X5 boosts logistics in Central Russia

Yaroslavl, 4 October 2018 X5 Retail Group ("X5" or the "Company"), a leading Russian food retailer (LSE and MOEX ticker: FIVE), announces the development of logistics infrastructure in the Central Federal District and the opening of a distribution centre (DC) in Yaroslavl.

The 34,000 sq m Yaroslavl logistics facility will serve over 500 Pyaterochka stores in the Yaroslavl, Arkhangelsk, Vologda, Ivanovo and Kostroma regions. With six separate temperature zones, the facility is designed to store nearly all categories of goods.

The new distribution centre will help ensure that goods are always fresh and available, even as Pyaterochka continues its active expansion, contributing to lower transportation costs and unlocking new opportunities for local suppliers. The Yaroslavl DC will be the focal point for local suppliers to increase their sales, bring products to other regions and significantly cut delivery costs. At its full capacity, the distribution centre will be able to handle and store products from 500 plus suppliers.

The new logistics facility will help enhance the share of local goods, which already account for more than 20% of Pyaterochka's product mix in the Yaroslavl Region. In 2017, X5 Retail Group added 11 producers from the region to its supplier list. Pyaterochka is already partnered with Yaroslavsky Broiler (poultry) which delivers its produce to the format's stores in 10 Russian regions, Atrus (meat products, bakery), Danilovskiye Syry Trade House (dairy products) and many others.

The Yaroslavl DC's around-the-clock operations will be supported by 400 local residents. Overall, Pyaterochka's facilities and stores have provided over 2,000 jobs in the Yaroslavl Region.

X5 is actively developing its logistics infrastructure, which is essential to ensure the smooth operation of its stores. This will be one of the Group's strategic focus areas for the next few years. For the past three years, X5 Retail Group has opened 23 distribution centres, with a total area of 598,000 sq m. As of 30 June 2018, it operates 40 DCs.

Currently, there are over 150 Pyaterochkas in the Yaroslavl Region, with more than 80 of them in Yaroslavl. By the end of the year, eight more stores are to open up in the region, of which at least one will be located in the regional centre.

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