PIK GROUP REPORTS 1H2015 FINANCIAL RESULTS

PIK GROUP REPORTS 1H2015 CONSOLIDATED FINANCIAL RESULTS

Moscow, August 28, 2015 - 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, 2015.

1H2015 Financial Highlights:

· Total cash collections increased by 10.0% to RUB 30.0 billion (1H2014: RUB27.3 billion);

· New sales contracts to customers increased by 4.6% to 228 th. sqm.(1H2014: 218 th. sq. meters);

· Total revenue decreased by 23.0% to RUB22.1 billion (1H2014: RUB28.6 billion). Revenue from sale of real estate decreased by 25.3% to RUB18.6 billion(1H2014: RUB24.9 billion);

· Transfers of real estate to customers decreased by 30.8% to 191,000 square meters (1H2014: 276,000 square meters)

· Gross profit margin amounted to 39.4% (1H2014: 26.0%);

· Adjusted EBITDA increased by 19.3% to RUB7.1 billion (1H2014: RUB5.9 billion). Adjusted EBITDA margin amounted to 32.0% (1H2014: 20.7%);

· Net profit for the year amounted to RUB4.1 billion(1H2014: RUB1.5 billion);

· Free cash flow increased amounted to to RUB3.6 billion (1H2014: RUB1.8 billion);

· Net debt as of June 30, 2015 decreased by RUB3.9 billion to RUB6.3 billion (December 31, 2014: RUB10.2 billion);

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Additional documents:

The Consolidated Financial Statements, prepared in accordance with IFRS, for 6 months ended June 30, 2015 can be found under the following link:

http://pik-group.com/investors/financial-statements/2015/

http://www.rns-pdf.londonstockexchange.com/rns/5043X_-2015-8-28.pdf

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: Monday, August 31, 2015

Time: 12:00 Moscow / 10:00 London / 5:00 New York

Title: PIK Group 1H2015 IFRS Results

Conference ID (Russian line): 5320487 

Domestic line: +7(495) 705-94-50

UK international tel.: +44 20 3427 1915

Enquiries:

PIK Group

Management review of financial condition for the 6 months ended June 30, 2015

Group revenues in 1H2015 decreased by 23.0% to RUB 22.1 billion compared to RUB28.6 billion in 1H2014. The decline was driven by lower number of projects recognized in the reported period. Revenues from real estate sales accounted for 84.4% of total revenues compared to 87.0% in 1H2014.

Sales revenue by segment

Source: IFRS

PIK Group's core revenues come from the sale of apartments. In 1H2015, they were 25.3% lower due to a reduction of number of projects recognized in the revenues. The implied revenue per square meter increased by 8.0% to 97.5 thousand rubles.

Implied revenue per sq. meter of transferred properties (1)

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

Source: IFRS

Gross profit increased by 17.0% to RUB8.7 billion from RUB7.4 billion due to higher margin of the development segment. The Group's gross profit margin increased to 39.4% from 26.0% in 1H2014 driven primarily by higher individual profitability of projects recognized in the reported period.

In 1H2015, administrative expenses decreased by 6.2% and amounted to RUB1.2 billion (1H2014: RUB1.3 billion).

As a result of the above factors, adjusted EBITDA from core activities increased by 19.2% to RUB7.1 billion from RUB5.9 billion in 1H2014, whilst adjusted EBITDA margin increased 11.3ppt to 32.0% from 20.7%.

Adjusted EBITDA reconciliation

Source: IFRS

As a results of the above factors, profit for the period (net profit) increased to RUB4.1 billion from RUB1.5 billion.

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

Net cash from operating activities in 1H2015 reached RUB6.8 billion (1H2014: RUB2.5 billion).

Free cash flow (defined as net cash generated from operating activities, less acquisition of property, plant & equipment and development rights) amounted to RUB3.6 billion in 1H2015, compared to RUB1.8 billion in 1H2014.

As of June 30, 2015, the Group had RUB24.1 billion of gross debt (down from RUB24.5 billion of gross debt as of December 31, 2014). Net debt as of June 30, 2015 amounted to RUB 6.3 billion, down from RUB10.2 billion at the end of 2014. During 1H2015, the Group successfully extended its RUB21.1 billion loan with VTB Capital and paid the RUB300 million loan with FC Otkritie.

Directors' Responsibility Statement

The attached Annual 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.