Raven Property : Half-year Report

28 August 2018

Raven Property Group Limited ('Raven' or the 'Company')

2018 Interim Results

Raven today announces its unaudited results for the six months ended 30 June 2018.

Highlights

· Net operating income of $79.3 million for the six months to 30 June 2018 (30 June 2017: $69.9 million);

· Occupancy increased to 87% across the investment portfolio (31 December 2017: 81%);

· Cash balance of $198 million supporting acquisition strategy;

· In August, contracts signed on acquisition of additional 58,851sqm of warehouse space;

· Proposed distribution of 1.25p per ordinary share by way of a tender offer buy back of 1 in 44 shares at 55p.

Glyn Hirsch CEO said, 'We have made significant progress in the period. Our vacancies are down, Net Operating Income is up and we are acquiring further space at an attractive yield.'

Click on, or paste the following link into your web browser, to view the associated PDF document.

http://www.rns-pdf.londonstockexchange.com/rns/9352Y_1-2018-8-27.pdf

Enquiries

Raven Property Group Limited Tel: + 44 (0) 1481 712955

Anton Bilton

Glyn Hirsch

Novella Communications Tel: [phone]

Tim Robertson

Toby Andrews

N+1 Singer Tel: [phone]

Corporate Finance - James Maxwell / James Moat

Sales - Alan Geeves / James Waterlow

Numis Securities Limited Tel:+ 44 (0) 207 260 1000

Alex Ham / Jamie Loughborough / Alasdair Abram

Ravenscroft Tel: [phone]

Jade Cook

This announcement contains forward-looking statements that involve risk and uncertainties. The Group's actual results could differ materially from those estimated or anticipated in the forward-looking statements as a result of many factors. Information contained in this announcement relating to the Company should not be relied upon as a guide to future performance.

About Raven Property Group Limited

Raven 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 and admitted to the Official List of The International Stock Exchange ('TISE'). Its Convertible Preference Shares are admitted to the Official List of TISE and trading on the SETSqx market of the London Stock Exchange. The Company operates out of offices in Guernsey, Moscow and Cyprus and has an investment portfolio of circa 1.8 million square metres of Grade 'A' warehouses in Moscow, St Petersburg, Rostov-on-Don and Novosibirsk and 49,000 square metres of commercial office space in St Petersburg. For further information visit the Company's website:www.theravenpropertygroup.com

Financial Summary

Income Statement for the 6 months ended:	30 June 2018	30 June 2017
Net Rental and Related Income ($m)	79.3	69.9
Revaluation (deficit)/ surplus ($m)	(34.4)	11.6
IFRS (Loss)/Earnings after tax ($m)	(41.1)	9.2
Underlying Earnings after tax ($m)	3.2	15.5
Basic EPS (cents)	(6.3)	1.4
Basic Underlying EPS (cents)	0.5	2.3
Distribution per share (pence)	1.25	1.0
Balance Sheet at:	30 June 2018	31 December 2017
Investment Property Market Value ($m)	1,557	1,593
Diluted NAV per share (cents)	76	80

Letting Summary

Warehouse Portfolio

Our warehouse portfolio currently totals 1.77 million sqm. Occupancy at the period end was 86% (31 December 2017: 81%).

Maturities '000 sqm	2018	2019	2020	2021-2027	Total
Maturity profile at 1 January 2018	159	247	308	710	1,424
Renegotiated and extended	(28)	(7)	(44)	(37)	(116)
Maturity profile of renegotiations	-	13	4	99	116
Vacated/terminated	(33)	-	(10)	(11)	(54)
New lettings	34	9	-	110	153
Maturity profile at 30 June 2018	132	262	258	871	1,523
Maturity profile with breaks	194	332	329	668	1,523

Office Portfolio

Our office portfolio of 49,000sqm has been fully let throughout the period.

Maturities '000 sqm	2018	2019	2020	2021-2027	Total
Maturity profile at 1 January 2018	10	13	6	20	49
Renegotiated and extended	(3)	-	-	-	(3)
Maturity profile of renegotiations	-	-	1	2	3
Vacated/terminated	(4)	-	-	-	(4)
New lettings	1	1	-	2	4
Maturity profile at 30 June 2017	4	14	7	24	49
Maturity profile with breaks	12	12	1	24	49

Lease Currency Mix

	USD	RUB	EUR	Vacant	Total
Sqm %	29%	54%	3%	14%	100%
NOI %	47%	46%	7%	-	100%

Chairman's Message

The Russian market fundamentals have been positive for us in the six months to 30 June 2018.

Net operating income ('NOI') has improved to $79.3 million (30 June 2017: $69.9 million). Occupancy levels on our investment portfolio climbed from 81% at the year end to 87% at 30 June 2018. Rouble leases account for 54% of our warehouse space (31 December 2017: 47%) and 46% of our NOI in the period to 30 June 2018 (31 December 2017: 32%), and we have drawn funds on our first Rouble debt facility.

Our acquisition strategy is also progressing and this month we signed contracts for the acquisition of a further 58,851sqm of warehouse space in Moscow at a yield of 11.3% and purchase price of Roubles 2.45 billion ($36.5 million). We hope to announce further acquisitions in the coming quarter.

The accumulation of this work produces an income statement with reducing reliance on US Dollar pegged income and signals the start of the balance sheet restructuring away from US Dollar liabilities.

The one anomaly as we move away from the US Dollar model is that, whilst we continue with US Dollar presentation of our numbers, the increasing Rouble cash balances that we hold cause unrealised foreign exchange movements in our income statement, distorting profitability. These unrealised foreign exchange movements give a $13.6 million swing in profit for the period with a foreign exchange loss of $8.7 million for the six months compared to a profit of $4.9 million in the same period last year.

The impact can also be seen on our property valuations which have increased by 7% in Rouble terms in the period but translate to a revaluation loss of $34.4 million in US Dollar terms. Our IFRS earnings show a loss of $41.1 million following this foreign exchange impact (30 June 2017: profit of $9.2 million).

Underlying operating cash generation remains robust and underlying earnings before unrealised foreign exchange movements of $11.9 million support a proposed interim distribution of 1.25p, again by way of tender offer buy back of 1 in 44 shares at 55p (30 June 2017: 1p by way of tender offer buy back of 1 in 52 shares at 52p).

Richard Jewson

Chairman

27 August 2018

Chief Executive's Review

Dear shareholders

This is the newly toned down re-draft of my statement following news of additional US sanctions, contagion from the Turkish Lira crash and the resulting Rouble weakness. Prior to this, we were feeling pretty bullish again and early drafts of my statement reflected that.

Operating fundamentals in the Russian market are strong and many economic indicators have moved in our favour. These include a growing economy, albeit slowly, falling interest rates, increased tenant demand and a reduced vacancy rate for us and the market as a whole. At this time last year the Russian Central Bank rate was 9.0%, today it is 7.25%.

Following the recent elections, we have medium term political stability and the successful World Cup has started to show the world the positive side of Russia that we have been going on about for years. However, the weaker Rouble means we suffer foreign exchange losses when presenting our results in US Dollars.

Our main operational efforts in the period have been focussed on letting space and pursuing income producing acquisitions. These efforts continue to be the best strategy in the current climate. It is producing results.

Our portfolio occupancy has risen to 87% and this trend is continuing. The weighted average warehouse lease length is 3.3 years and average annual indexation on Rouble leases is 6.1%, an attractive level of growth.

We are delighted to have signed contracts this month on a Rouble 2.45 billion ($36.5 million) acquisition at an average yield of 11.3%. It will contribute Rouble 272 million ($4.0 million) to NOI per annum when fully let. We have also walked away from deals in the period where they have not met our criteria and this has resulted in abortive due diligence costs in the first half. We have a number of other acquisitions under discussion and hope to make further announcements in due course.

We are sitting on $198 million of cash which will support our acquisition growth.

Given the improvement in our core market we are also planning to speculatively build around 70,000sqm at our site at Nova Riga. At today's construction costs and rents this should show us a 12% return on the marginal cost of investment and further enhance NOI albeit not until 2020.

We have continued to promote our business and Russia generally wherever and whenever possible. Despite the success of the World Cup, Russia's investment audience remains limited. With this in mind we intend to list our ordinary shares on both the Moscow and Johannesburg Stock Exchanges and will make a separate announcement shortly when the process is finalised. We hope that this will increase and broaden investor interest.

To reflect our cautious optimism we are continuing our progressive distribution policy and will pay 1.25p (a 25% increase on the same period last year) as a tender offer buy back of 1 in 44 shares at 55p.

Property Update

The portfolio comprised 1.77 million sqm of warehouse space and 49,000sqm of office space at 30 June 2018. Warehouse occupancy increased to 86% in the period (31 December 2017: 81%) and our office portfolio continues to be fully let giving total occupancy of 87% across the entire portfolio.

New warehouse lettings in the period totalled 153,000sqm with a further 116,000sqm of existing leases renegotiated and extended. Tenants vacated 54,000sqm of space.

Since the period end, we have let a further 38,000sqm of vacant space and renegotiated and extended 23,000sqm of maturing leases.

As at 30 June 2018 we had 132,000sqm of warehouse leases maturing in the second half of the year and 62,000sqm of potential lease breaks. Of those, we expect maturing tenants to vacate 39,000sqm and 15,000sqm of the breaks to be exercised before the year end.

Rouble denominated leases accounted for 54% (31 December 2017: 47%) of the total warehouse space at the period end and US Dollar leases 29% (31 December 2017: 31%). The average Rouble rent was 4,900 per sqm (31 December 2017: 5,200 per sqm) and the average US Dollar rent was $152 per sqm (31 December 2017: $143 per sqm). Rouble denominated leases had a weighted average term to maturity of 3.6 years (31 December 2017: 3.6 years) and US Dollar leases 2.6 years (31 December 2017: 3.0 years).

Our St Petersburg office portfolio continues to perform well with no significant change in tenant mix since the year end.

Results

Underlying Earnings

Acquisitions and increased letting activity have supported an increase in NOI to $79.3 million (30 June 2017: $69.9 million). This increase is offset by the step up in costs to implement our current strategy, with salaries and bonuses increasing by $3 million, bonuses relating to prior year performance, and last year's issue of new convertible preference shares increasing finance costs. The cost increase supports our on-going growth policy and any future warehouse acquisitions or development will improve profitability without any marked increase in overhead. The bonuses are a full year cost and not repeated in the second half of the year.

As explained in the Chairman's statement, the big swing in underlying profitability compared to the six months to 30 June 2018 relates to unrealised foreign exchange losses when presenting our results in US Dollars. Underlying earnings before these foreign exchange movements compare favourably, $11.9 million in 2018 and $10.6 million in the six months to 30 June 2017.

IFRS Earnings

The IFRS loss for the period is $41.1 million (30 June 2017: profit of $9.2 million). This is principally driven by the Rouble weakness against the US Dollar. Our investment properties increased in value in Rouble terms but show a revaluation loss of $30.8 million net of tax (30 June 2017: profit of $7.0 million) when translated into US Dollars. The other significant charge to IFRS earnings is the amortisation of the cumulative preference share redemption premium of $5.0 million (30 June 2017: $2.8 million) in the period.

Financing

As explained in the 2017 Annual Report, the refinancing of a project straddled the year end with both cash balances and bank loans increasing by $62.3 million. This needs to be taken into account when comparing the 30 June 2018 balance sheet to that of 31 December 2017. The old facility was repaid on 9 January 2018.

Our cash balance at 30 June 2018 is $198.1 million and at 31 December 2017, $266.7 million, reducing to $204.4 million when adjusting for the effect of the financing above. Similarly, secured and unsecured loans at 30 June 2018 were $824.3 million compared to $847.2 million at 31 December 2017 or $784.9 million adjusted.

In fact, our secured debt increased during the year as we drew the final tranche of €11 million on the financing of last year's St Petersburg acquisitions and then refinanced the Sever acquisition which we had completed in November 2017. This was our first Euro/Rouble mix facility, drawing €9.7 million and Roubles 2.96 billion on 8 June 2018, a facility with a term of five years. We also refinanced the one unsecured loan we have of $15 million, reducing the margin charged from 7.9% to 2.5% in the process.

At 30 June 2018 our weighted average cost of debt was 7.4% (31 December 2017: 7.6%) with a weighted average term to maturity of 4.4 years (31 December 2017: 4.5 years). The currency weighting of the Group's loan financing at 30 June 2018 was US Dollar 77.4%, Euro 16.9% and Rouble 5.7%, six of the seventeen projects supporting the secured debt now financed in Euro or Roubles.

The debt restructuring in 2016 and 2017 was undertaken to create a buffer for covenant headroom on secured debt in times of foreign exchange volatility. At 30 June 2018 the loan to value ratio on secured debt was 52% (31 December 2017: 53%).

Cash flow

Cash flows from operating activities followed the same trend as our NOI in the period, generating $55.9 million (30 June 2017: $48.8 million). Cash generation after net interest and preference share coupon paid was maintained at the same level as the previous year, $7.5 million (30 June 2017: $7.4 million).

Net Asset Value

The Group's Net Asset Value falls to $478.4 million from $529.8 million at 31 December 2017 following the IFRS loss for the period and the increased tender offer paid for the final 2017 distribution.

Diluted, Net Asset Value per share is 76 cents (31 December 2017: 80 cents).

Tender offer

We are proposing a distribution of the equivalent of 1.25p per ordinary share by way of tender offer buy back of 1 in 44 shares at 55p (30 June 2017: 1p by way of an offer of 1 in 52 shares at 52p). This reflects our progress and financial performance so far this year.

Glyn Hirsch

Chief Executive Officer

27 August 2018

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 along with the potential impact and mitigation strategies are set out in the Risk Report on pages 37 to 40 of the Group's 2017 Annual Report. These risks fall into five main categories, these being: financial, property investment, Russian domestic, personnel and political and economic risks.

Having reviewed the principal risks and uncertainties for Group in relation to the first half of 2018, the Board believes these have remained consistent with those presented in the 2017 Annual Report and that the existing mitigation strategies continue to be appropriate.

Going concern

The financial position of the Group, its cash flows, liquidity and borrowings are described in the Chief Executive's Review and the accompanying financial statements and related notes. During the period the Group had, and continues to hold, substantial cash and short term deposits and is generating underlying profits. 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 Property Group Limited are disclosed in the 2017 Annual Report of the Group.

This responsibility statement was approved by the Board of Directors on the 27 August 2018 and is signed on its behalf by

Mark Sinclair Colin Smith

Chief Financial Officer Chief Operating Officer

Independent review report to Raven Property Group Limited

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the interim financial report for the six months ended 30 June 2018 which comprises the Condensed Unaudited Group Income Statement, the Condensed Unaudited Group Statement of 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 20. We have read the other information contained in the interim 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 financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim financial report in accordance with the Disclosure Guidance 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 interim 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 financial report based on our review.

Scope of Review

We conducted our review in accordance with 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 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 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 financial report for the six months ended 30 June 2018 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.

Ernst & Young LLP

London

27 August 2018

Condensed Unaudited Group Income Statement
For the six months ended 30 June 2018
						Six months ended 30 June 2018										Six months ended 30 June 2017
		Notes		Underlying earnings		Capital & other			Total			Underlying earnings				Capital & other				Total
				$'000		$'000			$'000			$'000				$'000				$'000
Gross revenue		2		109,253		-			109,253			95,381				-				95,381
Property operating expenditure and cost of sales				(29,969)		-			(29,969)			(25,518)				-				(25,518)
Net rental and related income		2		79,284		-			79,284			69,863				-				69,863
Administrative expenses		3		(16,884)		(2,273)			(19,157)			(12,603)				(589)				(13,192)
Share-based payments and other long term incentives		17b		(877)		(1,600)			(2,477)			(818)				(1,409)				(2,227)
Foreign currency (loss) / profit				(8,708)		-			(8,708)			4,912				-				4,912
Operating expenditure				(26,469)		(3,873)			(30,342)			(8,509)				(1,998)				(10,507)
Share of profits of joint ventures				204		-			204			285				-				285
Operating profit / (loss) before profits and losses on investment property				53,019		(3,873)			49,146			61,639				(1,998)				59,641
Unrealised (loss) / profit on revaluation of investment property		7		-		(35,055)			(35,055)			-				13,343				13,343
Unrealised profit / (loss) on revaluation of investment property under construction		8		-		606			606			-				(1,730)				(1,730)
Operating profit / (loss)		2		53,019		(38,322)			14,697			61,639				9,615				71,254
Finance income		4		2,216		5,833			8,049			2,965				299				3,264
Finance expense		4		(48,618)		(11,261)			(59,879)			(40,293)				(8,263)				(48,556)
Profit / (loss) before tax				6,617		(43,750)			(37,133)			24,311				1,651				25,962
Tax		5		(3,440)		(551)			(3,991)			(8,812)				(7,969)				(16,781)
Profit / (loss) for the period				3,177		(44,301)			(41,124)			15,499				(6,318)				9,181
Earnings per share:		6
Basic (cents)									(6.30)											1.38
Diluted (cents)									(6.30)											1.34
Underlying earnings per share:		6
Basic (cents)				0.49								2.33
Diluted (cents)				0.48								2.29
The total column of this statement represents the Group's Income Statement, prepared in accordance with IFRS as adopted by the EU. The 'underlying earnings' and 'capital and other' columns are both supplied as supplementary information permitted by IFRS as adopted by the EU. Further details of the allocation of items between the supplementary columns are given in note 6.
All items in the above statement derive from continuing operations.
All income is attributable to the equity holders of the parent company. There are no non-controlling interests.
The accompanying notes are an integral part of this statement.

Condensed Unaudited Group Statement Of Comprehensive Income
For the six months ended 30 June 2018
		Six months ended		Six months ended
		30 June 2018		30 June 2017
		$'000		$'000
(Loss) / profit for the period		(41,124)		9,181
Other comprehensive income, net of tax
Items to be reclassified to profit or loss in subsequent
periods:
Foreign currency translation on consolidation		12,958		(10,231)
Total comprehensive income for the period, net of tax		(28,166)		(1,050)
All income is attributable to the equity holders of the parent company. There are no non-controlling interests.
The accompanying notes are an integral part of this statement.

Condensed Unaudited Group Balance Sheet
As at 30 June 2018
		30 June	31 December
		2018	2017
	Notes	$'000	$'000
Non-current assets
Investment property	7	1,531,964	1,568,126
Investment property under construction	8	37,152	38,411
Plant and equipment		4,544	4,248
Investment in joint ventures		9,940	9,983
Other receivables		20,798	5,625
Derivative financial instruments		15,411	7,948
Deferred tax assets		32,548	34,629
		1,652,357	1,668,970
Current assets
Inventory		415	423
Trade and other receivables		58,650	78,946
Derivative financial instruments		13	445
Cash and short term deposits		198,095	266,666
		257,173	346,480
Total assets		1,909,530	2,015,450
Current liabilities
Trade and other payables		93,892	107,357
Derivative financial instruments		69	35
Interest bearing loans and borrowings	10	43,202	106,697
		137,163	214,089
Non-current liabilities
Interest bearing loans and borrowings	10	781,084	740,485
Preference shares	11	143,477	146,458
Convertible preference shares	12	267,353	269,031
Other payables		24,290	34,566
Deferred tax liabilities		77,771	81,063
		1,293,975	1,271,603
Total liabilities		1,431,138	1,485,692
Net assets		478,392	529,758
Equity
Share capital	13	12,169	12,479
Share premium		189,254	207,746
Warrants	14	186	441
Own shares held	15	(8,335)	(5,742)
Convertible preference shares	12	14,497	14,497
Capital reserve		(248,462)	(217,782)
Translation reserve		(188,953)	(201,911)
Retained earnings		708,036	720,030
Total equity		478,392	529,758
Net asset value per share (cents):	16
Basic		76	81
Diluted		76	80
Adjusted net asset value per share (cents):	16
Basic		71	78
Diluted		71	77
The accompanying notes are an integral part of this statement.

Condensed Unaudited Group Statement Of Changes In Equity
For the six months ended 30 June 2018
		Share Capital	Premium	Warrants	Own Shares Held	Convertible Preference Shares	Capital Reserve	Translation Reserve	Retained Earnings	Total
	Notes	$'000	$'000	$'000	$'000	$'000	$'000	$'000	$'000	$'000
At 1 January 2017		12,578	216,938	1,161	(7,449)	8,453	(245,426)	(177,199)	691,170	500,226
Profit for the period		-	-	-	-	-	-	-	9,181	9,181
Other comprehensive income		-	-	-	-	-	-	(10,231)	-	(10,231)
Total comprehensive income for the period		-	-	-	-	-	-	(10,231)	9,181	(1,050)
Warrants exercised		178	4,985	(712)	-	-	-	-	-	4,451
Ordinary shares cancelled		-	-	-	-	-	-	-	-	-
Own shares acquired		-	-	-	(76)	-	-	-	-	(76)
Own shares allocated		-	-	-	913	-	-	-	(600)	313
Transfer in respect of capital losses		-	-	-	-	-	7,007	-	(7,007)	-
At 30 June 2017		12,756	221,923	449	(6,612)	8,453	(238,419)	(187,430)	692,744	503,864
At 1 January 2018		12,479	207,746	441	(5,742)	14,497	(217,782)	(201,911)	720,030	529,758
Loss for the period		-	-	-	-	-	-	-	(41,124)	(41,124)
Other comprehensive income		-	-	-	-	-	-	12,958	-	12,958
Total comprehensive income for the period		-	-	-	-	-	-	12,958	(41,124)	(28,166)
Warrants exercised	13/14	107	2,767	(255)	-	-	-	-	-	2,619
Ordinary shares cancelled	13/15	(417)	(21,259)	-	22	-	-	-	-	(21,654)
Own shares acquired	15	-	-	-	(5,639)	-	-	-		(5,639)
Own shares allocated	15	-	-	-	3,024	-	-	-	(1,550)	1,474
Transfer in respect of capital losses		-	-	-	-	-	(30,680)	-	30,680	-
At 30 June 2018		12,169	189,254	186	(8,335)	14,497	(248,462)	(188,953)	708,036	478,392
The accompanying notes are an integral part of this statement.

Condensed Unaudited Group Cash Flow Statement
For the six months ended 30 June 2018
				Six months ended	Six months ended
				30 June 2018	30 June 2017
			Notes	$'000	$'000
Cash flows from operating activities
(Loss) / profit before tax				(37,133)	25,962
Adjustments for:
Depreciation			3	509	590
Provision for bad debts			3	-	(201)
Share of profits of joint ventures				(204)	(285)
Finance income			4	(8,049)	(3,264)
Finance expense			4	59,879	48,556
Loss / (profit) on revaluation of investment property			7	35,055	(13,343)
(Profit) / loss on revaluation of investment property under construction			8	(606)	1,730
Foreign exchange loss / (profit)				8,708	(4,912)
Non-cash element of share-based payments and other long term incentives			17b	1,600	1,409
				59,759	56,242
Changes in operating working capital
Decrease in operating receivables				1,755	3,211
(Increase) / decrease in other operating current assets				(1)	2
Decrease in operating payables				(2,444)	(2,026)
				59,069	57,429
Tax paid				(3,210)	(8,670)
Net cash generated from operating activities				55,859	48,759
Cash flows from investing activities
Payments for property improvements				(5,458)	(6,615)
Refund of VAT on acquisition of investment property				16,990	-
Acquisition of subsidiaries				-	(88,301)
Cash acquired with subsidiaries				-	4,088
Payment of deferred consideration on
acquisition of investment property				(9,717)	-
Purchase of plant and equipment				(1,906)	(1,305)
Loans repaid				-	45
Interest received				2,199	2,951
Net cash generated from / (used in) investing activities				2,108	(89,137)
Cash flows from financing activities
Proceeds from long term borrowings				143,512	80,000
Repayment of and security on long term borrowings				(166,278)	(77,156)
Loan amortisation				(15,984)	(20,187)
Bank borrowing costs paid				(33,850)	(32,656)
Exercise of warrants				2,619	4,451
Ordinary shares purchased				(27,021)	237
Dividends paid on preference shares				(7,895)	(7,108)
Dividends paid on convertible preference shares				(8,836)	(4,502)
Premium paid for derivative financial instruments				(3,820)	(759)
Net cash used in financing activities				(117,553)	(57,680)
Net decrease in cash and cash equivalents				(59,586)	(98,058)
Opening cash and cash equivalents				266,666	198,621
Effect of foreign exchange rate changes				(8,985)	7,520
Closing cash and cash equivalents				198,095	108,083
The accompanying notes are an integral part of this statement.

Notes to the Condensed Unaudited Group Financial Statements
For the six months ended 30 June 2018
1. Basis of accounting Basis of preparation The condensed unaudited financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards adopted for use in the European Union ('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 2017. 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 2017, except for the adoption of new standards that became effective on 1 January 2018. The Group applies for the first time, IFRS 15 Revenue from Contracts with Customers and IFRS 9 Financial Instruments. IFRS 15 does not affect the financial performance or financial position of the Group but it does require additional disclosures to be made. IFRS 15 does not apply to lease income, so the additional disclosures only relate to the Group's revenues generated by its Roslogistics and Raven Mount reporting segments and provide information as to how the nature, amount, timing and uncertainty of cash flows from these revenues are affected by economic factors. These disclosures are provided in note 2. The Group has assessed the impact of IFRS 9 and concluded that it does not affect the financial performance or financial position of the Group or the disclosures made in its financial statements. The Group has not adopted early any standard, interpretation or amendment that has been issued but is not yet effective. The requirements of IFRS 16, which is effective from 1 January 2019, has been assessed and is not expected to have a material impact on the Group's financial statements. Going concern The financial position of the Group, its cash flows, liquidity position and borrowings are described in the Chief Executive's Review and the notes to these interim financial statements. After making appropriate enquiries and examining sensitivities that could give rise to financial exposure, the Board has a reasonable expectation that the Group has adequate resources to continue operations for the foreseeable future. Accordingly, the Group continues to adopt the going concern basis in the preparation of these interim financial statements.
Foreign currency On consolidation the results and financial position of all the Group entities that have a functional currency different from the Group's presentation currency (United States Dollars) are translated into the presentation currency using the following rates:
		30 June				31 December
		2018				2017
Balance Sheet
- Roubles		62.75				57.60
- Sterling		1.32				1.35
- Euro		1.17				1.20
		30 June				30 June
		2018				2017
Income Statement *
- Roubles		59.35				57.99
- Sterling		1.38				1.26
- Euro		1.21				1.08
* These are the average rates for the six months ended 30 June 2017 and 2018, which are used unless this does not approximate the rates ruling at the dates of the relevant transactions in which case the item of income or expenditure is translated at the transaction date rate.
2. Segmental information The Group has three reportable 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 - IFRS 15 revenue - services are provided to customers over time and invoiced at appropriate intervals in accordance with the relevant contract terms; and Raven Mount - sale of residential property in the UK - IFRS 15 revenue - the transfer of land or property to the purchaser occurs on legal completion of the sale contract.
(a) Segmental information for the six months ended and as at 30 June 2018
For the six months ended 30 June 2018					Property				Raven	Segment	Central
					Investment		Roslogistics		Mount	Total	Overhead		Total
					$'000		$'000		$'000	$'000	$'000		$'000
Gross revenue					98,342		10,821		90	109,253	-		109,253
Operating costs / Cost of sales					(24,474)		(5,442)		(53)	(29,969)	-		(29,969)
Net operating income					73,868		5,379		37	79,284	-		79,284
Administrative expenses
Running general & administration expenses					(10,561)		(1,458)		(332)	(12,351)	(4,533)		(16,884)
Aborted project costs					(1,764)		-		-	(1,764)	-		(1,764)
Depreciation					(294)		(215)		-	(509)	-		(509)
Share-based payments and other long term incentives					(241)		-		-	(241)	(2,236)		(2,477)
Foreign currency losses					(8,707)		(1)		-	(8,708)	-		(8,708)
					52,301		3,705		(295)	55,711	(6,769)		48,942
Unrealised loss on revaluation of investment property					(35,055)		-		-	(35,055)	-		(35,055)
Unrealised profit on revaluation of investment property under construction					606		-		-	606	-		606
Share of profits of joint ventures					-		-		204	204	-		204
Segment profit / (loss)					17,852		3,705		(91)	21,466	(6,769)		14,697
Finance income													8,049
Finance expense													(59,879)
Profit before tax													(37,133)
As at 30 June 2018									Property		Raven
									Investment	Roslogistics	Mount		Total
									$'000	$'000	$'000		$'000
Assets
Investment property									1,531,964	-	-		1,531,964
Investment property under construction									37,152	-	-		37,152
Investment in joint ventures									-	-	9,940		9,940
Inventory									-	-	415		415
Cash and short term deposits									194,885	381	2,829		198,095
Segment assets									1,764,001	381	13,184		1,777,566
Other non-current assets													73,301
Other current assets													58,663
Total assets													1,909,530
Segment liabilities
Interest bearing loans and borrowings									824,286	-	-		824,286
Capital expenditure
Payments for property improvements									5,458	-	-		5,458
Payment of deferred consideration on acquisition of investment property									9,717	-	-		9,717
									15,175	-	-		15,175
(b) Segmental information for the six months ended and as at 30 June 2017
					Property				Raven	Segment	Central
					Investment		Roslogistics		Mount	Total	Overhead		Total
					$'000		$'000		$'000	$'000	$'000		$'000
Gross revenue					83,646		11,458		277	95,381	-		95,381
Operating costs / Cost of sales					(20,305)		(5,158)		(55)	(25,518)	-		(25,518)
Net operating income					63,341		6,300		222	69,863	-		69,863
Administrative expenses
Running general & administration expenses					(8,207)		(1,032)		(511)	(9,750)	(2,852)		(12,602)
Aborted project costs					-		-		-	-	-		-
Depreciation					(362)		(228)		-	(590)	-		(590)
Share-based payments and other long term incentives					(396)		-		-	(396)	(1,831)		(2,227)
Foreign currency profits					4,919		(7)		-	4,912	-		4,912
					59,295		5,033		(289)	64,039	(4,683)		59,356
Unrealised profit on revaluation of investment property					13,343		-		-	13,343	-		13,343
Unrealised loss on revaluation of investment property under construction					(1,730)		-		-	(1,730)	-		(1,730)
Share of profits of joint ventures					-		-		285	285	-		285
Segment profit / (loss)					70,908		5,033		(4)	75,937	(4,683)		71,254
Finance income													3,264
Finance expense													(48,556)
Profit before tax													25,962
									Property		Raven
									Investment	Roslogistics	Mount		Total
									$'000	$'000	$'000		$'000
Capital expenditure
Corporate acquisitions									88,301	-	-		88,301
Property improvements									6,615	-	-		6,615
									94,916	-	-		94,916
(c) Segmental information as at 31 December 2017
									Property		Raven
									Investment	Roslogistics	Mount		Total
									$'000	$'000	$'000		$'000
Assets
Investment property									1,568,126	-	-		1,568,126
Investment property under construction									38,411	-	-		38,411
Investment in joint ventures									-	-	9,983		9,983
Inventory									-	-	423		423
Cash and short term deposits									258,908	907	6,851		266,666
Segment assets									1,865,445	907	17,257		1,883,609
Other non-current assets													52,450
Other current assets													79,391
Total assets													2,015,450
Segment liabilities
Interest bearing loans and borrowings									847,182	-	-		847,182
3. Administrative expenses
											Six months		Six months
											ended		ended
											30 June		30 June
											2018		2017
											$'000		$'000
Employment costs											9,481		7,023
Directors' remuneration											2,360		1,624
Bad debts											-		(201)
Office running costs and insurance											1,984		1,702
Travel costs											887		840
Auditors' remuneration											419		338
Aborted project costs											1,764		-
Legal and professional											1,546		1,087
Depreciation											509		590
Registrar costs and other administrative expenses											207		189
											19,157		13,192
4. Finance income and expense
											Six months		Six months
											ended		ended
											30 June		30 June
											2018		2017
Finance income											$'000		$'000
Total interest income on financial assets not at fair value through profit or loss
Income from cash and short term deposits											2,199		2,951
Interest receivable from joint ventures											17		14
Other finance income
Change in fair value of open interest rate derivative financial instruments											5,833		-
Change in fair value of foreign currency embedded derivatives											-		299
Finance income											8,049		3,264
Finance expense
Interest expense on loans and borrowings measured at amortised cost											35,032		31,777
Interest expense on preference shares											8,475		7,725
Interest expense on convertible preference shares											13,715		7,184
Total interest expense on financial liabilities not at fair value through profit or loss											57,222		46,686
Change in fair value of open forward currency derivative financial instruments											94		110
Change in fair value of foreign currency embedded derivatives											256		-
Change in fair value of open interest rate derivative financial instruments											2,307		1,760
Finance expense											59,879		48,556
5. Taxation											Six months		Six months
											ended		ended
											30 June		30 June
											2018		2017
The tax charge for the period can be reconciled to the profit per the Income Statement as follows:											$'000		$'000
(Loss) / profit before tax											(37,133)		25,962
Tax at the Russian corporate tax rate of 20%											(7,427)		5,192
Tax effect of financing arrangements											(2,097)		(2,818)
Tax effect of non deductible preference share coupon											4,438		2,982
Tax effect of foreign exchange movements											(7)		1,009
Movement in provision for uncertain tax positions											(406)		5,379
Tax effect of other income not subject to tax and non-deductible expenses											3,019		2,651
Tax effect of property depreciation on revaluations											3,057		2,283
Tax on dividends and other inter company gains											950		1,115
Movement on previously unprovided deferred tax assets											2,464		(1,012)
											3,991		16,781
The tax effect of financing arrangements reflects the impact of intra group funding in each jurisdiction. Foreign exchange movements on intra group financing are taxable or tax deductible in Russia but not in other jurisdictions. Other income and expenditure not subject to tax arises in Guernsey.
6. Earnings measures
In addition to reporting IFRS earnings the Group also reports its own underlying earnings measure. The Directors consider underlying earnings to be a key performance measure, as this is the measure used by Management to assess the return on holding investment assets for the long term and the Group's ability to declare covered distributions. As a consequence the underlying earnings measure excludes investment property revaluations, gains or losses on the disposal of investment property, intangible asset movements, gains and losses on derivative financial instruments, share-based payments and other long term incentives (to the extent not settled in cash), the accretion of premiums payable on redemption of preference shares and convertible preference shares, material non-recurring items, depreciation and amortisation of loan origination costs, together with any related tax.
											Six months		Six months
											ended		ended
											30 June		30 June
The calculation of basic and diluted earnings per share is based on the following data:											2018		2017
											$'000		$'000
Earnings
Net (loss) / profit for the period prepared under IFRS											(41,124)		9,181
Adjustments to arrive at underlying earnings:
Depreciation											509		589
Aborted project costs											1,764		-
Share-based payments and other long term incentives											1,600		1,409
Unrealised loss / (profit) on revaluation of investment property											35,055		(13,343)
Unrealised loss on revaluation of investment property under construction											(606)		1,730
Change in fair value of open forward currency derivative financial instruments											94		110
Change in fair value of open interest rate derivative financial instruments											(3,526)		1,760
Change in fair value of foreign currency embedded derivatives											256		(299)
Premium on redemption of preference shares and amortisation of issue costs											286		262
Premium on redemption of convertible preference shares and amortisation of issue costs											4,982		2,799
Amortisation of loan origination costs											3,336		3,332
Movement on deferred tax arising on depreciation and revaluation of investment property											368		7,919
Tax on unrealised foreign exchange movements in loans											183		50
Underlying earnings											3,177		15,499
							30 June 2018				30 June 2017
							Weighted				Weighted
							average				average
					Earnings		shares		EPS	Earnings	shares		EPS
IFRS					$'000		No. '000		Cents	$'000	No. '000		Cents
Basic					(41,124)		653,093		(6.30)	9,181	666,209		1.38
Effect of dilutive potential ordinary shares:
Warrants (note 14)					-		-			-	10,082
LTIP (note 17)					-		-			-	1,711
2016 Retention scheme (note 17)					-		-			-	4,873
Convertible preference shares (note 12)					-		-			-	-
Diluted					(41,124)		653,093		(6.30)	9,181	682,875		1.34
							30 June 2018				30 June 2017
							Weighted				Weighted
							average				average
					Earnings		shares		EPS	Earnings	shares		EPS
Underlying earnings					$'000		No. '000		Cents	$'000	No. '000		Cents
Basic					3,177		653,093		0.49	15,498	666,209		2.33
Effect of dilutive potential ordinary shares:
Warrants (note 14)					-		4,052			-	10,082
LTIP (note 17)					-		777			-	1,711
2016 Retention scheme (note 17)					-		3,584			-	4,873
Convertible preference shares (note 12)					-		-			4,385	187,032
Diluted					3,177		661,506		0.48	19,883	869,907		2.29
The finance expense for the period relating to the convertible preference shares is greater than IFRS basic earnings per share and underlying earnings per share and thus the convertible preference shares are not dilutive for either measure of fully diluted earnings per share.
7. Investment property
Asset class							Logistics		Logistics	Logistics	Office		30 June
Location							Moscow		St Petersburg	Regions	St Petersburg		2018
Fair value hierarchy *							Level 3		Level 3	Level 3	Level 3		Total
							$'000		$'000	$'000	$'000		$'000
Market value at 1 January 2018							1,155,680		196,035	159,404	82,143		1,593,262
Property improvements							(2,720)		400	569	764		(987)
Unrealised (loss) / profit on revaluation							(24,537)		2,552	(4,231)	(8,976)		(35,192)
Market value at 30 June 2018							1,128,423		198,987	155,742	73,931		1,557,083
Tenant incentives and contracted rent uplift balances							(18,003)		(5,807)	(1,885)	(730)		(26,425)
Head lease obligations							1,306		-	-	-		1,306
Carrying value at 30 June 2018							1,111,726		193,180	153,857	73,201		1,531,964
Revaluation movement in the period ended 30 June 2018
Gross revaluation							(24,537)		2,552	(4,231)	(8,976)		(35,192)
Effect of tenant incentives and contracted rent uplift balances							549		(58)	(174)	(180)		137
Revaluation reported in the Income Statement							(23,988)		2,494	(4,405)	(9,156)		(35,055)
Asset class							Logistics		Logistics	Logistics	Office		31 December
Location							Moscow		St Petersburg	Regions	St Petersburg		2017
Fair value hierarchy *							Level 3		Level 3	Level 3	Level 3		Total
							$'000		$'000	$'000	$'000		$'000
Market value at 1 January 2017							1,005,449		141,431	151,846	24,818		1,323,544
Corporate acquisitions							-		35,994	-	50,179		86,173
Other acquisition							122,730		-	-	-		122,730
Property improvements							11,155		1,738	3,081	312		16,286
Unrealised profit on revaluation							16,346		16,872	4,477	6,834		44,529
Market value at 31 December 2017							1,155,680		196,035	159,404	82,143		1,593,262
Tenant incentives and contracted rent uplift balances							(18,552)		(5,749)	(1,711)	(550)		(26,562)
Head lease obligations							1,426		-	-	-		1,426
Carrying value at 31 December 2017							1,138,554		190,286	157,693	81,593		1,568,126
Revaluation movement in the period ended 30 June 2017
Gross revaluation							(5,536)		13,554	904	3,874		12,796
Effect of tenant incentives and contracted rent uplift balances							366		138	251	(208)		547
Revaluation reported in the Income Statement							(5,170)		13,692	1,155	3,666		13,343
*Classified in accordance with the fair value hierarchy. There were no transfers between fair value hierarchy in 2017 or 2018.
At 30 June 2018 the Group has pledged investment property with a value of $1,546 million (31 December 2017: $1,435 million) to secure banking facilities granted to the Group (note 10).
8. Investment property under construction
Asset class					Assets under construction					Land Bank			30 June
Location					Moscow		Regions			Regions			2018
Fair value hierarchy *					Level 3		Level 3		Sub-total	Level 3	Sub-total		Total
					$'000		$'000		$'000	$'000	$'000		$'000
Market value at 1 January 2018					26,700		7,600		34,300	3,596	3,596		37,896
Costs incurred					(19)		3		(16)	-	-		(16)
Effect of foreign exchange rate changes					(934)		(557)		(1,491)	(314)	(314)		(1,805)
Unrealised profit on revaluation					53		553		606	-	-		606
Market value at 30 June 2018					25,800		7,599		33,399	3,282	3,282		36,681
Head lease obligations					471		-		471	-	-		471
Carrying value at 30 June 2018					26,271		7,599		33,870	3,282	3,282		37,152
Asset class					Assets under construction					Land Bank			31 December
Location					Moscow		Regions			Regions			2017
Fair value hierarchy *					Level 3		Level 3		Sub-total	Level 3	Sub-total		Total
					$'000		$'000		$'000	$'000	$'000		$'000
Market value at 1 January 2017					29,600		7,500		37,100	3,662	3,662		40,762
Costs incurred					57		12		69	-	-		69
Effect of foreign exchange rate changes					686		341		1,027	206	206		1,233
Unrealised loss on revaluation					(3,643)		(253)		(3,896)	(272)	(272)		(4,168)
Market value at 31 December 2017					26,700		7,600		34,300	3,596	3,596		37,896
Head lease obligations					515		-		515	-	-		515
Carrying value at 31 December 2017					27,215		7,600		34,815	3,596	3,596		38,411
*Classified in accordance with the fair value hierarchy. There were no transfers between fair value hierarchy in 2017 or 2018.
No borrowing costs were capitalised in the period (31 December 2017: $nil). At 30 June 2018 the Group has pledged investment property under construction with a value of $33.4 million (31 December 2017: $34.3 million) to secure banking facilities granted to the Group (note 10).

9. Valuation assumptions and key inputs

Class of property

Carrying amount

Valuation

Input

Range

30 June

31 December

30 June

31 December

2018

2017

technique

2018

2017

$'000

$'000

Completed investment property

Moscow - Logistics

1,111,726

1,138,554

Income

Long term ERV per sqm for existing tenants

Rub 4,895 to Rub 5,334

Rub 4,500 to Rub 4,896

capitalisation

Short term ERV per sqm for vacant space

Rub 3,500 to Rub 3,800

Rub 3,500 to Rub 3,800

Initial yield

2.2% to 17.1%

2.5% to 15.5%

Equivalent yield

10.5% to 12.0%

10.5% to 12.0%

Vacancy rate

1% to 61%

1% to 94%

Passing rent per sqm

$113 to $166

$110 to $166

Passing rent per sqm

Rub 3,000 to Rub 11,847

Rub 3,104 to Rub 11,847

St Petersburg - Logistics

193,180

190,286

Income

Long term ERV per sqm for existing tenants

Rub 4,707 to Rub 5,021

Rub 4,320 to Rub 4,608

capitalisation

Short term ERV per sqm for vacant space

Rub 3,800

Rub 3,800

Initial yield

6.8% to 12.2%

6.0% to 13.4%

Equivalent yield

11.7% to 11.8%

12.1% to 13.4%

Vacancy rate

7% to 19%

3% to 19%

Passing rent per sqm

$109 to $135

$69 to $140

Passing rent per sqm

Rub 2,339 to Rub 5,260

Rub 2,339 to Rub 4,916

Regional - Logistics

153,857

157,693

Income

Long term ERV per sqm for existing tenants

capitalisation

Rub 5,021

Rub 4,608

Short term ERV per sqm for vacant space

Rub 3,800

Rub 3,800

Initial yield

11.1% to 12.0%

9.0% to 11.3%

Equivalent yield

11.6% to 11.7%

12.1% to 12.5%

Vacancy rate

3% to 12%

6% to 27%

Passing rent per sqm

$105 to $138

$104 to $133

Passing rent per sqm

Rub 3,780 to Rub 4,549

Rub 3,720 to Rub 6,707

St Petersburg - Office

73,201

81,593

Income

ERV per sqm

$159 to $197

$173 to $215

capitalisation

Initial yield

12.0% to 27.5%

12.5% to 24.3%

Equivalent yield

11.0% to 12.3%

11.0% to 12.3%

Vacancy rate

0% to 2%

0% to 1%

Passing rent per sqm

$366

$388

Passing rent per sqm

Rub 8,004 to Rub 16,272

Rub 8,124 to Rub 16,271

Passing rent per sqm

€390

€390

Range

Other key information

Description

30 June

31 December

2018

2017

Moscow - Logistics

Land plot ratio

34% - 65%

34% - 65%

Age of building

2 to 13 years

1 to 13 years

Outstanding costs (US$'000)

2,980

9,436

St Petersburg - Logistics

Land plot ratio

48% - 57%

48% - 57%

Age of building

3 to 9 years

3 to 9 years

Outstanding costs (US$'000)

667

826

Regional - Logistics

Land plot ratio

48% - 61%

48% - 61%

Age of building

8 years

8 years

Outstanding costs (US$'000)

545

154

St Petersburg - Office

Land plot ratio

148% to 496%

148% to 496%

Age of building

9 to 11 years

9 to 11 years

Outstanding costs (US$'000)

253

81

Carrying amount

Input

Range

Investment property under construction

30 June 2018

31 December 2017

Valuation technique

30 June 2018

31 December 2017

$'000

$'000

Moscow - Logistics

26,271

27,215

Comparable

Value per ha ($m)

$0.29 - $0.52

$0.32 - $0.53

Regional - Logistics

7,599

7,600

Comparable

Value per ha ($m)

$0.30

$0.30

10. Interest bearing loans and borrowings							30 June	31 December
							2018	2017
Bank loans							$'000	$'000
Loans due for settlement within 12 months							43,202	106,697
Loans due for settlement after 12 months							781,084	740,485
							824,286	847,182
The Group's borrowings have the following maturity profile:
On demand or within one year							43,202	106,697
In the second year							81,686	148,390
In the third to fifth years							437,097	383,582
After five years							262,301	208,513
							824,286	847,182
The amounts above include unamortised loan origination costs of $9.7 million (31 December 2017: $10.6 million) and interest accruals of $1.8 million (31 December 2017: $1.7 million).
The principal terms of the Group's interest bearing loans and borrowings on a weighted average basis are summarised below:
As at 30 June 2018						Interest	Maturity
						Rate	(years)	$'000
Secured on investment property and investment property under construction						7.49%	4.4	809,554
Unsecured facility of the Company						4.84%	2.9	14,732
								824,286
As at 31 December 2017
Secured on investment property and investment property under construction						7.60%	4.5	832,405
Unsecured facility of the Company						8.90%	2.7	14,777
								847,182
The interest rates shown above are the weighted average cost, including US LIBOR (or equivalent benchmark rate as appropriate), as at the Balance Sheet dates.
11. Preference shares
							30 June	31 December
							2018	2017
							$'000	$'000
At 1 January							146,458	131,703
Purchased in the period / year							-	(112)
Re-issued in the period / year							-	961
Premium on redemption of preference shares and amortisation of issue costs							286	537
Scrip dividends							261	863
Effect of foreign exchange rate changes							(3,528)	12,506
At 30 June / 31 December							143,477	146,458
							30 June	31 December
							2018	2017
							Number	Number
At 1 January							99,143,192	98,265,327
Purchased in the period / year							-	(56,866)
Re-issued in the period / year							-	487,047
Scrip dividends							132,974	447,684
At 30 June / 31 December							99,276,166	99,143,192
Shares in issue							99,333,034	99,200,060
Held by the Company's Employee Benefit Trusts							(56,868)	(56,868)
At 30 June / 31 December							99,276,166	99,143,192
12. Convertible preference shares
							30 June	31 December
							2018	2017
							$'000	$'000
At 1 January							269,031	119,859
Issued in the period / year							-	130,290
Allocated to equity							-	(6,067)
Acquired by Company's Employee Benefit Trust							-	(3,888)
Reissued in the period / year							-	4,376
Converted to ordinary shares (note 13)							-	(331)
Premium on redemption of preference shares and amortisation of issue costs							4,982	7,448
Movement on accrual for preference dividends							-	22
Effect of foreign exchange rate changes							(6,660)	17,322
At 30 June / 31 December							267,353	269,031
							30 June	31 December
							2018	2017
							Number	Number
At 1 January							192,388,886	102,837,876
Issued in the period / year							-	89,766,361
Acquired by Company's Employee Benefit Trust							-	(2,631,578)
Reissued in the year							-	2,683,075
Converted to ordinary shares (note 13)							-	(266,848)
At 30 June / 31 December							192,388,886	192,388,886
Shares in issue							198,189,014	198,189,014
Held by the Company's Employee Benefit Trusts							(5,800,128)	(5,800,128)
At 30 June / 31 December							192,388,886	192,388,886
On 4 July 2017 the Company created and issued a further 89,766,361 convertible preference shares at a placing price of 114p per share. The new convertible preference shares rank pari passu with the existing convertible preference shares in issue. One of the Company's employee benefit trusts participated in the placing and subscribed for a further 2,631,578 convertible preference shares.
13. Share capital							30 June	31 December
							2018	2017
							$'000	$'000
At 1 January							12,479	12,578
Issued in the period / year for cash on warrant exercises							107	180
On conversion of convertible preference shares (note 12)							-	6
Repurchased and cancelled in the period / year							(417)	(285)
At 30 June / 31 December							12,169	12,479
							30 June	31 December
							2018	2017
							Number	Number
At 1 January							660,571,843	667,968,463
Issued in the period / year for cash on warrant exercises							7,853,348	13,946,387
On conversion of convertible preference shares (note 12)							-	474,722
Repurchased and cancelled in the period / year							(31,311,181)	(21,817,729)
At 30 June / 31 December							637,114,010	660,571,843
Of the authorised ordinary share capital of 1,500,000,000 at 30 June 2018 (31 December 2017: 1,500,000,000), 3.1 million (31 December 2017: 10.9 million) ordinary shares are reserved for warrants.
Details of own shares held are given in note 15.
							30 June	31 December
							2018	2017
Summary of ordinary share movements from tender offers in the period / year							Number	Number
Number of ordinary shares purchased							39,311,181	21,817,729
Retained as own shares (note 15)							(8,000,000)	-
Cancelled in the period / year							31,311,181	21,817,729
14. Warrants							30 June	31 December
							2018	2017
							$'000	$'000
At 1 January							441	1,161
Exercised in the period / year							(255)	(720)
At 30 June / 31 December							186	441
							30 June	31 December
							2018	2017
							Number	Number
At 1 January							10,948,352	24,894,739
Exercised in the period / year							(7,853,348)	(13,946,387)
At 30 June / 31 December							3,095,004	10,948,352
15. Own shares held							30 June	31 December
							2018	2017
							$'000	$'000
At 1 January							(5,742)	(7,449)
Acquired under tender offers							(5,536)	-
Acquisitions							(103)	(158)
Allocation to satisfy Annual Performance Incentive (note 17b)							2,049	-
Cancelled							22	47
Allocation to satisfy LTIP options exercised (note 17a)							975	1,818
At 30 June / 31 December							(8,335)	(5,742)
							30 June	31 December
							2018	2017
							Number	Number
At 1 January							5,150,122	6,444,080
Acquired under a tender offer							8,000,000	-
Other acquisitions							173,958	257,703
Allocation to satisfy Annual Performance Incentive (note 17b)							(1,704,000)	-
Cancelled							(18,398)	(39,472)
Allocation to satisfy LTIP options exercised (note 17a)							(810,811)	(1,512,189)
At 30 June / 31 December							10,790,871	5,150,122
Allocations are transfers by the Company's Employee Benefit Trusts to satisfy LTIP options exercised in the period and two of the 2017 Annual Performance Incentives. The amounts shown for share movements are net of the Trustees' participation in tender offers during the period from grant to exercise. Details of outstanding LTIP options, which are vested but unexercised, are given in note 17a.
16. Net asset value per share
As well as reporting IFRS net asset value per share, the Group also reports its own adjusted net asset value and adjusted net asset value per share measure. The Directors consider that the adjusted measure provides more relevant information to shareholders as to the net asset value of a property investment group with a strategy of long term investment. The adjustments remove or adjust assets and liabilities, including goodwill and amounts relating to irredeemable preference shares, that are not expected to crystallise in normal circumstances.
							30 June	31 December
							2018	2017
							$'000	$'000
Net asset value							478,392	529,758
Goodwill in joint venture							(4,599)	(4,712)
Unrealised foreign exchange profits on preference shares							(11,384)	(7,856)
Fair value of interest rate derivative financial instruments							(15,378)	(8,032)
Fair value of embedded derivatives							69	(186)
Fair value of foreign exchange derivative financial instruments							(46)	(140)
Adjusted net asset value							447,054	508,832
							Number	Number
Number of ordinary shares (note 13)							637,114,010	660,571,843
Less own shares held (note 15)							(10,790,871)	(5,150,122)
							626,323,139	655,421,721
				30 June 2018			31 December 2017
					Net asset			Net asset
			Net asset	Ordinary	value per	Net asset	Ordinary	value per
			value	shares	share	value	shares	share
IFRS			$'000	No. '000	Cents	$'000	No. '000	Cents
Net asset value per share			478,392	626,323	76	529,758	655,422	81
Effect of dilutive potential ordinary shares:
Convertible preference shares (note 12)			-	-		269,031	338,412
Warrants (note 14)			1,021	3,095		3,703	10,948
LTIP (Note 17)			351	1,062		633	1,873
2016 Retention Scheme (note 17)			2,219	4,912		1,714	4,616
Fully diluted net asset value per share			481,983	635,392	76	804,839	1,011,271	80
				30 June 2018			31 December 2017
					Net asset			Net asset
			Net asset	Ordinary	value per	Net asset	Ordinary	value per
			value	shares	share	value	shares	share
Adjusted			$'000	No. '000	Cents	$'000	No. '000	Cents
Net asset value per share			447,054	626,323	71	508,832	655,422	78
Effect of dilutive potential ordinary shares:
Convertible preference shares (note 12)			-	-		-	-
Warrants (note 14)			1,021	3,095		3,703	10,948
LTIP (Note 17)			351	1,062		633	1,873
2016 Retention Scheme (note 17)			2,219	4,912		1,714	4,616
Fully diluted net asset value per share			450,645	635,392	71	514,882	672,859	77
The carrying value of the convertible preference shares at 30 June 2018 (see note 12) when divided by the number of ordinary shares that would be issued on conversion, is greater than basic net asset value per share and thus the convertible preference shares are not dilutive at 30 June 2018.
17. Share-based payments and other long term incentives					Six months ended 30 June 2018		Six months ended 30 June 2017
					No of options	Weighted	No of options	Weighted
(a) Movements in Executive Share Option Schemes						average		average
						exercise		exercise
						price		price
Outstanding at the beginning of the period					1,872,973	25p	3,872,973	25p
Exercised during the period
- LTIP					(810,811)	25p	(1,000,000)	25p
Outstanding at the end of the period					1,062,162	25p	2,872,973	25p
Represented by:
- LTIP					1,062,162		2,872,973
Exercisable at the end of the period					1,062,162	25p	2,872,973	25p
							Six months	Six months
							ended	ended
(b) Income statement charge for the period							30 June 2018	30 June 2017
							$'000	$'000
Five Year Performance Plan							-	-
Annual Performance Incentive							1,031	-
2016 Retention Scheme							1,446	2,227
							2,477	2,227
Satisfied by or to be satisfied by allocation of:
Ordinary shares (IFRS 2 expense)							1,031	-
Convertible preference shares (IFRS 2 expense)							569	1,409
Cash							877	818
							2,477	2,227
18. Ordinary dividends The Company did not declare a final dividend for the year ended 31 December 2017 (2016: none) and instead implemented a tender offer buy back for ordinary shares on 1 June 2018 on the basis of 1 in every 17 shares held and a tender price of 52 pence per share, the equivalent of a final dividend of 3 pence per share. (2016: 1 in every 26 shares at 52p per share the equivalent of 2p per share).
19. Fair value measurement Set out below is a comparison of the carrying amounts and fair value of the Group's financial instruments as at the balance sheet date:
					30 June 2018		31 December 2017
					Carrying	Fair	Carrying	Fair
					Value	Value	Value	Value
					$'000	$'000	$'000	$'000
Non-current assets
Loans receivable					664	620	665	621
Security deposits					16,616	13,467	1,305	1,220
Derivative financial instruments					15,411	15,411	7,948	7,948
Current assets
Trade receivables					41,644	41,644	44,315	44,315
Security deposits					1,332	1,332	-	-
Other current receivables					834	834	1,509	1,509
Derivative financial instruments					13	13	445	445
Cash and short term deposits					198,095	198,095	266,666	266,666
Non-current liabilities
Interest bearing loans and borrowings					781,084	777,646	740,485	743,488
Preference shares					143,477	193,991	146,458	195,816
Convertible preference shares					267,353	303,545	269,031	317,521
Rent deposits					22,521	19,306	22,626	19,838
Deferred consideration on property acquisition					-	-	10,008	10,008
Other payables					1,769	1,769	1,932	1,932
Current liabilities
Interest bearing loans and borrowings					43,202	43,202	106,697	106,697
Derivative financial instruments					69	69	35	35
Rent deposits					7,398	7,398	6,622	6,622
Deferred consideration on property acquisition					22,693	22,693	24,166	24,166
Other payables					1,874	1,874	17,455	17,455
Fair value hierarchy
The following table provides the fair value measurement hierarchy* of the Group's assets and liabilities.
								Total Fair
					Level 1	Level 2	Level 3	Value
As at 30 June 2018					$'000	$'000	$'000	$'000
Assets measured at fair value
Investment property					-	-	1,531,964	1,531,964
Investment property under construction					-	-	37,152	37,152
Derivative financial instruments					-	15,424	-	15,424
Liabilities measured at fair value
Derivative financial instruments					-	69	-	69
As at 31 December 2017
Assets measured at fair value
Investment property					-	-	1,568,126	1,568,126
Investment property under construction					-	-	38,411	38,411
Derivative financial instruments					-	8,393	-	8,393
Liabilities measured at fair value
Derivative financial instruments					-	35	-	35
* Explanation of the fair value hierarchy:
Level 1 - Quoted prices in active markets for identical assets or liabilities that can be accessed at the balance sheet date. Level 2 - Use of a model with inputs that are directly or indirectly observable market data. Level 3 - Use of a model with inputs that are not based on observable market data. The Group's foreign currency derivative financial instruments are call options and are measured based on spot exchange rates, the yield curves of the respective currencies as well as the currency basis spreads between the respective currencies. The Group's interest rate derivative financial instruments comprise swap contracts and interest rate caps. These contracts are valued using a discounted cash flow model and where not cash collateralised consideration is given to the Group's own credit risk.
20. Subsequent events On 10 August 2018 the Group entered into two agreements to purchase an extension to the Sever logistics park in Moscow for a consideration of Rub 2.45 billion. The agreements are conditional on the satisfaction of certain escrow arrangements and the acquisition is expected to complete in late September 2018.