8 September 2016

X5 launches major upgrade of logistics cluster in north-west Russia

St. Petersburg, 8 September 2016

X5 Retail Group (“X5” or the “Company”), a leading Russian food retailer (LSE ticker: “FIVE”), announces the development and optimisation of its logistics infrastructure in the north-west of Russia and the opening of a distribution centre (DC) in St. Petersburg.

With over 27,000 sq m of space, the St. Petersburg – Yug logistics facility will supply 889 Pyaterochkas in eight regions: St Petersburg plus the Leningrad, Arkhangelsk, Vologda, Novgorod, Murmansk and Pskov regions, as well as the Republic of Karelia. The DC covers a total of 298 cities, towns and villages in the Northwestern Federal District. Featuring five storage zones, each with distinct temperature zone, the facility is designed to accommodate all categories of goods.

St. Petersburg – Yug marks a new milestone in the development of X5’s logistics infrastructure in the north-west of Russia, with the aim of optimising the number of DCs in the Federal District while also increasing capacity and capabilities. This is the first in a series of multi-format, next-generation DCs the Group will use to ensure the availability and freshness of products during Pyaterochka’s rapid expansion, while also cutting logistics costs.

X5 Retail Group invited managers of over 60 suppliers from St Petersburg, the Leningrad, Pskov, Novgorod and Vologda regions to take part in the ceremony. The launch of the new logistics facilities offers them vast opportunities to develop cooperation with X5’s retail chains, materially reducing logistics costs and boosting supplies to X5 stores, including through wider geographic reach.

At its full capacity, St. Petersburg – Yug will be able to process and handle products from over 200 local suppliers. Currently, the share of local supplies in the offering of Pyaterochka stores in the north-west of Russia stands at 27%, while in some categories (like bread and bakery) it reaches as much as 95%.

This advanced logistics facility is X5’s second DC to open in St. Petersburg this year and the sixth one launched across Russia in 2016. Previously, X5 opened five distribution centres with a total area of 164.5 thousand sq m: one each in St Petersburg, the Moscow region and Chelyabinsk, and two in the Republic of Adygea.

The opening of St. Petersburg – Yug has helped create almost 500 additional jobs in the region.​