Final Results

12 March 2012

Raven Russia Limited ("Raven Russia" or the " Company")

Results for the year ended 31 December 2011

The Board of Raven Russia releases below the results for the year ended 31 December 2011

HIGHLIGHTS

·; Profit before tax increased 131% from $55.7 million to $128.9 million;

·; NAV per share up 13.3% from 105 cents to 119 cents;

·; 222,000sqm of new lettings during the year;

·; Portfolio now 92% let;

·; Annualised NOI of $129 million at today's date;

·; Fully let portfolio NOI of $137 million;

·; Fully let portfolio yield of 11.9%;

·; Tender offer buy-back of 1 in 39 shares at 68 pence proposed;

·; Basic EPS of 16.7 cents;

·; Fully diluted EPS of 14.7 cents;

·; Year end cash balance of $181.8 million.

Glyn Hirsch (CEO) said "we have been helped by a strong level of tenant demand and have done as well as we could have hoped"

Enquiries

Raven Russia Limited Tel: + 44 (0) 1481 712955

Anton Bilton

Glyn Hirsch

Cardew Group Tel: + 44 (0) 207 930 0777

Tim Robertson

Alexandra Stoneham

Singer Capital Markets Limited Tel: +44 (0) 203 205 7500

Corporate Finance- James Maxwell

Sales - Alan Geeves / James Waterlow

About Raven Russia

Raven Russia was founded in 2005 to invest in class A warehouse complexes in Russia and lease to Russian and International tenants. Its Ordinary Shares, Preference Shares and Warrants are listed on the Main Market of the London Stock Exchange with a market capitalisation of approximately £350 million. The company operates out of offices in Guernsey, Moscow and Cyprus and has to date completed a portfolio of circa 1 million square metres of Grade "A" warehouses in Moscow, St Petersburg, Rostov-on-Don and Novosibirsk. For further information visit the Company's website: www.ravenrussia.com

Chairman's Statement

The Board of Raven Russia announces the Group's results for the year ended 31 December 2011.

The year has shown continued progress in lettings and financing, both helped by strong demand from occupiers.

Reported net operating income ("NOI") for the year increased by 50% from $61.0 million to $91.7 million. Operating profit increased by 128% from $25.3 million to $57.8 million and underlying earnings before tax showed a profit of $8.1 million (2010: loss of $19.8 million). Operating cash inflow increased 147% from $33.1 million to $81.6 million.

After a revaluation surplus of $153 million (2010: $79.2 million), profit before tax has increased by 131% to $128.9 million (2010: $55.7 million) and fully diluted net asset value per share has increased by 13.3% to 119 cents (2010: 105 cents) per share.

At today's date the annualised total of NOI including pre let agreements ("PLAs") and letters of intent ("LOIs") is $129 million. On that basis, 92% of our 1.03 million square metres ("sqm") of completed portfolio is let.

Our balance sheet remains strong. Gearing remains low at 38.1% (2010: 35.6%) as calculated in note 34 to the financial statements. Our year end cash balance stood at $181.8 million (2010: $107.6 million).

As a result of the considerable progress made we are able to declare a final distribution of 1.75 pence per share making a total of 3 pence for the year. As the shares continue to trade at a significant discount to NAV we will be distributing in the form of a tender offer buy back of 1 in 39 ordinary shares at 68 pence. The tender off will be subject to the approval of shareholders and a circular setting out full details will be posted shortly. It is expected that the tender offer will be completed in May 2012.

I would like to take this opportunity to thank our shareholders, employees and advisors for their support during the year.

Richard Jewson

Chairman

11 March 2012

Chief Executive's Report

Our task for 2011 was relatively straightforward. Continue to let the portfolio and improve returns and cash-flow through refinancing.

We have been helped by a strong level of tenant demand and have done as well as we could have hoped.

When we started Raven Russia the aim was to create a high quality, income producing portfolio of grade A warehouses. It feels like we are nearly there. 1.03 million sqm of finished space, 92% let, with an annualised NOI (including PLAs and LOIs) at today's date of $129 million. We are profitable and cash generative and have now started to make the meaningful distributions to shareholders that we have always planned. This should continue to improve as we let up our remaining vacant space.

The completed portfolio will produce $137 million of NOI when fully let, so there is still potential for further growth from the existing portfolio as well as the potential from developing out our land.

Report and Accounts tend to be repetitive but I am more than happy to repeat our key numbers:

·; Annualised NOI up to $129 million;

·; Profit before tax up to $128.9 million;

·; Fully diluted NAV per share 119 cents;

·; Distribution per share 3 pence; and

·; A year end cash balance $181.8 million.

So looking back is lovely, what about looking forward?

There is some clear built in growth as we let our remaining vacant space and annualised NOI rises towards $137 million. Everything in the occupiers' market today suggests that we will achieve this in the short term. That will enable us to continue a progressive distribution policy and should enhance NAV per share as well.

In addition, the 119 cents of NAV per share is derived from a portfolio valuation at an average, fully let yield of 11.9% (2010: 12.8%), which still has potential to improve.

The key to our next phase of growth is investment and the use of our cash. The plan is to combine further development and acquisition of income producing assets. We are in the process of acquiring attractive land plots in the North of Moscow where we believe tenant demand is strong and competition limited. Initial cautious appraisals suggest unleveraged cash on cash returns of around 14% should be achievable. We are confident that we can increase the portfolio by 50,000sqm to 100,000sqm per annum on this basis, from our own resources.

High quality completed assets yielding 11.5% funded with conservative bank debt gives a high income return on equity. This is earnings enhancing and immediately contributes to our capacity to make distributions to shareholders. We are looking at a number of acquisitions and have active negotiations in progress including one potentially significant acquisition which would require shareholder approval.

One option open to us to fund income producing investments would be a further issue of preference shares. We are currently exploring this option and at a 9% yield this would be an attractive funding option for the Group.

So, we have had a good year, the Group's financials are strong and the market place is helping us. What is there to worry about? There are still a lot of global problems. The main direct issue for us is the small pool of debt providers to our market. Despite high margins and reliable cash flows the twin terrors of "Russia" and "property" keep most institutions away. This helps us in constraining development and discouraging competition but reduces our returns and slows our growth.

In general though, business is going well and there is no other asset class or country where we would rather be.

Glyn Hirsch

Chief Executive Officer

11 March 2011

Property Review

Throughout 2011 we saw high levels of tenant demand across the portfolio and as a result we completed 222,000sqm (2.39 million square feet) of new lettings to third parties, generating an additional $31.4 million of annual rental income and allowing full operating cost recovery on the space. We remain the market leader in our sector, as measured by amount of space, breadth of portfolio and capacity to expand.

As we anticipated last year, vacancy rates in Moscow have fallen to negligible levels and rents have risen considerably. In our other markets, vacancy is falling and rents increasing, albeit at a slower rate.

The investment properties were valued by JLL at the period end, in accordance with the RICS Valuation and Appraisal guidelines, and are carried at an aggregate gross value of $1,154 million.

This resulted in an increase of $125 million in portfolio value, (on a like for like basis) compared to 31 December 2010, reflecting our progress in leasing and the improvement in the investment market. This year end valuation reflects an average yield of 11.9% on a fully let portfolio NOI of $137 million.

Investment Portfolio

In Moscow, not including the second phase of the Klimovsk project, we have six completed projects totalling 563,000sqm, producing an annualised income of $74.6 million at the year end. These properties are virtually fully let. We let 135,000 sqm in Moscow in 2011 and rents have grown strongly, now standing at $130-$135 per sqm for Grade A warehousing. This included turning a vacancy of 95,000sqm at Noginsk into a vacancy of just 3,000sqm, about 1,000,000 million square feet of letting at one project. Within this number was the 76,000sqm we leased to X5 Retail, the largest retailer in Russia for whom we fitted out part of their space as temperature controlled storage, at a cost of almost $20 million, in return for which we benefit from an enhanced rent.

At the end of the last quarter we completed the construction of 53,000sqm of new Grade A warehouse space at Klimovsk on time and budget. Since the year end, we have signed leases with Burda and de Agostini on 18,260sqm with a further 20,217sqm under PLA and LOI, giving a total NOI of $6.3 million per annum. This increases to $8.5 million once the phase is fully let. Cash cost to construct this part of the project was $37.2 million, delivering a yield on cost of 23%. Even after allowing for an allocation of pre paid land and infrastructure costs, the yield on cost is 15.5%. In the third quarter, we acquired 8ha of adjacent land to allow a third phase to the project, with the potential to construct a further 45,000sqm.

In St Petersburg, we have leased 27,000sqm during the year which reflects the slower market in the city. Since the year end we have leased a further 21,500sqm at our Shushari project. We also sold 2ha of surplus land to Johnson Controls at around $500,000 per ha.

Our Rostov project is now 95% leased, with the final space under a LOI. Demand in the city has been strong and we have the potential to start construction of an additional 15,000 sqm of new space. In Novosibirsk demand has been improving although we still have 42,000sqm vacant.

New leases included a total of 50,700sqm to tenants for expansion purposes; effectively organic growth from within the portfolio. The strength of our contacts with occupiers and of our in house leasing team is demonstrated by the fact that we paid agents fees on only 75,288sqm out of the 222,000sqm of lettings, representing a saving of circa $1.7 million.

We have now exited all of our remaining development joint venture arrangements at a notional cash cost.

Land Bank

We own development land at Noginsk, Klimovsk phase 3 and Rostov, a total of 75ha. These projects benefit from existing infrastructure and utilities and should the Company choose, development could commence on them in short order. We sold our property assets in Kiev in the last quarter of 2011, as the market in Ukraine seemed unlikely to deliver better returns than development in Moscow.

The company holds an additional 290ha of land in various regional Russian cities and in Minsk, Belarus, with longer term potential.

The Market

Particularly in Moscow, tenant demand is strong and far outstrips supply. JLL believe existing supply was just 1.26% or 104,000sqm at the year end. Demand for 2012 is estimated by JLL at 1 million sqm and additional supply at 700,000sqm. Based on this and our own analysis of the market, we will consider starting to build more space at our Moscow projects where possible.

Increasing rents produce excellent development returns, but at the same time they price a number of tenants out of the rental market. That is evidenced by the increasing number of build to suit to buy requirements in the market. Although this delivers immediate profits it does not produce long term stable income streams that can be the backbone for dividends. We therefore remain focused on the leasing market and continue with our strategy of trying to attract the best tenants on the longest leases at acceptable rents. Equivalent yields in Moscow for Grade A, well let, rack rented warehouses are now in the region of 11%, approximately 50bps improvement on last year.

If occupier demand stays strong and rents continue to tick up, our properties look increasingly reversionary, underpinning value.

Financial Review

We have let over 20% of our completed stock in the year and this is reflected in a strong set of financial results.

Income

The Russian warehouse portfolio generated $80.9 million of NOI (2010: $50.4 million) from third party tenants, increasing to $91.6 million (2010: $56.1 million) including Roslogistics contribution to gross revenue, an increase of 63%. This is after the cost of servicing vacant space in the year of $13.7 million (2010: $20.8 million).

Roslogistics continued to operate out of 76,600sqm of our portfolio and is steadily increasing its contribution to profit.

The poor residential market in the UK had an impact on the results of Raven Mount, which generated $14 million (2010: $18 million) in cash on liquidating its stock. In addition, we impaired our investment in a potential development in the Grand Bahamas in the first half of the year, resulting in a charge of $2 million.

Overheads

Overheads supporting the investment portfolio were $12.8 million (2010: $13.2 million) and central overheads, supporting the corporate head office in Guernsey and the intermediate office in Cyprus, $6.1 million (2010: $6.1 million). Raven Mount and Roslogistics had overheads of $3.0 million (2010: $3.1 million) and $3.0 million (2010: $3.4 million) respectively before depreciation and the cost of moving our preference shares to the full list was $0.5 million. The charge for share based payments in the year was $6.1 million (2010: $6.4 million), reflecting the share price on the grant date of various share schemes.

Our underlying earnings for the year, as defined in note 9 to the financial statements, show a pre tax profit of $8 million (2010: pre tax loss of $20 million).

Financing

With the Eurozone problems progressively impacting on the pool of available international lenders, we have focussed on drawing finance on unencumbered assets and extending the maturity of existing facilities, whilst maintaining our cost of debt. This has been a successful exercise so far.

Debt service costs totalled $38.9 million (2010: $35.7 million) including amortisation of costs of $4 million (2010: $3 million). Our year end debt level, excluding preference shares, was $561 million (2010: $432 million) with a weighted average cost of debt of 7.1% (2010: 7.0%) and average term to maturity of 4.5 years (2010: 3 years).

In January, we completed a $30 million, 7 year term loan with Marfin Bank secured on our Lobyna warehouse and in June we completed a $38 million, 9 year term loan with Raiffeisen Bank for the completed phase 1 of our Klimovsk project.

During the second half of the year, we completed the refinancing and extension of the Istra facility with Aareal Bank. The term has been extended to 2016 and an additional $34.5million was drawn, giving a total outstanding facility of $142 million.

In the final quarter, we completed the refinancing of the $57 million HSH Nordbank loan secured on our Noginsk warehouse, with a new $83.3 million, 5 year facility with Unicredit Bank. This generated $26.3 million of additional funds.

An initial $40 million was drawn from a $78 million, 10 year term loan with Raiffeisen Bank secured on our St Petersburg, Shushary project. The outstanding balance of this committed facility will be drawn this year as leasing and debt service triggers are satisfied.

These facilities have collectively generated $169 million of extra net funding.

The UK Barclays facility of $1.9 million (2010: $7.5 million) was extended to May 2012 at the same margin of 2.5%. A short term $10.9 million Group facility from RBSI was rolled over to January 2012 at a margin of 2.85% and has been repaid since the year end.

The Group has met all covenants on its debt facilities during the period except for the facility secured on Constanta, the Grade B office block in St Petersburg, where a potential loan to value breach of $5.3 million exists. The bank has waived this potential breach in the last calendar year and sweeps all excess cash generated by the asset. It has been agreed that this arrangement will continue in the current year.

The Dollar value of our preference shares was $218 million (2010: $217 million) at 31 December 2011. The unrealised foreign exchange loss since issue is $7.9 million (2010: $9.4 million) and is included in the translation reserve. The coupon paid during the year of $29.3 million (2010: $27.7 million) is included in finance expense. Our weighted average cost of debt and gearing level, including preference shares as debt, is 8.5% (2010: 8.4%) and 53% (2010: 53%) respectively.

Hedging

It is the Group's policy to hedge the cost of debt secured on completed assets and this is achieved using a mixture of caps and swaps on US Libor. $186 million (2010: $117 million) is capped at 2.69% (2010: 3.64%) with four years remaining. $335 million (2010: $225 million) is swapped at an average rate of 2.38% (2010: 3.10%) with three years remaining.

Cash flow hedges are operated through the lease mechanisms which are principally US Dollar pegged and in holding sufficient Sterling cash reserves to cover preference share coupon and dividend commitments.

Cashflow

Letting continues to drive our improving operating cashflows, increasing to $82 million (2010: $33 million) in the year. New debt financing more than covered capital commitments and debt amortisation obligations. We also had the benefit of warrant conversions generating $25 million of funds. Year end cash increased by $74 million, after distributions to ordinary and preference shareholders of $51 million.

Net Asset Value and Dividends

Net assets have increased to $669 million at 31 December 2011(2010: $580 million) after a revaluation surplus of $153 million (2010: $79 million). We distributed the equivalent of 1.25p per share by way of a combined tender offer buy back and dividend during the year and intend to distribute a further 1.75p by tender offer buy back as a final distribution.

Mark Sinclair

Chief Financial Officer

11 March 2011

Raven Russia Limited - Directors

Richard Jewson (aged 67)

Non-executive Chairman

Richard Jewson joined Jewson, the timber and building merchant, in 1965 becoming the Managing Director, then Chairman of its holding group, Meyer International plc from which he retired in 1993. Since then he has served as non-executive director and chairman of a number of public companies. He retired in 2004 from 10 years as Chairman of Savills plc and in 2005 from 14 years as a non-executive Director and deputy Chairman of Anglian Water plc. He is currently Chairman of Archant Ltd, and a non-executive director of Temple Bar Investment Trust plc, Grafton Group plc and other unquoted companies.

He is a member of the Remuneration Committee and is Chairman of the Nominations Committee.

Anton Bilton (aged 47)

Executive Deputy Chairman

Anton Bilton is an economics graduate from The City University in London. Anton was the founder of The Raven Group. He has also been a founder and director of three other companies that have floated on AIM and four public property companies established under the Business Expansion Scheme.

He is a member of the Nominations Committee.

Glyn Hirsch (aged 50)

Chief Executive Officer

Glyn Hirsch, a Guernsey resident, qualified as a Chartered Accountant with Peat, Marwick Mitchell & Co in 1985. Until 1995, he worked in the corporate finance department of UBS (formerly Phillips & Drew) latterly as an Executive Director specialising in UK smaller companies. From 1995 until 2001, he was Chief Executive of CLS Holdings plc, the listed property investment company, a former Director of Citadel Holdings plc, the specialist French property investor and former Chairman of Property Fund Management plc, the listed property fund management business. Glyn is also a non-executive director of Lion Trust Asset Management PLC.

Mark Sinclair (aged 46)

Chief Financial Officer

Mark Sinclair, a Guernsey resident, is a chartered accountant, and spent 18 years at BDO Stoy Hayward, a leading professional services firm in the UK. He was a partner in the London real estate group responsible for a portfolio of large property companies, both listed and private. He joined Raven Mount in June 2006 as Finance Director of Raven Russia Property Management Ltd, the Property Adviser to the Company. He has significant experience in all financial aspects of property transactions and company reporting.

Colin Smith (aged 42)

Chief Operating Officer

Colin Smith, a Guernsey resident, qualified as a Chartered Accountant with Stoy Hayward. Prior to joining the company, he was a director in the audit and assurance division of the chartered accountant practice of BDO in Guernsey, having joined BDO in 1994. Colin has also been a non-executive director of a number of offshore investment funds and companies.

Christopher Sherwell (aged 64)

Non-executive Director

Christopher Sherwell is a Guernsey resident and a former managing director of Schroders in the Channel Islands. Before joining Schroders, he was Far East Regional Strategist in London and Hong Kong for Smith New Court Securities and prior to that spent 15 years as a journalist much of them as a foreign correspondent for the Financial Times. He has considerable public company experience and acts as a non executive director on a number of publicly listed investment companies including Goldman Sachs Dynamic Opportunities Ltd, where he is chairman, IRP Property Investments Ltd, Baker Steel Resources Trust Ltd and Hermes Alternative Investment Funds Plc.

He is Chairman of the Remuneration Committee, a member of the Audit and Nominations Committees and is Senior Independent Director.

Stephen Coe (aged 46)

Non-executive Director

Stephen Coe BSc, FCA, a resident of Guernsey, is self employed providing executive and non-executive services to public and private clients. His current public directorships include Matrix European Real Estate Investment Trust Ltd, Kolar Gold Limited and Trinity Capital Limited where he acts as a non-executive director; he is also chairman of the audit committee for these three entities. Private clients include investment funds and a captive insurer. From 2003 to 2006, he was Managing Director of Investec Trust (Guernsey) Ltd and Investec Administration Services Ltd, responsible for private client and institutional structures. Between 1997 and 2003 he was a director of Bachmann Trust Company Ltd and previously he worked with Price Waterhouse specialising in financial services.

He is Chairman of the Audit Committee and a member of the Remuneration Committee.

David Moore (aged 51)

Non-executive Director

David Moore is a resident of Guernsey. He is an advocate of the Royal Court of Guernsey and is a partner with Mourant Ozannes. He has been with Mourant Ozannes since 1993 and before that spent 10 years practising in the City of London, predominantly with Ashurst Morris Crisp. He specialises in corporate and financial matters and is a non-executive director of a number of investment and insurance management companies, investment and insurance companies including Standard Life Investments Property Income Trust Ltd of which he is non-executive chairman.

He is a member of the Audit Committee.

Directors' Report

The Directors present their report and the audited financial statements of the Group for the year ended 31 December 2011.

Principal activities

The Company is a Guernsey registered investment company and during the year carried on business as a property investment company.

Business review

A review of the business during the year is contained in the Chairman's Statement, Chief Executive's Report, Property Review and Financial Review.

Results and dividends

The results for the year are set out in the attached financial statements.

The Company made an interim dividend of 1.25p per share. A tender offer alternative was also offered should a shareholder wish to elect for this option, (2010: Tender offer 1 share in every 62 at 58p). A final distribution of 1.75p by way of a tender offer of 1 share in every 39 at 68p is being proposed at the Annual General Meeting (2010: Dividend of 1p).

Principal Risks and Uncertainties

Internal controls and an effective risk management regime are integral to the Group's continued operation. The risk management processes adopted by the Group are described within the Corporate Governance statement. The following section outlines the Group's principal risks and uncertainties.

Strategic Risks

A poorly executed or ineffective strategy may damage shareholder value, fail to meet shareholders' expectations and have reputational consequences for the Group. The principal risks to delivering our strategy are:

Financial Risks

The financial risks to which the Group is exposed could lead to the Group's inability to meet shareholder expectations in terms of returns and ultimately the financial viability of the Group. The principal risks are:

Real Estate and Development risks

Real estate and development risks may impact income and the value of the Group's property assets. The principal risks are:

Operational Risk

The Group's inability to continue its operations may impact the reputation, revenue and value of the Group. The principal risks are:

Directors

The Directors, who served throughout the year were as follows:

Richard Jewson (Non-executive Chairman)

Anton Bilton (Executive Deputy Chairman)

Glyn Hirsch (Chief Executive Officer)

Mark Sinclair (Chief Financial Officer)

Colin Smith (Chief Operating Officer)

Christopher Sherwell (Independent Non-executive Director - Senior Independent Director)

Stephen Coe (Independent Non-executive Director)

David Moore (Independent Non-executive Director)

At each annual general meeting of the Company, one third of the Directors shall retire from office. In addition, each Director shall retire from office at the third annual general meeting after he was appointed or reappointed, if he would not otherwise fall within the Directors to retire by rotation. A retiring Director shall be eligible for re-appointment.

Details of the Directors' remuneration and shareholdings are included within the Remuneration Report.

Substantial shareholdings

The Company has been notified of shareholders, other than directors, holding 3% or more of the ordinary shares as follows:

Ordinary Shares of £0.01

Auditors

Ernst & Young LLP have expressed their willingness to continue in office and a resolution to re-appoint them will be proposed at the forthcoming Annual General Meeting.

Going Concern

The financial position of the Group, its cash flows, liquidity position and borrowings are described in the Financial Review and the notes to the accompanying financial statements. In addition, in note 34 there is a description of the Group's objectives and policies for managing its capital, its financial instruments and hedging activities and its exposure to credit and liquidity risk.

During the year the Group had and continues to hold substantial cash and short term deposits. These were supplemented by the increasing and profitable rental income streams of the operating activities of the Group. Additional financing facilities were obtained during the year which extended the Groups average time to maturity of its facilities to beyond four years. As a consequence, the Directors believe the Group is well placed to manage its future business risks.

After making enquiries and examining major areas which could give rise to significant financial exposure, the Board has a reasonable expectation that the Company and the Group have adequate resources to continue its operations for the foreseeable future. Accordingly, the Group continues to adopt the going concern basis in preparation of these financial statements.

Directors' responsibilities

Guernsey company law requires the Directors to prepare financial statements for each financial year, which give a true and fair view of the state of affairs of the Group at the end of the year and of the profit or loss of the Group for that period. In preparing those financial statements, the Directors are required to:

·; Select suitable accounting policies and then apply them consistently;

·; Make judgements and estimates that are reasonable and prudent;

·; State whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

·; Prepare the financial statements on the going concern basis unless it is inappropriate to assume that the Group will continue in business.

The Directors confirm that they have complied with the above requirements in preparing the financial statements.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Group and to enable them to ensure that the financial statements comply with the Companies (Guernsey) Law, 2008 and IFRS as adopted by the EU. They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

So far as each of the Directors is aware, there is no relevant audit information of which the Company's auditor is unaware and each has taken all the steps he ought to have taken as a Director to make himself aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Directors Responsibility Statement

The Board confirms to the best of its knowledge:

The financial statements, prepared in accordance with International Financial Reporting Standards as adopted by the EU, gives a true and fair view of the assets, liabilities, financial position and profit and loss of the Company and the undertakings included in the consolidation taken as a whole; and

The management report, which is incorporated into the Directors' Report, includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

This responsibility statement was approved by the board of directors on the 11 March 2012 and is signed on its behalf by:

Mark Sinclair Colin Smith

Chief Financial Officer Chief Operating Officer

Corporate Governance

UK Corporate Governance Code

The Board is committed to maintaining a high standard of corporate governance throughout the Group's operations. The Financial Services Authority's listing rules require the Company to explain how it has applied the Main Principles in Section 1 of the UK Corporate Governance Code (the "Code"). This report, together with the Directors' and Remuneration Reports, set out how the Company has done so. In the opinion of the Board, the Company has complied fully with the provisions of the Code throughout the financial year. Copies of the Code can be obtained free of charge from the Financial Reporting Council's website (www.frc.org.uk).

The Role of the Board

The Board is accountable for the governance processes within the Group, and sets the parameters within which the Group seeks to further the interests of shareholders, while monitoring the performance of the executives to whom it delegates management responsibility for the Group. The Board have approved a formal schedule of matters reserved solely for its consideration as outlined below. The Board review and update this schedule as necessary. Matters reserved for the board include:

·; Strategy;

·; Capital structure and dividends;

·; Financial reporting including approving results;

·; Internal control and risk management;

·; Corporate governance; and

·; Material transactional activity.

The Board has delegated a number of its responsibilities through its Audit, Remuneration and Nominations Committees. Terms of references for each of these committees are reviewed periodically by the Board and its Committees, and are made available on the Company's website, www.ravenrussia.com. An outline of each of the Committees' functions and responsibilities is set out below.

Board composition

During the year, the board comprised eight directors, Non-Executive Chairman, Richard Jewson, four Executive Directors and three Non-Executive Directors. The Board considers all the Non-Executive Directors to be independent for the purposes of the Code as further explained below. The Board considered the Chairman to be independent on appointment. The balance of skills and expertise of the Board ensures that no individual or group of individuals dominate the Board's decision making, allowing for independent challenge and rigour to the Boards deliberations. The roles of the individual directors are explained further below and within the directors' report.

There is a defined division of the responsibilities between the Chairman and Chief Executive, the Chairman being primarily responsible for the effective working of the Board, while the Chief Executive is responsible for the operational management of the business, developing the strategy and business model and presenting this to the Board for consideration, along with its implementation across the Group. These roles are undertaken by Richard Jewson and Glyn Hirsch respectively, terms of reference delineating clear divisions of responsibilities have been established and are reviewed on a regular basis.

Christopher Sherwell is the Senior Independent Director of the Company.

David Moore is a partner in Mourant Ozannes, Advocates and Notaries Public. The Group has previously used Mourant Ozannes for legal engagements and Notary services. To avoid any possible conflict of interest or challenge of independence to Mr Moore, the Group has, since early 2010 ensured all new legal engagements, both in terms of structure and remuneration, are not undertaken by Mourant Ozannes other than notary services. During 2011 all engagements, including notary services ceased to be undertaken by Mourant Ozannes further supporting the independence of Mr Moore. Fees to Mourant Ozannes for the year ended 31 December 2011 amounted to £18,877 (2010: £1,194). Mr Moore refrains from participation in and voting on any board resolutions concerning the appointment or remuneration of Mourant Ozannes. The other members of the Board consider that Mr Moore has conducted himself and carried out his duties in relation to the Company in a manner consistent with, and demonstrative of, his independence, this along with the non material nature of the previous fees paid, the Board considers, therefore, Mr Moore to be independent for the purposes of the Code.

Biographies for each director are included elsewhere in the Annual Report and Financial Statements. In accordance with the Articles, one third of the Directors are required to retire by rotation. The Directors retiring by rotation at the Annual General Meeting in 2012 are Glyn Hirsch, Colin Smith, Stephen Coe and David Moore. Having considered the balance of skills and expertise of the Board, its committees and individual directors, the Board recommends each of the directors for reappointment at the Annual General Meeting.

The full Board meets at least six times a year to consider general matters affecting the Company and otherwise as required. Committee meetings comprising any two or more Directors meet on an ad hoc basis to consider transactional and related matters concerning the Company's business. During 2011, there were 20 such committee meetings. Meetings are generally held in Guernsey at the head office, however at least once a year the Board will hold a meeting in Russia to review the Group's operations and meet local management.

To enable the Board to discharge its duties, all directors receive appropriate and timely information, including briefing papers distributed in advance of any board meeting and regular management information. All the Directors are entitled to have access to independent professional advice at the Company's expense where they deem it necessary to discharge their responsibilities as Directors. On appointment, a director receives advice from the Company's financial and other professional advisers as to the affairs of the Company and their responsibilities, an estimation of time commitments necessary to undertake the role and a commitment to receive other such training as may, from time to time, be appropriate.

Attendance at Board or Committee meetings during the year to 31 December 2011

(where 'N/A' is shown, the director listed is not a member of the Committee)

1 - In addition to the above Board meetings there were 20 Board Committee meetings held throughout the year

2 - Richard Jewson resigned from the audit committee on the 16 May 2011.

Board performance evaluation

The Board undertakes annual performance evaluations of its own and its Committees' activities. These are led by the Chairman and where dealing with his own performance, by the Senior Independent Director.

The performance evaluations during 2011 were facilitated internally which took the form of a questionnaire and one to one interview with the Chairman or Senior Independent Director. It was concluded that the performance of the Board, its Committees and individual directors were operating effectively and had the necessary balance of skills and expertise required to direct the business. The Board supports the re-election of each director standing for re-election at the 2012 AGM.

The Board considers the Non-Executive Directors, Stephen Coe and David Moore to be of continued value to the Group's operations having an intrinsic understanding of the Group's operations and having acted and worked with the Company since its establishment. Their continued commitment to the Group, Board and its committees supports their reappointment. Mr Coe and Mr Moore will, should they be re-appointed by shareholders at the 2012 AGM, serve as Non-Executive Directors until their next scheduled re-election during 2015. During this term, the Board and the Nominations Committee will consider the composition of the board with reference to the business needs and requirements of the Code.

Board Committees

The Board has established Audit, Remuneration and Nominations Committees. These Committees undertake specific activities through delegated authority from the full Board. Terms of reference for each Committee are agreed and reviewed on a regular basis by the Board. Full terms of reference for each Committee can be obtained from the Company's website.

Audit Committee

The Audit Committee comprises David Moore, Christopher Sherwell and Stephen Coe, (Chairman), who is considered to have recent and relevant financial experience. Richard Jewson resigned from the Audit Committee on the 16 May 2011 to allow the Committee to be constituted solely from Independent Non-Executive Directors. The Committee meets at least twice a year. There are a number of regular attendees at the meetings of the Audit Committee which include other members of the Board, senior management and the Group's external auditors. The Chairman of the Committee also meets with the external auditors without management present.

The Committee is responsible for ensuring that the financial performance of the Group is properly reported and monitored. The Committee reviews the annual and interim accounts, results, management information statements, financial announcements, internal control systems and risk management, accounting policies of the Group and the continuing appointment of the auditors. During the year, the Audit Committee met four times, to consider the annual and interim accounts, audit planning and internal controls and risk management.

Due to its size and structure, the Group does not have an internal audit function, a matter which is kept under review by the Committee. During the year, the Audit Committee again considered the need for an internal audit function, whether a bespoke function facilitated by internal resources, or using an outsourced model with the assistance of the Group's advisors. The Audit Committee concluded that there was no need for a separate internal audit function at this time. The Committee, however assesses the internal controls and risk management of the Group on a regular basis and reports to the Board accordingly.

During the year, the Committee has considered the appointment, compensation and independence of the Group's auditor, Ernst & Young LLP.

Having considered the ratio of audit to non audit services performed by Ernst & Young LLP, the Committee is satisfied that where Ernst & Young LLP are used for non audit services, due to their intrinsic knowledge of the Group's activities, they were best placed and offered commercial advantage to the Group in performing these services. The policy for the provision of non audit services is reviewed and confirmed by the Committee annually. For the year ended December 2011, fees payable to Ernst & Young LLP totalled $0.972m (2010: $1.483m) of which 22% (2010: 64%) was for the provision of non audit services. For the year ended 31 December 2011, the fees for non audit services totalled US$0.210m (2010: US$0.944m).

Ernst & Young LLP have provided the Committee with written confirmation of their independence. The Committee has recommended a resolution for their reappointment be proposed to shareholders at the Annual General Meeting.

Nominations Committee

The Nominations Committee comprises Anton Bilton, Christopher Sherwell and Richard Jewson, who is Chairman. The Committee undertake an annual review of any succession planning and ensures that the membership and composition of the Board and its Committees are constituted appropriately in light of the business requirements and those of the Code, with the necessary balance of skills and expertise to undertake their roles effectively.

The Committee reviewed and assessed the performance of the Board and its Committees. It concluded that the Board comprised the appropriate mix of skill and experience for the ongoing activities of the Group. Should the Committee consider it necessary to either refresh or enlarge the Board or its Committees, acting in accordance with its terms of reference, a rigorous and thorough evaluation will be undertaken by the Committee in assessing the requirements of the Company and Group so that the individual or individuals appointed will add value to the ongoing activities of the business.

Remuneration Committee

The Remuneration Committee comprises Stephen Coe, Richard Jewson and Christopher Sherwell, who is Chairman. The Remuneration Committee meet at least once a year to review the performance of Executive Directors and to recommend their remuneration and other benefit packages. The fees of the Non-Executive Directors are determined by the Executive Directors. Full details of the activities undertaken by the Committee during the year are included within the Remuneration Committee Report. This Report will be subject to an advisory vote at the Annual General Meeting.

Internal Control and Risk Management

The Board has overall responsibility for the systems of internal control and for reviewing their effectiveness throughout the Group and ensuring that there is an ongoing process in accordance with the guidance of the Turnbull Committee on internal controls that identifies, evaluates and manages the principal risk and uncertainties that may affect the achievement of the Group's strategic objectives. Such a system is designed to manage or reduce the effects of the possible risks to which the Group's activities are subject, rather than providing absolute assurance against material misstatement or loss.

Key features of the risk management process in place during the year and up to the date of the annual report and financial statements include:

·; A comprehensive system of reporting and business planning;

·; A defined schedule of matters reserved for the Board;

·; An organisational structure chart with clearly defined levels of authority and division of responsibilities;

·; Formal documented policies and procedures throughout the Group;

·; The close involvement of the Executive Directors and senior management in all aspects of the day-to-day operations, including regular meetings to review all operational aspects of the business and risk management systems;

·; The Board reviewing Group strategy and progress against objectives throughout the year;

·; A formal whistle blowing policy;

·; A comprehensive and robust system of financial reporting which includes regular management information, such as budgets, re-forecasting models, cash flows, treasury reporting and management accounts; and

·; A formal assessment of risks within the business at all operational levels.

The Audit Committee has reviewed the effectiveness of the systems of internal control and has reported its findings to the Board throughout the year. The Risk Committee (as further defined below) report regularly to the Audit Committee on its deliberations and findings. The risks and uncertainties to which the Group is subject are reviewed and considered by the Audit Committee and Board at regular intervals, specifically around the strategic and long term objects of the Group as a whole in delivering a sustainable operating business and creating long term shareholder value.

The Audit Committee have established a Risk Committee to carry out the review and assessment of risks within the Group's activities. This Risk Committee comprises Executive Directors and senior management involved in each operating jurisdiction and activity of the Group. This process allows a bottom up, as well as a top down approach to risk assessment and ensures that all significant principal risk and uncertainties to which the Group is subject are identified. During the year ended 2011, the Risk Committees met three times.

Corporate, Social and Environmental reporting

The Board are responsible and accountable for matters relating to corporate responsibility. The Executive Directors and senior management have been tasked with the day to day operations and control of the Group's impact within the environments in which it operates. The Board understand that operating in its favoured jurisdiction, Russia, may have implications which can differ from those of organisations operating in western locations such as Europe and the UK. The Board considers its jurisdiction specific obligations as well as those specific to the property asset class.

Investor relations

The Chief Executive, Executive Deputy Chairman and Chief Financial Officer are the Company's points of contact for investors, fund managers, analysts, the press and other interested parties. The Company's investor relations programme includes formal presentations of the annual and interim results, as well and regular analyst briefings and meetings.

The Board regularly receive reports on the Group's investor relations activities including any reports prepared by the Company's brokers and analysts following the Company, views of major shareholder and details of any shareholder meetings.

The Board believes that sustainable financial performance and delivering on the objectives of the Company are key measures in building trust with the Company's shareholders. To promote a clear understanding of the Company, its objectives and financial results, the Board ensures that information relating to the Company is disclosed in a timely manner and in a format suitable to the shareholders of the Company. The Company's website has been developed to facilitate communication with all shareholders. Communication through these means allow our investors to receive information in a timely and cost effective manner.

The notice of AGM accompanies this report and a separate proxy card is provided for shareholders.

Signed For and On behalf of the Board

Colin Smith

Director

11 March 2012