1st Quarter Results

Press-release

Krasnodar

May 17, 2010

OJSC "Magnit" announces unaudited 1Q 2010 operating and financial results

Krasnodar, May 17, 2010: OJSC "Magnit" (the "Company"; RTS, MICEX and LSE: MGNT) is pleased to release its 1Q 2010 financial results prepared in accordance with IFRS[1].

During 1Q 2010 the Company added 90 stores (89 convenience stores and 1 hypermarket) and increased its selling space by 27.90% in comparison to 1Q 2009 from 854.26 thousand sq. m. to 1,092.61 thousand sq. m. The total store base as of March 31, 2010 reached 3,318 stores (3,293 convenience stores and 25 hypermarkets).

Revenue in rubles increased by 28.09% YoY from 38,263.13 million RUR in 1Q 2009 to 49,009.71 million RUR in 1Q 2010. The top line growth was due to an increase in selling space as well as to a 2.81% increase of like-for-like sales (excl. VAT). Revenue growth in dollar terms amounted to 45.40%: from US$ 1,127.68 million to US$ 1,639.65 million due to significant change of US$ exchange rate[2].

Gross margin reduced from 23.29% in 1Q 2009 to 21.87% in 1Q 2010. Gross profit in rubles increased by 20.29% from 8,909.74 million RUR (US$ 262.59 million) to 10,717.51 million RUR (US$ 358.56 million).

EBITDA increased by 7.98% from 3,450.08 million RUR (US$ 101.68 million) in 1Q 2009 to 3,725.43 million RUR (US$ 124.64 million) in 1Q 2010. EBITDA margin in 1Q 2010 amounted to 7.60% which is 1.42% below the figure of 1Q 2009 (9.02%). The reduction of EBITDA margin compared to 1Q 2009 was mainly conditioned by spread between reduction of mark-up and improvement of purchasing conditions. Besides, it is important to note that about 0.5% of EBITDA margin in 1Q 2009 was contributed by the additional mark-up on products due to the increase of sale prices on the back of the growth of the dollar exchange rate within the reported period. Net debt/EBITDA ratio (in ruble terms) for 1Q 2010 amounted to 0.27.

1Q 2010 net income increased by 7.21% and amounted to 1,930.41 million RUR (US$ 64.58 million) vs. 1,800.57 million RUR (US$ 53.07 million) in 1Q 2009.

Sergey Galitsky, the Company's CEO, provided the following comments on the published 1Q 2010 results:

"First results of price investments support the right and well-timed strategy. We see a positive trend of traffic and average ticket, at that we confirm our EBITDA margin guidance of 8-9% for 2010".

1Q 2010 Key Operating Results

1Q 2010 to 1Q 2009 LFL results[3]

1Q 2010 Key Financial Results

Note: net revenue in US$ terms is calculated using the daily exchange rate.

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Company description:

Based in Krasnodar, in the Southern region of Russia, Open Joint Stock Company "Magnit" is the holding company for a group of entities that operate in the retail trade under the "Magnit" brand. The chain of "Magnit" stores is one of the leading food retail networks in Russia. As of December 31, 2009 the chain consisted of 3,204 convenience stores and 24 hypermarkets in 1,048 locations in the Russian Federation.

Approximately two-thirds of the Company's stores are located in cities with a population of less than 500,000 inhabitants. Most of its stores are located in the Southern, North-Caucasian, Central and Volga regions. The Company also operates stores in the North-Western and Urals regions.

As of December 31, 2009 the Company operated an in-house logistics system consisting of 9 distribution centers, employing automated stock replenishment systems and a fleet of 1,453 vehicles.

In accordance with the audited IFRS consolidated financial statements for the twelve months ended December 31, 2009, the Company recorded consolidated revenue of approximately US$5,354 million and consolidated EBITDA of around US$509 million.