Etalon Group Board of Directors Meeting Results

1 April 2019

Etalon Group Board of Directors Meeting Results

The Board of Directors of ETALON GROUP PLC ("Etalon Group" or the "Company"), one of Russia's largest and longest-established development and construction companies, held a meeting on 29 March 2019 in Limassol, the Republic of Cyprus.

At its meeting, the Board of Directors reviewed the status of the integration of the Moscow business of Etalon Group and Leader-Invest, in which the Company acquired a controlling stake in February. The Board of Directors supported the decision to launch cross-selling of projects as a first step toward integrating the sales systems of both companies. Leader-Invest's projects are already listed on the website and in sales offices of Etalon Group, while Etalon Group's projects are listed at the website and sales offices of Leader-Invest.

The Board of Directors also accepted the resignation of Alexey Kalinin, who requested the early termination of his powers as a member of the Board of Directors of Etalon Group due to his many commitments on other projects.

In addition, Oleg Mubarakshin was elected as Chairman of the Remuneration and Nomination Committee, while Maxim Berlovich was elected as Chairman of the Strategy Committee.

Oleg Mubarakshin, Chairman of the Etalon Group Board of Directors, said:

"On behalf of the Board of Directors, I want to express my gratitude to Alexey Kalinin for his many years of contributions to Etalon Group's governance bodies. He was directly involved in the Company's transformation from a regional player into one of Russia's leading development and construction companies by successfully entering the Moscow market, where it now holds a leading position. Alexey was also instrumental in Etalon Group's successful IPO on the London Stock Exchange. Moreover, Alexey has also made an important contribution to establishing Etalon Group's unique corporate culture and its high standards of corporate governance, which serve as a benchmark for other market participants."

Alexey Kalinin said:

"I have been a member of the Board of Directors of Etalon Group for more than 10 years. During this time, the Company has gone through several key stages of its development. Following the completion of several transactions earlier this year, Etalon Group emerged from a period of significant uncertainty. The Company has now formed a professional Board of Directors and management team and entered a qualitatively new stage of its development by significantly increasing its presence in the Moscow market. Up to this point, despite our fund having reduced its stake to just over 5%, I continued to perform the duties of a member of the Board of Directors during the Company's transition period. Now I believe that I have fully performed the main tasks that I set for myself at the very beginning, and therefore I have decided to leave the position. At the same time, I am confident that the Group will continue to grow successfully under the direction of the new leadership team."

The new makeup of the Board of Directors and its committees are listed below:

Board of Directors:

•    Oleg Mubarakshin, Chairman of the Board of Directors of Etalon Group, non-executive director

•    Sergey Egorov, non-executive director

•    Kirill Bagachenko, Chief Financial Officer of Etalon Group, executive director

•    Maxim Berlovich, executive director

•    Marina Ogloblina, independent non-executive director

•    Ganna Khomenko, independent non-executive director

•    Martin Cocker, independent non-executive director

•    Boris Svetlichny, independent non-executive director

•    Dennis Vinokourov, independent non-executive director

•    Charalampos Avgousti, independent non-executive director

Remuneration and Nomination Committee:

•    Oleg Mubarakshin, Chairman of the Committee, Chairman of the Etalon Group Board of Directors, non-executive director

•    Sergey Egorov, non-executive director

•    Ganna Khomenko, independent non-executive director

•    Martin Cocker, independent non-executive director

•    Charalampos Avgousti, independent non-executive director

Strategy Committee:

•    Maxim Berlovich, Chairman of the Committee, executive director;

•    Oleg Mubarakshin, Chairman of the Board of Directors of Etalon Group, non-executive director

•    Sergey Egorov, non-executive director

•    Gennadiy Shcherbina, Chief Executive Officer of Etalon Group

•    Kirill Bagachenko, Chief Financial Officer of Etalon Group, executive director

•    Marina Ogloblina, independent non-executive director

•    Dennis Vinokourov, independent non-executive director

Audit Committee:

•    Martin Cocker, Chairman of the Committee, independent non-executive director

•    Boris Svetlichny, independent non-executive director

•    Ganna Khomenko, independent non-executive director

Disclosure Committee:

•    Kirill Bagachenko, Chairman of the Committee, Chief Financial Officer of Etalon Group, Executive Director

•    Ksenia Savchuk, head of PR of Etalon Group

This and other recent announcements are available on the Etalon Group website: http://www.etalongroup.com/investors/news/ 

Etalon Group IR Team

T: +44 20 8123 1328

E: info@etalongroup.com

EM

Sam VanDerlip

T: +44 7554 993 032

T: +7 499 918 3134

E: vanderlip@em-comms.com 

About Etalon Group

Founded in 1987, Etalon Group has become one of Russia's largest development and construction corporations. The Company focuses on middle class residential real estate in the Moscow and St Petersburg metropolitan areas, where it operates through Etalon Invest and Etalon LenSpetsSMU subsidiaries. With a more than 30-year history, Etalon Group has one of the longest and most successful track records in the Russian real estate industry - since its inception, Etalon Group has commissioned 6.3 million sqm.

Etalon Group's strong reputation among consumers supports its pre-sales business model, which helps the Company to minimise external financing needs for on-going projects while maintaining a secure liquidity position: net debt as of 31 December 2017 was RUB 9.7 billion.

The Company is vertically integrated, which helps it to control costs, quality and timing, as well as to demonstrate best-in-class profitability. Etalon Group employs 5 thousand people, and its nationwide sales and marketing network covers 58 Russian cities.

As of 30 June 2018, Etalon Group's assets comprised 39 projects and a construction and maintenance division, with a total of 2.73 million sqm of unsold net sellable area. Knight Frank valued the Company's assets at RUB 132,487 million.

For the year ended 31 December 2018, Etalon Group's new contract sales totalled 628 ths sqm, or RUB 68,731 million. Deliveries in 2018 amounted to 479 ths sqm.

The Company recorded revenue of RUB 70.6 billion and EBITDA of RUB 13.2 billion for the year ended 31 December 2017.

Etalon Group's GDRs have been traded on the Main Market of the London Stock Exchange since 20 April 2011.

In February 2019 Etalon Group acquired 51% of the shares of Leader-Invest, one of Moscow's largest residential developers in terms of land bank and number of projects currently available for sale. Leader-Invest's primary focus is on infill development projects and integrated development of large-scale mixed use projects in the comfort-, business- and premium-class segments. Leader-Invest's portfolio includes 31 projects under construction or at the design stage, unsold inventory at eight completed residential complexes, and commercial real estate, with a total NSA of 1.3 million sqm. As of 1 October 2018, Colliers International valued Leader-Invest's portfolio at RUB 66,645 million.

As a result of the acquisition of Leader-Invest, Etalon Group will become the largest residential developer in Moscow in terms of number of projects offered to the market, and the second-largest in terms of sales and construction volumes. In St Petersburg the Company will maintain its position among the market leaders. Etalon Group plans to complete the full integration of Leader-Invest by the end of 3Q 2019.