OREANDA-NEWS. September 28, 2007. Interim Results for the six months ended.

Highlights

Financial
Net income increased nearly 6 times (492%) year-on-year to US $21.9 million (2006: US $3.7m)
Adjusted EBITDA* increased 49% year-on-year to US $44.0 million (2006: US $29.5m)
Adjusted EBITDA* margin increased to 13% (2006: 10%)
Gross Profit increased 51% to US $94.5 million (2006: US $62.7m)
Gross margin increased to 28% (2006: 22%)
Turnover up 21% to US $343.1 million (2006: US $282.7m)

Business
Strong organic and volume growth in Poultry Division
Doubled volumes in Pork Division as new state-of-the-art facility at Lipetsk gained momentum
Strengthened gross margins in Meat Processing Division through focus on high quality value-added product portfolio

Post period end
Completed acquisition of OAO Chicken Kingdom, a transformational acquisition for the business - making Cherkizovo the clear number one poultry producer in Russia

Sergey Mikhailov, Chief Executive Officer of Cherkizovo Group, said

"We have made an excellent start to our second year as a listed business. We have a clear and proven strategy for the business to grow profits and margins through a combination of organic growth in the Russian market, driving costs out of the business and deriving synergistic benefits from acquisitions within our fragmented markets. We have delivered on all fronts.

"In the Meat Processing Division we will maintain our strategy of strengthening the quality of our product range, and in the Pork Division, our leading state-of-the-art facilities are enabling us to significantly drive volumes.

"Following the completion of the acquisition of OAO Chicken Kingdom, we are now Russia's undisputed number one poultry producer and we believe this acquisition has been transformational for the business.

"The seasonal nature of the business means that performance in the second half of the year will exceed our achievements in the first half. With our strong, record organic growth and the acquisition of Chicken Kingdom, we have the scale, strong brands and market share to further pursue our growth strategy.

"The prospects in Russia remain very exciting for domestic producers and we feel that the business is well placed to continue to maximise the opportunities from this. Management remains confident in the outlook for the full year."