29 May 2008 09:00
PIK GROUP ("The Group" or "PIK")
PIK TO EXPAND INTO KAZAKHSTAN
(London 29 May) - PIK (LSE: PIK), a leading Russian nationwide residential property developer, today announces its intention to expand operations into the Republic of Kazakhstan. To facilitate this move, PIK has recently established a new business unit, PIK Kazakhstan, in Astana, in the centre of Republic. PIK Kazakhstan will be responsible for identifying land for purchase, zoning, and construction.
PIK's move into Kazakhstan is in line with its strategy of opening up new geographic markets where the economic fundamentals will support future growth. Kazakhstan has a stable economy that has grown strongly in recent years, supported by the performance of the oil and gas and agriculture sectors. Looking ahead, the country is predicted to achieve continued economic growth, of 5.0% in the current year and 7.0% in 2009 (source: IMF).
Against this backdrop, there remains a shortage of quality housing to meet the needs of the increasingly affluent Kazakh population. PIK has been developing residential real estate since 1994 and sees an opportunity to utilize its experience in Russia and its vertically integrated business model to meet growing demand in this fast developing country.
Entry into Kazakhstan follows the announcement on 25 March 2007 of the establishment of PIK Ukraine and a representative office in Kiev. PIK has also been expanding its presence in Russia's regions since 2006, entering cities such as Rostov-on-Don, Kaliningrad, Omsk, Perm, Novorossiysk, and Yaroslavl, Taganrog, Nizhny Novgorod, Kaluga and St. Petersburg.
Over the next few years, management intends to expand PIK's reach further, through land purchases and by acting as a consolidator of Russia's fragmented real estate development industry.
The Group will make further announcements regarding PIK Kazakhstan in due course.
Enquiries:
PIK Group Tel: +7 495 505 97 33 ext. 1358
Viktor Szalkay
Investor Relations
Citigate Dewe Rogerson Tel: +44 20 7638 9571
Tom Baldock
Lindsay Noton
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of PIK. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. PIK 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's projections or forward-looking statements, including, among others, general economic conditions, PIK's competitive environment, risks associated with operating in Russia, rapid technological and market change, and other factors specifically related to PIK and its operations.
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NOTES TO EDITORS
PIK Group Overview
Founded in 1994, PIK is one of the leading vertically integrated residential developers in Russia with over 14,000 employees across the country. Its business activities are concentrated in Moscow and the Moscow region with an increasing footprint in many of Russia's other regions. Its principal activity is the development, construction and sale of residential properties in large scale developments targeted primarily at the middle income housing market in Russia.
PIK's core activities include:
development of residential real estate projects and sales of completed units, including servicing and maintenance of residential real estate developed by PIK and other developers;
production and assembly of concrete panel housing in Moscow as a subcontractor for the Moscow city government; and
production and sale of raw materials and construction materials.
Since 2004, PIK has completed over 4 million square meters of residential housing, which is equivalent to approximately 58,000 residential units across Russia.
June 1, 2007, the Group completed successful listings on the London Stock Exchange, the RTS and MICEX exchanges in Russia.
PIK Group's website address is: www.pik.ru
Group Financial Summary
Revenue for 2007 rose by 75% and equalled US$2.7 billion, while EBITDA for 2007 amounted to US$939 million . Net profit was US$700 million in 2007 compared to US$ 298 million in 2006.
According to CBRE, an independent appraiser, the combined market value of the Group's properties valued as of January 1, 2008 was $12.3 billion.
Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of PIK. You can identify forward-looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might" the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. PIK 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's projections or forward-looking statements, including, among others, general economic conditions, PIK's competitive environment, risks associated with operating in Russia, rapid technological and market change, and other factors specifically related to PIK and its operations.