Russia's X5 reports 23% increase in fourth-quarter sales

X5 Retail Group, Russia s largest retailer in terms of revenue, said Tuesday that fourth-quarter net retail sales rose 23% year-on-year in ruble terms to 78.56 billion rubles or 11% in U.S. dollar terms to $2.6 billion. The company s like-for-like sales grew 7% in ruble terms year-on-year, supported by 5% traffic growth.

In 2010, X5 expects to deliver net sales growth comparable to the 2009 pro-forma level. On a pro-forma basis, full-year 2009 net retail sales grew 25% year-on-year in ruble terms and declined 2% in U.S. dollar terms. The company also confirmed its expansion and capital expenditure outlook for 2010; it plans capex of up to 18 billion rubles.

Fourth-quarter trading results were strong despite trading down by consumers, thanks particularly to targeted New Year s and Christmas promotions in December and continued focus on price and assortment, said Lev Khasis, chief executive of X5 Retail Group, in a statement. Russia's new retail law comes into effect in February and creates certain restrictions for retailers in terms of expansion.

Khasis said that the impact on X5 will be limited to St. Petersburg, where we are by far the market leader.