OREANDA-NEWS. January 24, 2013. Veles Capital group announces 2012 results. According to the preliminary data, Veles Capital’s net profit exceed 5 mln EUR (200 mln RUR), +8% as compared to the 2011 results.

According to the consensus opinion of market leaders, 2012 was the year of the debt market. Veles Capital caught the trend and increased the turnover on bonds, Eurobonds and promissory notes markets. As compared to the same period of 2011 Veles Capital’s total turnover on bonds market increased +9% in January-September 2012 and exceeded 37 bln EUR (1,47 trln RUR). Eurobonds turnover increased +45% up to 3,8 bln EUR (151,16 bln RUR). Promissory notes turnover increased +32% up to 33 bln EUR (1,3 trln RUR).The volume of promissory notes programs organized with the participation of Veles Capital doubled. The company organized 55 promissory notes programs worth 7,2 bln EUR (288 bln RUR) and participated in 69 bonds issues worth 511 mln EUR (20,4 bln RUR). For comparison: in 2011 Veles Capital participated in 41 bonds issues worth 431 mln EUR (17,2 bln RUR).

“2012 was a hard year on the private equity market with very low liquidity, so many companies selected debt market for fund raising, thus increasing total volume of issues. Also fixed income instruments became very popular among investors because of the stable yield rates and clear regulation from Bank of Russia. These factors contributed to the company’s positive results”, - said Alexey Gnedovskiy, Veles Capital IC CEO.

Veles Capital continues to expand brokerage services on stock and debt markets. To raise the efficiency and to distribute the experience and effective practices of work which the company has on the debt market, the company’s corporate structure was reorganized and special department of active operations was formed. Evgeniy Shilenkov, former head of Veles Capital’s debt market department, was appointed as head of the new Department. On this new position Evgeniy coordinates stock and debt market desks as well as operations with derivatives. This reorganization has already demonstrated very positive results. Veles Capital’s turnover on stock market (Moscow exchange, main trading mode) increased +86% as compared to the 2011 results. The company joined Moscow Exchange FX Market Trading participants, hired specialists to develop algorithmic trading, continued to update technological infrastructure to increase quality of client service.

The total volume of assets in Veles Capital’s trust management increased +80% as compared to the same period of 2011 up to 422 mln EUR (16,86 bln RUR). “Last year we concentrated on the investment instruments with limited risks (structured notes and products based on the rent income) which allow earning income even in the hard market situation. Development of such interesting strategies, which does not depend directly on the market volatility contributed to the company’s results and supported trust management business”, - said Beyshen Isaev, head of Veles Management.

Important event of 2012 was consolidation of Albion Finance Asset Management company (reorganized to VELES TRUST Asset Management company), which specializes on the organization and management of commercial real estate funds. This step should increase efficiency and contribute to the synergy with Veles Management Company in promotion of REIT investments. In 2012 VELES TRUST formed Perlovskiy REIT, which was very popular among the investors and more than the half of it’s units was sold on the over the counter market within only 3 months after the start of sales.

“We plan to expand amount of REITS in 2013 as we see high interest from investors to this instrument. Collective investments to high quality commercial real estate are simple and conservative instrument to save capital in long term period. We can hardly find any alternatives to it in current market situation”, - said Ekaterina Chernikh, VELES TRUST CEO.

Veles Capital Investment Group participated as consultant in transaction of VIYM fund bought part of the Syktyvkar Tissue Group; supported the transaction of private investors bought the Don Agro company from Razguliay group and consulted several transactions in FMCG sector. The companies in Veles Capital’s private equity portfolio were developing according to the confirmed strategies and outperform the market. The first step of the modernization of the Bugulminskiy Electro Driving Pump Enterprise (Runaco group, Tatarstan) was finished in 2012 (expected group revenue in 2012 – 37,6 mln EUR (1,5 bln RUR)). Smela Electromechanical Plant (Ukraine) develops as engineering and repair enterprise as also active participant of service market. Also Veles Capital invests in venture projects. One of them –Veles Pharma innovative company which is making research and developing new pharmaceutical forms.

Veles Capital group operates on Russian financial market since 1995 and renders services on the securities market, in the field of private equity, real estate investments for corporate and private investors. Veles Capital brand unites investment companies in Russia, Ukraine, Cyprus; asset management companies Veles Management and VELES TRUST; Veles Capital Investment Group (private equity, M&A consulting, corporate finance); Veles Development (real estate investments), etc.