The Russian chain of fixed price stores Fix Price announced, that will carry out the buyback of global depositary receipts for up to 4 billion rubles.
The company stated, that the market capitalization of Fix Price does not reflect the true value of the business. The cost of the retailer's receipts on the Moscow Exchange is below the IPO level - in the region 400 R, while rising higher after the March 2021 placement 740 R.
The program will start 24 January and will last six months, to 23 July 2022. Receipts on the Moscow Exchange will be redeemed by VTB Capital, and Fix Price will buy them from the bank. Acquired GDRs will become treasury, the company will be able to use them to motivate employees or pay off.
After the announcement of the GDR Fix Price on the Moscow Exchange rose and 24 January at the maximum were traded at 425 R for receipt - against 393 P at the opening. However, to 17:05 the company lost growth: receipts were traded at 392,5 R for pike. On the London Stock Exchange, the value of one GDR was 4,96 $, this is -2.57% by the close of the session 21 January.
How the Fix Price business feels
24 January, the company also released operating results for the fourth quarter and all of 2021..
In 2021, revenue increased by 21,3% thanks to the opening of new stores and amounted to 230.5 billion rubles. The company's profit margin was not disclosed., but they said, which expect an annual EBITDA margin of about 19%.
On 31 December, the network consisted of 4904 stores, the company opened 737 new stores in a year.
However, comparable sales (like-for-like) in stores, who have been working for over a year, rose to 7,2% for the year. Previously double digit growth: 15,8% in 2020 and 15,4% in 2019.
In the fourth quarter of 2021, Fix Price sales increased by 14,5%, up to 66.5 billion rubles. LFL sales increased by 3,2% - against 15,7% at the end of 2020. The slowdown is associated with a drop in store attendance due to an increase in the incidence of coronavirus in November-December 2021, explained in the company.
Besides, Coronavirus restrictions have affected individual stores, including a self-isolation regime for senior citizens and the requirement to show a vaccination confirmation QR code to visit shopping centers in some regions.
Against the backdrop of a new wave of pandemic, buyers began to behave “more restrainedly”, concluded in Fix Price. In addition to the COVID-19 pandemic and related restrictions, the retailer's business was affected by high inflation in 2021, exchange rate volatility and rising transport costs.
