Kazakhstan Kagazy PLC
Kazakhstan Kagazy PLC: UNAUDITED FINANCIAL RESULTS FOR H1 2014

Kazakhstan Kagazy PLC  / Half-yearly Results

10.07.2014 17:22

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10 July 2014

KAZAKHSTAN KAGAZY PLC ANNOUNCES UNAUDITED FINANCIAL RESULTS FOR H1 2014*

Almaty, Kazakhstan - Kazakhstan Kagazy PLC (KAG LI) (the 'Group') announces
its non-audited consolidated financial results for the 6 months period
ended 30 June 2014 (the 'Period').

On February 11 the Kazakh Tenge ('KZT') was devalued by 19%. As a result
all financial indicators are 19% lower when being converted into US$ ('the
conversion effect'). The average exchange rates used for the Period and
2013 are 176.4 and 150.9 KZT per US$, respectively. This amounts to an
average 14% decline in the value of the KZT against the US$.

Financial highlights

  - Group revenue of US$ 28.0 million (US$ 33.5 million a year ago)

  - Gross profit of US$ 10.8 million (US$ 16.9 million a year ago)

  - Gross margin of 38.4% (50.6% a year ago) 

  - EBITDA before exceptional items of US$ 4.2 million (US$ 8.6 million a
    year ago).

  - EBIT before exceptional items of US$ 2.7 million (US$ 6.9 million a
    year ago)

  - Operating Cash Flows of US$ 3.3 million (US$ 8.7 million a year ago)

The Group's revenue has dropped by US$ 5.5 million, out of which US$ 4,7
million is attributable to the conversion effect and the rest to a drop in
sales volumes of corrugated packaging.

The Group's EBITDA dropped US$ 4,4 million, out of which US$ 1,2 million is
attributable to the conversion effect and the rest, US$ 3,2 million to
higher costs, mainly higher prices of waste paper (US$ 1.9 million) and US$
1 million higher purchasing costs for chemicals and spare parts in hard
currency.

Operational highlights

Paper Business


In millions of US$                   H1 of 2014                  H1 of 2013


Revenue                                    26.6                        31.7

Gross Profits                              10.0                        15.8

Gross Profit Margin                       37.6%                       49.7%




Production of paper for the Period amounted to 26.3 thousand tons compared
to 26.8 thousand tons for the same period of 2013.

Production of corrugated packaging for the Period amounted to 40.5 million
square meters compared to 47.7 million square meters for the same period of
2013.

Sales of paper to third parties for the Period amounted to 10.1 thousand
tons compared to 8.7 thousand tons for the same period of 2013.

Sales of corrugated packaging for the Period amounted to 40.4 million
square meters compared to 47.4 million square meters for the same period of
2013.

The average selling price of paper and corrugated packaging increased 12%
and 7%, respectively.

Despite sales volumes of corrugated products contributing by 10.2%, overall
revenue fell only by 2.0%, due to the increase of paper and cardboard sales
1% and higher selling prices for both paper 0.6% and corrugated packaging
6.6%.

Logistics Business


In millions of USD             6 months of 2014            6 months of 2013

Revenue                                     1.4                         1.8

Gross Profits                               0.8                         1.1

Gross Profit Margin                       54.8%                       61.4%





***
This segment is comprised solely of revenues from the Class B logistics
business, as the Class A and Container Terminal businesses were disposed to
Investment Fund of Kazakhstan as of January 2013. The revenue of our Class
B business dropped by US$ 0.3 million due to the conversion effect and US$
0.1 million due to lower occupancy rates. Occupancy rate was 87% for the
Period compared to 97% for the same period 2013.

Financial statements for previous years are available at
http://kazakhstankagazy.com/en/investor-relations/reports.html/

*Note: Q2 2013 results differ from those announced previously as in January 2014
the Group disposed of its Class A and Container terminal business

For more information please contact:

Mr. Sadyr Shaguzhayev                                                   +7
727 244 02 08
Head of Investor Relations    ir@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:      IR
TIDM:               KAG
Sequence Number:    2114
Time of Receipt:    Jul 10, 2014 17:22:21
 
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