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PJSC Magnit Annual Report 2024

Company Overview

Who we are

Magnit is one of Russia’s largest retailers with a total selling space of 10,934 thous. sq. m and 31,483 stores of various formats operating in 72 regions of Russia and in the Republic of Uzbekistan.

2,363

DIXY convenience
stores

8,050

drogerie
stores

456

supermarkets

20,268

Magnit convenience stores

1,084

pharmacies

Own production

21

production facilities


7 - agricultural sites

14 - manufacturing sites

Distribution centres

>2 

mln sq. m

of DC space

88%

orders assembled using voice picking technologies

80%

warehouse operations mechanisation rate

Retail Offline retail

31 483

stores

Retail revenue breakdown by format, %

68.8 Magnit convenience stores

10.8 DIXY convenience stores

8.8 Supermarkets

7.5 Drogerie stores

4.1 Other formats

Customers

~18 

mln

customers daily

80 

mln

loyalty cards

72 

regions

>33 

thous.

self-checkouts at Magnit stores

>21 

mln

users of the OMNI mobile app

Suppliers

>5 

thous.

supplier companies

47% 

share of local suppliers

62 

private labels

>750

new Russian supplier partners in 2024

Retail Online retail

RUB  100.6 bln

digital sales

Proprietary marketplace:
Magnit Market

Magnit Delivery

~190 thous.

average number of orders per day

Planets Production Markets Distribution Home Factor Delivery

The largest retail chain by number of stores and geographic coverage

The only retailer with its own marketplace

Vertically integrated retailer


Mission

At Magnit, we are committed to continuous operational improvement and professionalism in all areas of activity, while aiming to deliver exceptional quality and customer service.

2,363

DIXY convenience
stores

8,050

drogerie
stores

456

supermarkets

20,268

Magnit convenience stores

1,084

pharmacies

Own production

21

production facilities


7 - agricultural sites

14 - manufacturing sites

Distribution centres

>2 

mln sq. m

of DC space

88%

orders assembled using voice picking technologies

80%

warehouse operations mechanisation rate

Retail Offline retail

31 483

stores

Retail revenue breakdown by format, %

68.8 Magnit convenience stores

10.8 DIXY convenience stores

8.8 Supermarkets

7.5 Drogerie stores

4.1 Other formats

Customers

~18 

mln

customers daily

80 

mln

loyalty cards

72 

regions

>33 

thous.

self-checkouts at Magnit stores

>21 

mln

users of the OMNI mobile app

Suppliers

>5 

thous.

supplier companies

47% 

share of local suppliers

62 

private labels

>750

new Russian supplier partners in 2024

Retail Online retail

RUB  100.6 bln

digital sales

Proprietary marketplace:
Magnit Market

Magnit Delivery

~190 thous.

average number of orders per day

Planets Production Markets Distribution Home Factor Delivery
Company Overview

Key highlights

  • Number of stores,

    • 20,725 2019
    • 21,564 2020
    • 26,077 2021
    • 27,405 2022
    • 29,165 2023
    • 31,483 2024
  • Headcount,
    thous.

    • 308 2019
    • 316 2020
    • 357 2021
    • 361 2022
    • 361 2023
    • 368 2024
  • Number of tickets,
    mln

    • 4,690 2019
    • 4,641 2020
    • 5,147 2021
    • 5,932 2022
    • 6,190 2023
    • 6,671 2024
  • Revenue,
    RUB bln

    • 1,369 2019
    • 1,554 2020
    • 1,856 2021
    • 2,352 2022
    • 2,545 2023
    • 3,043 2024
  • EBITDA margin,
    %

    • 6.1 2019
    • 7.0 2020
    • 7.2 2021
    • 6.8 2022
    • 6.5 2023
    • 5.6 2024
  • Net income margin,
    %

    • 1.2 2019
    • 2.4 2020
    • 2.8 2021
    • 1.4 2022
    • 2.6 2023
    • 1.6 2024
  • 29% in 2023 vs the 2019 base year
    42%
    reduction in specific greenhouse gas emissions
  • 55% in 2023 vs the 2019 base year
    65%
    reduction in specific water consumption
  • 59% in 2023 vs the 2019 base year
    59%
    reduction in specific food waste generation
  • 29% in 2023 vs the 2019 base year
    29%
    reduction in specific electricity consumption
  • 81,1% in 2023
    81.2%
    employee satisfaction rate
  • 86% in 2023
    87.1%
    employee engagement rate
  • RUB 598.5 mln in 2023
    RUB 561 mln
    spending on social and charitable projects
Company Overview

Key developments of 2024

5 March 2024
Magnit celebrates its 30th anniversary and expands to 30,000 stores.
years
putting our customers
at the heart
of everything we do
8 July 2024
Magnit launches the AI.Lab artificial intelligence laboratory.
19 January 2024
Magnit completes the acquisition of a 33.01% stake in Samberi.
9 October 2024
The Company develops its own Forecasting & Replenishment system.
29 May 2024
The loyalty programme relaunches as Magnit Plus.
16 May 2024
The Company develops its Magnit Market marketplace, increasing pick-up points and expanding to new cities.
Quality, convenience, and comfort for our customers

30 years of serving customers

Quality, convenience, and comfort for our customers

Investment case

Magnit offers investors access to a sizeable market
Magnit boasts a recognisable brand with strong customer loyalty
Magnit leverages tech capabilities to drive business growth
«Magnit offers high dividend yield

Investment case

For investors, we offer exposure to a sizeable market with potential for organic expansion and further consolidation.
Sizeable market with increasing penetration of modern food retail and opportunities for organic expansion.
01
Fragmented market with high potential for further consolidation.
02
Growing market share of major players.
03
New niches and growth opportunities coming along in the consistently growing e-grocery segment.
04
Magnit is one of the largest food retailers in Russia, with a well-developed infrastructure, a strong customer base, a recognisable brand, and a growing market share.
Multiformat offering with four core formats covering a range of shopping missions in grocery, drogerie, and pharma segments.
13.2% market share in food retail sales.
Established distribution chain, with 51 distribution centres and one of the largest own truck fleets in Russia.
Wide coverage: 31,483 stores in 4 594 cities and townships across eight federal districts.
Serving customers in all highly populated Russian regions (72 regions, 80 mln loyalty cards).
Vertically integrated retailer: 21 own production facilities, including seven agricultural complexes.
Strong capital discipline with a focus on returns in all investment decisions with a view to generating substantial dividend payments.
Focus on the quality of new store openings as a way to maximise ROI.
Clear plan to improve working capital with a focus on stock days optimisation.
Keeping Net Debt / EBITDA at a comfortable level.
Value accretion for shareholders to deliver consistently solid dividends.
On track to speed up profitable returndriven growth leading to further market share gains.
We are consistently working to unlock the Company’s huge potential to grow the business.
Acceleration of value-accretive organic growth.
Smart expansion implying high profitability targets for new openings.
Selective small to mid-size value-accretive M&As to strengthen market positions.
Adherence to sustaining high return requirements for new projects.
Store redesign programme to improve sales density.
Building a leading e-grocery platform to account for over 5% of total turnover.
Proactive forays into adjacent value-accretive niches.
Further CVP improvement. In 2023, the Company unveiled three new CVP concepts for DIXY, Magnit Convenience, and Magnit Pharmacy stores.
CVP initiatives to enhance consumers’ perception and experience with a focus on expanding the range of private labels, farm and healthy products and on revamping store interiors.
Increase in sales density partly through redesign acceleration and process improvements.
Extension of consumer offering complementary to the core business: in 2023, the Company piloted the ultra-convenience and First Choice hard discounter formats.

Our strategic ambition

Our strategic ambition is to achieve market leadership through a unique multiformat offering, supported by a broad ecosystem of tech-driven services, all integrated under a single loyalty programme.

Strategy

Enhancing customer value proposition

  • Adapting product assortment to local customer preferences

  • Broadening and differentiating the private label offering

  • Enhancing customer engagement through in-store add‑on services (e.g., bakery items, takeaway coffee), delivering more personalised experiences through big data analytics and AI, and offering compelling loyalty programmes

  • Continuously enhancing loyalty programme mechanics

  • Improving brand positioning by emphasising care, safety, sustainability, and an attractive value proposition

  • Expanding tech-driven ecosystem services to enhance multi-channel customer experiences

Developing the Company’s key asset — our employees

  • Implementing a flexible and proactive approach to personnel attraction

  • Intensifying investment in people to ensure key competences and business continuity

  • Continuously improving working conditions for line personnel

  • Designing long-term development and succession plans

Driving efficiency improvements

  • Flexible organisational structure with clear responsibilities, combined with entrepreneurial culture and efficient cross-functional collaboration

  • Monetisation of online and offline infrastructure

  • Fleet renewal

  • Cross-functional end-to-end initiatives focused on improving the efficiency of key business processes

  • Flexible, reliable and scalable cloud-based IT solutions and data platform

  • New distribution centre openings

  • Investments in process automation and standardisation

We implement 
our strategy 
through 
customer 
engagement 
across 
our 
core 
existing 
formats, 
relying on: 

We 
leverage 
new 
growth 
drivers 
to 
broaden 
our 
product 
offering 
and 
enhance 
customer 
convenience 
by 
developing: 

Image

Development of our flagship convenience store format

Image

Smart investments in the Magnit Cosmetic drogerie format

Image

Balance between sustaining and expanding the Magnit Family and Magnit Extra hypermarket formats

Image

Discounter stores

Image

Ultra-convenience stores

Image

E-commerce delivery and the Magnit Market marketplace, both accessible through a single super app

Sustainable development

Sustainability Strategy

The Sustainability Strategy is the Company’s key sustainable development document. Developed in 2020, the Strategy is focused on an analysis of the Company’s current and potential environmental and social impact, as well as an analysis of the retail industry and stakeholder opinions. The Company has identified five strategic areas: environment, sustainable supplies, employer brand development, supporting local communities and volunteering, and promoting healthy lifestyles.

Magnit tracks progress against the goals, comparing quantitative performance with the baseline of 2019. For qualitative goals, a set of KPIs is established to reflect progress. The indicators are analysed on a year-on-year basis and may be supplemented to reflect changes in the business.

In 2024, the Company began the development of a new Sustainability Strategy that represents Magnit’s vision for the next five years, takes into account new products and services, as well as changing customer preferences. The document will maintain the continuity of the current strategy, incorporate global ESG trends, and align with Russia’s national goals until 2030, and adjust to the business dynamics with the focus on measurable quantitative goals.

The Company actively integrates sustainability principles into all aspects of its operations. Recent years have been marked by significant progress in this area, thanks to our established sustainability management system and clearly defined strategic priorities.
Sustainable development

Sustainability Strategy 2025

Sustainable development
Leadership in environmental impact reduction
Creation of a 100% responsible supply chain
Status of the number one employer in the industry
Positive impact on the quality of life of all Russians
Improvement in the quality of life for consumers and local communities
Strategy goal achieved
Strategy goal in progress
Target for 2025
Progress towards our goals

50% of private label and own production packaging to be recyclable, reusable or compostable

  • 72% of private label packaging is potentially recyclable

100% of recyclable plastics used in own operations to be collected and recycled

  • 100% of plastic waste is sent for recycling

50% reduction in specific food waste generation

  • 59% reduction in specific food waste generation compared to the baseline of 2019

30% reduction in specific GHG emissions

  • 42% reduction in specific GHG emissions compared to the baseline of 2019

25% reduction in specific water and electricity consumption

  • 65% decrease in specific water consumption compared to the baseline of 2019
  • 29% decrease in specific electricity consumption compared to the baseline of 2019
Target for 2025
Progress towards our goals

100% responsible sourcing for socially important categories

  • 66% share of Russian-made products in the range of socially important goods 79.7% in 2023
  • 40% private label share in the range of socially important goods 33% in 2023

100% responsibility for own production and agriculture

  • 77% share of domestic agricultural feedstock used in own production 76.4% in 2023

Partnership programmes for local suppliers and farmers

  • 18% increase in sales of local suppliers’ products 9% in 2023
  • 37% increase in product supplies under agricultural contracts 22% in 2023
  • 1,061 Russian suppliers became new partners of Magnit 1,158 in 2023
Target for 2025
Progress towards our goals

70% employee satisfaction rate

  • 81.2% employee satisfaction rate

50% reduction in lost time injury frequency rate, zero fatalities

  • 0.83 injury frequency rate
  • 12% decrease in LTIFR
    compared to 2023

40% maximum staff turnover rate

  • 64.5% staff turnover
Target for 2025
Progress towards our goals

Community programmes throughout all our regions of operation

  • 100% regions of the Company operation covered by the programmes

10% volunteering employees

  • 28,351 unique volunteers
    within the Company 21,445 in 2023
  • representing 9% of the average headcount 7% in 2023
Target for 2025
Progress towards our goals

Information about healthy lifestyles and nutrition available to all customers

  • Over 10 million unique monthly users of the Gastronom website
  • Over 7 million readers of the My Magnit magazine

Healthy products available to all customers

  • 28% share of healthy food among the Company’s private labels 28% in 2023
  • RUB 516 mln sales
    of the Lifestyle healthy food brand RUB 695 mln  in 2023
  • 447 stores have Health Islands 475 in 2023
  • 836 Health Islands 693 in 2023
Sustainable development

Our achievements

Sustainable development
Gold
in Forbes ranking of Russia’s best employers
Resg2
high level in AK&M ranking of non-financial reporting
A+
highest position in the Corporate Charity Leader ranking organised by the Donor’s Forum Association
Winner
of the Retail Week Awards in the ESG Project of the Year in Retail category (Retail Event)
Group С
in RSPP Sustainability Vector Index
Group В
in RSPP Responsibility and Transparency Index
No. 1
at the Open to All competition of inclusive practices in the Corporate Policy category (ASI)
No. 1
in the ESG ranking of Russian consumer and non-financial services companies (NRA)
No. 2
at the Silver Mercury 2024 contest in the Best Creativity in HR and Internal Communications category
No. 3
at the Red Apple 2024 Moscow International Advertising Festival in the Environmental, Social, and Governance category