PIK Group

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PIK Group OJSC
Public company (OAO)
Traded asMCXPIKK
LSEPIK
IndustryReal estate
Construction
Founded1994 as Pervaya Ipotechnaya Kompaniya
HeadquartersMoscow, Russia
Key people
Vladislav Mamulkin, (chairman)
Sergei Gordeev, (CEO)
ProductsHouse-building
Revenue$3 billion[1] (2017)
$157 million[1] (2017)
$54.1 million[1] (2017)
Total assets$6.48 billion[1] (2017)
Total equity$962 million[1] (2017)
Number of employees
14,263
Websitewww.pik-group.com

PIK Group is the largest real estate and homebuilder company in Russia.

The company and its subsidiaries is principally engaged in the residential construction industry. Its activities comprise construction and development of residential real estate projects and sales of completed units, including service and maintenance of residential real estate developed by the Company itself and by other developers; production and assembly of concrete panel housing in Moscow and the Moscow Region, as well as production and sales of construction materials. The Company operates through numerous subsidiaries and four affiliated companies located in Moscow and the Moscow Region, Rostov, Kirov, Kaluga, Tula, Nizhny Novgorod, Kaliningrad as well as in Cyprus, among others.

Currently the company is listed in the Russian stock Exchanges of RTS and MICEX and in London Stock Exchange.

In 2016, PIK completed the acquisition of rival Morton for 11.7 billion rubles ($189 million), making it the largest Russian real estate company, with a portfolio of 12.5 million square metres of property.[2] PIK also acquired DSK Grad, a high-tech building units manufacturing facility in Kotovo.[3]

History[edit]

Pervaya Ipotechnaya Kompaniya (PIK), subsequently renamed "PIK", was founded in 1994 by Yuri Zhukov and Kirill Pisarev.

In 2001, to expand its real estate development activities, PIK acquired Housebuilding Combine No.2 (DSK-2). DSK-2 is the third biggest housebuilding enterprise in Moscow, handing over more than 450,000 m2 of residential floorspace every year[4]. It specializes in building multi-story industrial (panel) residential buildings of the KOPE (3D design element) series. The combination performs the full range of residential panel construction operations, including the manufacturing of external and internal reinforced concrete structures, façade solutions, window units and other elements of residential buildings.

In 2005, PIK bought from Inteco another major Moscow housebuilding combine — DSK-3, with a capacity of 500,000 m2, thereby establishing an in-house large-panel construction capacity of up to 1 mln m2 of housing per annum and becoming a leading player on the Russian residential panel housing market[5].

In 2006, PIK acquired the Stroyinvestregion company and began to expand its real estate development activities across Russia, with projects in cities such as Kaliningrad, Yaroslavl, Kaluga, Obninsk, Nizhny Novgorod, Taganrog, Novorossiysk, Perm and Omsk.

In 2007, PIK bought Reinforced Concrete Structures Combine No.480, located in the town of Aleksin, Tula Region.

In late May 2007, PIK held an IPO in which its shareholders sold 15 % of the company for $1.85 bn, giving the company a capitalization of $12.3 bn[6]. In 2013, the company carried out an additional share placement and its shares traded on the London Stock Exchange and the Moscow Interbank Exchange[7]. In June 2017, PIK delisted from the London Stock Exchange and consolidated its share trading on the Moscow Exchange.

In 2013, an integrated production company called PIK-Industriya AO was created on the basis of DSK-2, DSK-3 and PIK-Avtotrans[8].

In 2014, the CEO and almost the entire management team were replaced.

In mid-2016, it was announced that PIK was to purchase the Morton Group — one of the biggest real estate developers in Russia. The value of the deal was not disclosed.

Russia's Economic Crisis period[edit]

In 2008, as a result of Russia's economic crisis, the company encountered financial difficulties. Residential real estate construction almost halved that year relative to 2007, from 23,000 apartments (1.5 mln m2) to 12,380 apartments (813,000 m2).

The crisis was a turning point in the company's history. On 25 December 2008, the Government of the Russian Federation adopted a decision to include PIK in the list of systemic companies of the Russian economy. Despite this, however, in April 2009, PIK's founders, Kirill Pisarev and Yuri Zhukov, had to relinquish control over the company: they ceded a 25 % shareholding to Suleyman Kerimov (Nafta-Moscow OOO) in exchange for a debt restructuring[9].

In 2009, the company received state guarantees from the Government of the Russian Federation[10].

Following the most acute phase of the economic crisis, in 2010—2012 PIK recovered and reinforced its position in the market. The National Rating Agency gave the company an "A» individual creditworthiness rating. In 2014, international ratings agency Standard & Poor's gave the company a corporate credit rating of "B/positive" with a positive outlook[11]. In late 2013, strategic investors Aleksandr Leonidovich Mamut and Sergey Eduardovich Gordeev acquired a shareholding in PIK from subsidiaries of the Suleyman Kerimov Foundation[12].

In late 2014, PIK received notification of a 5 % increase in the shareholding of its President and main shareholder, Sergey Gordeev, taking his equity share from 24,9 % to 29,9 %[13].

In the summer of 2017, Sergey Gordeev closed a deal to buy out the shareholdings of companies belonging to Aleksandr Mamut (16 %) and Mikail Shishkhanov (9.8 %) at a price of 280 rubles per one ordinary share. Sergey Gordeev thereby became the controlling shareholder, owning 50,02 % of PIK[14].

In the autumn of 2017, Sergey Gordeev further increased his shareholding in PIK to 74,6 % by completing a buyout of the minority shareholders in Alexander Mamut's and Mikhail Shishkhanov's companies[15].

Owners and Management[edit]

The main shareholder and President of PIK is Sergey Gordeev. He has a 74,6 % shareholding[16].

Activities[edit]

PIK specializes in the construction and sale of comfort-class residential real estate, primarily in the industrial housebuilding segment, and is a leader on the Russian real estate market. Since the company began its activities (1994) it has built 21.2 mln m2 of residential space, or 340,000 apartments, thereby providing housing to over 1 million people. PIK is active in 10 regions of Russia, with a focus on Moscow and Moscow Region.

PIK has an extensive and diversified project portfolio. As at 31 December 2007, it held a land bank of 11.5 mln m2. In 2018, the company is working on more than 40 integrated real estate development projects in the Moscow metropolitan area, most of them in the affordable housing sector. At the same time, the company's portfolio also features a number of business-class projects: Vavilova 4, Vander Park and Mosfilmovskaya.

PIK has approximately 13,000 employees and is accredited with 18 major Russian banks[17].

In 2017, the Analytical Credit Ratings Agency (ACRA) assigned the company a «BBB+» rating, which is higher than any other Russian real estate developer, and Standard & Poor’s confirmed its «B» credit rating. Also in 2017, Expert ratings agency gave PIK a credit rating of «A-» with a stable outlook. By decision of the Government of the Russian Federation, PIK has been included in the list of systemic companies of the Russian economy.

PIK has its own design bureau and modern manufacturing facilities, enabling it to adapt flexibly and rapidly to the needs of the market. In 2015, the company brought some fundamentally new industrial and monolithic housebuilding products to the market, completely transforming its approach to shaping the internal living environment in new developments.

PIK's production facilities include: the Aleksin Reinforced Concrete Structures Plant, the Naro-Fominsk Reinforced Concrete Structures Plant, the Ochakov Reinforced Concrete Structures Plant, the New Construction Systems plant in Obninsk and the Volga-Form Non-Standard Reinforced Concrete Plant. It also includes concrete mixing units and production of semi-finished items for the full range of components, embedded items, rigging, formwork etc. Taken together, these facilities have an annual capacity of 1.5 mln m2 of prefabricated reinforced concrete housing units and 500,000 m2 of SEM (Superefficient Monolith) façade structures, fully meeting PIK's requirements for these items.

The company is currently erecting houses in two main categories: PIK (industrial housing) and SEM (Superefficient Monolith). The basements and ground floors of PIK series buildings are monolithic, with tiled panels used from the first floor upwards.

Most of these houses do not have balconies, though they do feature storage rooms for the residents and the facades are fitted with cages for external air conditioning units. This helps to preserve the architectural appearance of the facades.

PIK works with both European and Russian design, architectural and engineering partners including de Architekten Cie., Gillespies, Steer Davies Gleave, John McAslan+Partners, Urbica and RuGBSC, Aukett Swanke, Buromoscow.

In 2015, the company introduced PIK Standard — its own set of regulations under which all new projects are being implemented. This describes all the parameters of a residential district from the external appearance of the facades to the number of electrical sockets in each apartment.

Together with AFA landscape bureau, PIK created Russia’s first PlayHub children’s playground in the grounds of the Buninskiye Luga residential district. In 2018, it plans to complete a second PlayHub in the Salaryevo Park district[18].

Key Statistics[edit]

PIK’s 2013 IFS revenue was 62.5 bn rubles. The company’s net profit as at 31 December 2013 fell by 20.1 bn rubles to 18.0 bn rubles (2012: 38.1 bn rubles)[19]. Net debt as at 31 December 2012 was 37.1 bn rubles, which was 5.7 bn rubles less than in the previous year[20].

In 2013, 52 new projects were launched (49 new projects in 2012). Sales grew by 2,9 % to 677,000 m2 of residential real estate. Total cash revenue in 2013 grew by 10,8 % while revenue from real estate retail sales grew by 32,3 % following a deliberate reduction in less profitable wholesale deals. Net profit in 2013 increased by more than 2.3 times to 7.4 bn rubles[21].

In 2014, PIK's total sales fell by 8,4 % to 620,000 m2 and sales revenue fell by 19,1 % to 50.95 bn rubles. The Group's total revenue in 2014 fell from 74.8 bn rubles to 61.7 bn rubles, or by 17,5 %[22].

In 2015, the company brought 12 new projects (50 new multi-story buildings) to the market. Real estate sales grew to 625,000 m2 and PIK's total revenue was 68.7 bn rubles[23].

In 2016, as in the previous year, the company brought 12 new projects to the market and 63 new multi-story residential buildings were put on sale. The developer's total revenue grew by 47,2 % over the year to 101.2 bn rubles and residential sales increased by more than 50 % to 950,000 m2[23].

In 2017, the company put 11 new projects and 99 new multi-story buildings up for sale[24]. Total revenue increased by 203,4 % to 175.1 bn rubles. Real estate sales increased by 214,5 % to 169.9 bn rubles. The volume of completed real estate handed over to buyers grew by 10,4 % to 1,887,000 m2.

In the first quarter of 2018, PIK put 21 new residential buildings up for sale. Total revenue increased by 26,9 % to 57.0 bn rubles from 44.9 bn rubles in the first quarter of 2017. Real estate sales increased by 36,9 % to 53.8 bn rubles, compared to 39.3 bn rubles in the first quarter of 2017.

Social Responsibility[edit]

Since 2005, PIK has been involved in addressing the problems of individual investors defrauded by dishonest construction firms such as Stroymetresurs ZAO, Kompaniya Stroyindustriya OOO and KT Sotsialnaya Initsiativa, which failed to meet their obligations to buyers. The company has completed construction of over 20 multi-story buildings and handed over 3,330 apartments to such investors.

The company is also completing construction of the Western Gateway to the Capital residential complex in the town of Odintsovo, Moscow Region. Work on the project began in 2004 but was frozen in 2005. New investors were brought in to complete it but they also failed to meet their obligations. Construction of the two six-section buildings — Buildings 2 and 3 — was resumed in November 2016 by the project's new investor, PIK, and the keys to the apartments in those blocks were finally handed over to their long-suffering owners in the autumn of 2017[25].

The company has a strong focus on building social infrastructure such as schools, kindergartens and clinics, bringing in prominent experts to work on these projects. Thus, PIK engaged the Dominique Colon & Associates bureau to design a school and kindergarten for the Green Park residential complex. And the unique round kindergarten by Buromoscow in the Varshavskoe Shosse 141 project was named Best Urban Architectural Solution for Educational and Medical Facilities by Moscow's Architectural Council.

From January 2014 to June 2018 alone, PIK built 16 schools and 33 kindergartens, creating 19,645 places in child education establishments in Мoscow Region. The company hands over all social facilities for children fully kitted out with furniture, equipment, toys and everything required for learning, development, comfortable and informative leisure[26].

References[edit]

  1. ^ a b c d e "Сonsolidated Financial Statements for the 12 months ended 31 December 2017" (PDF). Retrieved 28 October 2018.
  2. ^ "The PIK of Russian real estate". BNE Intellinews. 29 November 2017. Retrieved 28 October 2018.
  3. ^ "Власти отказались работать с устаревшими ДСК по программе реновации". РБК. Retrieved 28 October 2018.
  4. ^ Оксана Муравьева, Заслуги строителей отмечены мэром Москвы // Строительный мир, 2 July 2012 г.
  5. ^ Елена Никитина, НА АСФАЛЬТЕ: Куды бечь? // Ведомости, 20 July 2005 г.
  6. ^ Бэла Ляув. ПИК удержалась в коридоре // Ведомости, № 100 (1874), 4 июня 2007
  7. ^ Группа «ПИК» привлекает $330 млн в рамках SPO // Interfax, 7 June 2013 г.
  8. ^ ГК ПИК завершила процедуру объединении предприятий производственного блока // РБК, 6 November 2013 г.
  9. ^ Керимов продаст свою долю в группе ПИК // Лента.ру, 23 July 2010 г.
  10. ^ Ольга Сичкарь, Дмитрий Ладыгин, Группа ПИК дождалась госгарантий // Коммерсант, № 173 (4228), 18 September 2009 г.
  11. ^ S&P присвоило ГК ПИК рейтинг «B» с положительным прогнозом // РИА Новости, 14 August 2014 г.
  12. ^ Мамут и Гордеев купили у Керимова 36 % акций группы «ПИК» // Forbes, 20 December 2013 г.
  13. ^ "Сергей Гордеев увеличил долю в ГК ПИК". Retrieved 22 February 2017.
  14. ^ "Глава "ПИК" Сергей Гордеев получил контроль над компанией с 50,02%". Retrieved 22 February 2017.
  15. ^ "ПИК одиночества Сергея Гордеева". Retrieved 22 February 2017.
  16. ^ "Capital Group нашла партнера на застройку промзоны". Ведомости. Retrieved 27 January 2018.
  17. ^ http://rbcdaily.ru/market/562949985577338 Николай Михалев, НАМ С НЕБА НИЧЕГО ПРОСТО ТАК НЕ СВАЛИЛОСЬ //РБК Daily, 24 December 2013 г.
  18. ^ http://www.forbes.ru/biznes/365209-na-pike-sprosa-krupneyshiy-zastroyshchik-zapuskaet-servis-arendy-kvartir, Крупнейший застройщик запускает сервис аренды квартир //Forbes, 26 July 2018 г.
  19. ^ Мария Дранишникова, ПИК поборолась с долгами // Ведомости, 24 January 2013
  20. ^ Группа компаний ПИК за 2012 г сократила чистый долг на 14 % // РИА Недвижимость, 23 April 2014 г.
  21. ^ Чистая прибыль ГК «ПИК» по МСФО за 2013 г. выросла более чем в 2,3 раза // РБК, 22 April 2014 г.
  22. ^ "Ажиотажный спрос на квартиры не помог ПИК увеличить выручку в 2014 году". РБК. Retrieved 22 February 2017.
  23. ^ a b "Группа Компаний ПИК объявляет о результатах основной деятельности за 12 месяцев 2016 г." (in Russian). pik.ru. Retrieved 22 February 2017.
  24. ^ ""Мортон" помог ГК ПИК удвоить продажи в 2017 году" (in Russian). Retrieved 23 January 2017.
  25. ^ "Дольщики двух корпусов долгостроя в подмосковном Одинцове получили ключи". Retrieved 22 February 2017.
  26. ^ "Детская инфраструктура в проектах ГК ПИК". Retrieved 22 February 2017.

External links[edit]