Kazakhstan Kagazy PLC Announces its 2011 Financial Statements

Kazakhstan Kagazy PLC  / Annual Financial Report

02.05.2012 21:03

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May 2 2012

KAZAKHSTAN KAGAZY PLC ANNOUNCES FINANCIAL RESULTS FOR 2011

Almaty, Kazakhstan - Kazakhstan Kagazy PLC (KAG LI) (the 'Group') announces
its audited consolidated financial results prepared in accordance with IFRS
for the 12 months period ended 31 December 2011 (the 'Period').

Financial highlights

  - Group revenue increased by US$ 11 million, or 15% y-o-y, to US$ 80
    million

  - Gross profit increased by US$ 12 million, or 52% y-o-y, to US$ 35
    million

  - EBIT of US$ 14.9 million, compared to a loss of US$ (0.2) million a
    year ago

  - Net Income of US$ 2.1 million, compared to loss of US$ (56.8) million a
    year ago

  - Earnings per share of US$ 0.02, compared to loss per share of US$
    (0.53) a year ago

  - Cash generated  from operating activities Increased to US$ 27.1 million
    from US$ 12.0 million a year ago

Taisiya Kogutyuk, CEO of Kazakhstan Kagazy, commented:

'I am pleased to report that Kazakhstan Kagazy's net income is positive for
the first time since 2008, and that we have generated record cash flows
from operating activities.

This performance is the result of the focused initiatives and decisive
execution by the Group following the turnaround strategy which was launched
in 2009. Our focus on cash generation and on achieving operational
improvements has delivered results; we are maintaining a relentless focus
on operations and investing in the profitable growth of our business.'

 Operating Highlights

Logistics Business

Revenue and gross profit


In US$ millions                               2011           2010
Revenue                                       14.6           8.8
Gross profit                                  7.0            3.6
Gross profit margin                           47.9%          40.9%




In 2011, Kazakhstan Kagazy increased its revenue in the Logistics business
by 66% year on year. This has been achieved through a significant increase
in average occupancy rates; Class A warehouse average occupancy rate
increased to 73% (2010: 39%), Class B warehouse average occupancy rate was
up to 79% (2010: 48%) and the Container terminal turnover rose to 78%
(2010: 49%).

Gross profit increased by 94.4% year on year with gross profit margin
expanding to 47.9% (in 2010: 40.9%).

Paper Business

Revenue and gross profit

In US$ millions                               2011           2010
Revenue                                       65.4           60.6
Underlying Revenue                            65.0           53.3
Gross profit                                  28.0           19.4
Gross profit margin                           42.8%          32.0%




In 2011, the underlying Paper segment revenue increased by 22% year on year
as a result of improved pricing for our paper and corrugated products.

Gross profit increased by 44.3% year on year with gross profit margin
expanding to 42.8% (2010: 32.0%).

Outlook

Tomas Mateos Werner, Chairman of Kazakhstan Kagazy, comments on the outlook
for the Group:

'I am very pleased with the performance of the Group in 2011. Under the
leadership of our CEO, Taissiya Kogutyuk, we have delivered strong
financial and operational results. Going forward the Group will continue
pursuing a strategy of financial discipline and profitable growth.

I am also pleased with the progress made to date to restructure our debt.
The Group has completed the restructuring of its bond portfolio, the 'first
ever in Kazakhstan' by an industrial company, and signed term sheets with
its two remaining creditors, the European Bank for Reconstruction and
Development ('EBRD') and the Development Bank of Kazakhstan ('DBK'). The
Group is working towards completing the restructuring of these loans and
signing legally binding agreements. However, DBK's inability to offer
specific restructuring terms for the Astana City project loan, is delaying
the Group's full restructuring, and casts an uncertain future over the
Group, its more than 1,200 employees as well as the investments of the
creditors and shareholders of the Group.  I hope that, together with DBK,
we will find a solution to this problem during 2012.'

Group highlights  


                                                                        %
                                                     2011   2010   change
Revenue
Reported revenue                              US$m   80.0   69.4     15.3
Gross profit                                  US$m   35.0   22.9     52.8
Gross margin                                     %   43.8   33.0     33.0
Profitability
EBIT2                                         US$m   14.9  (0.2)        -
Total comprehensive profit/(loss)             US$m   2.1   (56.8)       -
Total basic/diluted earnings/(loss) per share
(cents per share)                              US$   2.0   (53.0)       -
Return on Assets3                                %   0.6   (15.8)       -
Group return on capital employed (ROCE)4         %   5.1   (0.1)        -
Cash
Cash generated  from operating activities     US$m   27.1   12.0     126%
Net  increase in cash                         US$m   2.9     1.5      93%
Total Debt                                    US$m   229     236     (3%)
out of which:
Restructured                                  US$m   147      47
Unrestructured                                US$m    82     189




***

For further details please see
http://kazakhstankagazy.com/en/investor-relations/reporting-and-events/rep
orts.html

For information:

Mr. Sadyr Shaguzhayev                           +7 727 341 02 00

Head of Investor Relations   ir@kagazy.kz

                                                                    
Ms. Yekaterina Karmysheva   +7 727 320 12 00 (5701)
Press Service     press@kagazy.kz

The content of this document includes forward-looking statements. These
relate to Kazakhstan Kagazy's future prospects, developments and
strategies, including statements regarding target returns. Forward-looking
statements are identified by their use of terms and phrases such as
'believe', 'could', 'would', 'envisage', 'estimate', 'intend' 'seek',
'may', 'plan', 'will' or the negative of those, variations or comparable
expressions, including references to assumptions. These statements are
based on Kazakhstan Kagazy's current beliefs, assumptions and expectations
of its future performance, and are subject to risks and uncertainties
because they relate to events and depend on circumstances that may or may
not occur in the future. Accordingly, these beliefs, assumptions and
expectations can change as a result of many possible events or factors that
may cause Kazakhstan Kagazy's business, financial condition, liquidity,
results of operations and actual returns to vary materially and target
returns to be revised from those expressed or implied in the
forward-looking statements. None of the data in this statement has been
audited and where any reference is made in this statement to the past
performance of investments by persons associated with Kazakhstan Kagazy or
other investments, you should bear in mind that such information is not
necessarily indicative of the future performance of the relevant
investments or of Kazakhstan Kagazy's future performance.



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Language:           English
Company:            Kazakhstan Kagazy PLC
                    33-37 Athol Street
                    IM1 1LB Douglas
                    Isle of Man
Phone:              +7-727-244-87-87
Fax:                +7-727-244-87-82
E-mail:             ir@kagazy.kz
Internet:           www.kazakhstankagazy.com
ISIN:               US48667M2035
Listed:             London
Category Code:      ACS
LSE Ticker:         KAG
Sequence Number:    1073
Time of Receipt:    May 02, 2012 21:03:24
 
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