OREANDA-NEWS. Joint Stock Company “Open Investments” (JSC “OPIN” or the “Company”) (BLOOMBERG: MICEX - OPIN.RM), the first publicly traded real estate developer in Russia, has today published its IFRS audited results for the full year 2012. The document contains audited financial statements and independent auditor’s report.

Highlights

Revenue for the year 2012 decreased by 35% year-on-year to RUB4.3 bn. Mainly this is due to volatility on the global financial markets at the beginning of the year and, which had a negative impact on the dynamics of the real estate suburban market. Another major reason was the absence of the most liquid formats (apartments and townhouses) due to completion of their sales during the year.

In 2012 according to the independent valuer’s opinion the land market hasn’t changed considerably, whereby the fair value of Company’s investment property (land bank) remained at the previous year level. For comparison in 2011 the Company recognised a RUB3.2 bn gain in fair value of its investment property.

Net loss for the year was RUB2.8 bn in comparison to an income of RUB1.0 bn in 2011. The main factors contributing were the high costs of premium real estate construction against the deceleration on the suburban market due to which the Company was offering special promotional programmes to clients. Also additional expenses, related to restructuring and increase of the loan portfolio had a negative effect.

As a result of successful restructuring of the loan portfolio OPIN managed to decrease its short-term liabilities by 26% from RUB9.2 bn in 2011 to RUB6.8 bn in 2012.

Total Company’s debt increased by RUB2.0 bn and total liabilities were RUB12.2 bn. Funds were partially used for financing and participation in the Company’s new projects (“Park Rublevo”, “Vesna”).

In 2012 net asset value decreased by RUB2.7 bn or 8% compared to 2011.

The Company’s cash balance as at December 31, 2012 was RUB577.0 mln.

Commenting on today’s announcement, Artemiy Krylov, CEO of OPIN, said:

“In 2012 there was a correction on the suburban housing market towards a more affordably-priced property. Mainly it happened due to changing views over the price of non-primary housing caused by uncertainties about economic stability and volatility on the financial markets. The most desired real estate was in a price range of below 30 million rubles. That said, many of OPIN’s offerings in that category were sold out during 2011 and in 2012 we had a limited stock of a more expensive and less liquid projects.

In multi-apartment housing in economy and business-class segments in 2012 in the Moscow Region on opposite we observed a positive dynamics influenced by a low supply of quality residential real estate affordable for middle and upper-middle income households.

Corresponding to the changes in the market trends in 2011 OPIN adopted a new development strategy that is based on capitalisation of existing land bank and broadening pricing ranges of the product lines. As a result 2012 was a year of the Company’s transformation from a pure developer of suburban real estate to the company with a diverse offering of suburban, low-rise and multi-storey housing all built in accordance with single architectural plan and design and with high standards of quality. In 2012 we started construction of two multi-apartment housing projects with total sellable area of over 270 thousand square meters and expect them to have a significant contribution to the Company’s cash flows in the coming years”.