Half Yearly Report

27 August 2013

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

Results for the six months ended 30 June 2013

The Board of Raven Russia releases the results for the six months ended 30 June 2013.

· Annualised NOI now $191 million including PLAs and LOIs (30 June 2012: $177m);

· Investment portfolio over 97% let;

· Includes the completion of 84,000sqm of new space in Moscow, 80% pre let;

· Underlying earnings after tax increase 97% to $27.8 million in the six months to 30 June 2013;

· Operating cash inflow in the period up 50% to $74.4 million;

· Adjusted fully diluted NAV per share up 6 cents to 131 cents (31 December 2012: 125 cents);

· Cash balance of $152 million;

· Tender offer buy back of 1 in 37 shares at 75 pence proposed, equivalent to a 2 pence dividend (30 June 2012: 1.5 pence).

Glyn Hirsch, CEO, said "Our completed investment property portfolio is now virtually fully let with very little vacant space available at any location. Underlying earnings before tax in the six months have increased twofold, allowing us to push our covered distribution to the equivalent of 2 pence per share for the half year."

Enquiries:

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

Anton Bilton

Glyn Hirsch

Novella Communications Tel: +44 (0) 203151 7008

Tim Robertson

Ben Heath

N+1 Singer Tel: +44 (0) 20 7496 3000

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 £325 million. The Company operates out of offices in Guernsey, Moscow and Cyprus and has to date completed a portfolio of circa 1.4 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

I am pleased to announce the Group's results for the six months ended 30 June 2013.

We continue to move towards a fully let portfolio. At today's date, our annualised, consolidated net operating income ("NOI") is $177 million, increasing to $191 million with pre-let agreements ("PLAs") and letters of intent ("LOIs "). This includes 84,000 square metres ("sqm") of new space completed in Moscow which is 80% pre-let. Including PLAs and LOIs the investment portfolio is now over 97% let, comprising 1.4 million sqm, with only 37,000sqm of vacant space.

Reported NOI for the period to 30 June was $88.1 million (30 June 2012: $53.4 million). Profit before tax was $68.3 million (30 June 2012: $29.6 million), underlying earnings before tax were up 120% to $31.5 million (30 June 2012: $14.3 million). Underlying, basic earnings per share were 4.96 cents (30 June 2012: 2.47 cents), basic NAV per share was 133 cents (31 December 2012: 122 cents) and adjusted, fully diluted NAV per share was 131 cents (31 December 2012: 125 cents).

The external valuation carried out by Jones Lang Lasalle ("JLL") as at 30 June is reflected in the gross value of our completed assets of $1,586.3 million (31 December 2012: $1,502.3 million), and additional phases of completed assets of $92.6 million (31 December 2012: $85.6 million). Total gross revaluation gains in the period were $44.0 million (30 June 2012: $42.5 million), (see notes 4 and 5 to the Interim Statement). These values incorporate the market values of the new phases completed in Moscow, one commissioned just prior to the period end and one just after. The fully let portfolio NOI is estimated at $195 million at 30 June 2013 (31 December 2012: $190 million).

Our period end cash balance was $152 million (31 December 2012: $192 million) with operating cashflows increasing to $74.4 million for the first six months (30 June 2012: $49.6 million).

As in previous periods, we intend to enter into a tender-offer buy back of shares rather than the payment of an interim dividend, with terms set out below.

Results

In the six months to 30 June 2013 the Group made a pre-tax profit of $68.3 million (30 June 2012: $29.6 million) including gross revaluation gains of $44.0 million (30 June 2012: $42.5 million). Underlying earnings before tax for the period were $31.5 million (30 June 2012: $14.3 million).

Basic earnings per share are 9.7 cents (30 June 2012: 3.5 cents) and basic underlying earnings per share 4.96 cents (30 June 2012: 2.47 cents).

NOI for the period of $88.1 million (30 June 2012: $53.4 million) is after absorbing operating costs on vacant space of $3.2 million (30 June 2012: $4.5 million). The level of vacancy on our investment portfolio has continued to reduce and today stands at less than 3% (31 December 2012: 6%).

Underlying administrative expenses in the period reduced to $14.1 million (30 June 2012: $17.4 million).

Net finance costs, before Mark to Market valuation of financial instruments and amortisation of costs for the period were $44.8 million (30 June 2012: $34.2 million) including the preference share charge of $19.2 million (30 June 2012: $14.5 million).

Net Asset Value

Adjusted, fully diluted NAV per share was 131 cents at 30 June 2013 (31 December 2012: 125 cents).

The increase in NAV, from $689 million at the year end to $729 million at 30 June 2013, follows the formal bi-annual valuation of our completed portfolio by JLL. Based on this valuation, our investment properties are carried at a market value of $1,586 million, increasing to $1,625 million following the commissioning of completed space following the period end. This represents a fully let portfolio yield of 12% (31 December 2012: 11.9%).

Financing

Total bank debt outstanding at 30 June 2013 was $783 million (31 December 2012: $776 million) at a weighted average cost to the Group of 7.4% (31 December 2012: 7.3%) and a weighted average term to maturity of 5.0 years (31 December 2012: 4.7 years). This includes the refinancing of the bank facility secured on our Krekshino site, a new $100 million facility with Sberbank on a 6 year term with the existing outstanding facility of $78 million repaid. The Group's gearing ratio is 45% (31 December 2012: 44%).

We are in advanced stages of refinancing the senior debt secured on our Rostov asset on improved terms to the existing facility and have also agreed outline debt terms, secured on the new build phases completed at our Noginsk and Klimovsk sites, with the existing lenders. A further $10 million will be drawn on the facility secured on the Sholokovo asset in the current quarter.

Hedging

The majority of the Group's senior debt portfolio is hedged against US Libor rate rises, with a mix of swap and cap instruments. $426.5 million (31 December 2012: $225 million) has been capped for an average of 3.7 years (31 December 2012: 3.4 years) with an average strike of 1.47% (31 December 2012: 1.93%). $338 million (31 December 2012: $422 million) has been swapped for an average of 3.0 years (31 December 2012: 3.0 years) at an average fixed rate of 1.46% (31 December 2012: 1.86%).

We also hedged against the effect on our preference share coupon of Sterling strengthening against the Dollar, capping the US Dollar/Sterling exchange rate at 1.60 for 3.5 years to December 2016.

Tender Offer

Since the share price remains at a significant discount to our adjusted, fully diluted NAV per share we will return cash to shareholders by way of a tender offer. Accordingly we intend to implement a tender offer buy-back of 1 in 37 ordinary shares at 75 pence, a premium of 9 per cent to the existing price, and representing the equivalent of a dividend of 2 pence per share (30 June 2012: 1.5 pence). The tender offer circular setting out full details will be posted shortly. It is expected that the tender offer will complete in October.

We now have a strong, cash generative investment portfolio with a stable cost base and look forward to generating progressive distributions for our shareholders.

Richard Jewson

Chairman

26 August 2013

Chief Executive's Statement

The first half of the year has been a good one, with continued strong tenant demand and limited supply.

Our completed investment property portfolio is now virtually fully let with very little vacant space available at any location. We have also completed and commissioned 84,000sqm of new space in Moscow in the last month and this is 80% pre let. Including PLAs and LOIs on this new space, the total portfolio is over 97% let with annualised NOI of $191 million, up from $177 million a year ago. We expect the current portfolio to generate $195 million when fully let.

We continue to prepare our existing land in the Moscow region for phased construction and there are also asset acquisition opportunities in Moscow which we may consider. Over time our Moscow land bank can support construction of a further 350,000sqm of new space. At current rents this represents a further $45 million of annualised NOI.

Underlying earnings before tax in the six months have increased twofold, allowing us to push our covered distribution to the equivalent of 2 pence per share for the half year. Again we intend to use the tender offer buy back mechanism as an efficient way of distributing to shareholders.

Our balance sheet is strong, with no near term bank finance maturities. We do intend to refinance the more expensive of our senior debt facilities, secured on our regional assets, on improved terms now that these properties have reached high occupancy levels.

We are currently carrying our investment portfolio at a valuation of $1,625 million. This is capable of producing NOI of $195 million giving a simple, fully let yield of 12%.

Yield is what investment will be about for the next few years, with low interest rates and an ageing population, it will be a rare and sought after commodity. Maybe Russia won't just be about oil and gas.

So hopefully we can look forward to more of the same, increasing NOI, leading to a progressive distribution to shareholders. We are a simple niche business in a very exciting part of the world that from our standpoint keeps on improving.

Glyn Hirsch

Chief Executive Officer

26 August 2013

Corporate Governance

Principal risks and uncertainties

Internal controls and an effective risk management regime are integral to the Group's continued operation. The assessment of risks faced by the Group, in the context of its strategic objectives, is explained on page 20 of the Group's Annual Report for 2012. There have been no significant changes to those risks set out on pages 20 to 24 of the Annual Report.

A summary of the principal risks and uncertainties is set out below:

Financial risks

Bank Financing and Cost

A reduction in the number of banks lending into our market because of the Eurozone problems could lead to increased costs for new facilities.

Foreign Exchange

Adverse movements in Rouble or Sterling against US Dollar can lead to a reduction in our US denominated earnings and the carrying value of US denominated assets.

Property Investment and Development

Composition of Portfolio

The portfolio comprises one type of asset with a concentration in the Moscow Region.

Tenant Demand

A slow down in Russian consumer spending could have a knock on effect for tenant demand on speculative development and renewal of existing leases.

Development Returns

Cost and time overruns on development projects can mean target yields are missed and profitability reduced.

Acquisitions

The investment market in Russia continues to mature and legacy issues are common with Russian corporate acquisitions.

Russian Domestic Risk

Legal and Taxation Frameworks

The Russian legal and taxation frameworks are still developing with large volumes of new legislation being open to interpretation and abuse.

Going concern

The financial position of the Group, its cash flows, liquidity and borrowings are described in the Chairman's and Chief Executive's Statements and the accompanying financial statements and related notes. During the period the Group had and continues to hold substantial cash and short term deposits. These were supplemented by the increasing and profitable rental streams and, as a consequence, the Directors believe the Group is well placed to manage its business risks.

After making enquiries and examining major areas that 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 the preparation of the accompanying interim financial statements.

Directors' Responsibility Statement

The Board confirms to the best of its knowledge:

The condensed financial statements have been prepared in accordance with IAS 34 as adopted by the European Union, and that the half year report includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R.

The names and functions of the Directors of Raven Russia Limited are disclosed in the Annual Report of the Group for the year ended 31 December 2012.

This responsibility statement was approved by the Board of Directors on the 26 August 2013 and is signed on its behalf by

Mark Sinclair Colin Smith

Chief Financial Officer Chief Operating Officer

INDEPENDENT REVIEW REPORT TO RAVEN RUSSIA LIMITED

We have been engaged by the Company to review the condensed set of financial statements in the Interim Results financial report for the six months ended 30 June 2013 which comprises the Condensed Unaudited Group Income Statement, the Condensed Unaudited Group Statement of Other Comprehensive Income, the Condensed Unaudited Group Balance Sheet, the Condensed Unaudited Group Statement of Changes in Equity, the Condensed Unaudited Group Cash Flow Statement and the related notes 1 to 15. We have read the other information contained in the half yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusions we have formed.

Directors' Responsibilities

The Interim Results financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the Interim Results financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting", as adopted by the European Union.

Our Responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the Interim Results financial report based on our review.

Scope of Review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the Interim Results financial report for the six months ended 30 June 2013 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

Ernst & Young LLP

London

26 August 2013

1. Basis of accounting

Basis of preparation

The condensed unaudited financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards ("IFRS") and have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting.

The condensed financial statements do not include all the information and disclosures required in annual financial statements and should be read in conjunction with the Group's financial statements for the year ended 31 December 2012.

Significant accounting policies

The accounting policies adopted in the preparation of the condensed financial statements are consistent with those followed in the preparation of the Group's financial statements for the year ended 31 December 2012, except for the adoption of new standards and interpretations effective as of 1 January 2013.

The Group has adopted new and amended IFRS and IFRIC interpretations as of 1 January 2013, which did not have any effect on the financial performance or financial position of the Group, but had an impact on presentation and disclosures in the condensed unaudited financial statements. These were:

IAS 1 Financial Statement Presentation - Presentation of Items of Other Comprehensive Income

IFRS 13 Fair value Measurement

The amendment to IAS 1 required a change to the presentation of items in the Statement of Comprehensive Income. Adoption of IFRS 13 required specific additional disclosure in the condensed financial statements of the fair value of the Group's financial instruments and these are provided in note 15.

The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

2. Segmental information

The Group has three operating segments, which are managed and report independently to the Board of Directors. These comprise:Property investment - acquire, develop and lease commercial property in Russia

Roslogistics - provision of warehousing, transport, customs brokerage and related services in Russia

Raven Mount - sale of residential property in the UK.