PJSC “Magnit” Consolidated statement of cash flows for the year ended 31 December 2018

(In thousands of Russian rubles)

Notes 2018 2017
(Note 3Certain amounts shown here do not correspond to the financial statements for the year ended 31 December 2017 and reflect adjustments described in Note 3.)
Cash flows from operating activities
Profit before income tax 43,071,995 45,423,770
Adjustments for:
Depreciation 7 35,521,322 32,947,360
Amortization including land lease rights 24 996,116 768,342
Loss from disposal of property, plant and equipment 549,026 464,016
Loss from disposal of intangible assets 27,278
Loss from disposal of land lease rights 8 25,789 24,697
Gain from disposal of investment property (1,180)
(Reversal) of expected credit losses / accrual of bad debt provision 24 (97,118) 129,225
Foreign exchange loss/(gain) 1,415,310 (133,680)
Finance costs 25 9,136,262 12,978,882
Investment income (210,316) (340,714)
Operating cash flows before working capital changes 90,434,484 92,261,898
Increase in trade and other receivables (1,213,236) (684,289)
(increase)/decrease in advances paid (663,651) 217,829
Increase in advances received 511,328 375,292
Decrease/(increase) in taxes receivable 1,145,281 (150,461)
Decrease/(increase) in prepaid expenses 118,695 (181,674)
Increase in inventories (23,424,016) (27,260,045)
Increase in trade and other payables 10,247,625 15,353,763
Increase in accrued expenses 511,124 926,667
Decrease in taxes payable (1,827,166) (2,527,243)
Increase in contract liabilities 1,131,356 189,020
Increase in government grants 20 1,858,968 355,296
Cash generated from operations 78,830,792 78,876,053
Income tax paid (4,433,235) (4,876,235)
Interest paid (9,860,959) (13,334,900)
Interest received 200,720 343,376
Net cash from operating activities 64,737,318 61,008,294
Cash flows from investing activities
Purchase of property, plant and equipment (51,603,538) (73,528,262)
Purchase of intangible assets 9 (2,154,557) (1,560,744)
Purchase of land lease rights 8 (847) (63,023)
Cash received from business combination 6 187,758
Proceeds from sale of property, plant and equipment 1,079,628 459,417
Proceeds from sale of investment property 601,180
Loans provided (1,507,414) (1,855,287)
Loans repaid 166,756 1,552,549
Proceeds from government grants 20 22,742 800,695
Net cash used in investing activities (53,208,292) (74,194,655)
Cash flows from financing activities
Proceeds from loans and borrowings 30 600,693,859 688,243,578
Repayment of loans and borrowings 30 (572,272,534) (689,033,285)
Dividends paid 30 (13,808,982) (29,233,198)
Repayment of obligations under finance leases (3,345) (1,250)
Proceeds from additional issue of shares 14 44,988,662
Purchase of treasury shares 14 (17,727,687)
Net cash (used in) / generated from financing activities (3,118,689) 14,964,507
Net increase in cash and cash equivalents 8,410,337 1,778,146
Cash and cash equivalents at the beginning of the year 13 18,337,417 16,559,271
Cash and cash equivalents at the end of the year 13 26,747,754 18,337,417

Chief Executive PJSC “Magnit” Naumova O.V.

14 March 2019

The accompanying notes on pages 12-67 are an integral part of these consolidated financial statements