KRASNODAR, 17 July, 2006: OJSC “Magnit” (the “Company”; RTS: MGNT), Russia’s leading retail chain in terms of number of stores and customers, is pleased to release its 2Q06 trading update.

During 2Q06 Magnit opened 108 stores with its store base in Russia standing at 1682 stores at the end of the period.

Selling space of the company increased by 41% YoY and stood at 447 th. sq. metres.

Net revenue of the company according to unaudited management accounts prepared in accordance with IFRS increased by 49% YoY from 10.6 bln roubles in 2Q05 to 15.8 bln roubles in 2Q06.

The net revenue increase was achieved due to a selling space increase and like-for-like sales growth, which amounted to 9% in rouble terms in 2Q06.

The like-for-like sales increase was in turn due to a 2% increase in the number of tickets and a 7% increase in the average basket size in rouble terms.

2Q2006 trading update