PIK Group of Companies

PIK Group is present in 10 Russian regions and is working on the implementation of an extensive diversified portfolio of projects.

Areas of activity of PIK Group of Companies

• Construction and sale of residential real estate;
• Production and installation of prefabricated building structures, construction of both own residential projects and provision of construction services to third parties;
• Production of reinforced concrete panels, window blocks and other structural materials;
• Management and operation of real estate built by the Group and other developers;
• A comprehensive integrated approach to the project creation process is a significant competitive advantage for the Group. The Company produces prefabricated reinforced concrete panels, window and door blocks made of PVC and aluminum, which are part of PIK Group of Companies, which are used in the construction of projects.
• The Group's activities focus on the development and construction of large-scale residential projects, including the quarterly development of residential neighborhoods with a fully formed commercial and social infrastructure: a comfortable courtyard area, kindergartens, schools, sports centers, parking lots, as well as a trading component both in the form of detached shopping centers and located on the ground floors of residential buildings.

Performance indicators

2024: Loss of first place in Russia in terms of construction volume

In early January 2024, PIK for the first time since July 2018 lost first place in the ranking in terms of the volume of current construction in Russia, losing leadership to Airplane. This is evidenced by the data of the Unified Resource of Developers ("ЕРЗ.РФ"). More details here.

2021

Annual revenue growth of 28%

In 2021, the revenue of the PIK group of companies reached 487.8 billion, rubles which is 28% more than a year earlier. The net profit of the developer during that time increased by 20%, to 103.6 billion rubles. Such data TASS was published on June 27, 2022, referring to the Center for Corporate Information Disclosure.

As follows from the PIK consolidated financial statements, 72% of revenue (351.9 billion rubles) in 2021 fell on Moscow. Revenues from transactions in the capital increased by 41%. Another 21% of revenue (100 billion rubles) fell on the Moscow region, the remaining 7% - on the rest of the regions of Russia.

PIK reported a 28% increase in annual revenue. Moscow brought 72% of income

The adjusted EBITDA of the PIK Group in 2021 amounted to about 91 billion rubles, which is 0.67% more compared to 2020.

According to the report of the development group, the share of mortgage transactions in the company's total sales amounted to 79%. A special role in the growth of mortgage sales was played by the updated subsidized mortgage program, announced in April 2021. The average estimated price per square meter rose by 28.9%.

Moscow remains a key market for the company. The capital accounted for about 60% of the total volume of real estate sales and about 71% of the total amount under the concluded contracts in 2021.

Broken down by region, only the Moscow region demonstrated a drop in sales volumes in 2021 by 16% - to 687 thousand square meters. In Moscow, sales volumes increased by 22% - to 1.527 million square meters, in St. Petersburg - by 34%, to 103 thousand square meters, in other regions - by 6%, to 220 thousand square meters.

It is noted that PIK took advantage of the favorable market conditions in the residential real estate segment of Russia - 2021 turned out to be a record year from all points of view. The company not only received record cash revenues from the sale of real estate, but also updated historical highs in terms of the volume of real estate built and commissioned.^[1]

PIK increased cash receipts by 39%, to 516 billion rubles

In 2021, the PIK group received 516 billion rubles of cash, which is 39% more than a year earlier. The developer told about this on January 18, 2022.

According to PIK, cash receipts from construction services, fee-development business and other activities increased by 75% and amounted to 169 billion rubles, which corresponds to 33% of the total. Cash receipts to escrow accounts increased more than 2.5 times and reached 192 billion rubles.

PIK increased cash receipts by 39%

The press service of the development group also reported that the volume of sales of PIK real estate in 2021 increased by 33% compared to 2020 - to 451 billion rubles (in 2020 - 341 billion rubles), in physical terms - by 8%, to 2.5 million square meters. m (in 2020 - 2.36 million square meters. m). The total area of ​ ​ real estate on sale increased by 41% and amounted to 2.8 million square meters. m. The volume of commissioning increased by 25% and amounted to 3.036 million square meters. m. The share of mortgage transactions in 2021 amounted to 76% of total sales. Sales of secondary real estate for the year turned out to be equal to 21.1 billion rubles, or 113 thousand square meters. m.

In 2021, PIK put on sale:

• 22 new projects (in 2020 - 18 new projects);
• 152 new buildings (in 2020 - 92 buildings).

Alexey Pavlov, chief analyst for the Russian stock market of Otkritie Investments, noted that PIK somewhat exceeded its own forecast, according to which in 2021 it was planned to increase sales in rubles by 25-30%. In any case, sales in 2021 were a record for PIK. The main driver of such results was the rise in real estate prices, and to a lesser extent, the active development of the fee-development business. However, due to a strong jump in prices and an increase in interest rates in the second half of the year, the group's sales dynamics began to slow down, the expert noted.^[2]

2016: 3.1-fold increase in net income

The net profit of the public developer PIK Group for 2016 amounted to 11 billion 5 million rubles. This follows from the company's RAS reporting. Compared to 2015, this figure increased 3.1 times (then net profit amounted to 3.521 billion rubles). At the same time, profit from sales decreased by 28% and amounted to 3.217 billion rubles.

Annual revenue grew by 11% from 15.5 billion to 17 billion rubles. Total debt at the end of 2016 amounted to 52 billion rubles. The value of assets, in turn, almost doubled. The corresponding indicator increased by 46% to 164.681 billion rubles. This is mainly due to the purchase of the developer Morton in the fall of 2016.

Prior to the acquisition of Morton Group, according to interim reporting as of September 30, 2016, the value of PIK Group assets amounted to 122.303 billion rubles. Thus, it can be judged that the cost of Morton amounted to about 40 billion rubles. This is the figure that Vedomosti sources previously called.

The company's land bank as of December 31, 2016 is 12.5 million square meters. m.

2016 The Group acquired Morton Group of Companies

History

2024: Yervand Karapetyan's appointment as CEO

In early April 2024, it became known about the appointment of Yervand Karapetyan as the new general director of the PIK construction company. He replaced Ivan Polandov, who resigned as head of the group in March 2024. Read more here.

2023

The purchase of MIC cost the PIK group 45.6 billion rubles instead of the expected 40 billion rubles

The purchase of the MIC developer cost the PIK group 45.6 billion rubles instead of the expected 40 billion rubles. This amount is indicated in materials published on the corporate disclosure website at the end of October 2023. The deal was the largest in the Russian housing sector in its history. Read more here.

Former PIK CEO sold a controlling stake in the company

Businessman Sergei Gordeev sold a 20% stake in the PIK group. The company announced this in October 2023. It is noted that the entrepreneur lost the right to manage a controlling stake and reduced his stake from 52.49 to 32.49%.

20% of the developer's shares were received by the closed mutual investment fund "Institutional Investments in Residential Real Estate" Fund No. 1 "under the management of Central Trust Company JSC (CTC). The participants of the fund were not disclosed.

Sergey Gordeev reduced his stake in the company from 52.49 to 32.49%

As follows from the PIK message, Gordeev owns shares in the construction company through the structures of Pik + LLC (Moscow), Ledamen LLC (Kaliningrad), HREF Foundation (Liechtenstein), and the Cypriot companies Letiosa Holding Limited and Siridica Limited.

According to Izvestia, 20% of the shares could be sold to a strategic investor for 45-75 billion rubles. The buyer may be a large creditor of the group or a developer. The benefit of a new shareholder may be buying in large packages, but at a low valuation.

According to experts interviewed by RIA Real Estate, the sale by Sergei Gordeev of a 20% stake in the PIK group and the loss of a controlling stake in it will not have a significant impact either on the development market or on the company itself, although some changes in management and corporate culture are likely. Most likely, the changes will not be global in nature due to the fact that PIK's business functions and makes a profit, said Alexey Novikov, managing partner of NF Group.

If it is a company associated with the state, then it is possible that the group's resources will increase and will be aimed at actively developing new regions or engaged in projects not only profitable from an economic point of view, but also important at the level of state policy to create qualitatively affordable housing in Moscow and other cities of Russia. - he reflects, believing that the current team is unlikely to change anyone, regardless of who will be an investor.[3]

TAdviser interview with Vsevolod Nechitailenko, Director of Design Unit Automation

In recent years, the business of the largest Russia developer - the PIK group - has grown dynamically. In the Russian CAD an interview TAdviser in October 2023, the Vsevolod Nechitailenko director of automation for the PIK design unit spoke about what technologies help the group maintain high design rates, and why it is in no hurry to switch to. Read more here.

VTB withdrew from the capital of the PIK group of companies

VTB Bank completely withdrew from the capital of the largest housing developer in Russia, the PIK group, selling 12.36%. This is stated in the materials of the credit institution, which were published in August 2023.

VTB told Vedomosti that "the investment itself is assessed as successful for the group's business." How much VTB gained from the sale of the remaining share, the parties do not disclose. The capitalization of PIK Group on the Moscow Exchange at the time of its closure on August 23, 2023 amounted to 545.5 billion rubles, respectively, such a package could cost 67.3 billion rubles, the newspaper notes.

VTB withdrew from PIK Group capital

At the time of VTB's purchase of a stake in the PIK group, the value of one developer's share was 380 rubles, by August 23, 2023 they cost 828 rubles. Timur Ryvkin, director of the department of residential real estate and land development at Nikoliers, explains this growth, among other things, by increasing the project portfolio and financial indicators of the group.

The buyer of PIK securities, taking into account the rather significant size of the package, is likely to be a group of Russian institutional investors, believes Elena Tsareva, senior analyst at BCS World of Investments. Marat Ibragimov, executive director of the market analysis department of Gazprombank, also believes. Consultants also remind that, according to the law, PIK would be obliged to inform about the appearance of a shareholder with a share of more than 5% (having previously received the appropriate notification from it), therefore, according to them, in this case, it can really be considered that VTB's share was bought out by several investors, and not one. In addition, a forward agreement was previously concluded between PIK and VTB on the acquisition by the developer of the bank's shares, the developer's financial statements said. But now this agreement could be changed, a source familiar with its details clarifies to Vedomosti.^[4]

2021

Raising 36 billion rubles under SPO

On October 1, 2021, PIK Group held a secondary public offering (SPO), in which about 28.5 million securities were sold at a price of 1275 rubles apiece. Thanks to this deal, the developer earned about 36.29 billion rubles.

The initial volume of the offer was measured by 27 million PIK shares, and the benchmark for the offering price initially announced to investors was set in the range of 1250-1275 rubles per share. Thus, the placement passed along its upper border.

PIK held an SPO and raised 36 billion rubles

PIK intends to use the funds raised from SPO to pay off debt, expand business and other corporate purposes. About 11.6 billion rubles are planned to be spent on buying out global depositary receipts (GDR) of the company from VTB. At the expense of SPO, the company increased its share of equity in free float.

The SPO was organized by J.P. Morgan, Morgan Stanley, Sber CIB, VTB Capital, Alfa Bank, Aton, Credit Suisse, Gazprombank and Sova Capital.

After the SPO, PIK shares fell in price. By 16:00 Moscow time on October 1, 2021, the company's quotes on the Moscow Exchange decreased by 11.3% compared to the previous day, to 1269 rubles.

On the Russian market, the placement of shares is traditionally perceived negatively, analysts at BCS Express say. In their opinion, on the long-term horizon, "SPO will contribute to the growth of the attractiveness of shares by increasing free-float and liquidity, as well as, if funds are used to expand the business, grow the scale of the business and improve financial performance."

At the same time, Fitch Ratings analysts confirmed the long-term rating of PIK - a specialized developer and the long-term rating of PIK-Corporation at BB-. The outlook for both ratings is stable.

The ratings are supported by the company's leading positions in the Russian market, reliable operational and financial indicators, as well as favorable market conditions, the developer notes.^[5]

Purchase of 50% of the developer "Sigma"

At the end of September 2021, it became known about the sale of 50% in Sigma Holding to the PIK group. The latter bought the asset from the former top manager of PIK Vladislav Sviblov, a major shareholder in a number of mining assets in Russia. The remaining 50% of the developer belongs to Herman Tyo, the son of the head of Capital Group Pavel Tyo. Read more here. Read more here.

Set up a company to rent and sell homes online Kvatra

PIK created a new company to rent and sell housing online. Kvatra The largest Russia developer announced this on September 10, 2021. More. here

2020

VTB and PIK held the first online mortgage issuance in Russia

On April 15, 2020, it became known about the first case when a mortgage was first taken out in Russia and bought an apartment completely via the Internet. The deal was carried out by VTB and the PIK group, in which a client from home purchased real estate in the Sheremetyevsky residential complex in Moscow. Read more here.

TAdviser Interview on PIK Group Key IT Priorities and Benefits of Electronic Document Management

In January 2020, Pavel Smirnov, head of the Document Management product at PIK Digital, spoke in an interview with TAdviser about the key IT priorities of PIK Group and the advantages of introducing electronic document management in the construction sector. Read more here.

2017

In 2017, the Analytical Credit Rating Agency (ACRA) assigned the PIK Group of Companies a credit rating of BBB + - the highest among Russian developers. International credit rating from Standard & Poor's is confirmed at "B." In 2017, an RA expert assigned PIK Group a credit rating at the level of "A-" with a stable forecast.

Built a record 2 million m2 (29,000 apartments)

2015: VTB owns 20% of PIK Group

VTB became the owner of 19.27% of one of the largest development companies in Russia - PIK Group of Companies, follows from the information posted on the bank's official website. The transaction was closed on June 23, 2015, after which 127.29 million voting shares of^[6] came under the control of VTB^[7] the^[8].

The share in the development company was transferred to the bank as part of a repo transaction (purchases of securities with an obligation to buy back the seller after a fixed period at a fixed price), the VTB press service told RBC. It was not possible to get a comment on this in the PIK RBC group.

The developer raised a loan from VTB Capital for 24.3 billion rubles in June 2014 for a period of one year with the possibility of prolongation up to five years. Sberbank CIB analyst Yulia Gordeeva noted at the beginning of the year that one of the company's tasks will be to restructure this debt on acceptable terms. On June 11, the bank extended the loan term by two years with the possibility of prolongation by the same amount. The loan is pledged by the company's shares, which became the property of the bank as part of the repo transaction, a source close to the participants in the transaction told RBC.

• In 2015, PIK Group brought to the market fundamentally new products of industrial and monolithic housing construction and completely changed the approach to the formation of the internal residential environment of integrated development areas.
• Bringing Fundamentally New Home Types to Market with Improved Aesthetic and Consumer Characteristics

2012

Obtaining an individual credit rating at "A" level from the National Rating Agency (NRA)

2009

Receipt of state guarantees of the Government of the Russian Federation

2007

• Since 2007, the Group has been on the stock market - an initial offering on the London Stock Exchange (LSE), RTS, and MICEX
• By the decision of the Government of the Russian Federation, PIK Group of Companies is included in the list of strategic enterprises of the Russian economy.

1998-2005

• 2005 Acquisition of Moscow House-Building Plant No. 3 (DSK-3)
• 2004 Access to the markets of the Moscow and Rostov regions
• 2001 Acquisition of Moscow House-Building Plant No. 2 (DSK-2)
• 1998 Launch of mortgage programs together with the Moscow government and partner banks

1994

PIK Group of Companies was founded in 1994 and is one of the leading Russian developers in the field of residential real estate. PIK Group focuses on projects in Moscow, Moscow Region and several regions of Russia. The main activity of the company is the construction and sale of economy-class housing, mainly in the segment of panel industrial housing construction.

Since its inception, the Company's turnover has grown to $450 million in the first 10 years of the Group's operations. Over the next three years from 2004 to 2007, the company achieved a leading position in the Russian real estate market. During this period, the Company's turnover grew 5 times, reaching $2.3 billion.

Creation of the First Mortgage Company (PIK), subsequently - PIK Group of Companies

Notes