Raven Russia cashing in on lack of warehousing

Raven Russia, the Russia-focused property company, is benefiting from an improving economy, particularly around Moscow and Rostov, and an under-supply of the kind of warehousing facilities which are its speciality.

In the six months to June 30th pre-tax profits came in at $29.6m, down on the prior year's number of $86.4m but this may give a misleading impression because underlying earnings before tax for the period were $14.3m against a loss of $5.9m in 2011.

This equates to diluted, underlying, earnings per share of 2.35 cents (30th June 2011: loss of 0.5 cents).

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The group's net asset value, or NAV, increased from $669m at the year's end to $685m by the end of June; property companies tend to be far more concerned about NAV than the bottom line.

The latest portfolio valuation is $1,417m, representing a fully let portfolio yield of 11.7%.

Raven Russia's Chief Executive, Glyn Hirsch, said: "The market in which we operate continues to improve. The Russian economy is growing and our tenants are doing well. There is a structural under-supply of logistics warehousing and combined with fragmented competition and limited development finance, this means that the supply/demand dynamics are in the landlord's favour."

Raven Russia is a recent entrant to the FTSE 250 and so far this year the stock has gained 33.7%.

BS