Petersburg Rostov-on-Don The most Chelyabinsk Kazan frequently handed over electronics are steel, population kettles, mobile phones washing machines and refrigerators, as well as accessories - and. According to earphones the Volga cables to data region processor SimbirskVtorResurs, half of all devices handed over by organizations are computer monitors equipment.

{{quote 'author = said Oksana Platonova, head of environmental projects at M.Video-Eldorado. | M.Video-Eldorado Group voluntarily undertakes large-scale environmental obligations. We minimize our environmental impact under the Enhanced Manufacturer Responsibility (EPR) by supporting our customers in their quest to be more. eco-friendly As of September 2022, the 9 largest processing companies are participating in the M.Video-Eldorado project and the Electronics-Recycling Association of North Kazakhstan region. electronic engineers Many enterprises have been operating in the industry for more than 10 years, have permits for working with waste of up to 500 items, and also undergo quarterly unscheduled inspections of the quality of work. By entering production, the resulting raw materials (non-ferrous and rare earth metals, secondary plastics, including ABS, PS and PP and other materials) can repeatedly reduce greenhouse gas emissions throughout the cycle. So, thanks to a partnership with SKO Electronics-Disposal, we can guarantee that all handed over equipment will reach the factories and will be recycled as deeply as possible and without harm to the environment,}}

Шаблон:Quote 'author = noted Representative of the Association of North Kazakhstan Region "Electronics-Disposal" Anton Guskov.

Launch of sales in Red OS and P7-Office

M.Video Group Dorado - August 31, 2022 announced that it had agreed on cooperation the Russian with the developers - software "" and RED SOFT JSC. "" P7 At the sites of M.Video Dorado , domestic, operating system RED OS as well as a package of office applications "" are available in digital form to users and business clients. P7 Office More. here

Appointment of Bilan Uzhakhov as the new head of M.Video - Eldorado

On August 30, 2022, M.Video-Eldorado announced the appointment of Bilan Uzhakhov as the new general director of the group instead of Alexei Sukhov, who held this position for only a few months and resigned of his own free will. It is reported that Uzhakhov was appointed head of the company for a period of one year. Read more here.

60% increase in e-waste collected

The group M of Video El Dorado on May 27, 2022 reported that in the first four months of 2022, it increased the number of collected electronic waste for their correct processing in recyclable materials by 60 Russians %. About 540 tons of unnecessary equipment and used batteries were brought to the stores of the two chains.

The program to collect obsolete or non-operational equipment for recycling has been implemented by M.Video-Eldorado since 2019 together with the Association "SKO Electronics-Disposal" in order to reduce environmental threats due to the accelerated growth of hazardous waste at landfills. Over a few years, more than 31,000 units or 3,000 tons of unnecessary equipment have been collected. The total number of stores that accept equipment for disposal exceeds 750 as of May 2022. It is also possible to export large-sized equipment from the buyer's house when buying new goods.

In January-April 2022, Russians most often handed over for disposal: washing machines, refrigerators, mobile devices, small household appliances, wires and cables. The most active were residents of Moscow, St. Petersburg, Yekaterinburg, Nizhny Novgorod and Novosibirsk. Electronic waste from stores is transferred to licensed enterprises for subsequent environmentally friendly processing. In May 2022, M.Video-Eldorado has eight partner factories, which is two more than a year earlier.

Even in such a difficult period, we continue to develop our project on the civilized collection and processing of electronics and household appliances, and citizens have the opportunity to freely hand over worked equipment in more and more collection points. It is the cooperation within the framework of the ROP (Extended Responsibility of Manufacturers) of the retailer and the Association that unites manufacturers and importers that gives such tangible results, said the representative of the Association of North Kazakhstan Region "Electronics-Disposal" Anton Guskov.

The program to collect used food sources for recycling continues to grow in popularity, carried out in conjunction with Duracell. The most popular project was among residents of Moscow, St. Petersburg, Krasnodar and Chita. Since the end of 2018, M.Video-Eldorado has already received about 5.3 million batteries - about 110 tons.

You can hand over finger (AA) and pinky (AAA) batteries in more than 1,000 stores of two brands. To do this, special boxes in the form of a battery are installed, which meet all the necessary requirements for safe storage. transportation Licensed enterprises Chelyabinsk - the plant "" and the Megapolisresource Yaroslavl plant - are responsible for food sources from stores and their subsequent processing. Their NEC location and production facilities allow you to cover the needs for the disposal of batteries handed over by consumers from all. countries

Шаблон:Quote 'author = noted Oksana Platonova, Head of the Department of Environmental Projects Implementation in Retail of M.Video-Eldorado Group.

Appointment of Alexei Sukhov as CEO of M.Video - Eldorado

On April 29, 2022, Alexey Sukhov was appointed the new CEO of M.Video - Eldorado group. In this post, he replaced Enrique Fernandez, who will continue to work in the company as a member of the board of directors and will manage the group's operating business and lead the team. Read more here.

Technical Installation Expert Staff Expansion Plan

M.Video Group Dorado - April 6, 2022 announced plans to increase the number of its own fleet by a third to 210 cars during 2022, and the number of its own service employees by 15% to 575 people. Service personnel retailer can not only install already purchased equipment, but also "on the spot" will recommend new purchases, taking into account the needs of the family, will help with placing an order through a special one. mobile application Now the company's specialists carry out more than 50% of all units sold, in the future the company plans to bring this figure to 70%.

The fleet was purchased through operating leasing and has more than 150 cars as of April 2022, the service is available in 69 cities. In 2021, more than 500,000 customers used installation services, more than 50% of the total number of installations were delivered and installed on the same day, which the company carries out on its own. According to the results of January-March 2022, the installation of home appliances increased by almost 20%.

The company has launched a project to equip service teams with smartphones with special software, the same as that used by sellers in the store. The application allows you to accredit the buyer by phone number and select personal offers taking into account recommendations based on data analytics, the offer has become in demand, the company plans to equip all service experts with this solution.

In 2022, we intend to actively develop a turnkey service for delivery and installation on the same day. Developing the ideology of OneRetail, we also equipped the crews with a special mobile application that allows specialists, personally assessing the needs of the client while in his apartment, to show the most favorable offers from the screen of their smartphone and immediately close the deal. Already in April 2022, in pilot crews, we see a high level of customer confidence in the opinion of our specialists. In 2022, M.Video-Eldorado will expand by about a third the number of its own branded machines to more than 200, as well as increase the staff of specialists, which will increase customer satisfaction, trust, speed and quality of service, said Stanislav Gorshenin, Director of Customer Service and Digital Experience at M.Video-Eldorado Retail Chain.

Services can be issued when buying large equipment both in the store and online. Their provision is carried out throughout the country by professional teams (more than 670 own specialists and 1000 outsource partners) within a radius of 150-200 km from the store, at a convenient time for the buyer, and beyond independence from the floor on which the office or apartment is located.

Appointment of Enrique Fernandez as CEO of M.Video-Eldorado

The Russian company M.video, which works in the field of e-commerce and retail electronics and household appliances, on January 17, 2022 announced to TAdviser the appointment of Enrique Fernandez, CEO of M.Video-Eldorado group, who replaced Alexander Izosimov. The corresponding decision was adopted by the Board of Directors of PJSC M.video and comes into force on January 18, 2022. Read more here.

2021

Collection for processing 1.5 times more equipment and batteries

M.Video-Eldorado in 2021 collected 1.5 times more equipment and batteries for processing. The company announced this on February 3, 2022.

The company also launched a number of projects to reduce the impact of its own activities on the environment: collection of packaging and recyclable materials, waste sorting, fandomats for receiving aluminum cans and plastic bottles, disposal of outdated and unused metal trading equipment.

Circular economy programs are gaining scale and popularity. For more than two years now, M.Video-Eldorado has been implementing permanent programs on the federal scale to collect in stores for the correct processing of all types of equipment in any condition (together with the SKO Electronics-Disposal Association), as well as used batteries (together with Duracell). Projects with a transparent process for all stakeholders are aimed at reducing the volume of hazardous waste at landfills. More than 2,600 tons of equipment and 70 tons of batteries have already been collected. Electronic waste is transferred to licensed enterprises, where it is processed by 80-90% into secondary raw materials, which are used to produce new goods.

In 2021, the equipment collection program reached a new level - 1,500 tons of waste (60 thousand units) were collected, and the total number of collection points increased by 250 stores and is now being implemented in 750 retail points (this is more than half). Most of the equipment was transferred by residents,, Moscow, and St. Petersburg. In Novosibirsk Yaroslavl Samara 2022, it is planned to join the program with another 200 stores in 10 regions. The most frequently handed over steel, electronics mobile phones teapots and irons, as well as accessories - and cables earphones. In addition to the permanent program, both networks regularly host promotions when you can hand over old equipment and get a discount on a new one of the popular categories. M.Video-Eldorado also transferred about 1 ton of its own equipment from the office and stores for processing.

In 2021, more than 44 tons or 2 million batteries were also collected for processing. You can hand them over in all stores of two brands, for this they must be lowered into special boxes. More actively than others, outdated power elements were handed over in Moscow, St. Petersburg, Rostov-on-Don, Chelyabinsk and Kazan.

The company also launched a pilot project to install in fandomat stores. Users can hand over empty plastic bottles and aluminum cans up to 2 liters, and in return receive a promotional code for a 10% discount for purchase in M.Video. To do this, you only need to indicate your phone number on the fandomat screen.

M.Video and Eldorado have been offering customers, instead of plastic bags, FSC-certified paper packaging produced in a way that is as gentle as possible for nature. Part of the funds from its sale is used to restore the historical landscapes of broad-leaved forests in the framework of cooperation with the Beautiful Children in a Beautiful World charitable foundation.

The Company continues to improve its environmental performance and introduces new principles in waste management. The staff sorts waste from operational processes (cardboard, paper, polyethylene, foam, wood, PET bottles, plastic, containers from sanitizers, their own office equipment, advertising materials) and transfers them for processing (45 tons have already been collected and transferred for processing). Obsolete and unused metal trading equipment is also transferred for disposal.

To improve energy efficiency, there are remote power control systems (installed in only 200 stores) and lighting systems are used that reduce the impact on electrical networks (since 2015, LED lighting in all stores).

ESG transformation is an important component of the strategic direction for the digitalization of the client path. In all stores through the mobile application, the buyer can find out the characteristics of the goods, read reviews of the goods, compare them, see the personal price, as well as make payment and quickly receive the goods. To save paper and consumables, new stores use price tags in electronic form, and predominantly digital surfaces, including televisions, are used to report additional and advertising information. When opening new retail facilities, the company uses mainly natural environmental materials - wood, glass and concrete.

Acquisition of Direct Credit for 1.3 billion rubles

On Dorado September 23, 2021, M.Video Group announced TAdviser the approval by the Board of Directors of the project for the development fintech of the management within the Group and the acquisition for this purpose of 100% participation credit in the platform "." Direct Credit The amount of the transaction can be about 1.3 billion. rubles More. here

Grundig Embedded Kitchen Equipment Launch

M.Video-Eldorado Group on September 16, 2021 announced the launch of exclusive sales of embedded kitchen appliances Grundig.

Customers of M.Video and Eldorado already have more than 20 models of kitchen appliances available on online platforms and in retail stores, including ovens, hoods, cooktops and refrigerators. The entire line of embedded kitchen appliances will be available by the end of 2021, and freestanding products will be available during 2022.

Grundig is represented in the above-average price segment - this is the category where M.Video-Eldorado's capabilities are most fully manifested - the Group sells about 50% of all large household appliances in Russia in this price range.

The topic of conscious consumption and sustainability is the flagship in the updated Grundig line. The brand is working on this agenda in two directions at once: in some models of kitchen equipment there are parts created from recycled materials, while others are made using technologies aimed at reducing the ecological footprint and saving natural resources such as water or electricity.

Шаблон:Quote 'author = said Oleg Muravyov, Commercial Director of M.Video-Eldorado Group.

{{quote 'author = noted Ragip Baljiola, Commercial Director of Archelik To Europe for Middle East,, Severnaya To Africa, Northern and. South America|

In Arçelik, we work every day to integrate sustainability values into our products, business model and corporate culture. Our vision of "Respecting Peace, Respecting the World" helps us make environmentally and socially responsible decisions. Reflecting this vision, the Grundig brand is committed to a better future in every home, which pushes us to develop the most durable and sustainable products without compromising quality and aesthetics. Russia is one of the most important economies in the world, a strategic market and a key production center. By bringing Grundig to the Russian market, we hope to take our global ambitions one step further,}}

According to M.Video-Eldorado Group, in the first six months of 2021, sales of large household appliances for kitchen and home increased by 23% to 6.7 million units. In monetary terms, sales increased by 32%, to more than 155 billion rubles. In Russia, the trend for the growth of purchases in the middle and upper price segments also persists - more than half of sales in monetary terms fell on these categories of goods. Consumers are more likely to invest in technological solutions that will work stably and remain relevant in the coming years, make life more comfortable and "fit" into the interior.

The most popular among Russians in terms of the number of units sold were washing machines - 1.8 million units and refrigerators - 1.6 million units, the largest segment in terms of revenue remains refrigerators - sales of about 49 billion rubles. The highest sales rates were demonstrated by built-in kitchen equipment: cooktops (+ 27% in money), dishwashers (+ 25%), ovens (+ 23%), refrigerators (+ 23%).

3.5-fold increase in the volume of e-waste collected for recycling

M.Video-Eldorado Group on August 26, 2021 announced that it had expanded the program for the constant collection and processing of equipment to 600 stores, which exceeds half of the entire retail chain. Another 110 stores in Yekaterinburg, Stavropol, Chelyabinsk, Smolensk, Nizhny Novgorod and regions, as well as Kropotkin and Armavir joined the project. The development of projects to promote the circular economy allowed the company in the first six months of 2021 to increase the collection of equipment and batteries by 3.5 times compared to last year - more than 700 tons of equipment and 16 tons of batteries were sent for processing.

For more than two years, M.Video-Eldorado has been collecting and correctly processing all types of household appliances and batteries in order to reduce the volume of hazardous waste at landfills and contribute to the formation of a culture of responsible consumption. The main features of the program are complete transparency of the process for all participants and stakeholders, including consumers, manufacturers of machinery and processors themselves.

Since the start of the Smart Processing programs at M.Video and Dispose Correctly, Eldorado has collected and sent for processing, in partnership with the SKO Electronics-Disposal Association, more than 1,800 tons (so much weighs 40 Boeing 737 aircraft) or 180 thousand units of household appliances. Since the beginning of 2021, the total number of collection points under the project has increased to 600 in 22 major cities and their areas. Most often, mobile phones, washing machines, 15-30 inches TVs, irons, kettles are transferred for disposal. Equipment received from consumers is registered in a special IT system and transferred to one of seven partner plants, the received raw materials are used to produce new goods. The company will continue to deploy the program, and plans to implement the collection of equipment in all regions of its presence by 2025.

Since the end of 2018, M.Video-Eldorado has disposed of more than 44 tons or 2 million batteries. You can hand over finger (AA) and pinky (AAA) batteries in more than 1,000 stores of two brands. To do this, special boxes in the form of a battery are installed, they meet the necessary requirements for safe storage and contain up to 35 kg of electronic waste. Transportation and processing are carried out by licensed enterprises - the Chelyabinsk plant "Megapolisresource" and the Yaroslavl plant "NEC."

Шаблон:Quote 'author = said Oksana Platonova, Head of Environmental Projects at M.Video-Eldorado Group.

Creation of a management company for M.Video and Eldorado

On May 27, 2021, the M.Video-Eldorado group announced the creation of OneRetail, within which all the management functions of the M.Video and Eldorado brands were merged. This restructuring is underway with a focus on the retailer's digital transformation, it said. Read more here.

Election of Alexander Tynkovan as Chairman of the Board of Directors and formation of committees

M.Video Group on Dorado May 21, 2021 announced the completion of the process of updating the Board of Directors in order to improve corporate governance practices.

At the first meeting of the updated Board of Directors, held on May 18, 2021, Alexander Tynkovan was elected to the position of Chairman of the Board of Directors.

Within the Group's Board of Directors, three committees will continue to work - the Audit Committee, the Remuneration and Nomination Committee and the Strategy and Digital Transformation Committee.

The Board of Directors formed the following committees:

• 1. Remuneration and Nomination Committee
  • Brovett John (Committee Chairman)
  • Ekaterina Viktorovna Lapshina
  • Mirakyan Avet Vladimirovich
  • Vladimir Vladimirovich Preobrazhensky
  • Alexander Tynkovan

• 2. Strategy and Digital Transformation Committee:
  • Brovett John (John Browett)
  • Gutseriev Said Mikhailovich
  • Vladimir Vladimirovich Preobrazhensky (Chairman of the Committee)
  • Alexander Tynkovan
  • Fernandez Enrique (Enrique Fernandez)

• 3. Audit Committee:
  • Ekaterina Viktorovna Lapshina (Committee Chairman)
  • Riccardo Orcel
  • Vladimir Vladimirovich Preobrazhensky

Increase of Alexander Izosimov's share in the authorized capital of PJSC M.video

PJSC "M.video" (group "M.Video Dorado"), the Russian a company in the field e-commerce and retail, trade electronics and household appliances which is part of the group, "Safmar" Mikhail Gutseriev on May 18, 2021 announced that the CEO of the retailer Alexander Izosimov increased its stake in the authorized capital of the company from 0.1279% to 0.3173%. More. here

Election of the Board of Directors of PJSC M.video

PJSC "M.video" (Group "M.Video Dorado"), the Russian a company in the field e-commerce and retail, trade electronics and household appliances which is part of the Group, "Safmar" Mikhail Gutseriev on May 13, 2021 announced that the Annual General Meeting of Shareholders (AGM, Meeting), held on May 7, 2021, elected an updated composition of the Board of Directors - the share of independent directors increased to one third.

The number of representatives of the Safmar Group was reduced to two people, the main shareholder of M.Video-Eldorado in the updated composition is represented by Said Gutseriev and Avet Mirakyan.

The meeting elected the Board of Directors of PJSC M.video consisting of:

• Blase Andreas Blasé, Non-Executive Director
• John Browett, Independent Director (Executive Chairman, Internet Fusion Group, UK)
• Gutseriev Said Mikhailovich, Non-Executive Director (Chairman of the Board of Directors of Eldorado)
• Lapshina Ekaterina Viktorovna, Independent Director (Founder and General Director - Holding LLC "ERA")
• Mirakyan Avet Vladimirovich, Non-Executive Director (CEO of Safmar Group)
• Riccardo Orcel, Non-Executive Director (Vice Chairman, VTB Capital, Moscow)
• Vladimir Vladimirovich Preobrazhensky, Independent Director (M.Video-Eldorado)
• Alexander Tynkovan, Non-Executive Director (President of M.Video-Eldorado)
• Enrique Fernandez, Non-Executive Director (M.Video-Eldorado)

Earlier, by the decision of the Extraordinary General Meeting of Shareholders of December 28, 2020, the number of Directors was reduced from 14 to 9 people.

Sale of 85% stake in goods.ru to Sberbank

On March 30, 2021, the M.Video-Eldorado Group announced to TAdviser that, together with Sber and co-owner goods.ru Alexander Tynkovan, they had signed legally binding documentation on Sber's acquisition of an 85% stake in goods.ru (Marketplace LLC). The deal is expected to close in the second quarter of 2021. Read more here.

Safmar sells 13.5% of M.Video-Eldorado shares

On March 9, 2021, the Safmar group, owned by Mikhail Gutseriev and his family, announced the sale of 24.28 million shares of M.Video-Eldorado (about 13.5% of the total). The deal will be done as part of a secondary offer (SPO). Read more here.

Intention to sell 85% of Goods.ru to Sberbank

On January 28, 2020, the M.Video-Eldorado Group announced to TAdviser that it had signed an agreement of intent with Sber and founder and co-owner of goods.ru Alexander Tynkovan to jointly develop the marketplace goods.ru. Sberbank will acquire a part of the shares of goods.ru owned by M.Video-Eldorado Group as of January 2021. Read more here.

TAdviser interview with digital transformation director Victoria Kunina

In February 2021, Victoria Kunina, Director of Digital Transformation at M.Video-Eldorado, spoke in an interview with TAdviser about how this is happening digital transformation in the company. Read more here.

Said Gutseriev sold 10% of M.Video with a 30% discount

On January 11, 2021, some details of the transaction for the sale of 18 million shares (about 10%) to M.Video holding Safmar Financial Investments (SFI) became known. The seller of the package was the Cypriot offshore Ericaria Holdings (owned by Said Gutseriev), which at the end of the third quarter of 2020 had 73.5% of the retailer's shares. SFI is the holding company of the Gutseriev family.

According to Kommersant, citing materials for an extraordinary meeting of SFI shareholders, almost 18 million shares of M.Video were acquired by the Cypriot company Weridge Investments, which is part of the holding, at a price of just over 500 rubles per security. At the same time, by mid-2020, according to the report of the SFI appraiser (the publication refers to it), there were only 24.6 million rubles of cash and their equivalents on the balance sheet of Weridge Investments.

At the same time, the offshore company, which previously acted as the operator of the share buyback program of the parent company, received a loan from the SFI in the amount of 4.4 billion rubles, as well as from VTB for 4.6 billion rubles. There were no other large cash receipts (such as SFI dividends or other loans) on Weridge Investments' balance sheet. Based on the borrowed funds received, the purchase price of shares could be about 0.5 thousand rubles apiece.

The value of M.Video shares, as of December 2020, was estimated on the stock exchange in the range from 700 to 750 rubles. In the second half of the year, the retailer's securities rose in price by more than 75%. About 10% of the company's shares are in free circulation.

Kommersant notes that the discount to exchange quotes on the 10% deal of M.Video between the two structures of the Gutseriev family could be almost 30% and could be due to the fact that it is difficult to sell such a large package to the market. But usually in such cases the discount is much smaller, experts interviewed by the publication note.^[7]

2020

Revenue under IFRS grew by 14.4% to RUB 417,857 million.

On March 4, 2021, M.Video-Eldorado Group reported audited consolidated financial results prepared in accordance with International Financial Reporting Standards (IFRS) for the year ended December 31, 2020.

The Group's revenue increased by 14.4% y-o-y to RUB 417,857 million due to a more than twofold increase in total online sales (+ 108.6% y-o-y), an increase in the average check in mobile and web platforms, as well as an increase in active identified customers of the Group who had a higher average check and frequency of purchases.

Gross profit increased by 6.9% year-on-year and reached RUB 97,275 million (RUB 97,335 million under IFRS 16), gross margin amounted to 23.3%.

Commercial, general and administrative expenses (SG&A) excluding depreciation amounted to 74,682 million rubles (54,723 million rubles under IFRS 16) and decreased as a percentage of revenue by 1.2 percentage points (pp) year-on-year to 17.9% due to measures to improve the efficiency of the business, affecting personnel costs, rent, advertising and marketing.

The Group's adjusted EBITDA grew by 6.5% yoy to RUB 28,474 million (RUB 48,618 million under IFRS 16) and adjusted EBITDA margin was 6.8% (11.6% under IFRS 16).

The Group's adjusted net profit increased by 9.3% yoy to RUB 12,212 million (RUB 10,287 million under IFRS 16).

Net debt of the Group as at 31 December 2020 amounted to RUB 40,483 million (a decrease of 9.4% compared to 31 December 2019), net debt/adjusted EBITDA4 - 1.42x (a decrease of 0.25x compared to 31 December 2019).

In accordance with the dividend policy, M.Video-Eldorado plans to send at least 100% of net profit to dividend payments, excluding the share of profit (loss) of associates and joint ventures according to the IFRS of 17 standard (IAS 17) and make dividend payments twice a year.

When preparing a recommendation to shareholders on the distribution of profits and payment of dividends, the Company plans not to take into account one-time expenses incurred in 2020.

2020 was one of the most difficult, but at the same time extremely interesting periods in the almost thirty-year history of the Group. We learned to work in completely atypical and difficult circumstances, continued to create and bring products and services to the market in a short time, actively involve in our digital space and better recognize our customers. Of course, the successful results of 2020 of M.Video-Eldorado Group would not have been possible without the involvement, hard work and the highest professionalism of each employee. Although 2020 has allowed us to rebuild our business faster and create a solid digital foundation for further development, our main growth and transformation is still ahead. Our confidence in the future, based on deep expertise and many years of experience, is reflected in the medium-term development strategy, according to which we plan to double the GMV6 figure by 2025 to 1 trillion rubles. We are also willing to share our success with shareholders. Therefore, based on the results of 2020 and confidence in the long-term sustainability of the business, the company plans to use the adjusted net profit indicator as a basis for calculating dividends for the second half of 2020. said Alexander Izosimov, CEO of M.Video-Eldorado Group

Revenue growth by 15.4% due to online sales, up to 504.8 billion rubles

Revenue of M.Video-Eldorado at the end of 2020 reached 504.8 billion rubles, an increase of 15.4% compared to 2019. The main catalyst for the financial rise of the retailer was online sales - they jumped by 108.6% over the year and exceeded 300 billion rubles. The Internet channel accounted for 59.5% of the group's turnover.

It also follows from the financial statements of M.Video-Eldorado that the turnover of sales through the company's mobile applications in 2020 amounted to 154.1 billion rubles, which is 152.3% more than a year ago and corresponds to 51.3% in the total volume of online sales. Sales of goods and services through websites in 2020 increased by 76.3%, to 146.3 billion rubles.

The number of active identified customers at the retailer in 2020 reached 18.7 million, of which 41.6% are OneRetail customers. OneRetail's customer growth was 79.5%. The company defines OneRetail customers as buyers who have logged in and made at least one purchase within a year through a web or mobile platform that includes custom and merchant applications.

In 2020, mobile applications M.Video and Eldorado were downloaded by users about 7.8 million times, which is 5.5 times more than a year earlier. The average monthly number of active users of customer mobile applications (MAU) was more than 2 million.

The average monthly audience of the sites of the M.Video-Eldorado group in 2020 increased by 28.9% compared to 2019 and reached 74.7 million.

The total number of goods presented on the retailer's platforms has grown more than 2.5 times, to 75 thousand. As of December 31, 2020, the M.Video and Eldorado retail chain includes 1,074 stores with locations in 279 cities of the country.^[8]

Sales of smart home devices increased 7 times

The M.Video-Eldorado Group on January 18, 2021 announced the results of its own sales of "smart equipment" in 2020.

Sales of devices for smart home"" reached large volumes and increased by the end of 2020 7 times in pieces and 3.5 times in money. The best-selling products of 2020 from the ecosystem were: "smart outlet" Yandex YNDX-0007, "smart light" Yandex.Lamp YNDX-00010, "smart remote" Yandex YNDX-0006, - IP Xiaomi Mi Home Security Camera 360 camera (MJSXJ05CM), "smart outlet" Xiaomi Mi Smart Power Plug (ZNCZ05CM)

Before buying, it is important for consumers to personally test the goods, learn more about their principles of work and capabilities. To do this, several dozen stores M.Video and Eldorado have demonstration zones from, Rubetek Yandex Xiaomi Redmond,,,,,. Legrand Aqara CitiLux Philips A special hub is available on the M.Video website, which contains ready-made solutions and relevant products for the main use cases.

Among the main features of the "smart home" it is worth highlighting the automation of household tasks to save time and effort, ensure security, as well as reduce spending on electricity. The introduction of such solutions brings real benefits, and the relevance increases with the increase in time spent by consumers at home due to the pandemic. Given the emerging needs, we pay great attention to informing about the benefits of "smart" solutions, expanding the choice, integrating into the stores of the experience zone, where goods can be viewed in action or receive expert advice. In 2021, we expect that the smart home direction in our networks will show an increase in money by about three times, and the main driver will be complex solutions, not individual goods, - said Vadim Eremin, head of the Gadgets and Innovations department at M.Video-Eldorado Group.

A positive effect to popularize the category is having a growing interest in speakers with a voice assistant that can control the "smart home," as well as some types of equipment connected to the Internet - from kettles and vacuum cleaners, to washing machines and refrigerators. The segment of "smart speakers" is developing due to the emergence of new devices and virtual assistants, as well as an increase in knowledge about the functionality of devices. In addition, consumers have a habit of voice commands and messages when using a smartphone.

In the M.Video-Eldorado Group, the demand for speakers with a voice assistant increased 4 times in pieces and 6 times in money. Most sales are in devices with a virtual assistant Alice. The best-selling models in two networks were Yandex.Station Mini, Yandex.Station and Capsule from Mail.ru.

Start of sales of eSIM cards from Tele2

On October 23, 2020, the M.Video-Eldorado group announced the start of sales of eSIM cards from Tele2 in more than 1,000 stores. In nine months, unit sales of smartphones with eSIM support have tripled, tablets - 2.5 times.

Owners of flagship and smartphones Apple Samsung Huawei recent generations can use all operator services without communications installing a physical SIM card thanks to the built-in eSIM module. A virtual SIM card can become both the main one for calls or communication, and an addition to the classic sim. To purchase eSIM Tele2, users can contact the nearest store or M.Video Eldorado with their passport. To activate, you will need to scan QR code the mobile device received using the camera. A virtual SIM card can be issued free of charge when buying or smartphone tablet, as well as purchased separately.

According to the M.Video-Eldorado Group, over the nine months of 2020, Russians purchased about 1.7 million eSIM smartphones in the amount of 130 billion rubles, over the past year, the volume of sales of smartphones with support for virtual sim-cards has tripled both in kind and in monetary terms. The share of such devices in the total volume of smartphones sold increased in pieces to 7% from 3.5% and in money to 33% from 15%. The high rate of penetration of devices with support for the built-in SIM-card is associated with the expansion of the range and increased demand for flagship smartphones.

Mobile devices with eSIM are becoming more and more popular, already a third of sales come from smartphones that support virtual SIM cards. Such a card cannot be broken or lost, while it allows you to use the functionality of the device in full, using several numbers at once, including in the iPhone, to change the operator or tariff plan depending on your needs. For October 2020, we are selling such sim-cards in person, but we expect that in the future it will become available online. Simplification of the procedure, taking into account the compliance with the necessary requirements of regulators and the emergence of more affordable mobile devices with a chip, will be able to make the technology massive in the near future, "said Vladimir Chaika, head of the Telecom department at M.Video-Eldorado Group.

As of October 2020, more than 20 models of smartphones with eSim connectivity are available to Russian buyers.

In the tablet category, about ten iPad models from Apple are available to Russian buyers with eSIM, which are equipped with a mobile communication module. Over the past year, the popularity of such tablets has increased 2.5 times in pieces and twice in money. The entire tablet market for the period from January to September year to year increased by 3% in units and 18% in monetary terms, to about 1.75 million devices and 27 billion rubles. Apple holds the championship in monetary terms.

Appointment of Alexander Izosimov as General Director

On September 21, 2020, M.Video-Eldorado Group informed TAdviser about the approval by the Board of Directors of Alexander Izosimov for the position of CEO (CEO) of M.Video-Eldorado Group. more details here.

Collection for processing 360 thousand batteries

On June 25, 2020, the M.Video Group, a Dorado the Russian retail company for to trade electronics and, household appliances announced the results of the development of the battery collection and disposal program since its launch in October 2018. Visitors to stores M.Video and Eldorado transferred 7.5 tons or about 360 thousand pieces of used power sources. Specially designed Durecell containers for collection are installed for June 2020 in 920 stores in more than 100 Russian cities and settlements. By the end of 2020, M.Video and Eldorado will install boxes for collecting batteries in all stores.

The M.Video-Eldorado group for the year brought the program for the collection and processing of used batteries to the federal level. The geography of reception has 920 retail stores. In total, visitors to stores transferred 7.5 tons of used batteries for disposal, which is about 30 adults of Amur tigers.

In stores to collect the most popular battery formats, the retailer has placed special containers that meet the necessary requirements for the safe storage of this type of waste and hold up to 35 kilograms. Transportation and processing are carried out by licensed enterprises - the Chelyabinsk plant "Megapolisresource" and the Yaroslavl plant "NEC." Power supplies get a second life and turn into electrolytes for the re-production of batteries, graphite, zinc, manganese dioxide, black scrap and other elements.

We continue to expand the program to collect expired batteries and urge everyone to do their part to preserve the environment. The problem of proper disposal became especially urgent during the period of self-isolation. It is important not to throw the accumulated power sources together with other household waste, but to take them away if possible for recycling. Our company controls the entire cycle and guarantees sustainable disposal in accordance with industry standards. In parallel with the collection of batteries, we are developing a program for the disposal of equipment. We accept most types of technology from TVs and refrigerators to chargers and remote controls. Seven cities have already been connected to the project, where 350 tons of equipment have already been collected, - says Oksana Platonova, head of retail environmental projects at M.Video-Eldorado Group.

Sacking of Chief information officer Sergei Sergeyev

In January 2020, TAdviser became known that Sergei Sergeyev left M.Video/Eldorado. The company confirmed this information, saying that he left at the end of December. Read more here.

2019

Net profit growth by 44.8% to 11,178 million rubles

On March 24, 2020, M.Video-Eldorado reported to TAdviser the audited consolidated financial results prepared in accordance with International Financial Reporting Standards (IFRS) for the twelve months ended December 31, 2019. Thus, the Group's revenue increased by 3.6% yoy to RUB 365,216 million in 2019 due to the opening of additional stores, traffic growth and online sales of both brands. The Group's adjusted net profit under the IAS 17 standard ('IAS 17') increased by 44.8% yoy to RUB 11,178 million ( RUB 9,089 million under IFRS 16) in 2019 compared to RUB 7,718 million in 2018 as a result of the above-described business efficiency growth factors.

The Company's gross profit increased by 4.8% yoy to RUB 91,015 million, while its gross margin increased by 0.3 pp yoy to 24.9% in 2019 due to improved efficiency in procurement, promotion and assortment management.

The IAS EBITDA 17 indicator ('IAS 17') grew by 18.1% yoy to RUB 26,746 million, while EBITDA margin increased by 0.9 p.p. yoy to 7.3% in 2019. The improvement was driven by growth in gross profit and efficient management of commercial, general and administrative expenses, mainly personnel costs, which amounted to RUB 23,438 million and decreased as a percentage of revenue by 0.57 pp to 6.4% in 2019 from 7.0% in 2018. The Group reduced personnel costs, including as a result of integration with Eldorado business processes and synergies resulting from optimization.

In 2019, the Group opened 97 stores, 61 of which occurred in the second half of the year, as a result of which rental costs according to the IAS 17 standard ('IAS 17') increased to RR 21,335 million in 2019 from RR 19,000 million in 2018, and as a percentage of revenue increased by 0.45 pp to 5.8%, this dynamics was partially offset by the optimization of rental rates.

IAS 17 operating profit ('IAS 17') increased by 17.1% yoy to RUB 19,699 million in 2019 due to an increase in EBITDA. Amortization expenses under the IAS 17 standard decreased to RR 7,047 million in 2019 from RR 7,862 million in 2018 due to one-time non-cash asset write-offs and additional amortization accrued during the revaluation of Eldorado assets in 2018. ('IAS 17') increased to RR 7,047 million in 2019 from RR 5,833 million in 2018, and as a percentage of revenue increased by 0.3 pp yoy to 1.9% in 2019. The increase in depreciation expense was mainly due to integration and active expansion.

As at 31 December 2019, the Group's total debt amounted to RUB 49,410 million and the Company's debt is fully denominated in RUB. For 2019, the Group's total debt decreased by 17.0% and the total debt/EBITDA ratio was 1.8x as of December 31, 2019, showing a decrease from 2.6x as of December 31, 2018. The ratio of net debt EBITDA as of December 31, 2019 remains at a comfortable level of 1.7x.

According to M.Video-Eldorado, the implementation of IFRS 16 ('IFRS 16'), effective from 1 January 2019, had an impact on the Group's EBITDA, operating income and net profit.

Thus, the Group's EBITDA is significantly higher in accordance with IFRS 16 ('IFRS 16'), since the majority of lease expenses previously recognized in commercial, general and administrative expenses are recognized in IFRS 16 ('IFRS 16') as debt on the company's balance sheet, as well as in interest expense on loans in the income statement.

Rent and utilities expenses were lower under IFRS 16 ('IFRS 16') by RUB 17,190 million and maintenance and other operating expenses before depreciation were lower by RUB 2,681 million in 2019.

Therefore, the Group's EBITDA under IFRS 16 ('IFRS 16') rose to RR 46,617 million compared to RR 26,746 million under IAS 17 ('IAS 17') in 2019. EBITDA margin under IFRS 16 ('IFRS 16') was 12.8% or 5.5 pp higher compared to EBITDA margin of 7.3% under IAS 17 ('IAS 17') in 2019.

The Group's net income in 2019 was affected by additional expenses in the amount of RUB 15,456 million of lease asset depreciation in accordance with IFRS 16 ('IFRS 16').

The impact of these additional depreciation expenses was fully offset by the deduction of long-term lease expenses from operating expenses as mentioned above.

Thus, the net positive effect of operating expenses on net income under IFRS 16 ('IFRS 16') amounted to RUB 4,414 million in 2019. At the same time, financial costs increased by 7,214 million rubles under IFRS 16 ('IFRS 16') due to additional interest expenses on leasing obligations in 2019. The implementation of IFRS 16 ('IFRS 16') also resulted in lower income tax expense due to lower pre-tax profit in 2019.

As a result, the Group's adjusted net income under IFRS 16 ('IFRS 16') reached RR 9,089 million, compared to RR 11,178 million of adjusted net income under IAS 17 ('IAS 17') in 2019. Adjusted net margin under IFRS 16 ('IFRS 16') was 2.5% compared to 3.1% under IAS 17 ('IAS 17') in 2019.

The implementation of IFRS 16 ('IFRS 16') does not affect the net change in cash in the cash flow statement. However, IFRS 16 ('IFRS 16') affects the presentation of the cash flow statement, as principal lease payments are classified as financial activities, prepayments as investment activities and interest payments as interest paid in operating activities.

{{quote 'author = stressed President and Chairman of the Board of M.Video-Eldorado Group Alexander Tynkovan| Dorado M.Video Group against the background of moderate Russian dynamics of the consumer market electronic engineers showed a noticeable qualitative growth in key financial indicators - profitability reached EBITDA 7.3%, adjusted net profit increased to 11,178 million rubles. The financial success of the company in 2019 is a consequence of the fact that we successfully and in an unprecedented short time fully completed the integration of two retail chains after the purchase of Eldorado. Over the year, with a small team of the M.Video-Eldorado Group, it was possible not only to switch to a single legal entity and a common IT system, but also to rebuild all key business processes ones from procurement to customer service, which gave additional synergies. As a result of integration in 2018-2019 and the synergies received, the company in December 2019 paid dividends in the amount of 6 billion rubles, }}

The main objective of the Group in 2019 was to complete all integration processes and create an effective business model in which each of the brands, each function has its own role. We have completed the deployment of key projects - m mobile digital retail zones and freestanding digital boutiques, as well as a mobile seller application (RTD). These projects determine the current efficiency of the Group and formed the basis of our plans for further business growth. The group, due to the digitalization of all business processes and the authorization of customers not only on the site and through a mobile application, but also in stores, is developing as an online business. Our model is transformed from a homie to ONE RETAIL, which is based not only on a single price, service and assortment approach at all points of contact of buyers with us, but also on data analytics, personalization of promotional offers, and in the future - and prices. The interaction of the buyer with the retailer takes place through a smartphone. In 2020, despite the high level of uncertainty in the macroeconomic situation, our main focus remains unchanged, and we will continue to do what we do: serve our customers, providing the necessary technologies and devices for communication and work, cooking, household chores and entertainment, noted the Chief Executive Officer of M.Video-Eldorado Group Enrique Fernandez

TAdviser interview with IT Director, Sergei Sergeyev

In December 2019, Sergei Sergeyev in an interview with TAdviser spoke about how the integration of M.Video and Eldorado took place, and what technologies play a decisive role in the development of the combined company. Read more here.

Launch of the thousandth store

On November 19, 2019, M.Video-Eldorado Group announced the launch of a thousandth retail store, which was the M.Video hypermarket in Omsk in the Quadro shopping center.

The M.Video-Eldorado group opened 160 stores in a small year, since June 2018, after the start of Eldorado integration, including 56 rebranded MediaMarkt facilities. Total online sales of the company grew by 79% to RUB 91 billion in the first nine months of 2019, while the share of total online sales in the Group's turnover reached 31%.

As part of the ONE RETAIL strategy, the Group considers stores as a natural continuation of sites and mobile applications combined by one IT platform. In M.Video stores, consultants use mobile devices with a special application installed on them (RTD, real time dealing or "real-time transaction") to authorize customers and personal service. In addition, each store serves as a pick-up point for online orders made on eldorado.ru or mvideo.ru.

The Group develops several retail formats - hypermarkets of household appliances and electronics under the brands "M.Video" and "Eldorado" with an area of ​ ​ 1-1.5 thousand square meters. m, a m_mobile concept focused on the sale of smartphones and other digital electronics, and "Eldorado 600," small equipment stores with the most popular range at minimum prices. The retail strategy allows the Group to reach different audiences and increase market share.

For M.Video-Eldorado Group, as an online business, a developed and efficient retail network is a competitive advantage - these are points of direct contact with customers, an important component of the distribution network and the opportunity for our partners, manufacturers of equipment, to demonstrate all technologies "live." As of November 2019, about 70% of our customers use the Internet in the process of choosing equipment, and only about 5% place orders without contacting the store, which indicates a high demand for stores. Moreover, with the opening of each next store, we see an increase in online traffic and online sales in this region or city. The ONE RETAIL strategy aims to fully integrate online and offline both on the buyer's side and in terms of business processes, which will allow the Group to grow further as an online platform, relying on efficient retail. noted the Chief Executive Officer of M.Video-Eldorado Group Enrique Fernandez

As of November 2019, M.Video-Eldorado Group stores are represented in 220 Russian settlements in all federal districts, their trading area exceeds 1,500 thousand square meters. meters.

Recommendation of the Board of Directors to pay dividends in the amount of RUB 33.37 per share

On November 1, 2019, M.Video-Eldorado Group, a Russian retail and online retail electronics and appliances company, announced that the Board of Directors recommended dividends on the results of the integration of M.Video and Eldorado for 2018-2019 for approval at an extraordinary general meeting of shareholders on December 3, 2019.

In particular, dividends are recommended for approval in the amount of 33.37 rubles per ordinary share of PJSC M.Video.

In accordance with the Russian accounting standard, the financial result of synergies from the integration of companies for 2018-2019 is reflected in the third quarter of 2019. The total amount of dividends can be about 6 billion rubles.

M.Video-Eldorado Group this year completed the integration of all assets acquired in 2018, not only organizational, but also legal, and technological. As a result, the company entered the top ten largest public retailers in the world in its segment in terms of revenue and in the top three in terms of efficiency. The Group used its own funds for all capital expenditures associated with the consolidation of IT systems, while increasing profitability. The Group increased its EBITDA margin to 6% in 2018 from 5% in 2017 to RUB 6 billion in 2018. The Board of Directors is satisfied with the results of the merger and the pace of the company's development and believes that M.Video-Eldorado Group receives the planned financial results and may return to the practice of regular annual dividend payments after a two-year break, during which the company built an excellent foundation for further growth of shareholder value, "said Said Gutseriev, Chairman of the Board of Directors of PJSC M.Video.

Launch of a project for the constant collection and disposal of old equipment in Moscow and the Moscow region

On September 26, 2019, M.Video-Eldorado Group announced that, together with the SKO Electronics-Recycling Association and Ecopolis Corporation JSC, it had launched a project to constantly collect and dispose of household appliances and electronics.

More than 200 retail stores "M.Video," "Eldorado," as well as digital salons m_mobile in Moscow and the Moscow region have already begun to accept equipment for disposal. Consumers can hand over any unnecessary devices for free and at any convenient time for themselves: from a refrigerator and a washing machine to a smartphone, iron or TV. To do this, it is enough to contact the store's service area and sign a consent for disposal. Customers also have access to the service of exporting large household appliances with subsequent disposal when delivering newly purchased goods. In the future, export for disposal can be ordered as a separate service. The equipment collected in Moscow as part of the project will be sent to a high-tech complex for deep processing of electronic waste under the management of ECOPOLIS Corporation. In the medium term, the project participants are aimed at collecting and processing about 4,000 tons of electronic garbage in Moscow and the region annually.

The M.Video-Eldorado Group and the SKO-Recycling Association have already launched a pilot program for the constant utilization of equipment in St. Petersburg, in just two full months they managed to collect more than 2,000 units of equipment. By the end of the year, in addition to Moscow and the Moscow region, the project will work in five more cities: Kazan, Novokuznetsk, Samara, Yaroslavl, Ulyanovsk. Within two years, partners expect to launch the reception of equipment for disposal in all 220 cities of the Group.

All assembled equipment is taken into account in the retailer's IT system and transferred to the association, which is engaged in the selection and accreditation of recycling plants, as well as control at the stage of transportation from the store to the recycling plant and subsequent disposal. The economic and legal model of partner interaction was developed by Deloitte.

For the first time in Russia, we are launching a constant process of collecting old equipment, within the framework of which we can definitely guarantee that each handed over device will be effectively disposed of without harm to the ecosystem of the city. It is very logical to hand over the equipment where you acquired it, and the developed infrastructure of M.Video and Eldorado, our IT solutions will allow this project to be implemented in most cities. More and more people are paying attention to how the goods and services they consume affect the planet, and it can be assumed that over time, responsible consumption will become not a fashion trend, but a standard, a norm, but recycling - an actively growing segment of the economy closely related to retail retail.

The processing complex of ECOPOLIS Corporation consists of three plants that form a full cycle of environmental disposal with processing efficiency of up to 95% of the incoming volume of electronic waste. Initially, the equipment gets to the Ecotechprom plant, where it is disassembled into components and sorted. The company operates a unique line for the processing of refrigeration equipment, equipped with an automatic sealed closed-cycle system to remove freon, which prevents it from entering the atmosphere. The line of disposal of monitors and televisions with a cathode ray tube allows you to neutralize flasks and environmentally assemble phosphor in sealed containers for subsequent processing at enterprises that utilize mercury-containing materials. Case plastics sorted and shredded at the Ecotechprom plant are transferred for subsequent eco-processing to the Ecoplast plant, and printed circuit boards and non-ferrous metals to the Aurus plant. The products of the complete complex of environmental processing of the three plants are high-quality secondary plastic pellets ABS, PS, PP, copper cathode, scrap of ferrous and non-ferrous metals.

In the matter of electronic waste disposal, control of the quality and depth of processing is extremely important. As of September 2019, more than 3,000 licenses for the processing of electronic waste were issued in Russia, while the quality of the work of recycling companies is not actually checked. This leads to the fact that unscrupulous processors extract only the most valuable components from the equipment, and everything else is burned, buried or thrown into a landfill, causing significant damage to the ecology of the city. Also, the issue of centralized collection of electronics waste from the population has not been worked out. People do not know where to hand over the accumulated electronic garbage so that it is environmentally recycled. The production capacity of the ECOPOLIS Corporation complex of plants will allow closing the full volume of electronic waste processing in the city of Moscow, and in the future - in the Moscow region. In Russia, there are no similar complex enterprises for the processing of electronic waste, and we will do everything possible to combat electronic garbage. Cooperation with the M.Video-Eldorado Group in building a complete chain of utilization of used electronic equipment from the stage of its collection from the population to deep processing at our plants is the first big step towards this. I am sure that this project will become the flagship in the way of creating a system for the environmental disposal of electronic equipment in Russia, notes Chairman of the Board of Directors of ECOPOLIS Corporation Vladislav Vladimirovich Sviblov

All equipment assembled in stores is taken into account individually before being sent for processing. The recycler, having received the batch, weighs it and also enters the data into the general IT system. Retailers, the Association "SKO Electronics-Recycling" and recycling enterprises are connected to it, which allows you to track the path of each product. The experts of the Association check the entire cycle of processing for compliance with Russian and international environmental standards. In addition to the ECOPOLIS Corporation complex, the association is already cooperating with 10 recycling facilities in different regions of Russia. These companies have passed an incoming audit according to the high requirements of the Association and confirm accreditation quarterly.

The costs of collecting equipment - personnel training, paperwork, storage in stores - are borne by the M.Video-Eldorado Group. Transportation of equipment to recycling enterprises is paid by the association.

This large-scale project is a response of responsible business to the request of society and the state in terms of the formation of a circular economy and increasing the level of environmental friendliness in general. An important stimulating factor of this work was the possibility of self-realization of the extended responsibility of manufacturers and importers for the fate of goods that have lost their consumer properties, provided for in the Federal Law of 24.06.1998 No. 89-FZ "On Production and Consumption Waste." The Association pays special attention to monitoring all its counterparties and their business processes related to collection and disposal for compliance with the current legislation and even deeper, for compliance with its internal regulations, sometimes more stringent than the law, emphasizes the President of the Association "SKO Electronics-Disposal" Alexander Onishchuk

For about 10 years, M.Video-Eldorado Group regularly conducts short-term marketing campaigns to collect old equipment, within the framework of which it issues discounts on new devices. In parallel, the retailer is testing the disposal of any old electronics on a permanent and non-commercial basis. The pilot project started in June 2019 in 30 M.Video stores in St. Petersburg and Kolpino. Most often, old washing machines, televisions and irons are handed over for disposal. From one washing machine weighing about 50 kg, the recycling results in 15 kg of building mixtures, one section of a 2.5m metal fence and one plastic garden chair.

Sales growth to 193.6 billion rubles (+ 10.4%)

M.video (M.Video-Eldorado Group), July 18, 2019 announced the combined unaudited pro-form * indicators of net sales and sales of comparable stores (like-for-like), as well as the results of the development of M.Video and Eldorado chains for the first half of the year ended June 30, 2019.

Sales of the Group increased by 10.4% yoy to RUB 193.6 billion (including VAT) in the first half of 2019. The growth is due to the active expansion at the end of 2018 and the positive dynamics of Internet sales at both M.Video and Eldorado. In the first half of the year, sales of the M.Video network showed an increase of 11.7% year-on-year and reached 130.2 billion rubles (including VAT), Eldorado increased its turnover by 8.0% year-on-year to 63.4 billion rubles (including VAT).

Internet sales of M.Video (online orders with home delivery and pickup from stores) in the first half of the year increased by 19.0% yoy to 26.4 billion rubles (including VAT), Eldorado by 14.1% yoy to 11.6 billion rubles (including VAT) due to traffic growth and the average check for both brands. Both chains increased their online share in total sales to 20.2% in M.Video and 18.3% in Eldorado.

Sales of LFL (sales of comparable stores) by group cumulatively increased by 0.4% in the first half of the year. Sales of LFL "M.Video" showed an increase of 1.0%. LFL sales of Eldorado decreased by 0.6%, mainly due to a decrease in the average check due to active promos against the backdrop of a slowing market, a change in the product mix and an increase in sales of goods in the low price segment as part of the current brand positioning.

In the first half of 2019, the Group expanded its network to 36 stores, including 15 M.Video, 17 Eldorado and 4 stores under the m_mobile brand. The Group's total number of stores was 977 as of 30 June 2019.

* M.Video-Eldorado Group's pro-forma operating statements show the consolidated statements that it would have looked like if Eldorado had been part of the Group not since its acquisition in 2018, but since the beginning of the compared period, i.e. from the beginning of the first half of 2018.

Opening of Apple service centers in the regions

On June 24, 2019, M.Video (M.Video - Eldorado group) announced the expansion of Apple's network of authorized service centers in its stores. In addition to two locations opened a year ago in Moscow, service centers will be added in the retailer's stores in St. Petersburg, Yekaterinburg, Rostov-on-Don, as well as two more in Moscow.

Apple's first regional authorized service center has already opened in the M.Video store in Rostov-on-Don; by the end of September 2019, the retailer expects to launch several more points for servicing and repairing Apple equipment in St. Petersburg, Yekaterinburg and Moscow.

Experts from service centers in M.Video stores will help you configure any Apple equipment, diagnose or repair. The centers are equipped with certified equipment, components for repairs are received directly from Apple, and employees of the centers undergo special training. Maintenance of equipment takes place with clear observance of the manufacturer's procedures. All owners of Apple equipment can contact the service center in the M.Video store, regardless of where it was bought.

There are more than 120 Apple zones in our stores, which, in fact, are brand stores - with design, special design and personnel who have been trained and certified. Service centers are a continuation of this ecosystem, it is logical to repair equipment where you bought it, it gives loyal customers and regular buyers. In the second half of 2018, after the opening of the first authorized service centers in Moscow, sales of Apple equipment in these stores increased by 40%. Now certified equipment, expertise and high-quality service will be available to visitors to M.Video stores not only in the capital, but also in other cities, - commented on the event Sergey Sukhorukov, head of the department for work with Apple in the M.Video-Eldorado Group.

In Rostov-on-Don, a service center is located on the territory of the M.Video store in the Zolotoy Babylon shopping center, in St. Petersburg an authorized service center will open in a store in the Nova Balkania shopping center, in Yekaterinburg - in the Rainbow shopping center, and two more will appear in Moscow, in the Shchelkovo shopping center and Yerevan Plaza shopping center.

Launch together with SKO Electronics - Recycling of any equipment and electronics

On June 03, 2019, M.Video Group, Dorado retailer household appliances and electronics a member of the PFG, and the SAFMAR Mikhail Gutseriev Electronics - Recycling Collective Responsibility System Association announced the launch of a project to constantly accept used equipment for disposal and fully control the life cycle of household appliances and, electronic engineers including recycling into secondary resources.

smartphone It will be possible to hand over all types of equipment, from to the refrigerator, in any store "M.Video" or "Eldorado" in the service area of ​ ​ the store. The pilot project has already been launched in, St. Petersburg by the end of 2019, the disposal of equipment on an ongoing basis will work in M.Video stores in six more cities - in To Moscow Kazan,,,,,. To Samara Ulyanovsk Chelyabinsk Yaroslavl Within two years, partners expect to launch the reception of equipment for disposal in all 220 cities of M.Video and Eldorado. The plans of the Group and the Association are also to launch the process of recycling large equipment from home, the client will be able to order the export of equipment through, website contact center or stores "M.Video" and "Eldorado."

M.Video and Eldorado regularly host short-term actions to collect old equipment, and every year they attract more and more people. Customers, like us, are worried about what exactly happens to the equipment after it is left in the store. Now, thanks to a partnership with SKO Electronics - Disposal, we can track the last stage of the "life cycle" of any device not only within the framework of promotions, but also on a regular basis. We are launching a constant process of collecting old equipment, within the framework of which we can definitely guarantee that each handed over device will definitely be disposed of, and in the most friendly way for nature. It is very natural, logical, to hand over the equipment to where you acquired it, and the developed infrastructure of M.Video and Eldorado, our IT solutions will allow you to implement this project in most cities,

All equipment handed over in stores is taken into account and sent for disposal. A tripartite IT system between retailers, the Association and recycling enterprises allows you to track the path of each product. The Association "SKO Electronics - Recycling" is already cooperating with 11 recycling companies in different regions of the country, these recyclers have passed an incoming audit in accordance with the high requirements of the Association and confirm accreditation once a quarter. SKO Electronics - Recycling checks the entire processing cycle for compliance with current Russian and international environmental standards. The technical solutions used in Russia make it possible to reuse from 50 to 80% of the materials from which household appliances are made. On average, from one ton of used equipment, you can get 800 kilograms of raw materials for further production - plastic, metal, non-ferrous metals.

As part of a pilot project in St. Petersburg, through 26 stores within two months, partners collected and transferred more than 5,000 kg of used equipment for disposal. In total, during the year after the deployment of the project, most cities expect to collect up to 20 thousand tons.

M.Video-Eldorado Group undertakes the costs of equipment collection - paperwork, arrangement of storage in each store, personnel training. Transportation of equipment to recycling facilities and all recycling processes are paid by the Association.

2018

Shareholder information

At the beginning of 2018, the controlling shareholder of PJSC M.Video is SAFMAR Group Mikhail Gutseriev with 57.7% of the shares. 42.3% of the shares are in free float, of which, as of December 31, 2017, 9.4% belonged to the Future pension fund and another 5.8% belonged to the SAFMAR Group. Trust Pension Fund

Annual online turnover reached 77.3 billion rubles

The annual online turnover of M.Video-Eldorado Group, taking into account the results of the mvideo.ru 's work, eldorado.ru reached 77.3 billion rubles. Representatives of M.Video-Eldorado reported this to TAdviser on April 10, 2019.

Internet sales of M.Video in 2018 reached 53 billion rubles (including VAT), an increase of 46% compared to 2017, which is twice as high as in the market as a whole, due to traffic growth, conversion and an increase in the share of purchases of more expensive devices. Eldorado showed an increase in Internet sales by 8% to 25 billion rubles (including VAT). At the same time, the average Eldorado check grew by 37%, this is one of the highest speakers on the market, due to an increase in sales of digital categories and the transition to the omnichannel model, the group noted.

The share of online sales of the group as a whole amounted to 18.3%, the share of pickup - 74.4% in 2018.

The largest dynamics of online sales of household appliances and electronics in 2018 were shown in Omsk, where the growth was 50%, cities that showed an increase in Internet sales of about 30% - Krasnoyarsk, Rostov-on-Don, Moscow, Krasnodar, St. Petersburg, Kazan.

The leading positions of M.Video-Eldorado Group in online sales not only in the consumer electronics segment, but also in the Russian market as a whole clearly show that we successfully went beyond stores and became an online business. About 70% of our customers somehow use the Internet during the purchase process. This is convenient for the buyer: he can order on the Internet what he already knows, or, if you need to look at the goods live, come for him a store. This does not mean that stores are closing, on the contrary, we see that even global online players appreciate direct "real" contact with the consumer, while stores, if effective, become a competitive advantage online. Further development of retail will lead to the emergence of a format that we call One Retail within the M.Video-Eldorado group, within which the purchase process will become as mobile as possible both on the client's side and retail, and the boundaries for the buyer between the store, site, mobile application will be completely erased, "said Enrique Fernandez, Chief Executive Officer of the M.Video-Eldorado group.

Revenue 321.1 billion rubles (+ 62%)

• The Group's consolidated revenue increased by 62.0% in 2018 compared to 2017 to 321.1 billion rubles
• Consolidated gross profit of the company increased by 69.0% to RUB 78.6 billion, while gross margin improved by 1.0 percentage points year-on-year to 24.5% in 2018
• Consolidated EBITDA for the Group increased by 76.0% yoy to RUB 20.8 billion, while EBITDA margin increased by 0.5 percentage points yoy to 6.5% in 2018
• Consolidated net income for the Group increased by 20.3% yoy to RUB 8.4 billion in 2018

Key indicators for M.Video-Eldorado Group for 2018 (combined proforma):

• The combined pro forma revenue for M.Video-Eldorado Group grew by 15.7% yoy to RUB 352.5 billion in 2018
• The combined proforma gross profit of the company increased by 19.4% year-on-year and amounted to 86.7 billion rubles, and gross margin increased by 0.8 percentage points on an annualized basis to 24.6% in 2018
• The Group's combined proforma EBITDA increased by 39.2% yoy to RUB 21.3 billion, while EBITDA margin increased by 1.0 percentage points yoy to 6.0% in 2018

Collecting batteries and transferring them for disposal in 72 stores

November 01, 2018 Group M.VideoDorado"-," the Russian a retail company in the market electronic engineers and household appliances announced the start of a pilot to collect batteries with the support Duracell of the plant "." Megapolisresource M.Video has become a major federal one organizing the retailer collection of batteries and their transfer for disposal. Since the beginning of November 2018, residents Moscow can rent batteries in 72 M.Video stores. In 2019, the project will be launched in almost all cities of presence of both chains - M.Video and Eldorado. Thus, in 2019, the federal battery collection network will be replenished with 500 points.

M.Video stores have boxes in the form of a recognizable Duracell battery. These are specially designed containers for collecting batteries that meet all the requirements of safe storage. In them, store visitors can leave expired batteries of the most common formats - finger (AA) and pinky (AAA). Each box holds up to 35 kg of batteries. As part of the project, M.Video also trained its personnel in waste management. After filling the box, the batteries will be taken to the Megapolisresource plant; as of November 2018, this is the only battery processing enterprise in Russia.

When batteries are burned, dioxins and metals enter the air, which adversely affect health. However, with the efficient processing of cells from one ton of batteries, 940 kg of secondary raw materials (zinc, manganese, iron and graphite) can be obtained, which is subsequently used in industry, mechanical engineering, medicine and construction. A wide range of products are made from recycled batteries: from pencils to railway rails.

According to M.Video-Eldorado Group estimates, in 2019, when most stores of the network are connected to the project, companies can jointly collect about 100 tons of used batteries - this is about 5 million pieces of finger or 10 million pieces of pinky batteries.

When it comes to important social initiatives, retail has a significant advantage: we constantly communicate with millions of people - in stores, on the site, on social networks. With our help, customers can learn more about why it is so important to properly collect and dispose of batteries, the threats posed by batteries discarded with household trash. But there is little to tell about this, we need to organize the process so that our customers know exactly where to bring the batteries, so that they are disposed of without harm to the environment. Thanks to our partners Duracell and Megapolisresource, the issue of safe collection, export and disposal has been resolved.

author '= Vladimir Matsyuk, General Director of Megapolisresus GC ' Collecting used batteries in the same place they are sold is the most reasonable solution, because the collection uses the same infrastructure as distribution. This structure is optimal for all interested parties: manufacturers, citizens, retail and the state - and meets the trends of an eco-oriented economy. After all, there is no need to build additional infrastructure, only to use the existing one more efficiently.

Opening of M.Video stores m_mobile in the network of regional centers ADG group

On October 17, 2018, M.Video announced that it had agreed on a partnership with ADG Group, a developer of a retail project in Moscow. Free-standing stores under the M.Video sub-brand will m_mobile open in the network of ADG group district centers during 2019-2020. An agreement has been reached on the lease of space in seven objects of ADG group: Angara, Prague, Kyrgyzstan, Budapest, Dawn, Sofia and Orione.

In addition to renting retail space, the partnership provides for the implementation of joint marketing projects and events. M.Video group stores will open in ADG group district centers as facilities are launched in the next two years.

The ADG group network of district centers in residential areas of the city is a format of public spaces that combines leisure, educational and trade functions. As a result of the reconstruction, 39 old Soviet cinemas will turn into modern regional centers that will provide tenants and partners with direct access to 2.5 million Muscovites already living near the facilities. The development of cinemas in district centers is carried out by CJ CGV, which operates a network of multiplex cinemas in South Korea. As of October 2018, the company has more than 400 cinemas and 3,000 screens in several countries, Russia will become the seventh in the list of countries of presence of CJ CGV.

The constant search for modern formats and long-term partnership are one of the key priorities of M.Video in planning expansion. The network of regional centers ADG group occupies a free niche - modern multifunctional centers within walking distance for residents of residential areas of Moscow, and we see here a potential possibility of developing m mobile stores focused on digital technology. Within the framework of this concept, our stores can become not only a comfortable place to buy, but also convenient points for issuing online orders - for M.Video this is an organic format as part of the development of the omnichannel model. As of October 2018, about 850 stores operate under the M.Video and Eldorado brands, we expect to increase the network to 1100 stores by 2022.

The m_mobile store is the latest concept of M.Video chain stores. Only digital goods are presented on an area of ​ ​ about 200 sq.m. - a large selection of smartphones, accessories for them, smart watches, laptops, tablets, smart home gadgets and gaming devices. All goods are in open display, any gadget can be held in your hands and tested: listen to music with headphones, try the camera in a smartphone, etc. m_mobile stores also work as pick-up points for small-sized equipment: order a smartphone, laptop or headphones on the mvideo.ru and pick them up on the way home. For those who need to think about the purchase, a coffee zone works.

Opening of gaming areas in 4 stores in Moscow

On October 12, 2018, the retail chain M.Video"" announced the opening Russia in specialized gaming areas with a large range for fans. video games The M.Game project has combined several thousand products - consoles, laptops accessories and the games themselves, you can play in the store. As of October 2018, dedicated departments for gamers opened in four Moscow stores. By M.Video the end of 2018, several dozen additional zones will appear in more than 10 cities.

Thanks to the zoning and increased display area, store visitors will get the most complete view of the assortment, exclusive offers, profitable promotions held by M.Game, and trends in the gaming industry. This space contains several thousand titles of games and digital equipment, including laptops, consoles and accessories. In addition, a wide range of digital content is presented: in-game currency, digital codes, subscriptions, add-ons and much more. Participants of the M.Video bonus program can spend accumulated points for each game purchase not only on gaming products, but also on other categories.

The game zones implemented in the concept of touch-and-play suggest a radically different purchasing experience, an important component of which is testing the functions and features of consoles, accessories and the games themselves. Visitors to M.Video can immerse themselves in the world of virtual reality or try out their skills as an F1 driver in a real racing car.

Gaming equipment is one of the most popular and rapidly growing categories on the Russian market. At the end of nine months of 2018, sales of game consoles maintained their growth rates - demand in pieces and sales in money increased by 40% compared to the same period in 2017. The most noticeable dynamics were demonstrated by home consoles, in particular, the demand for Nintendo Switch more than doubled, and on Xbox One - one and a half times in unit terms. The demand for games for consoles is also consistently high thanks to regular releases of cult games - the year-on-year increase exceeded 15%. Interest in gaming is also stimulated by the accompanying categories - M.Video sees an increase in demand for gaming accessories (mice, keyboards and headsets), armchairs, VR glasses, steering wheels and gamepads.

We focused on the best international practices in the field of retail. This approach to zoning, mapping and navigation will allow us to meet the needs of game lovers, create a comfortable space for choosing the best products at the most favorable prices. We see a particularly promising solution for the implementation of demo equipment, since it helps the buyer here and now feel all the advantages of the presented goods.

Closing the deal with MediaMarktSaturn

On August 31, 2018, M.Video-Eldorado Group, a Russian seller of electronics and household appliances, part of Mikhail Gutseriev's Safmar Group, announced the closure of the deal in which MediaMarktSaturn acquired a 15% stake in M.video PJSC from Safmar Group, the company's largest shareholder, and M.Video-Eldorado Group acquired a 100% stake in Media-Saturn-Media LLC, Russian.

As a result of the transaction, the M.Video-Eldorado group received 42 MediaMarkt stores in 22 cities of Russia. The group plans to open about 60 stores under the M.Video or Eldorado brands in their place, depending on the location, competitive environment and customer audience. Some stores will open this year, the rest in the first half of 2019.

M.Video-Eldorado Group plans to fully integrate MediaMarkt stores, which is expected to improve their economic model and additionally receive up to 110 billion rubles in revenue and up to 11 billion rubles in EBITDA over the next four years. The Group tentatively forecasts total revenue for 2022 at 500 billion rubles and EBITDA at 35 billion rubles.

MediaMarkt stores are closing for rebranding from September 1, 2018. After the transaction, M.Video also undertakes obligations under the current exchange legislation, return and warranty repair of equipment previously purchased in MediaMarkt stores throughout Russia - buyers of MediaMarkt can contact any nearest store "M.Video." The company will also retain bonus points, accumulated under the MediaMarkt loyalty program, and will provide an opportunity to exchange gift cards previously purchased at MediaMarkt for M.Video cards.

The Group has submitted all necessary documents to register its interests in Media-Saturn-Rusland LLC with the tax authorities in accordance with the current Russian legislation.

The first results of the merger of M.Video and Eldorado are proof of the effectiveness of our business model, based on the preservation of two retail chains. Both networks were able to improve their operating and financial performance, and the group as a whole showed growth taking into account the first synergies realized. The acquisition of well-located MediaMarkt stores allows us to implement the previously conceived plans for the development of both chains in a short time - in their place we will open about 60 new hypermarkets M.Video and Eldorado. We will make every effort to preserve and develop MediaMarkt employees, "said Alexander Tynkovan, president of the M.Video-Eldorado group.

In turn, representatives of MediaMarktSaturn will receive positions of director and observer on the Board of Directors of PJSC M.Video.

As of August 31, 2018, after the closing of the transaction, M.Video PJSC has the following shareholder structure: Safmar Group controls 38.2% of the shares, MediaMarktSaturn owns 15% of the shares, 46.8% remain in free float on the Moscow Exchange.

Opening of the first two Apple service centers in Moscow

In August 2018, the M.Video chain opened the first two Apple service centers in its stores in Moscow in the Aviapark shopping center and the Furniture Grad shopping center. As planned, the presence of service centers directly in the store had a positive effect on the shopping experience, allowing to improve the quality of service for customers who prefer the Apple brand, the company noted.

German MediaMarkt bought a stake in M.Video from Gutseriev's structures

The German MediaMarktSaturn acquires a 15 percent stake in the Russian retailer from the Safmar group M.Video and transfers MediaMarkt Russia under the control of Safmara"." This is stated in a message on the website of the German company^[9][10]

An agreement was concluded between the companies, according to which, in exchange for a stake in M.Video, MediaMarktSaturn will pay Safmar €258 million. The purchase cost may decrease by €86 million, depending on M.Video's achievement of the established EBITDA indicators in 2018 and 2019 and tax deduction, the report says.

M.Video plans to join the European alliance of retailers and become its third member after MediaMarkt and the French Fnac Darty. After the entry of M.Video, the alliance will become the largest in its field with a total value of almost €34 billion.

In addition, MediaMarktSaturn will transfer its Russian business in the form of MediaMarkt Russia to the Safmar group.

"This transaction means that we will maintain constant activity in a large, constantly growing Russian market and have found a sustainable solution for our activities in Russia," said Peter Haas, CEO of MediaMarktSaturn.

The companies plan to close the deal this September.

Opening separately stores under the brand m_mobile

M.Video, a Russian seller of electronics and household appliances, part of the Safmar Mikhail Gutseriev group, announced the opening of m_mobile stores on April 13, 2018. m_mobile salons with an area of ​ ​ 200-300 square meters are focused only on the digital range - smartphones, laptops, tablets, gadgets for a smart home, gaming devices and related accessories and services.

The first store in this format opened in Moscow on the ground floor of the Afimall shopping and entertainment center.

All goods are in open display, any gadget can be held in your hands and tested: listen to music with headphones, try the camera in a smartphone, etc. Visitors can access the tariff plans of any of the four federal telecom operators, and smartphone buyers will be able to get a SIM card with a hit from their favorite prepaid operator as a gift. Expert "M.Kredit," if necessary, will issue an installment plan for the purchase. m_mobile stores also work as pick-up points for small-sized equipment: you can order a smartphone, laptop or headphones on the mvideo.ru and pick them up on the way home.

The m_mobile zones in the "store in store" format, focused on the sale of smartphones, related gadgets, accessories and services, have been operating at M.Video retail since the end of 2016. According to M.Video, the project showed good results: m_mobile turnover in 2017 increased by 14%, sales of accessories showed an increase of 54%. The share of revenue from digital categories in the total revenue of the company reached 27%.

Piloting free-standing stores focused exclusively on the sale of smartphones and gadgets is a logical development for m mobile. The M.Video brand is recognizable and associated with quality, high level of service, and positioning adds dynamics and expands the audience. Over the next few years, it is smartphones that will be the driver of the technology market. Individual m mobile stores are a modern open display, a truly wide range. The right place to buy electronics, "said Andrei Gubanov, director of the digital technology department at M.Video.

Purchase of Eldorado for 45.5 billion rubles

The transaction amount will be up to 45.5 billion, rubles excluding credit obligations of LLC Dorado"," which corresponds to a fair market estimate based on discounted cash flows conducted by the auditor from among the "Big Four." As part of the transaction, LLC M.Video Management will raise a loan of about 40 billion rubles and use its own free funds. The loan portfolio of the combined company after the completion of the transaction is expected at 47 billion rubles. The combined company's net debt to EBITDA measure will be 1.5x by the end of 2018. M.Video aims to systematically reduce the debt burden due to high financial discipline and increased cash flow of the combined business and reduce the ratio of net debt to EBITDA by the end of 2020 to 0.5x.

Corporate Governance

The management team headed by the founder of the business and the president of M.Video Alexander Tynkovan and the chief executive officer Enrique Fernandez will continue to manage the combined company and focus on the process of integration and creation on the basis of M.Video one of the leading players in the electronics market in the world. The operations business of the two companies will be headed by Enrique Fernandez. The combined company will continue to work within the framework of the best corporate governance practices, which will ensure transparency and efficiency of work in the interests of all shareholders.

It is expected that the company's joint revenue by 2022 will amount to more than 450 billion rubles, which will allow the Group to become one of the largest public companies in its sector, and by increasing the EBITDA margin to more than 6%, to enter the top three players in the global market of household appliances and electronics in terms of efficiency, whose shares are traded on the exchange. The combined company plans to create a single legal entity, while retaining two brands and competing networks.

Management relies on a significant increase in the operating efficiency of the company through combined commercial and non-commercial purchases and joint inventory management, simplification of the corporate governance system, optimization of IT infrastructure, and reduction of operating costs. According to M.Video estimates, the synergistic effect of the merger of two companies within one legal entity may amount to up to 18 billion rubles per EBITDA in 2018-2020, while doubling the combined EBITDA and net profit in the future for five years.

Repurchase of shares from minority shareholders

In accordance with corporate governance practices, M.Video PJSC makes conditions for the acquisition of Eldorado LLC for voting by VOSA, which will be held on April 13, 2018. Under current law, minority shareholders who disagree with the transaction or do not take part in the voting are entitled to present their own shares for redemption. The redemption price was determined by the Board of Directors of M.Video PJSC in the amount of 401 rubles per ordinary share based on the report of an independent appraiser and is close to the weighted average closing price on the Moscow Exchange over the past 12 months. Share repurchase claims must be made by the holders within 45 days of the date of the VOCA. If the transaction is approved by an extraordinary general meeting of shareholders, LLC M.Video Management plans to complete all formalities for the acquisition of LLC Eldorado during the second quarter of 2018. The companies plan to reorganize and create one legal entity by the first quarter of 2019, which will allow them to realize all the planned synergies.

2017

Revenue 198 billion rubles (+ 8.2%)

• Revenue of M.Video increased by 8.2% to 198 billion rubles (excluding VAT) in 2017. The growth was driven by both increased comparable store sales and strong online shopping dynamics, the latter accounting for 15.7% of revenue (12.0% a year earlier).
• The company's share in the home appliances market electronic engineers Russia reached 17.1%. In the reporting period, the company was able to significantly increase its share in the online market to a record 14.1% from 11.3% in 2016.
• Gross profit of M.Video amounted to 46.5 billion rubles in 2017, an increase of 8.4% compared to the same period last year. At the same time, gross profitability increased by 0.1 percentage point to 23.5%.
• The company's EBITDA showed significant growth, increasing by 14.0% compared to last year to 11.8 billion rubles.
• EBITDA margin was a record 6.0% in the last three years.
• Net profit of M.Video increased by 25.4% in 2017 to 7 billion rubles. Net profit margin was 3.5% in 2017, up from 3.0% a year earlier.

In November 2017, M.Video's sales on the Internet for the first time reached 20.2% of the company's total turnover, adding 8 percentage points. since the beginning of the year. The growth rate of M.Video's online turnover was three times higher than the market rate. So, in 11 months since the beginning of the year, the retailer's Internet sales have added 37%, while the entire market is only 10%.

The positive dynamics of Internet sales at M.Video is associated with a set of measures to improve the interface of the mvideo.ru website, deploy an updated online lending program, expand the range, improve logistics processes and remove restrictions on ordering. The company also improved the process of planning and launching promotions based on the study of purchasing behavior and using various mechanics. As a result, in November, traffic increased by 31% year-on-year, and the conversion rate by 65%. On average, these indicators increased by 19% and 10% over the year.

Siberia demonstrates the greatest increase in interest in Internet purchases, sales in November more than doubled compared to last year. Among the leaders are also the South (+ 90%), the Center (+ 84%) and the Urals (+ 83%). In general, in the year, online sales of M.Video in these regions also increased by one and a half times.

More dynamically than others, in monetary terms, sales on the Internet of smartphones and accessories (+ 159%), consoles, game content and other goods for gamers (+ 110%) and large household appliances (+ 22%) developed. At the end of November, small household appliances, smartphones and video games became the most popular Internet purchases.

M.Video and Alibaba begin partnership talks

The Chinese Alibaba Group has begun negotiations with co-owners and top management of M.Video on a possible participation in the capital of a Russian company or the creation of a joint venture. In November 2017, RBC was told about this by two sources familiar with the negotiations between^[11]

One of RBC's interlocutors says that in the near future, Said Gutseriev (son of Safmar founder Mikhail Gutseriev, the current owner of the company), who oversees the group's retail business, should travel to China to meet with Alibaba Group's top management in order to "determine the parameters of possible cooperation." According to the second source, the Chinese Alibaba is interested in gaining control in M.Video. Whether we are talking about the acquisition of only M.Video or all retail assets of the Safmar group (except M.Video, also owns the Eldorado network, as well as the marketplace goods.ru; all sites should be combined into Safmar Retail) RBC interlocutors do not specify.

Another RBC source close to one of the parties said that there is no "final configuration of possible cooperation" yet, but on the Russian side we are talking exactly about the entire retail group - i.e. about M.Video and Eldorado, as well as the condition that "all attracted investments should go to business development, and not cash-out shareholders."

2016

Sales of 216.2 billion rubles (+ 13.3%), including 25.9 billion via the Internet

• Sales increased by 13.3% to RUB 216.2 billion (incl. VAT);
• Comparable store (LfL) sales showed a 10.7% increase;
• Online sales ( delivery + pickup) increased by 26.6%;
• M.video opened 22 new stores, the retail area was 663 thousand square meters. m.

Comparable store (LfL) sales rose 10.7%. M.video demonstrates positive dynamics of key indicators due to double-digit growth in sales of all product categories and continues to increase its share in the market of household appliances and electronics.

Online sales of M.video (online orders with home delivery and pickup from stores) in 2016 showed an increase of 26.6% to 25.9 billion rubles, including VAT, from 20.4 billion rubles (including VAT) for 2015.

Fernandez succeeds Tach as CEO

On August 9, 2016, PJSC M.video announced the appointment of Enrique Fernandez to the position of Chief Executive Officer (CEO) of M.video Management LLC. The decision on appointment was approved by the Board of Directors of PJSC M.video on August 9, 2016.

The Chief Executive Officer (CEO) of M.video is responsible for the entire operations of the company, managed by the Retail Sales Directorate, the Commercial Directorate, the Marketing Directorate, the Directorate for Supply Management, Distribution and Logistics, Information Technology and Projects, the Financial Directorate, the Human Resources Directorate, the Retail Network Development Directorate and others. CEO of OOO M.video Management reports directly to Alexander Tynkovan, President and CEO of M.video Group.

Michael Tach, who previously held this position, decided to continue working beyond the perimeter of the M.video Group.

"The new management model of the company, introduced at the beginning of this year, has already proved its effectiveness - M.video has strengthened its leadership position in the market and is successfully piloting or has already launched a number of projects aimed at developing the segment of connected devices and services (connected services), online sales. I am grateful to Michael for his participation in the development of the business, the dynamics and positive motivation that he managed to bring. Michael leaves the company, and we made this decision together, since our views on the methods and pace of implementation of M.video's strategic plans turned out to be different, "said Alexander Tynkovan, President and CEO of M.video Group

.

2015: Retail sales 192 billion rubles (-5.5%)

In 2015, retail sales of the M.Video chain reached RUB 192 billion (including VAT), down 5.5% from 2014.

Sales of comparable stores of the M.Video chain (like-for-like, LfL) in 2015 decreased by 12.7%.

In the fourth quarter of 2015, retail sales of the M.Video chain decreased by 23.1% to RUB 61 billion (including VAT). The company explains the decline in sales by the high base of comparison: the indicators were higher in the IV quarter a year earlier and especially in December 2014 in the conditions of abnormally high consumer demand for home electronics due to fluctuations in the exchange rate.

At the same time, almost all of 2015 (with the exception of December), the company's sales remained positive against the background of a decrease in the volume of the market for household appliances and electronics in Russia.

Online sales of M.Video (online orders: home delivery + pickup from stores) in 2015 increased by 12.5% to 20.4 billion rubles. (including VAT) against 18 billion rubles. In 2014, showing a noticeable growth, despite the high comparative base of December 2014.

In 2015, the company opened 20 new hypermarkets, including 13 in the fourth quarter of 2015 (during the year, 10 stores were closed). At the end of 2015, the total number of M.Video stores was 378 hypermarkets operating in 161 cities of the Russian Federation. The retail area of ​ ​ M.Video stores has grown to 644.5 thousand square meters. m, total - up to 865 thousand square meters. m; area growth was 2% compared to 2014.

President of M.Video Alexander Tynkovan:

"We remain a financially sustainable entity with a high positive cash flow. Our sales via the Internet are growing steadily and now account for about 11% of the total network turnover compared to 9% a year earlier. We will also continue to open new stores: up to 20 new M.Video hypermarkets are scheduled to open in 2016.

2013

M.Video plans to buy 100% of the Eldorado network

In April 2013, it became known that the largest transaction in its history could take place on the Russian consumer electronics sales market. As it became known^[12]has a market share of more than 12%, intends to buy out its closest competitor, the Eldorado network (8.6%), from ^[12] Czech PPF Group. In 2011, retailers were already discussing the possibility of a merger, but then control in the combined company hoped to get, on the contrary, PPF. In April 2013, the M.Video network sent a petition to the Federal Antimonopoly Service (FAS) to acquire 100% of Eldorado's business, a Kommersant source familiar with the document said.

The Federal Antimonopoly Service of Russia (FAS Russia) approved the petition of M.video Management LLC to acquire 100% shares in the authorized capital of ELDORADO LLC with the simultaneous issuance of an order to M.video Management LLC on the implementation of actions aimed at ensuring competition in the Russian Federation.

Thus, M.video Management LLC is ordered to terminate the activities of M.video Management LLC within 6 months after the transaction and (or) ELDORADO LLC in part of the areas of retail facilities located on the territory of 35 constituent entities of the Russian Federation in order to reduce in the retail markets of household goods, as well as audio and video equipment in each of these constituent entities of the Russian Federation their total share to the level of 35% and provide the possibility of using the freed up space of their competitors.

In particular, it is necessary to terminate lease agreements and sublicense agreements, as well as to provide for the use of independent third parties trading facilities owned by.

Petition to the FAS for the acquisition of 100% Eldorado

On April 17, 2013, M.video filed a petition with the FAS to acquire a 100 percent stake in Eldorado from the Czech PPF Group. The value of the deal was not specified.

FAS restrains merger deal with Eldorado

On August 28, 2013, it became known that the merger of the companies selling household appliances electronic engineers M.Video and Eldorado again fell through.

As a representative of M.Video told Kommersant, consultations with PPF Group, which owns Eldorado, "have been suspended due to the instructions of the FAS and the lack of consensus on the terms of the transaction." What kind of conditions of the transaction are in question, M.Video did not explain.

The Federal Antimonopoly Service gave permission for the merger of M.Video and Eldorado - the two largest sellers of electronics and household appliances in Russia - in July 2013. At the same time, Vedomosti writes, the FAS ordered to close stores of one of the chains in 35 regions, including Moscow and the Moscow region, and give the vacated areas to competitors. According to expert estimates, we could talk about the closure of 40-60 stores. Moreover, as a source familiar with the negotiations told Kommersant, the possibility of closing exclusively Eldorado stores was considered.

2012: Sales growth by 20% to RUB 158 bn

Sales of M.video in 2012 increased by almost 20% to 158 billion rubles (including VAT). M.video's revenue growth was driven by the opening of 42 new stores, a 9.3% increase in like-for-like stores, including a 60% increase in online sales.

M.video's gross profit in 2012 increased by 20% to RUB 33 billion (RUB 27.5 billion in 2011), while the Group's gross profit margin in 2012 reached 24.7% (24.6% in 2011). In 2012, the Group changed the format of the presentation of the consolidated financial statements in terms of the classification of transportation expenses related to the shipment of goods from the Central Distribution Center to chain stores, attributing them to cost. In previous periods, these expenses were accounted for in terms of commercial, general and administrative expenses.

Operating profit of M.video (EBIT) in 2012 increased to 5.4 billion rubles (4.6 billion rubles in 2011), operating profitability (EBIT margin) of the Group in 2012 amounted to 4% (4.1% in 2011).

In the reporting period, M.video's EBITDA increased to RUB 7.5 billion compared to RUB 6.2 billion in 2011. The Group's EBITDA margin in 2012 was 5.6% as in the previous year.

Net profit of M.video under IFRS in 2012 increased by 23% to RUR 4 billion compared to RUR 3.4 billion in 2011.

2011

Raid on stealing managers

In November 2011, the Ministry of Internal Affairs announced the detention of M.Video managers who tricked themselves into charging themselves money for bonus cards. The retail chain admits that their employees periodically sin with this, but argue that none of the managers were detained - such problems are usually solved within the company.

As a source in the Ministry of Internal Affairs told CNews, yesterday on Profsoyuznaya Street in Moscow, law enforcement agencies detained two managers of M.Video on suspicion of fraud. According to him, a criminal case was initiated against them under the relevant article.

According to the source, using their official position, they acquired store bonus cards, to which they credited bonus funds for the purchase of non-existent goods, and then transferred the cards to their acquaintances.

The source did not want to disclose other details of the incident, referring to the fact that accomplices in the fraud are now wanted, and any disclosed details may prevent the detention of the entire group of suspects. Interfax reports that the total amount of bonuses accrued by fraudsters amounted to about 500 thousand rubles.

According to the Criminal Code of the Russian Federation, for fraud committed using official position, you can pay a fine of 100-500 thousand rubles. either in the amount of the salary or other income of the convicted person for a period of 1 to 3 years, or imprisonment for up to six years with a smaller fine.

M.Video did not refute the very fact of card fraud in their store, but claim that none of their employees were detained. The network also denies that any of the employees were prosecuted in this matter.

"Third-party people related to fraud may have been detained," a source close to the store chain suggested.

The representative of M.Video Anton Panteleev told CNews^[13]similar cases periodically occur in their network, but are not taken out of the hut, but are always decided within the company, and no one appeals to law enforcement agencies. "In such situations, we conduct an internal investigation, service checks, on the basis of which we ourselves take action," he says.

A source in the Ministry of Internal Affairs suggests that M.Video "" denies "the fact of the detention of its employees, so as not to interfere with the course of the investigation and the search for accomplices in the crime.

Unsuccessful attempt to merge with the Eldorado network

In 2011, the Czech company PPF Group, which owns the Russian chain for the sale of household appliances Eldorado, wanted to gain control of the combined company with M.Video as a result of an exchange of shares. However, after preliminary negotiations that lasted about a month, it was announced that the deal would not take place. Sources close to the talks said at the time that the parties had failed to agree on a price. PPF was evaluated by M.Video based on the stock prices of this company, and M.Video believed that the company is much more expensive.

Sharp growth in reader sales

M.video sold 3,000 readers in the first half of 2010, and 50,000 in January-June 2011, says network spokesman Anton Panteleev. During 2010, the average price of the device decreased from 11,700 to 7350 rubles, and in the summer of 2011 readers get cheaper by 5-7% every month, he notes.

2008: Sales growth to 84 billion rubles (+ 37 %)

The sales volume of the M. Video network in 2008 increased by 37% and amounted to 84.4 billion rubles (including VAT). At the same time, M.video's net revenue under IFRS in 2008 increased to RUB 71,486 million compared to RUB 52,317 million in 2007. The Group's net retail revenue (retail sales, including revenues from Internet trading) in 2008 increased by 41% to RUB 68,131 million. The growth of M.video's revenues in 2008 was due to an increase in the number of chain stores, as well as an increase in sales of comparable (like-for-like) stores.

In 2008, M.video's gross profit under IFRS amounted to RUR 17,876 million, an increase of 49% compared to 2007. Gross margin increased to 25% compared to 22.9%. a year earlier. The improvement in gross margin in 2008 was driven by an increase in the Group's sales volumes and increased sales of highly profitable goods and services.

EBITDA M.video grew by 38% to RUB 3,596 million in the reporting period. Margin margin (EBITDA EBITDA margin) increased to 5.03% in 2008 compared to 4.98% in 2007.

In 2008, M.video's net profit under IFRS increased to RUB 1,256 million, an increase of 94% compared to 2007.

Notes