Etalon Group Launches Sales for Tsar’s Capital Project

04 June 2013

 

Etalon Group Limited (“Etalon Group” or the “Company”, LSE ticker: ETLN), one of Russia’s largest and long established residential real estate developers, is pleased to announce it has launched sales for Tsar’s Capital, a 389.7 ths sqm NSA comfort class residential development project in St. Petersburg.

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The minimum starting price at Tsar’s Capital is RUB 125,000 per sqm. Etalon Group has received preliminary indications of interest for 170 of the 741 available residential premises, and for all 71 commercial premises before the official launch. Etalon Group expects to convert these indications of interest into new contract sales over the next three to five months.

Tsar’s Capital is situated in the Central district of St. Petersburg on a 20.8 hectare land plot bordering Kremenchugskaya street. The development is located in one of the most attractive areas of the city centre in close proximity to Nevsky Prospect, Vosstaniya Square and numerous historical and cultural landmarks. The nearest metro stations, Vosstaniya Square and Aleksandra Nevskogo Street, are within a 7-10-minute walking distance. The project will consist of twenty-five buildings of up to 12 storeys, containing an estimated 3,800 flats and 2,400 parking spaces. In addition to flats, non-residential premises on the ground floor of the development will house shops and services.

Etalon Group launched the sale of flats at Tsar’s Capital and targets to deliver the first stage of the project in 2013.

Other recent announcements are available on the Etalon Group website: www.etalongroup.com/investors/news/

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Etalon Group IR Team 

T: +44 (0) 20 8123 1328

E: info@etalongroup.com

M: Communications

Sam VanDerlip

T: +44 (0) 7445 993 032

vanderlip@mcomgroup.com

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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 more than 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 2012, Etalon Group’s portfolio comprised 35 projects, with a total of 3.58 million sqm of unsold net sellable area ("NSA") in the St. Petersburg and Moscow Metropolitan Areas. Jones Lang LaSalle valued this portfolio at USD 2,369 million, a 38% increase in the market value from YE 2011.

For the year ended 31 December 2012, Etalon Group’s new contract sales totalled 316,466 sqm, or RUR 23,739 million. Deliveries in 2012 totalled 363 thousand sqm.

The Company recorded revenues of RUB 26.9 billion and EBITDA of RUB 6.9 billion, with an EBITDA margin of 26% for the year ended 31 December 2012, making it one of the most profitable players in the sector.

Etalon Group’s net cash position at 31 December 2012 was RUB 890 million, leaving it well positioned to fund continued dynamic growth.

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5 June 2013