* Sees sales rising 12-16 pct in 2014 vs 15-19 pct
* Lowers like-for-like sales growth forecast to 5-6 pct
* Q1 sales up 13 pct, like-for-like sales up 4 pct
* Maintains core profit margin forecast of 8 pct
(Releads with guidance downgrade, CEO comments)
MOSCOW, April 29 Russian food retailer O'Key
on Tuesday lowered its sales growth forecast for the
year and pledged to reinforce project management to deliver on
"I believe that a realistic target for revenue growth is
between 12 and 16 percent," said Chief Executive Tony Maher on a
O'Key replaced the previous CEO in January after he
struggled to meet expansion targets. The company missed its new
store opening guidance last year and forecast sales growth would
slow to 15-19 percent in 2014 from 19 percent.
Maher also cut the like-for-like sales growth outlook to 5-6
percent from 5.5-6.5 percent, while confirming a core profit, or
EBITDA margin forecast of 8 percent.
He said the company aimed to open eight hypermarkets, of
which three had already opened, and five supermarkets this year,
resulting in an around 14 percent increase in its selling space.
"The track record of our openings of the last 18 months has
not been what we'd like. We are looking at making sure that we
are opening stores not for the sake of opening them but opening
in a way that is profitable... We just need stronger project
management than we've had up to now," said Maher.
In the first quarter, the company's sales grew 12.7 percent
to 35.1 billion roubles ($977.4 million) while like-for-like
sales increased 4.1 percent on the back of inflation.
But the number of transactions in comparable stores dipped 2
percent which the company blamed on increased competition.
O'Key also said earlier on Tuesday that it swung to a
first-quarter net loss of 22.2 million roubles from the year-ago
profit of 144.5 million roubles due to foreign exchange losses
and a tax charge related to the payment of dividends.
($1 = 35.9120 Russian Roubles)
(Reporting by Maria Kiselyova, editing by William Hardy)