Page 103 - RusRPTSept19

amounted to RUB69.2bn, at the end of 2018 they were RUB67.8bn. Long-term loans and borrowings were estimated at RUB4.2bn against RUB3.4bn a year earlier.
Russia will drop the plans to produce a 75-seat short version of medium- range Sukhoi Super Jet, Vedomosti daily reported on September 3 citing the chair and co-owner of S7 aviation group and carrier Vladislav Filev. Reportedly, despite having outstanding orders for SSJ-75 jets from S7, government officials told Filev that there was no sufficient demand for the short jet and all the efforts will be concentrating on producing a 100-seat version SSJ-100 ordered in greater numbers by national carrier Aeroflot. Produced by Russia’s Sukhoi Civil Aircraft (part of UAC), the SSJ100 has benefited from $1.5bn of state investment, but it has been dogged by technical problems, both in Russia and abroad. Domestic airlines are making more use of the SSJ100, but the growth rate in its utilisation is much slower than those of foreign competing models.
9.2.4 Construction & Real estate corporate news
Russia's largest real estate developer PIK Group increased its total consolidated revenues “massively,” up by 15% y/y to RUB104bn in 1H19 under IFRS. Out of those revenues, core real estate sales from the parent company were up by 17% year-on-year to RUB62bn ($1bn), in line with analysts expectations. Morton, previously acquired by PIK, showed sales of low-margin properties of RUB27.8bn, while other revenues (from renovation program, fee revenues, etc) increased to RUB13.5bn, beating the expectations two-fold. BCS Global Markets commented that other revenues have beaten the expectations "massively". PIK's Ebitda in the reporting period jumped 65% y/y to RUB17bn. Net income of RUB7.3bn was 21% above the forecast. BCS GM maintained a Hold recommendation on PIK with target price of RUB400 per share. The analysts see the results as strong, but warned that use of escrow accounts will start to make an impact on cash flows, similar to its peer LSR Group that published declining revenues for the same period. PIK saw its net debt soar to RUB50bn from RUB0.5bn in the beginning of the year, due to cash on escrow accounts.
Russia's largest real estate developer PIK Group will construct a 51,000 square meter storage complex in St Petersburg for IT distributor Marvel Distribution, in one of the largest deals in Russian storage market, Vedomosti daily reported citing unnamed sources close to the deal. Reportedly, currently Marvel operates three storages in Moscow and St Petersburg, one of which is leased from PIK. The new storage deal is estimated at RUB1.5bn, as estimated by JLL and RUB1.8bn as estimated by Cushman & Wakefield for Vedomosti. The deal makes the second largest storage deal this year after retailer Lenta acquired 70,000sqm of facilities in St Petersburg. As reported by bne IntelliNews, Russian e-commerce operators have been driving warehouse demand, with online businesses accounting for circa 25% of warehouse space leases in 2019.
Russian real estate developer LSR Group reported 10% year-on-year decline in revenues in 1H19 to RUB47.3bn, in line with expectations, but the company's adjusted Ebitda under IFRS declined 17% y/y to RUB7.8bn or 10% below the expectations Previously in 1Q19 LSR posted robust results and confirmed its dividends making almost 12% dividend yield. BCS Global
103 RUSSIA Country Report September 2019 www.intellinews.com