OREANDA-NEWS. On 24 April 2009 was announced, that the Board of Directors of OJSC LSR Group (LSE: LSRG, MICEX, RTS: LSRG) approved the 2008 consolidated financial statements prepared in accordance with the IFRS standards. The independent audit of the financial statements was carried out by KPMG.

In 2008 LSR Group demonstrated dynamic growth and achieved record operating financial results:

Sales revenues rose by 39% to reach RUR 49,813 million

EBITDA grew by 67% to RUR 13,178 million, and EBITDA margin grew from 22% to 26%.

Normalised operating profit increased by 75% to RUR 11,130 million.

Normalised net profit was up by 72% to RUR 5,298 million.

Igor Levit, CEO and member of the Board of Directors of LSR Group commented:

“2008 was a year of record achievements for our company: we demonstrated dynamic growth and showed high levels of revenue and EBITDA.

In 2008, we went on implementing a strategy aimed at strengthening our positions in the core segments of our home market as well as at expanding our influence in the key market regions. In particular, at the Urals we acquired building materials production facilities and the leading prefabricated construction company, and also a major real estate development company having a sizable land bank. As a result we succeeded in replicating the integrated business model of our company in the Yekaterinburg and the Urals region market strategically important for us.

In 2008, we obtained ad ominating position in the Ukrainian aerated concrete market through launching a new aerated concrete plant and finalizing the acquisition of a major aerated concrete producer in the Kiev region.

We continued the realization of programmes aimed at increasing the efficiency of our manufacturing facilities and in accordance with our time table carried on with the construction of a cement plant we will be ready to put into operation in the second half of 2010.

On the other part, one cannot disregard the fact that last year was a year of dramatic changes in the economic development worldwide. The crisis affected the 2008 results of LSR Group too, causing a reduction in demand in the second part of 2008 and bringing about a negative result of the revaluation of our investment property. However, it is important to note, that even though the loss from revaluation reduces the profit recognized in the income statement, it has no effect on the cash flows and liquidity of the company. In addition, since the valuation parameters depend greatly on the market environment, we are convinced that once the crisis is over the valuation will be reconsidered in the positive direction.

In autumn 2008, we developed and launched ananti-crisis strategy and implemented cost reduction programme. We believe that we will emerge from the current economic cycle even stronger than before”.

Notes to Editors:

OJSC LSR Group is a real estate and building materials company founded in 1993 and operating in a number of complementary market segments. Its core business areas are building materials, construction and real estate development. The Group includes enterprises for extraction and processing of aggregates, production and transportation of building materials, and housing construction — from mass market large-panel housing to elite property built after designs made by leading domestic and foreign architects.

LSR Group has operations and offices in a number of cities in the Leningrad region, in St. Petersburg, Moscow, Yekaterinburg, Lithuania, Latvia, Estonia, Ukraine and Germany.

In 2007, the sales revenues of LSR Group (IFRS) - were RUR 35,838 million, in 2008– RUR 49,813 million.

LSR Group is a public company, with its GDRs listed and traded on the London Stock Exchange and its shares listed and traded on MICEX and RTS. In 2007, LSR Group was awarded ‘The Company of the Year’ National Award in the ‘Construction’ category.