Dixy Announces 86% Jump in '07 Net Profit

Dixy, the country's third-largest listed supermarket chain, said Wednesday that net profit grew 86.2 percent to $16.7 million in 2007 on efforts to expand its customer base.

Net sales jumped 43.7 percent to $1.43 billion, pushed by the opening of 65 new stores, and earnings before interest, tax, depreciation and amortization grew 68.5 percent to $74.9 million, the company said in a statement.

Dixy president Vitaly Klyuchnikov said in the statement that efforts to expand the company's customer base and development of retail formats had enabled it to increase its profitability.

The chain, which raised $360 million in a IPO in May, said it would use the proceeds to roll out new stores, repay debts and carry out a rebranding in 2008 or 2009. Dixy will open around 100 new stores this year, Klyuchnikov said.

Dixy Group, which owns food retail chains Dixy, Megamart and Minimart, said it decreased debt and debt service costs dramatically in 2007, with net debt falling to $183 million in December, from $231 million a year before.

"Dixy Group financial results for 2007 surpassed all expectations," said Andrei Verkholantsev, a consumer analyst with Antanta Capital. "We had expected net sales and EBIDTA figures to be at least 7 percent or 8 percent lower."

He said Dixy debt figures reflected an effective use of funds raised through the IPO last year.