St. Petersburg – Etalon Group Limited (“Etalon Group” or the “Company”), one of Russia’s largest and oldest residential real estate developers, announces it has acquired development rights for a new project in Moscow with a total expected NSA of 138.9 ths sqm.
The acquisition of development rights for the residential development project in the Alexeevskiy district of Moscow marks another step towards Etalon Group’s strategic goal of expanding its portfolio and operations in the Moscow Metropolitan Area (MMA). This project will be built on an 8 hectare land plot in an excellent location close to Sokolniki park and just 7 kilometres from the centre of Moscow.
The project site is 10 minutes’ walk from Alexeevskaya metro station as well as from the Moskva-3 railway station, and has access to major roads including Prospekt Mira.
Construction is expected to start in 2015. Etalon Group plans to deliver project in 2018.
Etalon Group CEO Vyacheslav Zarenkov said: “This new project in Moscow’s Alekseevsky district is our fifth MMA acquisition, a fact that serves as further confirmation of our commitment to expanding operations in this lucrative market. We have already made significant progress on expanding our MMA portfolio: with this new project our landbank in the region now equals approximately 1.57 million sqm of unsold NSA, or 39% of Etalon Group’s total landbank.”
Further information about this new project is available on Etalon Group’s website here: www.etalongroup.com/investors/presentations/.
Etalon Group IR Team
T: +44 (0) 20 8123 1328
T: +7 495 363 2845
About Etalon Group
History and Overview
Founded in 1987 by Viacheslav Zarenkov, Etalon Group has become one of Russia's largest residential real estate developers. With a 25-year history, the Company has one of the longest and most successful track records in the Russian real estate industry.
Today Etalon Group is a leading player in Russia’s “Golden Triangle” – St Petersburg, Moscow and the greater Moscow area, with a dominant position in the “comfort class” segment. The Company’s strong foothold in these markets is reinforced further by its unique nationwide sales network covering 9 of the 10 wealthiest regions of Russia, and spanning 30 cities in total. The sales network generates up to 30% of Etalon Group’s revenue, and has been an important source of stable demand even throughout the crisis.
Etalon Group is one of the only truly vertically integrated businesses in the Russian real estate sector. The Company does everything from acquiring land to sales and cash collections from its customers, which enables it to maximise margins throughout the value chain, and reduces exposure to cost inflation from external service providers. Etalon Group is a company of scale, with a total of 40 business units that employ over 4,000 people, two strong management companies, five general contractors, 16 subcontractors, a crane company, a brick factory and a nationwide sales network.
Etalon Group’s strong financial position is driven by its effective pre-sales business model. The Company aims to pre-sell 70-90% of all residential space before a building is delivered. It also targets an average down payment of 50%. This allows Etalon Group to finance the construction process using money from customers, as opposed to using the loans or funding from shareholders.
In addition to homebuilding, Etalon Group’s long history and superior quality offering has helped it to become a trusted industrial construction partner for clients like General Motors, Toyota, Ford Motors, Bosch, Siemens, Nissan, Suzuki and Gazprom in northwest Russia.
Since 20 April 2011, Etalon Group Limited has had its GDRs traded on the Main Market of the London Stock Exchange.
Operational and Financial Highlights
As of 31 December 2011, Etalon Group’s portfolio comprised 31 projects, with a total of 3.25 million sqm of unsold net sellable area ("NSA") in the St. Petersburg and Moscow Metropolitan Areas. Jones Lang LaSalle valued this portfolio at USD 1,714 million, a 20% increase in the market value from YE 2010.
For the year ended 31 December 2011, Etalon Group’s new contract sales totalled 270,012 sqm, or RUR 18,306 million. Deliveries in 2011 totalled 328 thousand sqm.
The Company recorded revenues of RUB 22.7 billion (USD 774 million) and EBITDA of RUB 8.2 billion (USD 279 million), with an EBITDA margin of 36% for the year ended 31 December 2011, making it one of the most profitable players in the sector.
Etalon Group’s net cash position at 31 December 2011 was USD 167 million, leaving it well positioned to fund continued dynamic growth.