Etalon Group Limited (LSE: ETLN) (the "Company" or the “Group”), one of Russia's largest and oldest residential real estate developers, today released the updated valuation of its portfolio as of 31 December 2012, conducted by Jones Lang LaSalle. The updated valuation shows a 38% increase in the market value of the Group’s portfolio, reaching a total of USD 2,369 million. Details of the updated valuation is available on the Company’s website: www.etalongroup.com.
Etalon Group Head of Investments Dmitri Boulkhoukov said:
"The dramatic growth in landbank value and size has been possible due to active execution of our post-IPO investment programme in both the St. Petersburg and Moscow Metropolitan Areas.
“Our strategy to secure financing from the IPO and to focus on cash flow generation has successfully converted into robust landbank growth, which will be key to the next stage in Etalon's growth."
Etalon Group IR
T: +44 (0)20 8123 1328
T: +7 (916) 306 6112
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 especially throughout the last 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 primarily 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.