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EtalonAnnouncement

23/11/2016 11:45

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RNS Number : 9604P
Etalon Group Limited
23 November 2016 
 
The following amendment has been made to the 'Etalon Group Board of Directors
Meeting Results' replacement announcement released on 14 November 2016 at 7:56
under RNS No 0668P: 
 
The ex-dividend date was changed to 23 November 2016 in connection with the US
bank holiday on 24 November 2016. 
 
Previously, the following amendment had been made to the 'Etalon Group Board
of Directors Meeting Results' announcement released on 14 November 2016 at
7:30 under RNS No 0662P: 
 
The date of the EGM was corrected from 19 December 2016 to 15 December 2016. 
 
All other details remain unchanged. 
 
The full amended text is shown below. 
 
14 November 2016 
 
Replacement: Etalon Group Board of Directors Meeting Results 
 
The Board of Directors of Etalon Group Limited ("Etalon Group" or the
"Company"), one of Russia's largest and longest-established development and
construction companies, held a meeting at the Amathus Hotel Limassol, 75
Amathounta Avenue, 4532 Limassol, Cyprus. 
 
Strategy 
 
The Board of Directors reviewed the Company's strategic plan for 2017-2021 and
approved its key principles, which should lead to substantial market share
gains while improving profitability and cash flows over the next 5 years. The
Board tasked management with developing a detailed strategic plan by the
middle of January 2017, after which it will be presented to the public. 
 
Motivation programme 
 
The Board of Directors has changed the motivation programme for the top
management team in line with the Company's strategic goals for 2017-2021.
Starting from 1 January 2017, remuneration for Company leadership will be
based on five KPIs: delivery volumes, cash collections, dividend payments, net
profit and growth in the Company's market capitalisation. The latter two KPIs
will have the most significant role (their weight in overall remuneration is
expected to be over 60%). In addition, only 50% of bonuses will be paid out in
cash, while the remaining 50% will be paid out in the form of Etalon Group
GDRs with long-term limitations on their sale, ensuring even greater alignment
of shareholders and management. 
 
Changes to the Board of Directors and Committees 
 
In order to further enhance the Board's supervisory role and strategic
expertise, and in line with global best practices in corporate governance, the
directors re-elected the Board of Directors and decided to create an
Information Disclosure Committee. The new makeup of the Board of Directors and
its Committees is listed below: 
 
Board of Directors: 
 
·    Dmitry Zarenkov, Chairman, non-executive director 
 
·    Viacheslav Zarenkov, CEO and President of Etalon Group 
 
·    Kirill Bagachenko, Deputy CEO and Vice President of Etalon Group 
 
·    Dmitry Kashinsky, Vice President of Etalon Group 
 
·    Martin Cocker, independent non-executive director 
 
·    Boris Svetlichny, independent non-executive director 
 
·    Michael Calvey, non-executive director 
 
·    Alexey Kalinin, non-executive director 
 
·    Charalampos Avgousti, independent non-executive director 
 
·    Marios Theodosiou, independent non-executive director 
 
Strategy Committee: 
 
·    Dmitry Kashinsky, Committee Chairman, Vice President of Etalon Group 
 
·    Viacheslav Zarenkov, CEO and President of Etalon Group 
 
·    Dmitry Zarenkov, non-executive director 
 
·    Alexey Kalinin, non-executive director 
 
·    Kirill Bagachenko, Deputy CEO and Vice President of Etalon Group 
 
·    Victor Vasenev, Chief Financial Officer of Etalon Group 
 
·    Alexander Tyapin, Investment Director at Baring Vostok funds 
 
Audit Сommittee: 
 
·    Martin Cocker, Committee Chairman, independent non-executive director 
 
·    Boris Svetlichny, independent non-executive director 
 
·    Victor Vasenev, Chief Financial Officer of Etalon Group 
 
·    Gabbas Kazhimuratov, Chief Financial Officer at Baring Vostok funds 
 
Remuneration and Nomination Сommittee: 
 
·    Viacheslav Zarenkov, Committee Chairman, CEO and President of Etalon
Group 
 
·    Alexey Kalinin, non-executive director 
 
·    Martin Cocker, independent non-executive director 
 
·    Charalampos Avgousti, independent non-executive director 
 
·    Dmitry Zarenkov, non-executive director 
 
·    Kirill Bagachenko, Deputy CEO and Vice President of Etalon Group 
 
·    Michael Calvey, non-executive director 
 
Information Disclosure Committee: 
 
·    Kirill Bagachenko, Committee Chairman, Deputy CEO and Vice President of
Etalon Group 
 
·    Victoria Tsytrina, Chief Legal Officer of Etalon Group 
 
·    Ksenia Savchuk, Head of PR of Etalon Group 
 
Re-domicile from Guernsey to Cyprus 
 
At its meeting the Board also discussed moving the Company's domicile from
Guernsey to Cyprus. After considering changes to legislation in the countries
where Etalon Group operates, and in line with ongoing efforts to strengthen
further the Company's corporate governance, as well as to optimise overhead
costs, the Board of Directors unanimously voted to recommend that shareholders
approve the change in domicile at an extraordinary general meeting of
shareholders ("EGM"), which will be convened on 15 December 2016. 
 
Based on comprehensive legal and tax research, the Board of Directors
understands that investors' rights and protections will be unaffected by the
change in domicile, that LSE listing rules will continue to apply, and that
there will be no impact to Etalon Group's global depositary receipt ("GDR")
programme (including no requirement to exchange GDRs). 
 
The Notice of EGM and Form of Proxy will be posted to shareholders, and copies
of these documents will be submitted to the National Storage Mechanism at
http://www.morningstar.co.uk/uk/NSM, in due course. The Notice of Meeting will
also be made available on the Etalon Group website at www.etalongroup.com. 
 
Dividends 
 
The Board of Directors has declared an interim dividend of USD 0.03 per share
for 1H 2016. The dividend represents 43% of the Company's consolidated net
profit for the period (based on the Central Bank of Russia exchange rate on 10
November 2016).  The ex-dividend date for holders of the Company's Global
Depositary Receipts ("GDRs") was set as 23 November 2016, and the record date
is 25 November 2016. Dividends are to be paid on 13 December 2016. 
 
Etalon Group President and CEO Viacheslav Zarenkov said: "Following the
approval of its new strategy, Etalon Group will be embarking on a new and
ambitious stage in its development. We will focus on growth supported by
improved efficiency, which should translate into higher dividend payments to
shareholders. 
 
"One of the key changes will be better alignment of management and shareholder
interests with a new motivation programme. Starting from 2017, senior
management remuneration will be closely tied to delivering on strategic
targets and on increasing the value of the Company for shareholders. KPI-based
bonuses will make up the major part of senior management reward packages, with
bonus payments split 50/50 between cash and GDRs. I believe this updated
approach will provide the right motivation for management to achieve
breakthroughs in the Company's development that will benefit our shareholders
and other stakeholders. 
 
"Another step we are taking towards achieving this is building best-in-class
corporate governance systems, including by bringing in more non-executive and
independent directors to the Board of Directors, and creating an Information
Disclosure Committee that will focus on ensuring Etalon continues to lead its
sector in the field of transparency and disclosure. 
 
"I am also pleased to note that we are delivering on our updated dividend
policy that was adopted in May, with an interim dividend that represents 43%
of the Company's consolidated net profit for 1H 2016. The decision was made
because Etalon Group is in a solid financial position, with strong operating
performance year-to-date which translates into healthy free cash flow." 
 
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 by Viacheslav Zarenkov, 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
LenSpetsSMU subsidiaries. With a 29-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 5 million sqm. Etalon
Group's CAGR for deliveries in 2010-2015 was 19%. 
 
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 2015 was RUB 7,397 million. 
 
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 5,000 people, and its nationwide sales and marketing network
covers 37 Russian cities. 
 
As of 31 December 2015, Etalon Group's portfolio comprised 28 projects, with a
total of 2.72 million sqm of unsold net sellable area. JLL valued this
portfolio at RUB 104,384 million. 
 
For the year ended 31 December 2015, Etalon Group's new contract sales
totalled 385 ths sqm, or RUB 35,080 million. Deliveries in 2015 totalled 502
ths sqm. 
 
The Company recorded revenue of RUB 42.4 billion and EBITDA of RUB 7.7 billion
for the year ended 31 December 2015. 
 
Etalon Group Limited's GDRs have been traded on the Main Market of the London
Stock Exchange since 20 April 2011. 
 
This information is provided by RNS
The company news service from the London Stock Exchange