1st Quarter Results

Press-release

Krasnodar

May 11, 2011

OJSC "Magnit" announces unaudited 1Q 2011 operating and financial results

Krasnodar, May 11, 2011: OJSC "Magnit" (the "Company"; RTS, MICEX and LSE: MGNT) is pleased to release its 1Q 2011 financial results prepared in accordance with IFRS[1].

During 1Q 2011 the Company added (net) 134 stores (126 convenience stores, 6 hypermarkets and 2 drogerie stores) and increased its selling space by 35.98% in comparison to 1Q 2010 from 1,092.61 thousand sq. m. to 1,485.72 thousand sq. m. The total store base as of March 31, 2011 reached 4,189 stores (4,128 convenience stores, 57 hypermarkets and 4 drogerie stores).

Revenue in rubles increased by 53.14% YoY from 49,009.71 million RUR in 1Q 2010 to 75,052.23 million RUR in 1Q 2011. The top line growth was due to an increase in selling space as well as to a 20.15% increase of like-for-like sales (excl. VAT). Revenue growth in dollar terms amounted to 56.38%: from US$ 1,639.65 million to US$ 2,564.15 million.[2]

Gross margin grew from 21.87% in 1Q 2010 to 22.88% in 1Q 2011. Gross profit in rubles increased by 60.20% from 10,717.51 million RUR (US$ 358.56 million) to 17,169.70 million RUR (US$ 586.60 million).

EBITDA increased by 27.25% from 3,725.43 million RUR (US$ 124.64 million) in 1Q 2010 to 4,740.71 million RUR (US$ 161.97 million) in 1Q 2011. EBITDA margin in 1Q 2011 amounted to 6.32% which is 1.28% below the figure of 1Q 2010 (7.60%).

1Q 2011 net income declined by 7.49% and amounted to 1,785.76 million RUR (US$ 61.01 million) vs. 1,930.41 million RUR (US$ 64.58 million) in 1Q 2010.

Sergey Galitskiy, the Company's CEO, provided the following comments on the published 1Q 2011 results:

"We liked sales growth rate in the first quarter and did not transfer additional expenditures through increase of fuel cost and social tax to the customer which resulted in lower EBITDA vs. consensus. But from the second quarter we have started to gradually transfer increased costs to the customer, at that we are confident in fulfilling EBITDA margin and sales plans provided earlier."

1Q 2011 Key Operating Results

* including cosmetics stores (drogerie)

1Q 2011 to 1Q 2010 LFL results[3]

1Q 2011 Key Financial Results

* including cosmetics stores (drogerie)

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 March 31, 2011 the chain consisted of 4,128 convenience stores, 57 hypermarkets and 4 cosmetics stores (drogerie) in 1,239 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, Urals and Siberian regions.

As of March 31, 2011 the Company operated an in-house logistics system consisting of 11 distribution centers, employing automated stock replenishment systems and a fleet of 2,997 vehicles.

In accordance with the audited IFRS consolidated financial statements for the twelve months ended December 31, 2010, the Company recorded consolidated revenue of approximately US$7,777 million and consolidated EBITDA of around US$632 million.