Gruppa Kompaniy PIK : PIK GROUP REPORTS 1H2016 CONSOLIDATED FINANCIAL RESULTS

30 августа 2016

Moscow, August 30, 2016 - PIK Group (LSE: PIK), ('The Group' or 'PIK'), one of the leading Russian residential developers, today announces its unaudited Consolidated Financial Statements prepared in accordance with IFRS, for the 6 months ended June 30, 2016.

1H2016 Financial Highlights:

• Total cash collections increased by 39.5% to RUB 41.8 billion (1H2015: RUB30.0 billion);
• New sales contracts to customers increased by 77.6% to 405 th. sqm.
• (1H2015: 228 th. sq. meters);
• Transfers of real estate to customers increased by 2.6% to 196,000 square meters (1H2015: 191,000 square meters)
• Total revenue decreased by 14.2% to RUB18.9 billion (1H2015: RUB22.1 billion). Revenue from sale of real estate decreased by 15.5% to RUB15.7 billion
• (1H2015: RUB18.6 billion);
• Gross profit margin amounted to 29.2% (1H2015: 39.4%);
• Adjusted EBITDA decreased by 57.4% to RUB3.0 billion (1H2015: RUB7.1 billion). Adjusted EBITDA margin amounted to 15.9% (1H2015: 32.0%);
• Net profit for the year amounted to RUB1.7 billion
• (1H2015: RUB4.1 billion);
• Net cash flow from operations amounted to RUB2.0 billion (1H2015: RUB3.8 billion);
• Net debt as of June 30, 2016 was negative and amounted to (RUB6.6 billion) (December 31, 2015: negative (RUB3.9 billion);

***

Additional documents:

The Consolidated Financial Statements, prepared in accordance with IFRS, for 6 months ended June 30, 2016 can be found under the following link:

http://pik-group.com/investors/financial-statements/2016/

Conference Call Dial-In Details:

PIK Group's Management will host a conference call for investors and analysts followed by a Q&A session.

Date: Wednesday, August 31, 2016

Time: 15:00 Moscow / 13:00 London / 8:00 New York

Title: PIK Group 1H2016 IFRS Results

Conference ID: 8770958

Domestic line: +7 495 213 0979

UK international tel.: +44 20 3427 1913

Enquiries:

PIK Group

Management review of financial condition for the 6 months ended June 30, 2016

Group revenues in 1H2016 decreased by 14.2% to RUB 18.9 billion compared to RUB22.1 billion in 1H2015. The decline was driven by lesser amount of high margin projects recognized in the reported period. Revenues from real estate sales accounted for 83.2% of total revenues compared to 84.4% in 1H2015.

Sales revenue by segment

Source: IFRS

PIK Group's core revenues come from the sale of apartments. In 1H2016, they were 15.5% lower due to absence of high margin Moscow projects recognized in the revenues. The implied revenue per square meter decreased by 17.6% to 80.3 thousand rubles.

Implied revenue per sq. meter of transferred properties

Note: (1) calculated as revenue from apartment sales divided by transfers to customers

Source: IFRS

Gross profit decreased by 36.5% to RUB5.5 billion from RUB8.7 billion. The Group's gross profit margin decreased to 29.2% from 39.4% in 1H2015 due to lower margin of the development segment.

In 1H2016, administrative expenses increased by 14.5% and amounted to RUB1.4 billion (1H2015: RUB1.2 billion).

Factors above resulted that adjusted EBITDA from core activities decreased by 57.4% to RUB3.0 billion from RUB7.1 billion in 1H2015, whilst adjusted EBITDA margin decreased to 15.9% from 32.0%.

Adjusted EBITDA reconciliation

Source: IFRS

As a results of the above factors, profit for the period (net profit) decreased to RUB1.7 billion from RUB4.1 billion.

Discussion of Group's current financial position, cash flows and liquidity

Net cash from operating activities in 1H2016 reached RUB2.0 billion (1H2015: RUB3.8 billion).

As of June 30, 2016, the Group had RUB13.2 billion of gross debt (as of December 31, 2015 - RUB13.2 billion). Net debt as of June 30, 2016 was negative and amounted to (RUB6.6 billion), down from negative (RUB3.9 billion) at the end of 2015.

Directors' Responsibility Statement

The attached Financial Report (Consolidated Financial Statements) and the financial information contained herein, are the responsibility of, and have been approved by, the directors of PIK Group. The directors are responsible for ensuring that management prepares the Financial Report in accordance with the IFRS and the Listing Rules of the Financial Conduct Authority.

Notice to readers

The calculation of certain measures used in this announcement may be different from the calculation used by other companies and therefore comparability may be limited. Some of the measures (e.g. EBITDA, adjusted EBITDA, normalized net income, net debt, free cash flow) are not measures of financial performance under IFRS.

Some of the information in this press release may contain guidance, projections or other forward-looking statements regarding future events or the future financial performance of PIK Group. You can identify forward-looking statements by terms such as 'expect,' 'believe,' 'anticipate,' 'estimate,' 'intend,' 'will,' 'could,' 'may' or 'might,' or the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. PIK Group does not intend to or undertake any obligation to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in PIK Group's projections, guidance or forward-looking statements, including, among others, general economic and market conditions, PIK Group's competitive environment, risks associated with operating in Russia, rapid market change, and other factors specifically related to PIK Group and its operations.

This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of PIK Group, nor shall any part of it nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision relating thereto, nor does it constitute a recommendation regarding the securities of PIK Group.

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