RGI INTERNATIONAL LIMITED
ANNUAL REPORT & ACCOUNTS 2013
RGI INTERNATIONAL GROUP ANNUAL REPORT & ACCOUNTS 2013 Contents 
01 2013 Highlights 
02 At a Glance
04 Our Heritage
07 Portfolio
10 Chairman’s Statement
12 Market Overview
16 Strategy 
18 Chief Executive’s Review
24 Financial Review
26 Principal Risks and Uncertainties
28 Board of Directors
30 Corporate Governance
33 Independent Auditor’s Report
34 Consolidated Statement of Financial Position 
35 Consolidated Statement of Profit or Loss
36 Consolidated Statement of Profit or Loss and 
Comprehensive Income
37 Consolidated Statement of Changes in Equity
38 Consolidated Statement of Cash Flows
 39 Notes to the Consolidated Financial Statements
IBC Shareholder’s Information
Welcome to 
Rose Group RGI International Limited Annual Report & Accounts 2013 1
Operational
• Microgorod «V Lesu»
 – Phase 1 of «V Lesu» received occupancy permits and is on track for residents to begin moving into 
finished apartments in H1 2014
 – The school and kindergarten are under roof and three of Phase 2’s five residential buildings are  
under construction
 – Advance sales taken on 524 apartments in 2013 totalling 37 ,716 sq.metres (2012: 619 apartments; 
39,773 sq.m)
• Tsvetnoy Central Market
 – New management team appointed to drive concession revenues and reduce costs
 – Store mix improved with 15 new brands introduced
 – Footfall of over 2 million visitors achieved for the first time (2012: 1.9m)
 – Total store turnover increased 15% to US$99 million (2012: US$86m)
 – RGI revenue from the store increased 23% to US$24.3 million (2012: US$19.8m)
 – Store achieved break-even with operating profit of US$0.6 million (2012: US$9.8m loss)
• Other projects
 – Planning permission received for Kvazar mixed use residential, office and retail project adjacent to  
«V Lesu», including a 10,860 sq.metres eco-friendly office park
 – Divested Victory Park for US$22 million
 – Planning permission received to reconstruct and enlarge Moscow’s historic Forum cinema
2013 HIGHLIGHTS
Financial
Net assets
US$394.4m
-28.1m (2012: US$422.5m)
EPRA NAV per share 
US$3.63m
+0.26m (2012: US$3.37m)
Operating profit
US$7.5m
+73.5m (2012: (US$66m))
Cash
US$26.4m
-1.8m (2012: US$28.2m)
Microgorod «V Lesu» future resident RGI International Limited Annual Report & Accounts 2013 2
AT A GLANCE
Fair value of development portfolio
US$713.9m
+22.4m (2012: US$691.5m)
Projects in portfolio
8
-1 (2012: 9)
Apartments under construction
2,065
+872 (2012: 1193)
Visitors to Tsvetnoy Central Market (footfall)
2, 1 1 7 ,000
+128,000 (2012: 1,989,000)
Rose Group is an established real estate developer focused on the premium economy 
residential market in Moscow.
We have been successfully creating new markets in Moscow real estate since 1993. The Company’s 
innovative drive played a key role in the transformation of Moscow’s Golden Mile in the 1990s, 
when new landmark buildings were constructed that set the benchmark for modern living and 
working spaces in the rapidly changing Russian capital. Today the Company is focused on serving 
Moscow’s growing middle class by building aspirational, design led, residential communities. Its 
pioneering Microgorod «V Lesu» project has set new standards for the Moscow residential sector by 
offering homebuyers a well configured development, with good facilities and apartments finished 
to a high quality. 
In addition to its distinctive residential properties, Rose Group developed, owns and operates 
Tsvetnoy Central Market, Moscow’s first iconic department store on Tsvetnoy Boulevard. The 
Company is listed on the LSE’s AIM market and has significant land holdings in central Moscow.
We are building 
communities  
for Moscow’s 
emerging 
middle class
AT A GLANCE RGI International Limited Annual Report & Accounts 2013 3
Microgorod «V Lesu» building 18 RGI International Limited Annual Report & Accounts 2013 4
Rose Group  
has a heritage  
of innovation
1993
• Predecessor company founded
2003-4
• Construction of Copper House
2006
• AIM admission
2007
• Sold stake in the Butikovsky development,  
high end office development for US$97m
• Construction commenced at Tsvetnoy
2009
• Year of consolidation permits progressed at  
«V Lesu»
• Strategic decision to focus on residential 
developments and divest non-core projects
2010
• Opens Tsvetnoy, a new retail format for Moscow
• Construction permit received for «V Lesu»
• Completed US$90 million placing
2011
• Construction commences at «V Lesu»
2012
• Building permission for Phase 2 «V Lesu» 
obtained
• Pyatnitskaya metro station adjacent to  
«V Lesu» opens
• Further rationalisation of portfolio with sale 
of Zemlianoy
• Resolution of shareholder dispute
• Andrey Nesterenko named CEO as part of 
succession planning for founder Boris Kuzinez
2013
• Phase II pre-sales at «V Lesu»
• Tsvetnoy achieves first operating profit
• Founder Boris Kuzinez sells stake and 
Vnesheconombank takes majority holding
• Management team transition completed,  
key appointments made
• Victory Park project sold
• Commissioning process initiated for Phase 1  
of «V Lesu»
Experience
20yrs
Awards
4
Buildings in Phaidon Atlas of  
21st Century World Architecture
Land bank
99 hectares
Gross building area
1.5m sq.m
OUR HERITAGE RGI International Limited Annual Report & Accounts 2013 5
OUR HERITAGE
Key completed projects
Copper House
(Butikovsky Lane 3)
Type Residential
Years of 
development
2002-2004
GBA 18,000 sq.m
Butikovsky Lane 5
Type Residential
Years of 
development
2001-2003
GBA 18,000 sq.m
Butikovsky Lane 7
Type Office
Years of 
development
2006-2008
GBA 9,000 sq.m
Villa Ostozhenka
(Molochny Lane 1)
Type Residential
Years of 
development
2001-2003
GBA 950 sq.m 6 RGI International Limited Annual Report & Accounts 2013 6
Molochny Lane 1
Type Residential
Years of 
development
2001-2002
GBA 11,000 sq.m
Zachatievsky Lane 19-21
Type Residential
Years of 
development
1999-2001
Area 5,000 sq.m
Korobeinikov Lane 1
Type
Residential + 
Commercial
Years of 
development
1999-2001
GBA 5,000 sq.m
X-Park
Type
Single Family 
Homes
Years of 
development
2001-2004
GBA 7,000 sq.m
OUR HERITAGE continued
Key completed projects 
continued RGI International Limited Annual Report & Accounts 2013 7
Operating Asset
Tsvetnoy
Area
Gross Buildable Area (sq.m) 36,522
Net Leasable Area (sq.m) 11,706 
Completed 2011
Market Value (US$) 230.0M
Tsvetnoy Central Market is a development store 
located on the historic site of the old market on 
Tsvetnoy Boulevard, in central Moscow. The Group has 
designed and is operating Tsvetnoy as a Western-style 
tenancy department store offering a varied shopping 
experience with high street and niche designer 
fashion, accessories, a food hall, a fresh market, 
cafés, bars and a rooftop restaurant with views of 
Moscow. Its unique architecture and fit-out and 
iconic structure have won a number of awards and 
Tsvetnoy is becoming a destination for Muscovites 
who want to shop in a European style environment.
PORTFOLIO
Projects held for development –  
Moscow Region
Microgorod «V Lesu»
Area Total project Phase 1 Phase 2
Gross Buildable Area 
(sq.m) 1,383,511
Residential Saleable 
Area (sq.m) 659,391 80,303 100,568
Apartments 9,736 1,193 1,501
Commercial Leasable 
Area (sq.m) 59,205 3,244 8,373
Parking (lots) 10,262 1,239 1,401
Market Value 
(100% stake) 
(US$) 423.4M 
Market Value 
(82% RGI stake) 
(US$) 347.2M
Microgorod «V Lesu» is an unique residential 
development situated a few kilometres from the 
Moscow city limits with high-quality fit out and 
larger flats than competitors. The development 
has been designed with a strong emphasis on 
community, ecology and value for money. 
Microgorod «V Lesu» combines the convenience 
of urban living with the benefits of the suburbs. 
It is located only 1.8 kilometres from the nearest 
metro station, yet is adjacent to a large protected 
forest. The 8-phase development includes 10,000 
apartments on an 81-hectare site. The project also 
incorporates the construction of social infrastructure 
of two schools and three kindergartens around a 7 
hectare natural forest. When completed, Microgorod 
«V Lesu» will be home to 35,000 people.
Kvazar
Area
Site (ha) 17.1
Market Value (US$) 69.5M
The Kvazar Development is a mixed use development 
in the Moscow region. It covers a land plot of 17.1 ha 
to the northwest of Moscow, adjacent to Microgorod 
(«V Lesu») project.
The Company possesses the land lease rights for the 
two land plots of 17.1 ha in total purchased during the 
first half of 2011. A concept is being discussed with 
the local Krasnogorsk Government which includes 
both residential and commercial office development. 
The office development we believe will be attractive 
for business tenants not only because of the style of 
offices being considered but the environment of being 
surrounded by trees. These offices will also bring local 
employment opportunities in line with regional 
planning objectives. 
Tsvetnoy Central Market 8 RGI International Limited Annual Report & Accounts 2013
Central Moscow projects
Khilkov
Area
Gross Buildable Area (sq.m) 19,806
Residential Saleable Area (sq.m) 8,800
Commercial Saleable Area (sq.m) 1,802
Parking (lots) 170
Market Value (100% stake) (US$) 76.6M 
Market Value (50% RGI stake) (US$) 38.3M
The Khilkov project is a proposed ultra-high-end 
residential building located in the most exclusive 
residential neighbourhood in the centre of 
Moscow on Khilkov lane in the Ostozhenka area, 
commonly known as Moscow’s Golden Mile.
The existing old residential building is to be 
demolished and a new residential building 
constructed to combine a modern architectural 
design with a high quality fit-out and finish.
Ostozhenka, 37
Area
Gross Buildable Area (sq.m) 1,000
Market Value (US$) 7.3M
Ostozhenka 37 is a proposed ultra-high-end single-
family townhouse located in the most exclusive 
residential neighbourhood in the centre of Moscow 
at the intersection of Ostozhenka Street and 
Khilkov Lane. The site is located in a conservation 
area that has special construction requirements 
to ensure that new building developments blend 
in with existing structures in order to preserve 
the look and feel of the neighbourhood.
PORTFOLIO continued
Ostozhenka, 49
Area
Gross Buildable Area (sq.m) 969
Market Value (100% stake) (US$) 6.1M
Market Value (50% RGI stake) (US$) 3.0M
The Ostozhenka, 49 project is an ultra-high-end 
single-family townhouse located in the most exclusive 
residential neighbourhood in the centre of Moscow.
In the first half of 2011 RGI purchased the 
0.0206 ha land plot between Ostozhenka Street, 
Turchaninov and Khilkov lanes accommodating 
premises owned by the Company since 2007.
RGI’s proposed plan for the project entitles 
construction of a townhouse similar to 
that designed for Ostozhenka, 37.
Rose Group invests  
capital in projects with  
the potential to earn 
superior returns RGI International Limited Annual Report & Accounts 2013 9
Forum 
Area
Gross Buildable Area (sq.m) 6,062
Net Leasable Area (sq.m) 5,030
Parking (lots) 60–70
Market Value (US$) 9.5M
The Forum project is the reconstruction and 
renovation of one of Moscow’s oldest cinemas. 
The development is located to the east of Tsvetnoy 
Boulevard approximately 2 kilometres north of 
the Kremlin within the Garden Ring. The proposed 
plan is to reconstruct the building preserving the 
historical façade, with a mix of retail, restaurants 
and an arthouse mini-multiplex cinema. 
Chelsea 
Area
Gross Buildable Area (sq.m) 5,473
Residential Saleable Area (sq.m) 2,103
Commercial Saleable Area (sq.m) 1,102
Parking (lots) 33
Market Value (US$) 9.0M
The Chelsea project is a proposed mixed use 
development comprising residential and retail 
areas. Chelsea is located to the east of Tsvetnoy 
Boulevard approximately 2 kilometres north of the 
Kremlin within the Garden Ring in the Sretenka 
district. The historical richness of one of the 
oldest districts in Moscow combined with modern 
development, both commercial and residential, make 
this area one of the most attractive in the city.
Artist’s rendering of Forum Theater 10 RGI International Limited Annual Report & Accounts 2013
CHAIRMAN’S STATEMENT
With the full support of VEB, the Company has been 
able to push forward with building on the legacy  
of its visionary founder Boris Kuzinez, who created  
a business renowned in Moscow for distinctive, 
aspirational real estate built to a high quality. The  
RGI approach to design and build has been applied 
most recently to its large residential development,  
«V Lesu», in the Moscow Region, where over 30,000 
people will live once the project is completed in 2022. 
Here, a very different kind of neighbourhood is taking 
shape, far removed from most of the mass market 
residential projects that are seen in the suburbs  
of Moscow.
This distinctive look and feel can also be seen at 
Tsvetnoy Central Market, the department store built, 
owned and operated by RGI in the centre of Moscow. 
Both developments have the concept of dynamic 
communities at their heart and it is this key focus, as 
well as design excellence and build quality, that sets 
RGI apart as a developer and gives us the potential  
to deliver superior shareholder returns.
The opportunity for us is clear. RGI operates solely in 
Moscow, the 9th largest city economy in the world 
ranking ahead of cities such as Sao Paulo, Shanghai, 
Beijing and Washington DC. Home to the Russian 
Government it is also the headquarters of most of the 
multinationals operating in Russia across a range of 
industries. Moscow’s economy is significantly 
diversified beyond the natural resources sector, with a 
large industrial base and fast growing technology and 
consumer sectors. Despite a growing population, as a 
result of immigration from the regions, unemployment 
remains low at around 0.5%.
This economic dynamism is resulting in a fast 
expanding, increasingly sophisticated and prosperous 
middle and upper-middle class, constituting a natural 
customer base for both our residential development 
and the Tsvetnoy department store. As in many 
Western cities, the pressure on a limited stock of 
suitable housing in the right areas is high. At «V Lesu», 
we have completed Phase I, opening the doors on a 
new kind of community for the aspirational buyer. We 
are setting unique standards in terms of choice and 
quality in the fit-out of new apartments in a market 
still dominated by shell and core offerings. We are 
distinguishing ourselves by having underground 
parking spaces for every apartment accessible directly 
by lift. Above all, we are offering an attractive, safe, 
desirable neighbourhood with the on-site facilities 
and transport links needed to raise a modern family. 
As we begin to deliver the first completely fitted-out 
apartments to residents in H1 2014, we are 
committed to growing RGI in a responsible way.  
This means looking beyond Phase 2, already under 
construction, to later phases of «V Lesu» and new, 
scalable projects with suitable risk-return profiles.  
At Tsvetnoy, we will continue our efforts to increase 
profitability while looking for opportunities to return 
capital from the operation. The Company’s key 
objective remains to deliver a consistent level of 
positive cash flow each year to improve shareholder 
value, translating over time into growth in net asset 
value per share and a regular dividend stream.
Emmanuel Blouin
Non-Executive Chairman
We are focused on 
building long-term  
value and developing  
a sustainable business
2013 was a transformational year for RGI as we 
welcomed a new majority shareholder and drew a 
line under a difficult period in the Company’s history.
The acquisition in Q1 2013 of a majority stake in RGI 
by Vnesheconombank (“VEB”) group companies 
represents a long-term portfolio investment by one 
of Russia’s largest state owned banks. Our new 
shareholder provides the stability needed to plan for 
the long term on the basis of a relationship 
agreement that provides for VEB’s representation on 
the Board while affirming the principles of best 
corporate governance practices.
The restructured Board has emerged as leaner, 
independent and better balanced. The elevation last 
spring of Andrey Nesterenko to the Board of Directors, 
along with the appointments of David Wood as CFO, 
Natalia Saakyants as Commercial Director and 
Petr Isaev as CEO of Tsvetnoy have put in place a 
dynamic and experienced team combining finance 
and property expertise to lead the Company. 11 RGI International Limited Annual Report & Accounts 2013
Last year, we reported that we had rebranded the 
operating business in Russia as Rose Group, which has 
a better connection with consumers as a brand 
standing for the principles of innovation, design and 
product quality that have made Microgorod «V Lesu» 
a success. This year, the Directors are proposing to 
adopt that name formally for the Group as a whole to 
ensure alignment of our marketing and corporate 
messages. We will be adding such a resolution to the 
agenda for this year’s AGM. 
RGI invests capital in multi-year projects that, over the 
long run, have the potential to deliver superior returns. 
We now enjoy a strong and stable shareholder base, an 
outstanding executive team, a demonstrated ability to 
deliver real estate and exciting growth prospects 
embedded in our current portfolio as well as potential 
acquisition opportunities. Our management team in 
Moscow has the experience to generate good deal flow, 
and the expertise to analyse opportunities quickly and 
thoroughly. Our business is well-positioned for future 
growth. We must however caution that it is too early to 
assess fully the economic impact of the crisis in Ukraine 
and the Company is actively monitoring the situation.
Emmanuel Blouin
Non-Executive Chairman
“Our new shareholder provides the stability needed to plan for 
the long term”
Vnesheconombank
• Founded in 1922
• 100% owned by Russian Federation 
• Senior government representation on the Supervisory Board
• Direct equity contributions from the Federal Budget 
• Cooperation with the key development financial institutions worldwide 
• International credit ratings 
Fitch – BBB / Stable 
S&P – BBB / Stable 
Moody’s – BAA1/Stable
Vnesheconombank is a Russian state corporation performing functions of the Bank for Development. Its 
mission is to diversify the Russian economy, boost its competitive edge and encourage the inflow of 
investments. Vnesheconombank funds major investment projects aimed at removing economic growth 
infrastructure restrictions. As a development bank, VEB does not compete with commercial credit 
institutions and has a mandate to fund socially important projects.  12 RGI International Limited Annual Report & Accounts 2013
Sustained demand  
coupled with a housing 
shortage makes Moscow 
particularly attractive
MARKET OVERVIEW
The fundamental supply and demand dynamics 
of the market continue to support a proposition 
of long-term housing volume growth in Moscow 
Region. Around 60% of housing in Moscow and 
the suburbs is over 40 years old and the quality of 
the vast majority of housing is poor. The existing 
housing stock simply cannot support population 
growth of 200-300,000 people per year and 
independent forecasts point to a requirement of 6 
-7m square metres of new residential construction 
every year. In addition, around 500,000 square 
metres of housing becomes obsolete each year.
With approximately 23 square metres living space 
for the average Russian, new construction in 
Moscow and region barely covers the population 
growth, still leaving residents of the “old housing” 
looking for better projects as income per capita 
grows and mortgage is less of a challenge.
These pressures are playing to the strengths of RGI’s 
residential proposition. What are known in Russia as 
the ‘comfort’ and ‘business’ classes of residential are 
experiencing the greatest demand from a growing 
middle class. People with long-term, steady jobs 
and access to mortgages want to improve their 
living conditions and have the means to do so. They 
are looking for good architecture and design, well 
fitted out apartments, leisure facilities and schools, 
private parking, good transport infrastructure 
and access to large scale retail outlets.
Underlying these economic dynamics, during 
the year the industry saw the legal environment 
for developers improve. Given the political 
imperative for more new housing, the federal 
and city authorities have for some time been 
focused on improving governance of the property 
development industry, in particular with regard to 
land speculation. There is now much better scrutiny 
of land sales, with bigger developments being 
carried out by well-known developers like RGI.
Our view is that with greater transparency in 
land transactions now becoming established, 
there will be more land investment 
opportunities for companies with high 
corporate governance standards and levels of 
shareholder and regulatory accountability.
Moscow Residential Market Overview
Within the context of slower overall growth for 
the Russian economy, there were interesting 
developments in the Moscow residential 
market during the year which helped to 
reinforce our position in the market. 
Overall in residential, sales volumes weakened in 
Central Moscow and Moscow Region especially in 
the first half 2013 as lower growth and historically 
high interest rates affected consumer confidence. 
This in turn translated into flat sales prices in 
some market segments especially in Moscow. 
Greater Moscow* housing stock
440.7m sq.m
+10.2m (2012: 430.5m) 
*Moscow and Moscow Region
Population
19.2m
+0.2m (2012: 19.0m)
New mortgage financing
257.0 b RUR
+61.8 b RUR (2012: 195.2 b RUR)
Mortgage delinquency rate*
3.9%
-0.9% (2012: 4.8%)
*Moscow and Moscow Region total value of mortgages overdue divided by total 
mortgage stock, Source: www.ahml.ru RGI International Limited Annual Report & Accounts 2013 13
Moscow housing sqm/person versus other European examples
Residential stock per capita (2011)
65
50
43
42
41
39
38
38
35
31
30
25
23
 USA
 Denmark
 Sweden
 UK
 Germany
 Austria
 France
 Finland
 Hungary
 China
 Czech Republic
 Latvia
 Moscow &
 Moscow Region
Source: Rosstat, UNECE
Disposable income per head
(Roubles)
 Moscow Region Russia
Source: www.ahml.ru
 Moscow
0
10000
20000
30000
40000
50000
60000
2013 2012 2011 2010 2009 2008 2007 2006 2005
Weighted average mortgage interest rates
(%)
Source: www.ahml.ru
9
10
11
12
13
14
15
2013 2012 2011 2010 2009 2008 2007 2006 2005
Housing stock age structure 
(%)
 1946-1970
  1971-1995
 after 1995
Source: Rosstat
3%  
 Before 1920
 1921-1945
4%  
30%  
42%  
21%  
Model Microgorod «V Lesu» apartment 14 RGI International Limited Annual Report & Accounts 2013
Microgorod «V Lesu» building 16 RGI International Limited Annual Report & Accounts 2013 15
Buyers by age
(%)
30.2%  
  Under 30
  Under 40
  Under 50
  Over 50
36.1%  
18.3%  
15.4%  
Marital status of buyer
(%)
  Married
  Not married
80%
20%
  One or more
  No children
Buyers with children
(%)
29%
71%
Reason for purchase
(%)
  For myself
  For children
  For parents
  For investment purposes
83%
12%
2%
3%
Buyer Profile
The vast majority of buyers (66%) in Microgorod  
«V Lesu» are socially active people under 40. Only 
20% of future inhabitants of «V Lesu» are not married 
and 70% of the clients are parents of one or more 
children. More than a half of all buyers are planning to 
have one in the near future. This is proof that «V Lesu» 
project is highly sought after among its target market, 
for which favorable ecological conditions, good 
transport communication with the capital, developed 
infrastructure and safety are especially important.
The majority of buyers purchase apartments in 
«V Lesu» as a primary residence: first time buyers, 
people who wish to expand living space, or those 
who want to move out beyond the MKAD (Moscow 
Ring Road) limits to more environmentally friendly 
area. Over a quarter of buyers chose «V Lesu» thanks 
to its unique concept and features, such as: 
• functional and efficient planning solutions;
• high quality fit out in all of the apartments;
• unique architecture; and
• proximity to transportation infrastructure.
According to customers surveyed, more than one third 
of buyers’ decisions to purchase an apartment in «V 
Lesu» were based on other buyers’ recommendations. 16 RGI International Limited Annual Report & Accounts 2013
Rose Group  
is a strong 
aspirational  
brand attractive  
to the growing  
middle classes
STRATEGY
The strategy of the Company is to build on the principles established in the early years of the 
company Rose Group of quality, design and construction in the elite residential and office 
market sectors and to transfer these qualities to the premium economy residential sector.  
The focus of the new developments in the near term will be closer to the MKAD (Moscow Ring 
Road) in Moscow as well as in the wider Moscow region.
Over the next few years the Company plans to generate substantial equity via Microgorod «V Lesu» type 
projects and RGI will consider entering into joint ventures to accelerate growth rather than create its own 
land bank.
The Company will focus the majority of its resources on the premium economy residential market, where it 
believes that its «V Lesu» development is setting new standards as a clearly differentiated, aspirational 
product, but continue to retain a portion of its business in the elite sector where high financial premiums 
can be achieved. The Company will look into the mixed use elite office and residential boutique 
developments. Out of the existing Central Moscow projects the Group will proceed with certain 
developments and sell assets where the costs of development, in terms of capital and management time, 
are now expected to outweigh the benefits to shareholders.
The strategy also includes continuing the development of Tsvetnoy until it achieves a satisfactory level  
of profitability.
The Company’s key objective remains to deliver a consistent level of positive cash flow each year to improve 
shareholders’ returns via dividends and growing share value.
Key Performance Indicators
Cash collections at «V Lesu»
US$ 127.4m
-$3.4m (2012: US$130.8m)
Revenues at Tsvetnoy
US$24.3m
+4.5m (2012: US$19.8m)
Cash balance
US$26.4m
-$1.8m (2012: US$28.2m)
Borrowings
US$ 186.3m
-$7.7m (2012: US$194m) RGI International Limited Annual Report & Accounts 2013 17
Strategic goals Progress in 2013 Plans for 2014
Grow cash flow by high quality execution of 
Microgorod «V Lesu»
• Phase 1 commissioned
• Phase 2 initiated
• School operator secured
• Management company established
• Phase 1 delivery to residents
• Complete school and kindergarten
• Begin construction on buildings 13 and 15  
in Phase 2
Realise potential of Tsvetnoy • New management team
• 15 new brands
• Achieved break-even
• Create Tsvetnoy Home Store
• Add new brands
• Increase footfall 
• Increase profitability
Optimise portfolio • Sold Victory Park for US$22 million • Advance central Moscow projects
Source high-quality new developments • Advanced Kvazar with permitting • Seek opportunities to add large-scale 
development projects to portfolio
Microgorod «V Lesu» phase I buildings 18 RGI International Limited Annual Report & Accounts 2013
CHIEF EXECUTIVE’S REVIEW
strategy of targeting Moscow’s growing middle class, 
as our sales performance at Microgorod «V Lesu» and 
growth in store turnover at Tsvetnoy both show. 
Microgorod «V Lesu»
Our first challenge when we acquired the site at 
Microgorod «V Lesu» was to create a high quality 
city-scale residential development outside of 
Moscow with all necessary infrastructure present. 
Moscow, as distinct from the outlying Moscow 
region, has historically been more sought after for 
many reasons, including the higher level of social 
services provided. The great achievement of «V Lesu» 
has been to attract central Moscow residents out 
to the Moscow Region - over 80% of our buyers are 
Moscow residents. This is a hugely significant statistic. 
Middle class customers are very comfortable coming 
to «V Lesu» because we are creating a community 
and the successful launch of Phase 2 with sales of 
281 units in 2013 demonstrates that this is reaching 
a wider audience. We have good momentum as the 
development gains recognition and we were delighted 
that in November, «V Lesu» won the prestigious 
Urban Awards as the best comfort class residential 
project under construction in the Moscow region. 
Due to high mortgage interest rates and exchange 
rate volatility, we saw a 15% decline in pre-sales in 
terms of units in 2013 versus 2012; however, in terms 
of square metres, the decrease was only 5% as more 
families were attracted to the project moving closer 
to 1st phase completion. This overall decline was 
concurrent with a general slowdown in the Russian 
economy, and high mortgage rates; however Rose 
Group was able to maintain price growth during the 
year, despite evidence that other developers were 
not. In Phase 1, our average price per metre increased 
17% over 2012. Phase 2, in which we initiated sales 
only in February 2013, price per metre had increased 
between 4% and 15% in various buildings by year-end. 
The share of sales financed by mortgage contracts 
in 2013 was approximately 55% (2012: 57%), versus 
an average in Russia of only 25%. According to the 
Russian Agency for Mortgage Lending , by the end of 
2013, disposable income had increased in real terms 
by 3.3% while interest rates were beginning to fall. As 
a result, the share of households for whom mortgage 
credit is available to finance the purchase of a home 
has increased from 26.5% in 2012 to 28-30%. These 
trends contributed to a stronger fourth quarter.
In Phase 1, Buildings 16, 17 and 18, received occupancy 
permits (passed state commissioning) in Q4 2013. 
These buildings are on track for residents to take 
ownership and move in during the first half of 2014, 
at which point the Company will recognise revenues 
from the sales. In addition, planning permissions were 
received in Q4 for RGI’s Kvazar development, which is 
adjacent to the «V Lesu» development and comprises 
a 17 .1 hectare residential and office development. 
Andrey Nesterenko
Chief Executive Officer
The great achievement  
of «V Lesu» has been to 
attract central Moscow 
residents out to the 
Moscow Region
I am pleased to report that good progress was 
made during 2013 against each of the Board’s 
three main business objectives. We delivered on 
our key project goals at Microgorod «V Lesu», we 
improved our operational performance at Tsvetnoy 
and we advanced our other portfolio projects. Our 
accomplishments include completing construction 
of Phase 1 of Lesu, beginning construction of 
Phase 2 and achieving break-even at Tsvetnoy. 
We have also made key personnel improvements at 
both the corporate level and at Tsvetnoy’s operational 
business, bringing more specialist professionals to 
the team. Meanwhile the Rose Group brand is being 
defined more clearly than ever in the minds of Russian 
consumers. These factors combined contributed to a 
resilient performance during a year of slower growth 
for the Russian economy. We are succeeding with our  19 RGI International Limited Annual Report & Accounts 2013
Apartments sold
120  
  2013  2012
Q1
163  
113  
Q2
195  
129  
Q3
131  
162  
Q4
135  
Square metres sold
8,384  
  2013  2012
Q1
10,515  
8,222  
Q2
12,679  
9,321  
Q3
8,450  
11,789  
Q4
8,125  
Artem, Future Resident
“The happiness of  
my family is all  
that matters. We  
are looking forward  
to moving into our 
apartment and  
getting to know  
our neighbours.”
Microgorod «V Lesu» has set new standards for the 
Moscow residential sector by offering homebuyers a 
well configured development, with good facilities and 
apartments finished to a high quality. It is an example 
of the consistent implementation of a European city 
idea from the first planning to each building’s details. 
The main goal was to create a nice neighborhood,  
a community, where everyone could feel at home.  
We have created a comfortable environment and 
recognizable image to every building. As a result,  
we have a new type of community.
«V Lesu»
Building type
Residential
Land plot
81.1 ha
Gross building area sq.m
1.38m sq.m
Parking spaces
10,262
Year commenced
2011
19
Microgorod «V Lesu» sales office
Best Family project
Best comfort class project –
Moscow Region
Note: Total pre-sales of apartments have now exceeded US$255m. 20 RGI International Limited Annual Report & Accounts 2013
CHIEF EXECUTIVE’S REVIEW continued
Tsvetnoy Central Market
At Tsvetnoy, our goal for 2013 was to significantly 
improve operational performance. Our first step 
was to bring in a new management team with a 
mandate to improve operating efficiencies and 
revenues from concessionaires. This has resulted 
in significant changes inside the store that have 
provided top line growth and enabled us to achieve 
operational break even performance by year end. 
Many European department stores take three years 
or more to reach break even and we are pleased 
that Tsvetnoy, which became fully operational in 
2011, has reached this milestone relatively early. 
Tsvetnoy had record footfall in Q4 2013, with nearly 
700,000 visitors (Q4 2012: 510,000). This increase is 
further evidence that the repositioning of the store 
earlier in 2013 is beginning to have results. The new 
management team has focused on more affordable 
fashion brands, and with a better mix in place the 
store is appealing to a broader customer base. 
We were delighted when on 30 October, the WGSN 
Global Fashion Awards in London declared Tsvetnoy 
the Best Store amongst strong competition which 
included finalists Colette (Paris), Evoluzione (India), 
Kate Spade (New York) and Harrods (London). 
Tsvetnoy – An iconic 
department store in  
the heart of Moscow
Central Moscow Developments
We made further advances in 2013 with our central 
Moscow developments. During the year, we 
received planning permission from the Moscow City 
Government to reconstruct and enlarge Moscow’s 
historic “Forum” movie theater. RGI is currently 
evaluating various concepts to proceed based on 
the permits. In October, we sold our Victory Park 
development for US$22 million cash. The disposal of 
this project was in line with our strategy of focusing 
on the development of large scale residential 
schemes and frees up capital for the Company’s 
other projects. We also continued to evaluate 
options for development of the residential portion 
of our Chelsea project and for our Ostozhenka 
37 ultra-high-end residential development. 
In an effort to advance the Khilkov luxury residential 
project, we initiated legal action against Litonor 
Financial Limited, our development partner. The action 
claims damage from Litonor following Litonor’s failure 
to perform its obligations in accordance with the 
partnership agreement dated 19 September 2006. 
Outlook
Our priorities for 2014 are to accelerate our 
development in several directions. At «V Lesu», we 
are looking forward to welcoming the first residents 
shortly after we publish this report. As residents take 
ownership of their apartments, we will be able to 
recognise revenue for Phase 1 and record revenues and 
record our first profits from residential development. 
We expect the successful completion and handover of 
Phase 1 will make Phase 2 even more attractive to new 
buyers and have already begun to dig the foundations 
for the remaining two buildings of Phase 2. We are 
also aiming to complete the school and kindergarten, 
located on the territory of Phase 2, during this year. 
At Tsvetnoy, we will continue to focus on improving 
operational performance. We have already 
identified those areas of the store where the biggest 
opportunities lie and our first step has been to convert 
the lower level into the Tsvetnoy Home Store, selling 
home and kitchenware. We have set high goals for 
increasing footfall, turnover and profits at the store, 
and are continuing to look at ways we can capitalise 
on the strong brand image of Tsvetnoy itself.  RGI International Limited Annual Report & Accounts 2013 21
Total store turnover
(US$m)
24.8  
  2013
  2012
Q1
18.8  
23.0  
Q2
18.3  
22.5  
Q3
19.4  
28.7  
Q4
29.3  
Footfall
(Thousand visitors)
452  
  2013
  2012
Q1
376  
471  
Q2
517  
494  
Q3
551  
699  
Q4
510  
Tsvetnoy
Building type
Department 
store
Usable space
1 1,800 sq.m
Brands represented
150
Year opened
2011
Tsvetnoy Central Market 22 RGI International Limited Annual Report & Accounts 2013
Copper House RGI International Limited Annual Report & Accounts 2013 23
We will continue to advance our central Moscow 
projects in line with the timeframes that the 
permitting regime allows. At the same time, we 
will consider opportunities to divest or partner on 
these projects to free up capital and reduce risk. 
In terms of corporate developments, we recognise 
that RGI’s AIM listed shares need additional liquidity 
in order to reflect the value of the business. As part 
of our corporate strategy, the Board is engaged in an 
ongoing dialogue with VEB management on the issue. 
We have developed a clear, sustainable long-term 
plan for RGI. As well as having a proven ability to 
execute major developments, RGI has a strong 
reputation in the industry and access to good deal 
flow. We will continue to seek opportunities to 
invest capital in projects where the risk-reward 
ratio is well balanced for shareholders. 
I am confident that RGI can meet its strategic 
objectives but mindful of the risks that external events 
can have on our business and the Moscow housing 
market in general. Our view is that the Company is well 
positioned to weather the bouts of volatility in capital 
markets that have characterized 2014. Whatever the 
short-term brings, by operating efficiently and making 
the most of our clearly defined consumer proposition, 
RGI can look forward to a positive long-term future. 
Andrey Nesterenko
Chief Executive Officer
Marina Shustova
Engineer
13 years
Time with RGI
43 years
Experience
RGI Projects:
Copper House
Molochny Lane
Butikovsky 5
Crystal House
X-Park
Tsvetnoy
Marina Shustova personifies the kind of rich 
experience for which RGI is known. She has been 
working with RGI since 2000. Her 40 year career as an 
engineer has included working on such projects as the 
swimming complex built for the 1980 Moscow 
Olympics and the Armond Hammer World Trade 
Centre. During her tenure at RGI, she has helped 
design and build award-winning residential buildings 
in Moscow’s golden mile, including Copper House, for 
which Marina was awarded the Golden Harmony 
award for design. Marina was also a key figure on the 
team which designed and built Tsvetnoy.
“The DNA of this 
company is about 
quality design 
and attention to 
detail. It is truly 
exceptional”  24 RGI International Limited Annual Report & Accounts 2013
FINANCIAL REVIEW
We are pleased to report a return to operating 
profitability in 2013. For the year, our revenues 
increased 23% to US$24 million, all of which was 
attributable to Tsvetnoy, as no revenues have 
yet been recognised at «V Lesu». We had an 
operating profit of US$7.5 million versus a loss 
of US$66 million in 2012. This operating profit 
was attributable to a turnaround at Tsvetnoy, 
where EBITDA was US$607 thousand versus a 
negative US$9.8 million a year ago. In addition, 
we recorded US$22 million in unrealized gains on 
investment property (2012: US$27 million loss) 
which was driven by permitting progress Kvazar 
and Forum. In addition, we realized gains on the 
sale of Victory Park for US$22 million and were able 
to reduce general and administrative expenses 
by more than US$1 million during the year. 
RGI ended 2013 with over US$26 million in cash, a net 
change of US$1.8 million from year end 2012. The net 
cash outflow was decreased from US$15 million in 
2012. The single biggest element of cash flow for the 
year was US$127 million (2012: US$131 million) 
received from pre-sales of apartments at «V Lesu».  
The 3% decline in dollar terms was largely as a result 
of a decrease in the average exchange rate. In rouble 
terms, receipts were virtually unchanged at RUR 4.0 
billion. These receipts funded US$111 million 
investment in projects, up from US$102 million in 
2012. This higher level of expenditure reflects a higher 
pace of construction as we initiated work on Phase 2 
during the year. 
Other significant elements of cash flow for the year 
included US$22 million in interest and net repayments of 
borrowings (2012: US$22 million) and US$22 million 
proceeds from disposal of projects (2012: US$6.3 million). 
At year end, our balance sheet was healthy. Our  
Net Asset Value measured under EPRA standards, 
which differ from IFRS, was US$593.6 million 
(2012: US$545.5m) or US$3.63 per share, up 7.7% from 
2012. RGI’s IFRS net assets were US$394 million, a 6% 
reduction from 2012. This reduction is largely driven 
by foreign exchange translation, which reduced the 
book NAV of Microgorod «V Lesu» by US$22 million 
and the book NAV of Tsvetnoy by US$16 million.  
A US$93 million increase in property developed for 
sale was more than offset by US$114 million increase 
in advances received for residential sales. 
Borrowings declined from US$194 million in 2012 to 
US$186 million in 2013. We repaid US$8 million of the 
permanent financing on Tsvetnoy and had a net 
decrease of US$9 million in borrowings for Phase 1 of 
Microgorod «V Lesu». This decrease was offset as we 
fully drew a RUR 500 million facility with Nomos 
bank, but repaid a portion which was secured by 
Victory Park to end the year with a net new borrowing 
from Nomos Bank of US$9 million. 
The Fair Value of RGI’s share in its projects as 
determined by JLL, our independent valuers, is as 
follows;
Development 2012* 2013
Tsvetnoy 231.5 230.3
«V Lesu» 360.6 347.2
Khilkov 38 38.3
Victory Park 12.3 –
Ostozhenka 37 9.4 7.3
Chelsea 8.0 9.0
Kvazar 27.9 69.6
Forum – 9.5
Ostozhenka 49 3.8 3.1
Total Fair Value 691.5 713.9
*2012 valuation was undertaken by DTZ
The Company’s key 
objective remains to 
deliver a consistent  
level of positive cash  
flow each year
David Wood
Chief Financial Officer RGI International Limited Annual Report & Accounts 2013 25
The reconciliation between the financial accounts and 
the EPRA standard is as follows:
 31 Dec 13 31 Dec 12
NAV per the financial 
statements 394.4 422.5
Include:
(i) Revaluation of investment 
property – 17.9
(ii) Revaluation of property, 
plant and equipment 26.3 5.6
(iii) Revaluation of investment 
property held under joint 
control 3.0 3.7
(iv) Revaluation of property 
developed for sale 168.4 108.2
Exclude: 
(v.a)Deferred tax 51.6 59.5 
(vi) Non-controlling interests (50.1) (71.8)
EPRA NAV 593.6 545.5
(v.b) Include deferred tax (71.2) (73.9)
EPRA NNNAV 522.4 471.6
EPRA NAV US$ per share 3.63 3.37
EPRA NNNAV US$ per share 3.19 2.91
Explanation of adjustments
(i) Revaluation of investment property. Early 
stage projects held for development are carried in 
the IFRS accounts at cost less accumulated 
impairment. The NAV adjustment for revaluation 
in 2012 mainly relates to Kvazar for which the fair 
value exceeded the historical cost.
(ii) Revaluation of property, plant and 
equipment relates to the excess for the Tsvetnoy 
fair value determined by JLL over the carrying 
value of the corresponding property, plant and 
equipment, which is accounted at cost less 
accumulated depreciation and impairment in the 
IFRS accounts.
(iii) Revaluation of investment property held 
under joint control stands for an increase to fair 
value of the Ostozhenka, 49 projects carried at 
cost within the equity accounting for the joint 
venture, similar to (i) above.
(iv) Revaluation of property developed for sale 
stands for an increase to fair value of the residential 
part of the «V Lesu» project (including the related 
working capital items) carried at the lower of cost 
and net realisable value.
(v) Deferred tax
a. Exclude any deferred tax included in the 
financial statement under IFRS mainly in 
respect of the difference between the 
carrying value and the tax base of  
non-current investments and property 
developed for sale as this would only become 
payable if the assets were sold.
b. EPRA Triple Net Asset Value (NNNAV) includes 
an estimate of the deferred taxes likely to be 
payable upon realisation of the fair values of 
the Group’s assets in the normal course of 
business.
(vi) Non-controlling interests attributable to both 
carrying values in the IFRS accounts and the fair 
value adjustments (i) to (iv) above are excluded to 
reconcile the gross net assets to the NAV 
attributable to the shareholders of the Company.
David Wood
Chief Financial Officer
Future residents 26 RGI International Limited Annual Report & Accounts 2013
PRINCIPAL RISKS AND UNCERTAINTIES
While we have an obligation to maximise shareholder value, we are obliged to carefully monitor and, where possible, manage and mitigate the various risks the Company 
is exposed to. We have highly experienced construction, legal and finance teams with a wealth of experience in local and international markets, who are well placed to 
identify and manage the various risks and challenges that our market presents. We have procedures in place to ensure risk factors are identified and dealt with in time. 
The Audit Committee periodically reviews such procedures and systems, and evaluates the various risks faced by the Company. 
Our key risks are:
Risk Mitigation
Market conditions • The global and local economic instability may have an adverse effect on our 
cash flow. We are constantly monitoring the situation and make the required 
adjustments to maintain the Company’s stability. A slowdown in Russian 
growth and consumer spending may have an adverse effect on the business  
of the Company. The Company is taking the required steps to ensure that its 
products remain attractive in changing market conditions.
Legal environment • Changes in legislation, licensing and permit regimes may have an adverse 
effect on the Company. We are constantly monitoring such changes and its 
effects on the company’s business.
Credit Risks • As a real estate developer, the Company relies on third party financing to 
finance its projects. Any limitation or worsening of the credit environment may 
have an adverse effect on the Company’s ability to develop its project and/or 
acquire new projects. The management of the Company is continuously 
monitoring the situation, and is striving to diversify its sources of credit.
• A significant proportion of our home buyers rely on mortgages provided by 
local banks. Any worsening on the terms of such mortgages may have an 
adverse effect on sales of apartments. The Company is working closely with 
Russia’s leading mortgage providers to enable our customers to receive 
competitive mortgage terms. 
Currency risks • A significant growth in the exchange rate of the US Dollar or Euro may result  
in higher payments on loan and goods purchased. The Company operates in 
Russia and virtually all of its operating cash inflows and most of its cash 
outflows are denominated in Roubles. With the exception to financing  
for Tsvetnoy, the Company’s borrowings are denominated in Roubles.  
Thus, the Group primary currency exposure to a weakening Rouble  
is its dollar-denominated debt service on the Tsvetnoy loan. 
Geographic risks • Our business is concentrated in Moscow and the Moscow region. While this 
poses certain risks, we are confident that this allows bring our local expertise 
into greater effect. 
We have highly 
experienced teams  
in place to identify  
and manage risks RGI International Limited Annual Report & Accounts 2013 27
Phase 2 construction 28 RGI International Limited Annual Report & Accounts 2013
BOARD OF DIRECTORS
Emmanuel Blouin
Chairman, Non-Executive Director
Emmanuel Blouin is the founder and owner of 
property investment boutique Esterel Capital since 
2008. He is also an independent Non-Executive 
Director of the AIM-listed Ukrainian developer XXI 
Century Investment Public Ltd, after having acted 
as Noteholder Nominated Director in 2009 prior to 
the successful restructuring and recapitalisation of 
the company completed in January 2011. Emmanuel 
worked in the investment banking groups of 
Paribas, JPMorgan and Morgan Stanley between 
1995 and 2008. In this respect, he has been involved 
in over US$50 billion of corporate and property 
transactions across Europe including IPOs, SPOs, 
mergers and acquisitions, private placements, 
eurobond placements and structured financings.
Andrey Nesterenko
CEO, Executive Director
Andrey Nesterenko was appointed CEO of the 
Company in February 2012. He has extensive real 
estate development experience, having held senior 
executive positions at a number of international 
property companies, including Capital Group 
and Hals Development, prior to joining RGI. Since 
joining the Company he has been responsible for 
executing the Company’s strategy and delivering 
operational improvements throughout the business. 
He has additional experience with KPMG, Bunge 
and the Russian retailer DIXY. Andrey Nesterenko 
graduated from Moscow University of Consumers’ 
Cooperation with a degree in Economics.
Reginald Webb
Non-Executive Director
Reginald Webb retired as partner at 
PriceWaterhouseCoopers (PwC) Central and Eastern 
Europe (CEE) in December 2010 after 40 years in the 
accounting profession. He held a number of senior 
positions including Chairman of the Supervisory 
Board for PwC Central and Eastern Europe. Reginald 
was also a member of the Management Board of PwC 
CEE with specific responsibility for Risk, Compliance, 
Independence and Ethics and Business Conduct. He 
served as Chairman of the Audit Committee for PwC 
CEE from 2006 to 2010 and an insurance group from 
2007 to 2010. He is an alumnus of the University of 
Cape Town a Fellow of the Institute of Chartered 
Accountants of England and Wales and a Fellow of 
the Chartered Institute of Management Accountants.
Our board combines real 
estate, finance and listed 
company expertise RGI International Limited Annual Report & Accounts 2013 29
Mark Holdsworth
Non-Executive Director
Mark Holdsworth has extensive experience of both 
Russia and real estate having founded Fabian Capital 
Limited, a real estate private equity company which 
focuses on Eastern Europe. His experience includes 
leading a fund raising in June 2005 for Fabian 
Romania, the first dedicated commercial property 
fund for Romania and then floating the fund on 
AIM in 2006, raising a total of €61 million. Fabian 
Romania was subsequently sold in 2009. Prior to 
founding Fabian Capital, Mark spent eight years at 
ING Barings Limited in senior equity capital markets 
roles and was a managing director of the bank’s 
Russian, EMEA and Latin American equities businesses 
between 2001 and 2003. Mark Holdsworth is a 
graduate of Harvard Business School, the University 
of Pennsylvania and the University of Edinburgh.
Alexey Titov
Non-Executive Director
Alexey Titov is a senior vice-president of Closed 
Joint-Stock Company Commercial Bank “Globex” 
(“Globex Bank”), a major Russian bank that 
beneficially owns 100% of Direct Finance LLC, which 
currently holds 73.4% of the issued shares of RGI. At 
Globex Bank, Alexey leads the project finance and 
real estate finance departments and also sits on the 
investment committee. Before moving to Globex 
Bank in September 2009, Alexey spent over seven 
years as a deputy director of various departments 
at Vnesheconombank, the Russian state-owned 
financial institution that (from October 2008) is 
the controlling shareholder of Globex Bank. Alexey 
also worked in other Russian governmental and 
commercial banks from 1996 to 2002 prior to joining 
Vnesheconombank. Alexey holds a master’s degree 
in finance from Plekhanov Russian University of 
Economics and a master’s degree in civil engineering 
from Moscow State University of Civil Engineering.
Kevin Hennessey
Non-Executive Director
Kevin is a managing partner of K. Hennessey 
Associates LLC where he focuses on investment 
projects and advisory in Russia and Eastern Europe. 
Kevin previously spent 22 years at Credit Suisse, 
latterly in the Executive group as Chairman of the 
Global New Business Organisation and Support 
Committee – Strategic Planning and Chairman of 
the Global Ethics Committee. Additionally, he was 
a member of the Public Banking Committee, the 
Global Credit Committee, and the Fixed Income Risk 
Management Committee. During his career at Credit 
Suisse he was co-head of the Municipal Securities/
Public Finance Division and also headed up the 
Fixed Income Global Emerging Markets Group. In 
addition, he is a member of the Board of Directors 
and senior advisor to the Council for Trade and 
Economic Cooperation Russia/USA and a prior trustee 
of the Cooke Foundation for (Special) Education. 30 RGI International Limited Annual Report & Accounts 2013
CORPORATE GOVERNANCE
The Company complies, so far as practicable and appropriate for a company of its 
size, with the main provisions of the UK Corporate Governance Code. There is no 
corporate governance regime with which the Company is required to comply in 
Guernsey, its place of incorporation. However, the Company has established an 
audit committee, remuneration committee and nomination committee.
The Company has also adopted a share dealing code, based on the Model Code (as 
set out in Annex 1 to Chapter 9 of the Listing Rules of the UK Listing Authority) for 
Directors, persons discharging managerial responsibilities and relevant employees. 
Takeover Code
Following the decision of the Code Committee of the Takeover Panel, as of 30 
September 2013, the provisions of the City Code on Takeovers and Mergers (the 
“Takeover Code”) apply to the company, and as a result, the Company is now a 
“Takeover Code Company”.
Disclosure of Shareholdings
Although The Companies (Guernsey) Law, 2008 contains no requirement for 
shareholders to disclose their interests in the Ordinary Shares, the Company has 
adopted provisions in its Articles requiring any person who acquires three per cent 
or more of the Company’s relevant share capital to disclose the nature and amount 
of such interest and providing for sanctions against persons who fail to do so.
Directors’ Responsibilities 
The Directors are responsible for preparing the Annual Report and the consolidated 
financial statements in accordance with applicable law and regulations.
Company (Guernsey) Law requires the Directors to prepare financial statements for 
each financial year. Under that law the Directors are required to prepare the group 
financial statements in accordance with International Financial Reporting 
Standards (IFRSs). Under company law the Directors must not approve the accounts 
unless they are satisfied that they give a true and fair view of the state of affairs of 
the company and of the profit or loss of the company for that period. In preparing 
these financial statements, International Accounting Standard 1 requires that 
Directors:
• properly select and apply accounting policies;
• present information, including accounting policies, in a manner that provides 
relevant, reliable, comparable and understandable information; 
• provide additional disclosures when compliance with the specific requirements 
in IFRSs are insufficient to enable users to understand the impact of particular 
transactions, other events and conditions on the entity’s financial position and 
financial performance; and
• make an assessment of the company’s ability to continue as a going concern.
The Directors are responsible for keeping adequate accounting records that are 
sufficient to show and explain the company’s transactions and disclose with 
reasonable accuracy at any time the financial position of the company and enable 
them to ensure that the consolidated financial statements comply with the 
Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the 
assets of the company and hence for taking reasonable steps for the prevention 
and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate 
and financial information included on the company’s website. Legislation in 
Guernsey and the United Kingdom governing the preparation and dissemination of 
financial statements may differ from legislation in other jurisdictions.
Each of the persons who is a Director at the date of approval of the financial 
statements confirms that:
• the best of the Director’s knowledge, the financial statements, prepared in 
accordance with International Financial Reporting Standards, give a true and 
fair view of the assets, liabilities, financial position and profit or loss of the 
company and the undertakings included in the consolidation taken as a whole;
• so far as the Director is aware, there is no relevant audit information of which 
the Company’s auditor is unaware; and
• the Director has taken all steps he ought to have taken as a Director to make 
himself aware of any relevant audit information and to establish that the 
Company’s auditor is aware of that information.
This confirmation is given and should be interpreted in accordance with the 
provisions of Section 249 of The Companies (Guernsey) Law, 2008.
Registration
The Company was incorporated in Guernsey on 14 March 2006 as a limited liability 
company in accordance with the provisions of The Companies (Guernsey) Law, 1994 
(as amended). As at 31 December 2010, the registered office and business address 
was Frances House, Sir William Place, St. Peter Port, Guernsey, GY1 4EU.
Membership of the Board
As at 31 December 2013, there were six members of the Board. Collectively, the 
Board has extensive operational experience in the Moscow real estate market. 
There are three independent Non-Executive Directors in the Board: Reginald Webb, 
Mark Holdsworth and Emmanuel Blouin. There are two Non-Executive Directors 
who are considered not independent as they have been appointed by the majority 
shareholder on the basis of the relationship agreement. 
The roles of Chairman and Chief Executive Officer are distinct. The principal 
differentiating factors in their respective responsibilities are:
Chairman
• Reports to the Board
• Only the Chief Executive Officer reports to him
• Responsible for running the Board
Chief Executive Officer
• Reports to the Chairman
• All executive management report to him, directly or indirectly
• Responsible for running the business
• Responsible for implementing the Board’s decisions
The board consists of the following directors: 
Emmanuel Blouin
Independent Non-Executive Chairman Appointed 24 June 2011
Andrey Nesterenko
Executive CEO Appointed 17 May 2013
Reginald Webb
Independent Non-Executive Appointed 28 February 2011
Mark Holdsworth
Independent Non-Executive Appointed 21 March 2011
Alexey Titov
Non-Executive appointee of Direct Finance llc Appointed 31 May 2013
Kevin Hennessey
Non-Executive appointee of Direct Finance llc Appointed 11 December 2013 31 RGI International Limited Annual Report & Accounts 2013
During the period, the following directors resigned:
Appointed Resigned
Jacob Kriesler 13 July 2006 11 March 2013
Boris Kuzinez 23 November 2006 11 March 2013
Alan Hibbert 24 June 2011 31 May 2013
Yoram Evan 3 April 2008 31 May 2013
Emanuel Kuzinetz 13 July 2006 11 March 2013
Timothy Fenwick 23 November 2006 5 July 2013
Yuriy Borisenko 25 August 2011 5 July 2013
Pavel Altukhov 8 March 2012 11 March 2013
The UK Corporate Governance Code recommends that the Board of Directors of a listed company should include a balance of Executive and Non-Executive Directors (and, 
in particular, independent Non-Executive Directors) such that no individual or small group of individuals can dominate the Board’s decision taking. The UK Corporate 
Governance Code states that the Board should determine whether a Director is independent in character and judgment and whether there are relationships or 
circumstances which are likely to affect, or could appear to affect, the Director’s judgement. The Board has considered the independence of its Non-Executive Directors in 
line with the principles of the UK Corporate Governance Code (section B.1.1) and, following careful consideration, assessed the independence of the Non-Executive 
Directors as follows:
Director Determination Notes
Emmanuel Blouin Independent No section B.1.1 criteria apply
Reginald Webb Independent No section B.1.1 criteria apply
Mark Holdsworth Independent No section B.1.1 criteria apply
Kevin Hennessey Not Independent Represents a Significant Shareholder
Alexey Titov Not Independent Represents a Significant Shareholder
Board meeting attendance
During 2013, the Board met 11 times. The table below lists the attendance of Board members in these meetings: 
18/01/13 31/01/13 19/03/13 17/05/13 31/05/13 05/07/13 23/08/13 06/09/13 17/09/13 11/12/13 24/12/13
Emmanuel Blouin       –    
Andrey Nesterenko       
Mark Holdsworth – –         
Reginald Webb           –
Alexey Titov      – –
Kevin Hennessey 
Boris Kuzinez  –
Jacob Kriesler  
Alan Hibbert     
Yoram Evan     
Emanuel Kuzinetz  
Timothy Fenwick     
Pavel Altukhov  
Yuriy Borisenko  –  –  32 RGI International Limited Annual Report & Accounts 2013
Audit Committee
The Company has established an Audit Committee. The Audit Committee 
comprises at least three members, a majority of whom are independent 
Non-Executive Directors. It meets at least twice each year and at any other time 
when it is appropriate to consider and discuss audit and accounting related issues. 
The Audit Committee is chaired by Reginald Webb, a former partner with PwC with 
extensive financial and audit experience. The other members of the Audit 
Committee are Alexey Titov and Emmanuel Blouin. 
The Audit Committee is responsible for monitoring the audit of the annual 
accounts, quality of any internal controls and for ensuring that the financial 
performance of the Group is properly monitored, controlled and reported on.  
The Audit Committee also reviews and monitors the independence of the auditor. 
It also meets the Company’s auditors and review reports from the auditors  
relating to accounts and internal control systems.
During 2013, the Audit Committee met twice. In addition, the Audit Committee 
also had two meetings with both the external valuers and the auditors. The table 
below lists the attendance of the Audit Committee members in these meetings:
Timothy Fenwick* 1
Reginald Webb 2
Alexey Titov 1
Emmanuel Blouin 2
*Timothy Fenwick resigned on 5 July 2013
Remuneration Committee
The Company has established a Remuneration Committee. The Remuneration 
Committee comprises at least three members, a majority of whom are 
independent Non-Executive Directors. The members of the Remuneration 
Committee review the performance of the Executive Directors and executive 
management and set the scale and structure of their remuneration and the basis  
of their service agreements with due regard to the interests of the shareholders. 
The Remuneration Committee is chaired by Mark Holdsworth, with Emmanuel 
Blouin, and Reginald Webb as members. All Remuneration Committee members 
are independent directors.
In determining the remuneration of Executive Directors and executive 
management, the Remuneration Committee seeks to enable the Company to 
attract and retain executives of the highest calibre. No Director is permitted  
to participate in discussions or decisions concerning their own remuneration.  
In discharging its duties, the Remuneration Committee may seek, and has  
received, advice from external experts, such as remuneration specialists and  
other relevant experts.
During 2013, the Remuneration Committee met twice. The table below lists the 
attendance of the Remuneration Committee members in these meetings: 
Emmanuel Blouin 2
Timothy Fenwick* 1
Reginald Webb 2
Mark Holdsworth 2
*Timothy Fenwick resigned on 5 July 2013
Nomination Committee
The Company has established a Nomination Committee. The Nomination 
Committee comprises at least three members, a majority of whom are 
independent Non-Executive Directors. The members of the Nomination Committee 
will be responsible for reviewing the structure, size and composition of the Board, 
preparing a description of the role and capabilities required for a particular 
appointment and identifying and nominating candidates to fill Board positions as 
and when they arise. The Nomination Committee is chaired by Mark Holdsworth, 
with Emmanuel Blouin and Reginald Webb as members. All Nomination 
Committee members are independent Directors. The Nomination committee  
held one meeting during 2013, with all members present.
Relationship Agreement
A Relationship Agreement has been signed between the Company, Direct Finance 
and the Directors appointed by Direct Finance, to ensure a proper balance is 
maintained within the Board and control other aspects concerning the relations 
between the Company and its main shareholder, and to assist in maintaining good 
corporate governance practices. 
Service contracts
All Executive Directors have signed Service Agreements, which specify the terms  
of their service. All Non-Executive Directors have signed Letters of Appointment, 
which specify the terms of their service. The remuneration of the Directors is 
explained in Note 23 of the accounts.
Directors’ Shareholdings
At 31 December 2013, VEB Capital owns 71,000,000 shares and Direct Finance llc 
owns 49,168,094 shares. Direct Finance LLC and VEB-Capital are both owned and 
controlled by State Corporation “Bank for Development and Foreign Affairs 
(“Vnesheconombank”). Alexey Titov and Kevin Hennessey are appointees of Direct 
Finance llc and are deemed to be beneficially interested in the shares owned by 
entities related to Vnesheconombank. Andrey Nesterenko holds 750,000 shares.  
As far as the Company is aware, no other Director at the year-end held additional 
shares. 
Code of Conduct and Whistleblower policy
The Company has in place a Code of Conduct and Whistleblower Policy, which 
applies to all the Company’s Directors, executives and employees.
CORPORATE GOVERNANCE continued 33 RGI International Limited Annual Report & Accounts 2013
INDEPENDENT AUDITOR’S REPORT
To the Members of R.G.I. International Limited
            ZAO Deloitte & Touche CIS
            5 Lesnaya Street
            Moscow, 125047
            Russia
            Tel: +7 (495) 787 06 00
            Fax: +7 (495) 787 06 01
            www.deloitte.ru
Introduction
We have audited the accompanying consolidated financial statements of RGI. International Limited (the ‘Company’) and its subsidiaries (collectively – the ‘Group’), which 
comprise the consolidated statement of financial position as at 31 December 2013, and the consolidated statement of profit or loss, statement of profit or loss and other 
comprehensive income, statement of changes in equity and cash flow statement for the year then ended, and a summary of significant accounting policies and other 
explanatory information contained in the annual report of the Group.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting 
Standards and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material 
misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International 
Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether 
the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected 
depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. 
In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements 
in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal 
control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well 
as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as at 31 December 2013, and its financial 
performance and cash flows for the year then ended in accordance with International Financial Reporting Standards.
21 March 2014
Moscow, Russia
Note: Our audit does not provide assurance on the maintenance and integrity of the website, including controls used to achieve this, and in particular on whether any changes may have occurred to the consolidated financial statements 
since first published. These matters are the responsibility of management but no control procedure can provide absolute assurance in this area. Legislation in the United Kingdom and Guernsey governing the preparation and 
dissemination of financial information differs from legislation in other jurisdictions. 34 RGI International Limited Annual Report & Accounts 2013
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
All amounts in US$ thousands unless otherwise stated
NOTE
AS AT
31 DECEMBER
2013
AS AT
31 DECEMBER
2012
ASSETS
Non-current assets
Investment property 5 67,808 66,159
Property, plant and equipment 6 212,723 236,311
Investment in jointly-controlled entity 7 35,540 35,742
Input VAT 3,046 2,138
Intangible assets 1,248 1,505
Deferred income tax assets 8 11,770 9,274
Total non-current assets 332,135 351,129
Current assets
Property developed for sale 9 526,598 433,115
Receivables and prepayments 10 31,565 25,117
Other inventories 1,834 640
Cash and cash equivalents 11 26,400 28,243
Total current assets 586,397 487,115
Total assets 918,532 838,244
LIABILITIES
Non-current liabilities
Deferred income tax liabilities 8 63,413 66,124
Borrowings 12 129,206 138,225
Total non-current liabilities 192,619 204,349
Current liabilities
Borrowings 12 57,525 56,517
Trade and other payables 13 18,608 13,257
Advances from residential premises sales 255,392 141,602
Total current liabilities 331,525 211,376
Total liabilities 524,144 415,725
Equity
Share capital 14 1 1
Share premium 560,608 560,608
Share-based payment 15 – 2,948
Retained earnings (10,446) (15,693)
Translation reserve (184,383) (156,111)
Equity attributable to the owners of the Company 365,780 391,753
Non-controlling interest 28,608 30,766
Total equity 394,388 422,519
Total liabilities and equity 918,532 838,244
Approved for issue and signed on behalf of the Board of Directors on 21 March 2014.
Andrey Nesterenko    David Wood
CEO, Executive Director    CFO, Executive Director
The accompanying notes are an integral part of these consolidated financial statements. 35 RGI International Limited Annual Report & Accounts 2013
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
All amounts in US$ thousands unless otherwise stated
NOTE
YEAR ENDED 31 DECEMBER
2013 2012 
Gross revenue 16 24,324 19,809
Property operating costs 16 (23,717) (29,671)
Net profit/(loss) from operation of properties 16 607 (9,862)
Other operating income 757 1,012
General and administrative expenses 17 (13,030) (14,351)
Marketing expenses (4,460) (4,574)
Depreciation and amortisation (7,719) (7,945)
Unrealised gains/(loss) on investment property 5 21,829 (27,091)
Realised gains on investment property 18 9,243 6,385
Share in result of jointly-controlled entity 7 284 (9,772)
Operating profit/(loss) 7,511 (66,198)
Finance income 19 421 9,557
Finance costs 19 (8,108) (225)
Loss before income tax (176) (56,866)
Income tax credit/(charge) 8 1,130 (1,966)
Profit/(loss) for the period 954 (58,832)
Basic and diluted income/(loss) per share, US$ 20 0.01 (0.34)
Profit/(loss) is attributable to:
Owners of the Company 894 (54,324)
Non-controlling interest 60 (4,508)
Profit/(loss) for the period 954 (58,832)
The accompanying notes are an integral part of these consolidated financial statements. 36 RGI International Limited Annual Report & Accounts 2013
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME
All amounts in US$ thousands unless otherwise stated
YEAR ENDED 31 DECEMBER
2013 2012 
Profit/(loss) for the period 954 (58,832)
Other comprehensive (loss)/profit for the period:
Items that may be reclassified subsequently to profit or loss:
Currency translation difference (30,490) 27,035
Other comprehensive (loss)/profit for the period (30,490) 27,035
Total comprehensive loss for the period (29,536) (31,797)
Total comprehensive loss is attributable to:
Owners of the Company (27,378) (29,186)
Non-controlling interest (2,158) (2,611)
Total comprehensive loss for the period (29,536) (31,797)
The accompanying notes are an integral part of these consolidated financial statements. 37 RGI International Limited Annual Report & Accounts 2013
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
All amounts in US$ thousands unless otherwise stated
ATTRIBUTABLE TO OWNERS OF THE COMPANY:
NON-
CONTROLLING 
INTEREST 
TOTAL
EQUITY NOTE
SHARE
CAPITAL
SHARE
PREMIUM
SHARE-BASED
PAYMENT
RETAINED
EARNINGS
TRANSLATION 
RESERVE TOTAL
Balance at 1 January 2012 1 560,608 269 38,631 (181,249) 418,260 33,377 451,637
Total comprehensive income/(loss) for the year: – – – (54,324) 25,138 (29,186) (2,611) (31,797)
Loss for the year – – – (54,324) – (54,324) (4,508) (58,832)
Other comprehensive income – – – – 25,138 25,138 1,897 27,035
Share-based payment 15 – – 2,679 – – 2,679 – 2,679
Balance at 31 December 2012 1 560,608 2,948 (15,693) (156,111) 391,753 30,766 422,519
Total comprehensive income/(loss) for the year: – – – 894 (28,272) (27,378) (2,158) (29,536)
Income for the year – – – 894 – 894 60 954
Other comprehensive loss – – – – (28,272) (28,272) (2,218) (30,490)
Share-based payment 15 – – (2,948) 4,353 – 1,405 – 1,405
Balance at 31 December 2013 1 560,608 – (10,446) (184,383) 365,780 28,608 394,388
The accompanying notes are an integral part of these consolidated financial statements. 38 RGI International Limited Annual Report & Accounts 2013
CONSOLIDATED STATEMENT OF CASH FLOWS
All amounts in US$ thousands unless otherwise stated
NOTE
YEAR ENDED 31 DECEMBER
2013 2012 
Cash flows from operating activities before working capital changes
Loss before income tax (176) (56,866)
Depreciation and amortisation 7,719 7,945
Unrealised (gain)/loss on investment property 5 (21,829) 27,091
Share in result of jointly-controlled entity 7 (284) 9,772
Realised gains on investment property 18 (9,243) (6,385)
Finance costs/(income), net 19 7,687 (9,332)
Share-based payment 15 1,405 2,602
Working capital changes (14,721) (25,173)
Change in trade and other payables 6,586 3,005
Advances from residential premises sales 127,415 130,787
Change in inventories (1,006) 2,271
Change in receivables and prepayments (8,779) (3,950)
Additions to property developed for sale (104,357) (94,992)
Interest paid and capitalised (16,501) (17,442)
Cash used in operations (11,363) (5,494)
Income tax paid (122) (117)
Net cash used in operating activities (11,485) (5,611)
Cash flows from investing activities
Investment in jointly-controlled entity (15) –
Additions to property, plant and equipment (1,072) (2,144)
Additions to investment property (5,951) (3,719)
Proceeds from disposal of projects 22,000 6,385
Compensation received from written-off projects – 6,546
Net cash generated from investing activities 14,962 7,068
Cash flows from financing activities
Repayment of bonds – (9,237)
Proceeds from borrowings 43,488 85,780
Repayment of borrowings (47,907) (92,286)
Net cash used in financing activities (4,419) (15,743)
Effect of exchange rate changes on cash and cash equivalents (901) (580)
Net decrease in cash and cash equivalents (1,843) (14,866)
Cash and cash equivalents, beginning of the year 28,243 43,109
Cash and cash equivalents, end of the year 11 26,400 28,243
A portion of the cash and cash equivalents was subject to certain restrictions in use as of 31 December 2013 and 2012 (Note 11).
The accompanying notes are an integral part of these consolidated financial statements. 39 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. THE RGI INTERNATIONAL LIMITED GROUP
These consolidated financial statements of RGI International Limited (hereinafter, ‘RGI’ or the ‘Company’) and its subsidiaries (together referred to as the ‘Group’) and  
the Group’s interest in jointly-controlled entities for the year ended 31 December 2013 were authorised for issue in accordance with a resolution of the Directors on  
21 March 2014.
The Company was incorporated in Guernsey on 14 March 2006 as a limited liability company and its shares are quoted on the AIM market of the London Stock Exchange 
since December 2006.
The Company’s ultimate parent and controlling party is the Russian State Corporation ‘Bank for Development and Foreign Economic Affairs’ (Vnesheconombank).
The Company’s registered address is Frances House, Sir William Place, St. Peter Port, Guernsey, GY1 4EU.
The principal office of the Group’s Russian operations is Korobeinikov Lane, 1, Moscow 119034, Russia.
The principal business activity of the Group is property development and property management in the Russian Federation, with its core business being the development 
and management of high-end office and retail businesses and luxury residential and premium economy class residential properties in central Moscow and the 
surrounding areas. The Group is also engaged in concession management as well as retail sales both of which are executed in the Tsvetnoy shopping centre project.
The Group was involved in the development of the following projects during 2013 and 2012:
NAME OF PROJECT TYPE OF PROJECT
GROUP’S INTEREST 
CURRENT SHARE
2013 2012
Jointly controlled
Khilkov Residential 50% 50%
Ostozhenka, 49 Residential 50% 50%
Consolidated
Microgorod «V Lesu» Residential/Commercial 82% 82%
Kvazar Residential/Commercial 100% 100%
Victory Park Mixed Use – 100%
Chelsea Mixed Use 100% 100%
Ostozhenka, 37 Residential 100% 100%
Forum Mixed Use 100% 100%
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to 
all the years presented, unless otherwise stated.
Basis of preparation
Statement of compliance
These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) and with the requirements of the 
Companies (Guernsey) Law, 2008.
Preparation of the consolidated financial statements
The consolidated financial statements have been prepared on a going concern basis, applying the historical cost convention, except for the revaluation of certain financial 
assets and liabilities at fair value which are recognised through profit or loss and the revaluation of investment property and assets of disposal group classified as held 
for sale. 40 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
(a) Adopted standards effective for annual periods beginning on or after 1 January 2013:
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interest in Other Entities 
IFRS 13 Fair Value Measurement
IAS 27 (as revised in 2011) Separate Financial Statements
IAS 28 (as revised in 2011) Investments in Associates and Joint Ventures
IAS 19 (as revised in 2011) Employee Benefits
Amendments to IFRS 7 Disclosures – Offsetting Financial Assets and Liabilities
Amendments to IAS 1 Presentation of Items of Other Comprehensive Income
These amendments have not had a material effect on the Group’s financial position or results of operations.
(b) Standards, amendments and interpretations issued but not effective and not applied for the financial year beginning 1 January 2013:
Effective for annual 
periods beginning
on or after
IFRS 9 Financial Instruments 1 July 2015
Amendments to IAS 32 Offsetting Financial Assets and Financial Liabilities 1 January 2014
Amendments to IFRS 10, IFRS 12 and IAS 27 Investment Entities – Exemption from the consolidation of particular subsidiaries 1 January 2014
The new standards, amendments and interpretations are not expected to affect significantly the Group’s consolidated financial statements.
Consolidation
Subsidiaries are all entities (including special purpose entities) over which the Group has existing rights that give it the ability to direct the relevant activities, has rights to 
variable returns from its involvement and has the ability to affect those returns through its power over these entities.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. All intra-group 
transactions, balances and any unrealised profits or losses arising from intra-group transactions are eliminated in full on consolidation.
Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their 
capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is 
recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.
Accounting for business combinations under IFRS 3 only applies if it is considered that a business has been acquired. Under IFRS 3, ‘Business combinations’, a business is 
defined as an integrated set of activities and assets conducted and managed for the purpose of providing a return to investors or lower costs or other economic benefits 
directly and proportionately to policyholders or participants. A business generally consists of inputs, processes applied to those inputs, and resulting outputs that are, or 
will be, used to generate revenues. In the absence of such criteria, a group of assets is deemed to have been acquired.
For acquisitions meeting the definition of a business, the acquisition method of accounting is used. The consideration transferred for the acquisition of a subsidiary is  
the fair values of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration 
transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Any contingent consideration to be transferred by the 
group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is 
recognised in accordance with IAS 39 either in profit or loss or as a change to other comprehensive income. Contingent consideration that is classified as equity is not 
remeasured, and its subsequent settlement is accounted for within equity. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business 
combination are measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the acquiree on an acquisition-by-
acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.
Acquisition-related costs in relation to business combinations are expensed as incurred.
If the business combination is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value 
at the acquisition date and the resulting gain or loss, if any, is recognised in profit or loss.
For acquisitions of subsidiaries not meeting the definition of a business, the Group allocates the cost between the individual identifiable assets and liabilities in the Group 
based on their relative fair values at the date of acquisition. Such transactions or events do not give rise to goodwill. 41 RGI International Limited Annual Report & Accounts 2013
Foreign currency translation
(a) Functional and presentation currency
The Group operates in a Russian Ruble (‘RUR’) economic environment. Accordingly, the functional currency of each of the Group’s entities is the RUR. The Group’s 
consolidated financial statements have been presented in US dollars (‘US$’), as the Directors believe that this presentation is more appropriate for the users of these 
financial statements.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. At each balance sheet date, 
monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing at that date. Foreign exchange gains and losses resulting 
from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are 
recognised in the profit or loss for the year.
Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented net in the consolidated statement of comprehensive income 
within finance costs and finance income respectively, unless they are capitalised. All other foreign exchange gain and losses are presented net in the consolidated 
statement of comprehensive income.
(c) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from 
the presentation currency are translated into the presentation currency as follows:
• assets and liabilities for each statement of financial position are translated at the closing rate at the date of that financial position;
• income and expenses for each consolidated statement of comprehensive income are translated at average exchange rates (unless this average is not a reasonable 
approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates  
of the transactions);
• components of equity are translated at the historical rate; and
• all resulting exchange differences are recognised in other comprehensive income.
On the disposal of a foreign operation (that is, a disposal of the group’s entire interest in a foreign operation, or a disposal involving loss of control over a subsidiary that 
includes a foreign operation) all of the exchange differences accumulated in equity in respect of that operation attributable to the equity holders of the Company are 
reclassified to profit or loss.
In the case of a partial disposal that does not result in the Group losing control over a subsidiary that includes a foreign operation, the proportionate share of accumulated 
exchange differences are re-attributed to non-controlling interests and are not recognised in profit or loss.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. 
Exchange differences arising are recognised in other comprehensive income.
At 31 December 2013, the principal rate of exchange used for translating foreign currency balances was 1 US$ = RUR 32.7292 (at 31 December 2012: 1 US$ = RUR 30.3727). 
The principal average rate of exchange used for translating income and expenses for 2013 was 1 US$ = RUR 31.8480 (2012: 1 US$ = RUR 31.0930).
Investment property
Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by the companies in the consolidated Group, is classified as 
investment property. Investment property also includes property that is being constructed or developed for future use as investment property or for an undetermined use.
Investment property is measured initially at its cost, including related transaction costs and where applicable borrowing costs.
After initial recognition, investment property is carried at fair value. Investment property under construction is measured at fair value if the fair value is considered to be 
reliably determinable on a continuing basis. Investment properties under construction for which the fair value cannot be determined reliably, but for which the Group 
expects that the fair value of the property will be reliably determinable upon reaching a certain stage of development, are measured at cost less impairment until the  
fair value becomes reliably determinable or construction is completed – whichever is earlier. Fair value is based on active market prices, adjusted, if necessary, for any 
difference in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods, such as recent prices 
on less active markets or discounted cash flow projections. Valuations are performed as of the end of the reporting period by professional valuation specialists who hold 
recognised and relevant professional qualifications and have recent experience in the location and category of the investment property being valued. These valuations 
form the basis for the carrying amounts in the financial statements. Investment property that is being redeveloped for continuing use as investment property or for which 
the market has become less active continues to be measured at fair value. 42 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
Investment property continued
It may sometimes be difficult to determine reliably the fair value of the investment property under construction. In order to evaluate whether the fair value of an 
investment property under construction can be determined reliably, management considers the following factors, among others:
• Status of construction permits.
• The provisions of the construction contract.
• The stage of completion.
• Whether the project/property is standard (typical for the market) or non-standard.
• The level of reliability of cash inflows after completion.
• The development risk specific to the property.
• Past experience with similar constructions.
The fair value of investment property reflects, among other things, rental income from current leases and assumptions about rental income from future leases in the light 
of current market conditions.
The fair value also reflects, on a similar basis, any cash outflows that could be expected in respect of the property. Some of those outflows are recognised as a liability, 
including finance lease liabilities in respect of leasehold land classified as investment property; others, including contingent rent payments, are not recognised in the 
financial statements.
Subsequent expenditure is capitalised to the asset’s carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to 
the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred. When part of an investment property is 
replaced, the carrying amount of the replaced part is derecognised.
If a valuation obtained for a property held under a lease is net of all payments expected to be made, any related lease liability recognised separately in the consolidated 
statement of financial position is added back to arrive at the carrying value of the investment property for accounting purposes.
The fair value of investment property does not reflect future capital expenditure that will improve or enhance the property and does not reflect the related future benefits 
from this future expenditure other than those a rational market participant would take into account when determining the value of the property.
Changes in fair values are recognised in the profit or loss for the period. Investment properties are derecognised when they have been disposed of.
Where the Group disposes of a property at fair value in an arm’s length transaction, the property is remeasured immediately prior to the sale to the agreed transaction 
price, and the adjustment is recorded in the profit or loss within net gain from fair value adjustment on investment property.
If an investment property becomes owner-occupied, it is reclassified as property, plant and equipment. Its fair value at the date of reclassification becomes its cost for 
subsequent accounting purposes.
If an item of owner-occupied property becomes an investment property because its use has changed, any difference resulting between the carrying amount and the fair 
value of this item at the date of transfer is treated in the same way as a revaluation under IAS 16 Property, Plant and Equipment. Any resulting increase in the carrying 
amount of the property is recognised in profit or loss to the extent that it reverses a previous impairment loss, with any remaining increase recognised in other 
comprehensive income for the period. Any resulting decrease in the carrying amount of the property is initially charged in other comprehensive income against any 
previously recognised revaluation surplus, with any remaining decrease charged to profit or loss.
Where an investment property undergoes a change in use, evidenced by commencement of development with a view to sale, the property is transferred to inventories.  
A property’s deemed cost for subsequent accounting as inventories is its fair value at the date of change in use.
Investment in jointly-controlled entities
A jointly-controlled entity is a joint venture that involves the establishment of a corporation, partnership or other entity in which each partner has an interest. The entity 
operates in the same way as other entities, except that a contractual arrangement between the partners establishes joint control over the relevant activity of the entity 
which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. In the joint venture parties have rights to the 
net assets of the joint venture.
Investments in jointly-controlled entities are accounted for using the equity method of accounting, based upon the percentage of ownership held by the Group. When the 
Group’s share of losses exceeds its interest in an equity accounted investee, the carrying amount of the interest is reduced to nil and recognition of further losses is 
discontinued except to the extent that the Group has a legal or constructive obligation or has made payments on behalf of the investee.
Profits and losses from transactions with jointly-controlled entities are eliminated to the extent of the Group’s interest in the entity. 43 RGI International Limited Annual Report & Accounts 2013
Goodwill
Goodwill arising in a business combination represents the excess of the consideration transferred on an acquisition plus non-controlling interest of a business over the fair 
value of the Group’s share of the net identifiable assets of the acquired business at the date of acquisition. Goodwill is tested at least annually, or upon an impairment 
trigger, for impairment and carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill 
relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating 
units that are expected to benefit from the business combination in which the goodwill arose identified according to operating segment.
Impairment of non-financial assets
Non-financial assets that have an indefinite useful life – for example, goodwill – are not subject to amortisation and are tested at least annually for impairment. Assets 
that are subject to depreciation or amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be 
recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher 
of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately 
identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at 
each reporting date. Impairment losses on goodwill are not reversed.
Property, plant and equipment
Land and buildings comprise mainly retail outlets and offices. Land and buildings are shown at cost, which is defined as the amount of cash or cash equivalents paid at  
the time of their acquisition or construction, less subsequent depreciation for buildings and impairment, if any.
All other property, plant and equipment (PPE) is stated at historical cost less accumulated depreciation and impairment, if any. Historical cost includes expenditure that  
is directly attributable to the acquisition of the items and where applicable any borrowing costs.
The cost of an item of PPE includes its purchase price and any direct attributable costs. Cost includes the cost of replacing part of an existing PPE at the time that the cost  
is incurred if the recognition criteria are met; and excludes the costs of day-to-day servicing of an item of PPE.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits 
associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of those parts that are replaced is derecognised.  
All other repair and maintenance expenditures are charged to the consolidated statement of comprehensive income during the financial period in which they are incurred.
Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost or revalued amounts to their residual values over 
their estimated useful lives, as follows:
• Buildings 25-50 years
• Motor vehicles 3-5 years
• Furniture, fittings, office and computer equipment 3-8 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if impairment indicators are identified and its carrying amount is greater than its 
estimated recoverable amount.
Gains and losses on disposals are determined by comparing the sales proceeds with carrying amount of the assets and are included in the consolidated statement of 
comprehensive income.
Accounts receivables and prepayments
Accounts receivables are recorded inclusive of Value Added Tax (‘VAT’) and are carried at amortised cost, net of provisions for impairment, if any. A provision for 
impairment of receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the 
receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the 
original effective interest rate. The amount of the provision is recognised in the consolidated statement of comprehensive income. 44 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
Accounts receivables and prepayments continued
Prepayments are carried at cost less any accumulated impairment losses. A prepayment is classified as non-current when the goods or services relating to the prepayment 
are expected to be obtained after one year, or when the prepayment relates to an asset which will itself be classified as non-current upon initial recognition. Prepayments 
to acquire assets are transferred to the carrying amount of the asset once the Group has obtained control of the asset and it is probable that future economic benefits 
associated with the assets will flow to the Group. Other prepayments are written off to the consolidated statement of comprehensive income when the goods or services 
relating to the prepayments are received. If there is an indication that the assets, goods or services relating to a prepayment will not be received, the carrying value of the 
prepayment is written down accordingly and a corresponding impairment loss is recognised in profit or loss for the year.
Non-current receivables represent VAT related to development projects, which is either to be recovered in the future from the Government Budget or included in property 
development costs after completion of each project, if such recovery is not deemed possible.
Trade receivables are amounts due from customers for services performed in the ordinary course of business. If collection is expected in one year or less (or in the normal 
operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.
Inventories
The Group’s inventories include stock in trade in Tsvetnoy shopping center. They are carried at the lower of cost and net realisable value. Net realisable value is the 
estimated selling price in the ordinary course of business less selling expenses. Any write-down to net realisable value is recognised as an expense in the period in which 
the write-down occurs.
Property developed for sale
Property developed for sale is defined as projects in which the Group participates as a contractor or as a promoter, and which include construction work with the intention 
to sell the entire building as a whole or parts thereof. Each project represents one building or a group of buildings.
A group of buildings is considered one project when the buildings at the same site are being constructed according to one building plan and under one building license, 
and are developed with the view for sale. Property developed for sale includes cost of land or of rights to the land that constitutes the relative portion of the area on which 
the construction work on projects is performed, plus the cost of the work executed on the projects as well as other costs allocated thereto, less the cumulative amounts 
recognised in profit or loss as cost of property developed for sale sold up to the end of the reporting period.
Where the estimated expenses for a building project indicate that a loss is expected, property developed for sale is written-down from cost to net realisable value. 
Buildings that are under construction are classified as property developed for sale on the face of the consolidated statement of financial position.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with banks, and other short-term highly liquid investments with original maturities of three 
months or less.
Cash and cash equivalents are carried at amortised cost using the effective interest method.
Share capital
Shares are classified as equity when there is no obligation to transfer cash or other assets.
Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.
Trade and other payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as 
current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.
Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the 
proceeds (net of transaction costs) and the redemption value is recognised as finance cost over the period of the borrowings using the effective interest method.
Fees paid on the establishment of borrowings facilities are recognised as transaction costs of the borrowings to the extent that it is probable that some or all of the facility 
will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be 
drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates. 45 RGI International Limited Annual Report & Accounts 2013
Borrowings are classified as current liabilities when:
• the Group expects to settle the liability in its normal operating cycle;
• it holds the liability primarily for the purpose of trading;
• the liability is due to be settled within 12 months after the reporting period; or
• the Group does not have an unconditional right to defer settlement of the liability for at least 12 months after the date of the end of the reporting period.
Borrowing costs
General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, including qualifying investment properties 
and property developed for sale, which are assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those 
assets, until such time as the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs 
eligible for capitalisation. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
Current and deferred income tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in profit and loss, except to the extent that it relates to items recognised directly in 
other comprehensive income or equity – in which case, the tax is also recognised in other comprehensive income or equity.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the 
Group operates and generates taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax 
regulation is subject to interpretation, and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts 
in the consolidated financial statements. However, deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other 
than a business combination that at the time of the transaction affects either accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and 
laws) that have been enacted or substantially enacted by end of reporting period and are expected to apply when the related deferred income tax asset is realised or the 
deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.
The carrying value of the Group’s investment property will generally be realised by a combination of income (rental stream during the period of use) and capital (the 
consideration on the sale at the end of use). In jurisdictions where different tax rates exist for income and capital gains, the Group considers the planned recovery of the 
asset and how that affects the tax rate used in the calculation of the deferred tax. The length of the period for which a property will be held prior to disposal is based on 
the Group’s current plans and recent experience with similar properties. The capital gains tax rate applied is that which would apply on a direct sale of the property 
recorded in the consolidated statement of financial position regardless of whether the Group would structure the sale via the disposal of the subsidiary holding the asset, 
to which a different tax rate may apply. The deferred tax is then calculated based on the respective temporary differences and tax consequences arising from recovery 
through use and recovery through sale.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries and in jointly-controlled entities, except where the timing of the reversal 
of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the 
deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities 
where there is an intention to settle the balances on a net basis.
Share-based payments
The Group operates an equity-settled share-based compensation plan or a Long-Term Incentive Plan (‘LTIP’) under which the Group receives services from employees as 
consideration for equity instruments of the Group. The fair value of the employee’s services received in exchange for the grant of the equity instruments is recognised as 
an expense. The total amount to be expensed is determined on the grant date by reference to the fair value of the equity instruments granted, including the impact of the 
market performance vesting condition and excluding the impact of the non-market vesting condition. For compensation plans with the non-market vesting condition, 
this condition is included in assumptions about the number of equity instruments that are expected to vest. The total amount expensed is recognised over the vesting 
period on a straight-line basis, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the Group 
revises its estimates of the number of equity instruments that are expected to vest based on the non-market vesting conditions, if any, in profit and loss, with a 
corresponding adjustment to equity. For market compensation plans with the market performance vesting conditions, the assumption reflecting the probability of 
meeting this condition is incorporated in the initial valuation of the grant. The resulting expense is recognised over the vesting period on a straight-line basis, irrespective 
of whether the market condition is satisfied. 46 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
Provisions
Provisions are recognised when:
• the Group has a present legal or constructive obligation as a result of past events;
• it is probable that an outflow of resources will be required to settle the obligation; and
• the amount can be reliably estimated.
Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market 
assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as finance cost.
Revenue recognition
(a) Sale of property developments
Revenue from the sale of property developments is recognised at the point of transfer of the risks and rewards of ownership and effective control. Until this point, any 
consideration received from customers is recorded as a liability under the caption “Advances from residential premises sales”.
Revenue is measured at the fair value of the consideration received or receivable. In most cases, consideration is in the form of cash or cash equivalents and the amount of 
revenue is the amount of cash or cash equivalents received or receivable.
No revenues are recognised if there are significant uncertainties regarding recovery of consideration due, the cost incurred or to be incurred cannot be reliably measured, 
there is a risk of return, or there is continuing management involvement to the degree usually associated with ownership. Transfer of risks and rewards varies depending 
on the individual terms of the contract of sale.
(b) Concession revenue and other rental income
Rental income from operating leases is recognised on a straight-line basis over the term of the lease.
Concession revenue is earned from leasing out commercial premises for variable fees linked to the tenants’ retail sale turnovers. The contract terms for some of such 
tenants define certain minimum periodic amounts for these fees.
The Group collects receipts from retail customers on behalf of some tenants and then transfers them to the tenants, withholding the fees to which it is entitled under the 
agreements. Such fees are recognised as Group’s revenue. The Group holds no title to any of the tenants’ trading inventories.
(c) Sales of goods
Sales of goods are recognised when a Group entity sells a product to a customer. Revenue is measured at the fair value of the consideration received or receivable. In most 
cases, consideration is in the form of cash or cash equivalents such as credit cards and the amount of revenue is the amount of cash or cash equivalents received 
or receivable.
Revenue arising from the sale of goods is recognised when all of the following criteria have been satisfied:
• the seller has transferred to the buyer the significant risks and rewards of ownership;
• the seller retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
• the amount of revenue can be measured reliably;
• it is probable that the economic benefits associated with the transaction will flow to the seller, and
• the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Value added tax
Output value added tax related to sales is payable to tax authorities on the earlier of (a) collection of receivables from customers or (b) delivery of goods or services to 
customers. Input VAT is generally recoverable against output VAT upon receipt of the VAT invoice. The tax authorities permit the settlement of VAT on a net basis. VAT 
related to sales and purchases is recognised in the consolidated statement of financial position on a gross basis and disclosed separately as an asset and liability. Where 
provision has been made for impairment of receivables, impairment loss is recorded for the gross amount of the debtor, including VAT.
Interest income and expense
Interest income and expense are recognised within ‘finance income’ and ‘finance costs’ in profit or loss using the effective interest rate method, except for borrowing 
costs relating to qualifying assets, which are capitalised as part of the cost of that asset. 47 RGI International Limited Annual Report & Accounts 2013
The effective interest method is a method of calculating the amortised cost of a financial asset or financial liability and of allocating the interest income or interest 
expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts throughout the expected life  
of the financial instrument, or a shorter period where appropriate, to the net carrying amount of the financial asset or financial liability. When calculating the effective 
interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument (for example, pre-payment options) but does not consider 
future credit losses. The calculation includes all fees and points paid or received between parties to the contract that are an integral part of the effective interest rate, 
transaction costs and all other premiums or discounts.
Employee benefits
Wages, salaries, contributions to the Russian Federation state pension and social insurance funds, paid annual and sick leave, bonuses, awards in accordance with the 
long-term incentive plan (“LTIP”), and non-monetary benefits (such as health services) are accrued in the year in which the associated services are rendered by the 
employees of the Group. The Group has no legal or constructive obligation to make pension or similar benefit payments beyond the unified social tax and the 
share-based payments.
General and administrative expenses
All general and administrative expenses are recognised in the period when they are incurred. The expenses that are directly related to the Group activity in respect of a 
certain project (salaries of project staff and directors fees to the extent of their involvement in the development process) are capitalised as part of the cost of the project. 
The expenses that are not attributable to the projects are reflected in the consolidated statement of profit or loss.
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the consolidated statement of financial position only when there is a legally enforceable right to 
offset the recognised amounts, and there is an intention to either settle on a net basis, or to realise the asset and settle the liability simultaneously.
Earnings per share
Earnings per share are determined by dividing the profit or loss attributable to owners of the Company by the weighted average number of participating shares 
outstanding during the reporting year.
Amendment of the consolidated financial statements after issue
Any changes to these consolidated financial statements after issue require approval of the Board of Directors of the Group.
3. FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks: market risk (foreign exchange risk, interest rate risk), credit risk and liquidity risk. The Group’s overall risk 
management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.
The Treasury department of the Group identifies and evaluates financial risks in close co-operation with the Group’s operating units. The Board of Directors provides 
principles for overall risk management, as well as instructions covering specific areas, such as foreign exchange risk, interest rate risk, credit risk and use of derivative 
financial instruments.
Market risk
Foreign exchange risk
The functional currency of all entities within the Group is the Russian Ruble (‘RUR’). Foreign exchange risk is the risk that the value of future transactions, recognised 
assets and liabilities and net investments in foreign operations will fluctuate due to changes in foreign currency exchange rates. At 31 December 2013, the Group was 
exposed to foreign exchange risks arising from currency exposures, primarily in respect of the US Dollar (‘US$’). The Group’s policy is not to enter into any currency 
hedging transactions in respect of these risks. However, since the majority of expenditure and revenues of the Group are denominated in both RUR and US$, the Board  
of Directors allocate the Group’s cash resources based on the forecasted currency outflows.
Had the US dollar exchange rate on 31 December 2013 changed by 12% (a reasonably possible change in the current environment) the change in the carrying value of the 
dollar-denominated financial assets and liabilities and the effect on profit before tax would be as follows:
CARRYING AMOUNT
CARRYING AMOUNT AFTER 
12% INCREASE IN US$ 
EXCHANGE RATE
CARRYING AMOUNT AFTER 
12% DECREASE IN US$ 
EXCHANGE RATE
US$ denominated financial assets 7,804 8,740 6,868
US$ denominated financial liabilities (139,378) (156,103) (122,653)
US$ denominated financial assets, net (131,574) (147,363) (115,785)
Net impact on profit/(loss) before tax (15,789) 15,789
Net impact on equity (12,631) 12,631 48 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
3. FINANCIAL RISK MANAGEMENT continued
As at 31 December 2012:
CARRYING AMOUNT
CARRYING AMOUNT AFTER 
10% INCREASE IN US$ 
EXCHANGE RATE
CARRYING AMOUNT AFTER 
10% DECREASE IN US$ 
EXCHANGE RATE
US$ denominated financial assets 19,653 21,618 17,688
US$ denominated financial liabilities (149,473) (164,420) (134,526)
US$ denominated financial assets, net (129,820) (142,802) (116,838)
Net effect on profit/(loss) before tax (12,982) 12,982
Net impact on equity (10,386) 10,386
The table below summarises the Group’s exposure to foreign currency exchange rate risk at the end of the reporting period:
31 December 2013 31 December 2012
Monetary
financial assets
Monetary
financial liabilities
Net statement
 of financial position 
Monetary
financial assets
Monetary
financial liabilities
Net statement
of financial position 
US$ 7,804 (139,378) (131,574) 19,653 (149,473) (129,820)
EUR 102 (99) 3 139 (134) 5
GBP 146 – 146 453 – 453
NIS 1 – 1 44 – 44
8,053 (139,477) (131,424) 20,289 (149,607) (129,318)
Interest rate risk
The Group’s interest rate risk arises from long-term borrowings. The OJSC “Sberbank” (further referred to as Sberbank) loan to LLC Central Market at variable interest rates 
exposes the Group to cash flow interest rate risk. The other borrowings of the Group, such as the LLC Jevosset’s loan facility with Sberbank are subject to fixed interest 
rates and do not expose the Group to any interest rate risks. The Group is also exposed to variations in interest rates in relation to the interest earned on cash deposits. 
Reductions in interest rates would reduce the level of income earned by the Group on the surplus cash assets within the Group.
The Group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration refinancing, renewal of existing positions, 
alternative financing and hedging.
For the Sberbank loan to LLC Central Market the Group is exposed to changes in 3 month US$ LIBOR. As at 31 December 2013 an increase/decrease of 100 basis points in 
the 3 month US$ LIBOR would result in US$1,434,000 increase/decrease in interest expense incurred (2012: US$1,432,000).
Fair Value of Financial Instruments
The Group’s financial assets consist of cash and cash equivalents and receivables. The Group’s financial liabilities consist of borrowings and payables. All of the Group’s 
financial assets and liabilities are measured at amortised cost which approximates fair value due to the short-term nature of the financial instruments.
Credit risk
The Group is exposed to credit risk, which is the risk that a counterparty will not be able to pay all amounts in full when due. Financial assets, which potentially subject the 
Group to credit risk, consist principally of accounts receivable and cash and cash equivalents.
The carrying amount of accounts receivable and balances with banks represents the maximum amount that the Group is exposed to credit risk, which in 2013 was  
US$30,907 ,000 (2012: US$32,848,000).
86% of the above total credit exposure is related to cash and cash equivalents (2012: 86%).
Cash and cash equivalents are placed in high credit quality financial institutions, which are considered at the time of the deposit to have a minimal risk of default. The 
Directors believe the risk of default of these institutions is low, but will continue to monitor future placing of deposits in order to minimise credit risk exposure. 82% of 
cash balances are held with UniCredit Bank, 10% with Sberbank, 7% with ING Bank, 1% with UBS AG Bank (2012: 48% of cash balances are held with ING Bank NV, 38% 
with UniCredit Bank, 10% with Sberbank, 2% with UBS AG Bank, and 2% with First International Bank of Israel).
The remaining credit risk exposure is associated with trade and other receivables. Although collection of receivables could be influenced by economic factors, the Directors 
believe that there is no significant risk of loss to the Group beyond any provision already recorded.
Though there are no formal objectives, policies and processes for management of credit risk at the level of the Company, credit risk is managed at the shareholder level. 49 RGI International Limited Annual Report & Accounts 2013
Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. The Group is exposed to daily calls on its 
available cash resources. Management monitors monthly rolling forecasts of the Group’s cash flows.
Management estimates that the liquidity portfolio comprising cash and bank deposits can be realised in cash in order to meet unforeseen liquidity requirements.  
The Group’s liquidity position is monitored and regular liquidity stress testing under a variety of scenarios covering both normal and more severe market conditions  
is performed by the management.
The liquidity management of the Group requires considering the level of liquid assets necessary to settle obligations as they fall due; maintaining access to a range of 
funding sources; maintaining funding contingency plans; and monitoring statement of financial position liquidity ratios against regulatory requirements.
The maturity dates of the Group’s financial liabilities at 31 December 2013 are presented below. The amounts disclosed in the table are contractual undiscounted 
cash flows.
MATURITY DATE:
NOTE 2014 2015 2016 NEXT PERIODS TOTAL
Borrowings 12 57,806 10,650 12,225 106,050 186,731
Trade and other payables 13 15,867 – – 1,094 16,961
Total financial liabilities 73,673 10,650 12,225 107,144 203,692
The payment profile of the borrowings depends on the profile of pre-sales of the residential premises (Note 12).
The maturity dates of the Group’s financial liabilities at 31 December 2012 are presented below. The amounts disclosed in the table are contractual undiscounted 
cash flows.
MATURITY DATE:
NOTE 2013 2014 2015 NEXT PERIODS TOTAL
Borrowings 12 56,517 9,300 10,650 118,275 194,742
Trade and other payables 13 9,857 565 1,757 – 12,179
Total financial liabilities 66,374 9,865 12,407 118,275 206,921
Capital management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits 
for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or 
sell assets to reduce debt.
The amount of capital that the Group managed is as following:
NOTE 2013 2012
Total borrowings 12 186,731 194,742
Less cash and cash equivalents 11 (26,400) (28,243)
Net debt 160,331 166,499
Total equity 394,388 422,519
Total capital 554,719 589,018
As of the 31 December 2013 the Group was subject to an externally imposed capital requirement, set out in the LLC Jevosset loan agreement with Sberbank to fund the 
construction of the Group’s Microgorod «V Lesu» Project Phase 1. According to the agreement LLC Jevosset is required to maintain the level of equity investment not less 
than 30% of the total amount invested to-date in construction (less interest payments and other service fees) throughout the whole credit period. In the agreement 
between Central Market and Sberbank, the Tsvetnoy department store must generate a positive income higher than the interest and capital repayments due in the period 
by 10%. The Tsvetnoy entities did not achieve this throughout 2012 and therefore the Company agreed with Sberbank to deposit promissory notes to cover the expected 
shortfall (Note 12). The Group has complied with all other externally imposed capital requirements as of 31 December 2013. 50 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS IN APPLYING ACCOUNTING POLICIES
The Group makes estimates and assumptions that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated and are based 
on the Directors’ experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Directors also 
make certain judgments, apart from those involving estimations, in the process of applying the accounting policies. Judgments that have the most significant effect on 
the amounts recognised in the consolidated financial statements and which could cause a significant adjustment to the carrying amount of assets and liabilities within 
the next financial year include:
Valuation and recoverable amounts of the property developed for sale, investment property and property, plant and equipment
The Group has obtained a report from an international valuation company, Jones Lang LaSalle (“JLL”), setting out the estimated market values for the Group’s investment 
property, property developed for sale and property, plant and equipment in their current state as at 31 December 2013. JLL is an independent professionally qualified 
valuation specialist who holds a recognised relevant professional qualification and has recent experience in the locations and categories of the valued properties. The 
valuation was based on the assumption as to the best use of each property by a third party developer.
The development projects’ valuation or recoverable amount was determined based on the best estimates of future cash flows, supported by the terms of any existing 
lease and other contracts and by external evidence such as current market prices for similar properties in the same location and condition, and using discount rates that 
reflect current market assessments of the uncertainty in the amount and timing of the cash flows. Had a different assessment been made of the assumptions underlying 
the valuation report the estimated fair values of the assets would have been higher or lower as at the above mentioned date.
Management has reviewed the appraisers’ assumptions underlying discounted cash flow models used in the valuation, and confirmed that factors such as the discount 
rate applied have been appropriately determined considering the market conditions at the end of the reporting period. The discount cash flow methodology, which 
involves calculation of net present value of all future cost and income to be incurred and generated by property development, to derive market value via the residual 
method, i.e. assessing property as completed and deducting costs of development, is considered to provide a more accurate and sound valuation, taking into 
consideration the specific nature of the valued properties and limited market data available. Notwithstanding the above, management considers that the valuation of its 
property developed for sale and investment property is currently subject to an increased degree of judgment and an increased likelihood that actual proceeds on a sale 
may differ from the carrying value.
Microgorod «V Lesu»
The principal assumptions underlying the market value of the Group’s development portfolio in respect of the Group’s Microgorod «V Lesu» Development (Notes 5 and 9) 
taken at 100% of ownership are those related to current market level of: the projected sale and rent prices per square metre; the construction costs per square metre; the 
size of the project; the developer profit required and the level of other costs. The principal assumptions made, and the impact on the aggregate valuations by changing 
these assumptions as of 31 December 2013 is as follows:
• Gross buildable area for the project is assumed to be 1.4m square metres, comprising residential premises and related commercial and social facilities. If the area 
assumptions were to differ by 10% from management’s estimates, the unrealised loss/gain on investment property would be an estimated US$3.0m lower or higher 
and no influence to the carrying value of property developed for sale;
• Sale prices starting from US$3,720 per square metre for residential premises, retail rent rates starting from US$367 per square metre for commercial premises and 
parking sales price starting from US$22,915 per lot and US$11,458 per aboveground parking lot. If these values were to differ by 10% from management’s estimates, 
the unrealised loss/gain on investment property would be an estimated US$6.0m lower or higher and no influence to the carrying value of property developed 
for sale;
• Investment costs average at US$1,185 per square metre of gross buildable area of the premises. If this value was to differ by 10% from management’s estimates, the 
unrealised loss/gain on investment property would be an estimated US$2.0m lower or higher and no influence to the carrying value of property developed for sale;
• Discount rate applied to the project cash flow of 18%. If this value was to differ by 1 percentage point (“pp.”) from management’s estimates, the unrealised loss/gain 
on investment property would be an estimated US$2.0m lower or higher and no influence to the carrying value of property developed for sale;
• Construction completion date in 2025 and sales completion date in 2026. A one year delay in delivering the project would result in an estimated the unrealised loss on 
investment property of US$5.0m and no influence to the carrying value of property developed for sale.
The commercial part of the Microgorod «V Lesu» Development is classified as investment property (at fair value), whereas the residential part is classified as property 
developed for sale (at cost) as of the 31 December 2013. The costs of the project are allocated between the two parts on the basis of area, according to the proportion 
between the estimated total area of residential and commercial premises within the overall project and particularly within each Phase. The management believes the 
applied principle is reasonable as construction is not completed and the design for later Phases of the project is still in progress.
Tsvetnoy
The fair value of the Tsvetnoy project is estimated based on the income capitalisation method, where the value is estimated from the expected market rental income 
streams and capitalisation yields. The method considers net income generated by comparable property, capitalised to determine the value for the property which is 
subject to the valuation. 51 RGI International Limited Annual Report & Accounts 2013
The principal assumptions underlying the estimation of the fair value are those related to the possible market rentals and appropriate discount rates. The impact on the 
valuation from any changes in these assumptions, with all other variables held constant, as of 31 December 2013 is as follows:
• Rental and concession proceeds were assumed to vary from US$150 to 30,500 per square metre for the first projected year depending on the retail type and area. 
Should these proceeds differ by 10% from management’s estimates, the market value would be an estimated US$25.0m lower or higher without impairment to the 
carrying value of the project;
• Exit yield of 10% of annual income, determining property value at sale. If this were to differ by 1 pp. from management’s estimates it would result in an estimated 
market value US$18.0m lower or US$22.0m higher without impairment to the carrying value of the project;
•  Discount rate of 11% for net rental cash inflow. If these values differ by 1 pp. from management’s estimates, the market value would be an estimated US$4.0m lower 
or higher without impairment to the carrying value of the project.
5. INVESTMENT PROPERTY
NOTE
MICROGOROD
 «V LESU» KVAZAR FORUM CHELSEA
OSTOZHENKA,
 37
VICTORY
PARK ZEMLIANOY TOTAL
At 1 January 2012 59,986 9,086 – 10,238 8,476 11,061 – 98,847
Additions to investment property 3,088 366 – 252 13 – – 3,719
Reclassification of costs to property developed for sale 9 (15,213) – – – – – – (15,213)
Fair value loss (25,040) – – – – – – (25,040)
Borrowing costs capitalised (in accordance with IAS 23) 858 – – – – – – 858
Reversal of impairment – – – – 394 596 – 990
Impairment loss – – – (3,041) – – – (3,041)
Reversal of impairment due to permissions 18 – – – – – – 5,726 5,726
Disposal of the project 18 – – – – – – (5,726) (5,726)
Translation difference 2,740 554 – 549 518 678 – 5,039
At 31 December 2012 26,419 10,006 – 7,998 9,401 12,335 – 66,159
Additions to investment property 4,733 954 – 262 2 – – 5,951
Reclassification of costs to property developed for sale 9 – (8,712) – – – – – (8,712)
Fair value gain 406 10,548 – – – – – 10,954
Borrowing costs capitalised (in accordance with IAS 23) 495 – – – – – – 495
Reversal of impairment – – 9,763 1,360 – 1,210 – 12,333
Impairment loss – – – – (1,458) – – (1,458)
Disposal of the project 18 – – – – – (12,974) – (12,974)
Translation difference (2,053) (796) (263) (620) (637) (571) – (4,940)
At 31 December 2013 30,000 12,000 9,500 9,000 7,308 – – 67,808
The appraisal reports prepared by JLL as of 31 December 2013 and by DTZ Debenham Zadelhoff Limited as of 31 December 2012 were used to support management 
assessment of the fair value of the investment property (Level 3 of the hierarchy defined by IFRS 13) including the commercial part of the Microgorod «V Lesu»  
and Kvazar projects.
The Kvazar project was measured at cost as of 31 December 2012 as the early stage of the project caused significant uncertainties affecting the determination of its fair 
value. During the second half of 2013 the Group received the Project Planning approval from Krasnogorsk municipal authorities. The Directors, therefore, reassessed the 
fair value of the project accounting for the significant milestone reached in the course of the project development. Due to its location adjacent to the Microgorod «V Lesu» 
project site and its realisation plan related to that of Microgorod «V Lesu», the Kvazar project naturally forms an additional phase of the Microgorod «V Lesu» project, 
moreover, it is now at the same stage of development as the other future phases of Microgorod «V Lesu» project. Consequently, the same principles are applied that led to 
reclassification of its residential part to costs of property developed for sale and measurement at fair value of its commercial part which comprise 17% of the total project 
fair value. 52 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
5. INVESTMENT PROPERTY continued
The Forum project formed a part of the Group’s portfolio until 2009 as part of the Chelsea project. At the end of 2009 the Directors reassessed the scope of Chelsea project 
and part of the costs associated with the project were impaired. No value has been attributed to the Forum project since 2009 neither within the Chelsea project nor as a 
separate project. However, in the middle of 2013 the Group obtained the Land Plot Urban Plan (GPZU) from the Moscow Architecture Committee. Accordingly, the 
Directors revived the project and reinstated it back to the portfolio as a separate future development at the fair value. The fair value does not exceed the original cost.
The Chelsea and Ostozhenka, 37 projects are measured at cost less accumulated impairment because they are at the very early stages of development which causes 
significant uncertainties affecting the determination of their fair values, and because there is no readily available market evidence of such fair values.
The Zemlianoy project formed a part of the Group’s portfolio until 2009. At the end of 2009 the Directors suspended the development and the costs associated with the 
project were impaired. No value has been attributed to the Zemlianoy project since 2009. However, at the beginning of 2012 the Group obtained a decision from the Urban 
Land Committee to prolong the investment contract and provide the Group with the land lease rights. Accordingly, the Directors revived the project and reinstated it back 
to the portfolio as a future development at the original cost which did not exceed the fair value. On 17 December 2012 the rights for the project were sold (Note 18).
According to the loan agreements with Sberbank and Nomos-Bank (Note 12) the Microgorod «V Lesu», Ostozhenka, 37 and Chelsea projects are pledged as guarantees to 
secure the loans as at 31 December 2013.
The following table summarises the unrealised gains or losses on investment property. These arise from both assets held at fair value and from movements in provision 
for impairment when projects are recorded at cost.
31 DECEMBER
2013
31 DECEMBER
2012
Fair value gain/(loss) on investment property 10,954 (25,040)
Impairment of investment property (1,458) (3,041)
Reversal of impairment of investment property 12,333 990
Total unrealised gain/(loss) on investment property 21,829 (27,091)
The Group, through its Russian subsidiaries, has access to develop its projects through investment contracts with the Moscow City Government or through land use rights.
The land lease agreements held are detailed below:
NAME OF SUBSIDIARY THAT HAS ENTITLEMENT TO THE LEASE AGREEMENT
ACQUISITION DATE OF LAND 
USE RIGHTS 
PERIOD OF THE LEASE 
FROM THE DATE OF 
ACQUISITION 
LLC Ostozhie – Ostozhenka Project 30 June 2006 19 years
LLC Central Market –Tsvetnoy Project 30 June 2006 46 years
LLC Jevosset – Microgorod «V Lesu» Project 27 June 2007 48 years
LLC Dinvest – Forum Project 22 February 2008 21 years
LLC Kvazar – Kvazar Project 27 April 2010 45 years
The Group‘s future minimum rental payments under non-cancellable operating land leases in effect as of 31 December 2013 are presented below:
Due in one year or less 2,111
Due in more than one year but no more than five years 6,801
Due in more than five years 9,795
Total operating land lease 18,707 53 RGI International Limited Annual Report & Accounts 2013
6. PROPERTY, PLANT AND EQUIPMENT
TSVETNOY
OFFICE
PREMISES
OFFICE AND
 COMPUTER
EQUIPMENT
SALES
OFFICE
MOTOR
VEHICLES TOTAL LAND AND BUILDING
FURNITURE,  
FITTINGS AND 
EQUIPMENT
Cost at 1 January 2012 – – 9,754 808 – 430 10,992
Accumulated depreciation – – (1,632) (244) – (336) (2,212)
Carrying amount at 1 January 2012 – – 8,122 564 – 94 8,780
Additions – – – – 2,063 81 2,144
Disposals – – – (271) – – (271)
Depreciation – – (400) (24) (301) (52) (777)
Reclassification from assets of disposal group classified as 
held for sale 216,947 8,935 – – – – 225,882
Translation reserve – – 478 28 41 6 553
Cost at 31 December 2012 226,518 13,028 10,339 579 2,112 539 253,115
Accumulated depreciation (9,571) (4,093) (2,139) (282) (309) (410) (16,804)
Carrying amount at 31 December 2012 216,947 8,935 8,200 297 1,803 129 236,311
Additions – 1,235 – 112 100 66 1,513
Disposals – (509) (26) (21) – (26) (582)
Depreciation (4,689) (2,088) (357) (86) (414) (52) (7,686)
Translation reserve (15,494) (606) (581) (22) (121) (9) (16,833)
Cost at 31 December 2013 210,209 12,797 9,569 530 2,057 539 235,701
Accumulated depreciation (13,445) (5,830) (2,333) (250) (689) (431) (22,978)
Carrying amount at 31 December 2013 196,764 6,967 7,236 280 1,368 108 212,723
According to the loan agreements with Sberbank and Nomos-Bank (Note 12) the Tsvetnoy project and office premises are pledged as guarantees to secure the loans.
5. INVESTMENT PROPERTY continued
The Forum project formed a part of the Group’s portfolio until 2009 as part of the Chelsea project. At the end of 2009 the Directors reassessed the scope of Chelsea project 
and part of the costs associated with the project were impaired. No value has been attributed to the Forum project since 2009 neither within the Chelsea project nor as a 
separate project. However, in the middle of 2013 the Group obtained the Land Plot Urban Plan (GPZU) from the Moscow Architecture Committee. Accordingly, the 
Directors revived the project and reinstated it back to the portfolio as a separate future development at the fair value. The fair value does not exceed the original cost.
The Chelsea and Ostozhenka, 37 projects are measured at cost less accumulated impairment because they are at the very early stages of development which causes 
significant uncertainties affecting the determination of their fair values, and because there is no readily available market evidence of such fair values.
The Zemlianoy project formed a part of the Group’s portfolio until 2009. At the end of 2009 the Directors suspended the development and the costs associated with the 
project were impaired. No value has been attributed to the Zemlianoy project since 2009. However, at the beginning of 2012 the Group obtained a decision from the Urban 
Land Committee to prolong the investment contract and provide the Group with the land lease rights. Accordingly, the Directors revived the project and reinstated it back 
to the portfolio as a future development at the original cost which did not exceed the fair value. On 17 December 2012 the rights for the project were sold (Note 18).
According to the loan agreements with Sberbank and Nomos-Bank (Note 12) the Microgorod «V Lesu», Ostozhenka, 37 and Chelsea projects are pledged as guarantees to 
secure the loans as at 31 December 2013.
The following table summarises the unrealised gains or losses on investment property. These arise from both assets held at fair value and from movements in provision 
for impairment when projects are recorded at cost.
31 DECEMBER
2013
31 DECEMBER
2012
Fair value gain/(loss) on investment property 10,954 (25,040)
Impairment of investment property (1,458) (3,041)
Reversal of impairment of investment property 12,333 990
Total unrealised gain/(loss) on investment property 21,829 (27,091)
The Group, through its Russian subsidiaries, has access to develop its projects through investment contracts with the Moscow City Government or through land use rights.
The land lease agreements held are detailed below:
NAME OF SUBSIDIARY THAT HAS ENTITLEMENT TO THE LEASE AGREEMENT
ACQUISITION DATE OF LAND 
USE RIGHTS 
PERIOD OF THE LEASE 
FROM THE DATE OF 
ACQUISITION 
LLC Ostozhie – Ostozhenka Project 30 June 2006 19 years
LLC Central Market –Tsvetnoy Project 30 June 2006 46 years
LLC Jevosset – Microgorod «V Lesu» Project 27 June 2007 48 years
LLC Dinvest – Forum Project 22 February 2008 21 years
LLC Kvazar – Kvazar Project 27 April 2010 45 years
The Group‘s future minimum rental payments under non-cancellable operating land leases in effect as of 31 December 2013 are presented below:
Due in one year or less 2,111
Due in more than one year but no more than five years 6,801
Due in more than five years 9,795
Total operating land lease 18,707 54 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
7. INVESTMENT IN JOINTLY-CONTROLLED ENTITY
The Group’s investment in a jointly-controlled entity relates to its 50% interest in Lafar Management Limited, which holds a 100% interest in LLC Stolichnoe Podvorie,  
an entity involved in the development of an ultra high-end residential building at 3 Khilkov Lane, Moscow, Russian Federation and an ultra high-end single family 
townhouse at 49 Ostozhenka Street, Moscow, Russian Federation.
The following table sets out the assets and liabilities of the joint venture, and the Group’s share thereof. In addition, the table presents the Group’s share of the results of 
the joint venture:
31 DECEMBER
2013
31 DECEMBER
2012
ASSETS
Non-current assets
Investment property 76,722 76,248
Receivables 5 40
Deferred income tax assets 1,547 1,459
Total non-current assets 78,274 77,747
Current assets
Receivables and prepayments 93 100
Cash and cash equivalents 38 38
Total current assets 131 138
Total assets 78,405 77,885
LIABILITIES
Non-current liabilities
Deferred income tax liability 7,485 6,755
Loans 66,551 67,104
Total non-current liabilities 74,036 73,859
Current liabilities
Trade and other payables 329 270
Total current liabilities 329 270
EQUITY
Share capital 1 1
Retained earnings 14,450 33,994
Profit/(loss) for the period 568 (19,544)
Translation reserve (10,979) (10,695)
Total equity 4,040 3,756
Total liabilities and equity 78,405 77,885
Investment in jointly-controlled entity (50%) 2,020 1,878
Loans to jointly-controlled entity (Note 23) 33,022 33,325
Additional investment in jointly-controlled entity 498 539
Total investment in jointly-controlled entity 35,540 35,742
SHARE IN RESULT OF JOINTLY CONTROLLED ENTITY 284 (9,772)
The loans issued to the joint venture are past due as at the end of the reporting period and are collateralised (Notes 22 and 23).
The income for 12 months of US$568,000 in 2013 (2012: loss of US$19,544,000) includes income of US$6,249,000 (comprising fair value gain on Khilkov project) and 
expenses of US$5,681,000 consisting mainly of finance and income tax expenses (2012: income of US$8,108,000 and an impairment loss of US$27 ,652,000). 55 RGI International Limited Annual Report & Accounts 2013
8. INCOME TAX
The income tax expense comprises the following:
2013 2012
Total current tax charge 16 4
Total deferred tax (credit)/charge (1,146) 1,962
Income tax (credit)/charge for the year (1,130) 1,966
The Group operates in three tax jurisdictions and the Company and its subsidiaries are subject to tax at the rates in force in their respective countries of tax residence, the 
Island of Guernsey, the Republic of Cyprus or the Russian Federation.
The Company is a Guernsey incorporated entity, which is registered with the Administrator of Income Tax in Guernsey in order to obtain an exempt status. It is not 
anticipated that any income, other than bank interest income, will arise in Guernsey and therefore the Company will not be subject to tax in Guernsey.
The tax rates for the Group’s subsidiaries are currently 10% in Cyprus, 20% in the Russian Federation (2012: 10% in Cyprus, 20% in the Russian Federation).
Differences between the carrying amounts in the consolidated financial statements and the tax bases of assets and liabilities under statutory taxation regulations in 
Russia and other countries give rise to temporary differences. The tax effect of the movements in these temporary differences is detailed below and is recorded at the rate 
of 20% (2012: 20%) which represented the tax rate that had been enacted or substantively enacted by the end of the reporting period.
Reconciliation between the expected and the actual taxation charge is provided below:
2013 2012
Loss before taxation (176) (56,866)
Tax credit at the Russian statutory rate of 20% (35) (11,373)
Tax effect of items not deductible or assessable for taxation purposes:
Loss incurred in tax free jurisdictions 504 1,424
Income which is exempt from taxation: (5,670) (1,277)
– Disposal of subsidiaries (3,226) (1,277)
– Reversal of impairment of investment property (2,387) –
– Share in result of jointly-controlled entity (57) –
Non-deductible expenses: 4,071 13,192
– Impairment of investment property – 608
– Non-deductible regulation costs 3,260 10,238
– Share-based payment 289 520
– Share in result of jointly-controlled entity – 1,826
– Other 522 –
Income tax (credit)/charge for the year (1,130) 1,966
The tax effect of the movements in the temporary differences for the year ended 31 December 2013 is:
RECOGNISED IN CONSOLIDATED 
STATEMENT OF COMPREHENSIVE INCOME
CREDITED/(CHARGED) 
DIRECTLY TO OTHER 
COMPREHENSIVE 
INCOME
31 DECEMBER
2013
1 JANUARY
2013
REVERSAL OF 
IMPAIRMENT FAIR VALUE LOSS
OTHER
CHANGES
 SALE OF INVESTMENT 
PROPERTIES 
Tax effect of deductible temporary difference:
Tax losses carried forward 9,067 – – 3,263 (11) (743) 11,576
Other 207 – – – – (13) 194
Recognised deferred tax asset 9,274 – – 3,263 (11) (756) 11,770
Tax effect of taxable temporary difference:
Development projects (66,124) (2,433) 292 (1,347) 1,382 4,817 (63,413)
Recognised deferred tax liability (66,124) (2,433) 292 (1,347) 1,382 4,817 (63,413)
As at 31 December 2013 the Group recognised deferred tax assets in respect of unused tax losses carried forward of US$57 ,880,000 expiring in the years 2020 to 2023. 56 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
8. INCOME TAX continued
The recognised deferred tax asset represents taxes arising on the tax losses carried forward to future periods, which will be recoverable through future deductions from 
taxable profits. Deferred income tax assets are recorded to the extent that realisation of the related tax benefit is probable. The future taxable profits and the amount of 
tax benefits that are probable in the future are based on the current management expectations regarding the future performance.
The tax effect of the movements in the temporary differences for the year ended 31 December 2012 is:
1 JANUARY
2012
RECOGNISED IN CONSOLIDATED 
STATEMENT OF COMPREHENSIVE INCOME
RECLASS FROM 
ASSETS/
LIABILITIES HELD
 FOR SALE
CREDITED/(CHARGED) 
DIRECTLY TO OTHER 
COMPREHENSIVE 
INCOME
31 DECEMBER
2012
REVERSAL OF 
IMPAIRMENT FAIR VALUE LOSS
OTHER
CHANGES
 SALE OF INVESTMENT 
PROPERTIES 
Tax effect of deductible temporary 
difference:
Tax losses carried forward 2,406 – – (5,846) 84 12,128 295 9,067
Other – – – (209) 6 339 71 207
Recognised deferred tax asset 2,406 – – (6,055) 90 12,467 366 9,274
Tax effect of taxable temporary difference:
Development projects (51,374) (198) 5,008 (841) 7 (15,372) (3,354) (66,124)
Investment in joint controlled entity profit (120) – – 124 – – (4) –
Other 64 – – – – – (64) –
Recognised deferred tax liability (51,430) (198) 5,008 (717) 7 (15,372) (3,422) (66,124)
As at 31 December 2012 the Group recognised deferred tax assets in respect of unused tax losses carried forward of US$45,335,000 expiring in the years 2020 to 2022.
9. PROPERTY DEVELOPED FOR SALE
MICROGOROD 
<<V LESU> > KVAZAR TOTAL
At 1 January 2012 283,443 – 283,443
Additional construction costs 99,849 – 99,849
Reclassification of costs from investment property (Note 5) 15,213 – 15,213
Borrowing costs capitalised (in accordance with IAS 23) 16,584 – 16,584
Reclassification to property, plant and equipment (2,063) – (2,063)
Translation difference 20,089 – 20,089
At 31 December 2012 433,115 – 433,115
Additional construction costs 103,399 – 103,399
Reclassification of costs from investment property (Note 5) – 8,712 8,712
Borrowing costs capitalised (in accordance with IAS 23) 16,006 – 16,006
Translation difference (34,400) (234) (34,634)
At 31 December 2013 518,120 8,478 526,598
10. RECEIVABLES AND PREPAYMENTS
31 DECEMBER
2013
31 DECEMBER
2012
Prepayments 27,059 19,847
Input VAT 2,364 2,469
Receivables 1,779 2,082
Tax reimbursement 363 440
Written-off project costs reimbursement – 279
Total receivables and prepayments 31,565 25,117 57 RGI International Limited Annual Report & Accounts 2013
11. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of cash in hand, current accounts and amounts placed on deposit, as detailed below:
31 DECEMBER
2013
31 DECEMBER
2012
Non-interest bearing accounts (in RUR) 2,351 1,924
Non-interest bearing accounts (mainly in US$) 4,695 7,815
Promissory notes (in US$) 3,100 12,000
Short-term deposit (in US$) 39 474
Short-term deposit (in RUR) 16,215 6,030
Total cash and cash equivalents 26,400 28,243
Current accounts held in RUR, and mainly in US$, are non-interest bearing accounts. Interest is earned on the amounts of deposits at market interest rates (at rates up to 
6.2% per annum on short-term deposits in Russian Rubles).
The Board of Directors intends to continue placing surplus cash resources on deposits and with various money market funds with international financial institutions until 
such time as they are required for the business operations.
As of 31 of December 2013 the Group is subject to the restriction in use of its cash balance in respect of the promissory notes accounted for as cash equivalents in the 
financial statements. The promissory notes were issued by Sberbank in 2012 to the Group’s subsidiary LLC Central Market in the amount of US$12,000,000 as security for 
the loan facility of US$150,000,000, provided by Sberbank to LLC Central Market on 30 June 2011. Contractually, the promissory notes remaining as at 31 December 2013 
shall be converted to cash in the first half of 2014.
12. BORROWINGS
The loan agreements that were in place as at 31 December 2013 are set out below:
LENDER
ORIGINAL
CURRENCY
 OF LOAN
TOTAL AMOUNT
OF LOAN
FACILITY IN ORIGINAL 
CURRENCY
 
NOMINAL
INTEREST
 RATE
REPAYMENT
DATE
OUTSTANDING 
NOMINAL AMOUNT
31 DEC 2013 INTEREST PAYABLE
TOTAL LOAN OUTSTANDING
NON-CURRENT 
PORTION CURRENT PORTION
Sberbank US$ 150,000 LIBOR 3m+
PREMIUM*
29 June 2018 138,225 281 129,206 9,300
Sberbank RUR 4,922,000 12.5% 22 May 2015 39,002 150 – 39,152
Nomos Bank RUR 500,000 12.5% 13 Dec 2014 9,073 – – 9,073
Total borrowings 186,300 431 129,206 57,525
* the premium defaults to 6.5% provided all the cash generated from the Tsvetnoy building operation is received in lender bank current accounts, otherwise the premium increases to 9.5%.
On 30 June 2011, the Group’s subsidiary LLC Central Market entered into a loan facility of US$150,000,000 with Sberbank. The loan is secured against the property rights to 
the Tsvetnoy building, the share capital of LLC Central Market, the right of a long-term land lease which Tsvetnoy building occupies, promissory notes of Sberbank for the 
amount of US$3,100,000 on 31 December 2013 (31 December 2012: US$12,000,000) and the share capital of LLC Tsvetnoy Central Market, being the single lessee of the 
Tsvetnoy building. The purpose of the promissory notes acquisition is to guarantee interest and principal repayment for the next 12 months after the date of their 
acquisition. The loan facility has no recourse to the Company.
On 25 May 2011, the Group’s subsidiary LLC Jevosset entered into a loan facility of RUR 4,922,000,000 with Sberbank. The loan is secured against the property rights to the 
Microgorod «V Lesu» Development Phase 1, the share capital of LLC Jevosset and the right of two long-term land leases on which the Microgorod «V Lesu» project is being 
built. The loan facility has no recourse to the Company and is being used to fund the construction of the Microgorod «V Lesu» Project Phase 1.
The property rights to the Phase 1 of the Development consist of not less than 78,000 square metres of residential premises, 3,400 square metres of commercial premises, 
1,150 parking lots and 85 related parking lots to be constructed as part of the Development. Due to the repayment scheme applied the mortgage value of a part of the 
property rights was repaid during 2013 which resulted in the total amount of 17 ,823 square metres of residential premises, 3,400 square metres of commercial premises, 
279 parking lots and 45 related parking lots left as the security for the loan facility as of 31 December 2013 (31 December 2012: 34,846.77 square metres of residential 
premises, 3,400 square metres of commercial premises, 441 parking lots and 83 related parking lots).
As at 31 December 2013 the Sberbank loan facility was classified as current because of the repayment scheme applied. As the loan is secured against the property rights to 
the Microgorod «V Lesu» Development Phase 1 the Group has an obligation to repay the mortgage value of any part of those rights upon receiving proceeds according to 
any sale-purchase agreement in respect of those rights. The Group started to sell apartments in Phase 1 in 2011 and anticipates that the total projected amount of 
proceeds from future sales during 2014 will cover in full the repayment of the loan outstanding as of 31 December 2013. 58 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
12. BORROWINGS continued
On 19 December 2012 the Group’s subsidiary LLL Project Bureau entered into a loan facility in the form of a credit line of RUR 500,000,000 with OJSC “Nomos-Bank”.  
The loan is secured against guarantees of other Group companies such as LLC Profit Invest, LLC Ostozhie, LLC Titan along with a pledge of real estate property owned by 
the abovementioned Group companies. The carrying amount of the pledged real estate property equals US$11,558,000.
The loans’ fair value as at 31 December 2013 does not differ significantly from their carrying value.
The loan agreements that were in place as at 31 December 2012 are set out below:
LENDER
ORIGINAL
CURRENCY
OF LOAN
TOTAL AMOUNT
OF LOAN
FACILITY IN ORIGINAL 
CURRENCY
NOMINAL
INTEREST
RATE
REPAYMENT
DATE
OUTSTANDING 
NOMINAL AMOUNT
31 DEC 2012 INTEREST PAYABLE
TOTAL LOAN OUTSTANDING 
NON-CURRENT 
PORTION CURRENT PORTION
Sberbank US$ 150,000 LIBOR 3m+
PREMIUM*
29 June 2018 146,325 301 138,225 8,401
Sberbank RUR 4,922,000 12.5% 22 May 2015 47,930 186 – 48,116
Total borrowings 194,255 487 138,225 56,517
* the premium defaults to 6.5% provided all the cash generated from the Tsvetnoy building operation is received in lender bank current accounts, otherwise the premium increases to 9.5%
13. TRADE AND OTHER PAYABLES
31 DECEMBER
2013
31 DECEMBER
2012
Trade payables 15,870 10,224
Deposits and advances 1,091 1,955
Tax payables 1,647 1,078
Total trade and others payables 18,608 13,257
The increase in Trade payables at 31 December 2013 was due to the increase in activities in finishing Phase 1 Microgorod «V Lesu».
14. SHARE CAPITAL
Share capital
The Company’s share capital is denominated in British pounds (‘GBP’). The Company’s shares are stated at their par (nominal) value.
NUMBERS
OF SHARES
AUTHORISED
AND ISSUED
NOMINAL
AMOUNT IN
ACTUAL GBP’000
CARRYING
VALUE IN
 US$
Share capital as at 1 January 2012 161,786,978 0.65 1.23
Share capital as at 31 December 2012 161,786,978 0.65 1.23
Share capital as at 31 December 2013 163,736,978 0.65 1.00
The share capital of the Company comprises only Ordinary Shares, all of which bear voting rights and the right to dividends as approved at the General Meeting of the 
Company. No other additional rights or preferences are attached to this class of shares.
The shareholding structure as at 31 December 2013 was as follows:
SHAREHOLDERS
TOTAL
SHARES
 HELD
OWNERSHIP
IN THE COMPANY
%
LLC VEB Capital 71,000,000 43.37
Direct Finance LLC 49,168,094 30.03
AMG Group Limited 27,045,722 16.52
Other (none individually greater than 3%) 16,523,162 10.08
Total 163,736,978 100.00 59 RGI International Limited Annual Report & Accounts 2013
The shareholding structure as at 31 December 2012 was as follows:
SHAREHOLDERS
TOTAL
SHARES
HELD
OWNERSHIP
IN THE COMPANY
%
D.E.S. Commercial Holdings Limited 65,063,393 40.22
Synergy Classic Limited 36,010,000 22.26
Sigrun Finance Incorporation 32,490,160 20.08
Renaissance Capital Limited 4,846,174 3.00
Prosperity Capital Management Limited 5,951,665 3.68
Other (none individually greater than 3%) 17,425,586 10.76
Total 161,786,978 100.00
Share premium
The share premium represents the excess of contributions received over the nominal value of the shares issued.
15. SHARE-BASED PAYMENT
The Company operates a long-term share award incentive plan (LTIP) that entitles eligible employees to acquire shares in the Company at no cost providing certain 
conditions are met. The primary condition is based on share price growth and dividend payments. The eligible shares vest in two equal amounts after the second and the 
third years following the grant date.
On 15 January 2013, following the decision made by the Remuneration Committee, pursuant to the rules of the LTIP (due to the change of main shareholder), the awards 
granted to Mr. Alan Hibbert, Mr. Yoram Evan and Mr. Andrey Nesterenko, have fully vested.
On 1 February 2013 the Company allotted a total of 1,950,000 new Ordinary Shares of £0.000000004 each fully paid to the following individuals in relation to the vesting 
of awards under the Company’s LTIP:
(a) Mr. Alan Hibbert was issued 600,000 shares;
(b) Mr. Yoram Evan was issued 600,000 shares (due to the Board decision to extend the term of his LTIP , which would otherwise have expired in October 2012); and
(c)  Mr. Andrey Nesterenko was issued 750,000 shares.
The portion of Directors’ award shares amortised for the 12 month period ended 31 December 2013 was US$1,405,000 (for 2012: US$2,602,000).
No additional LTIP awards have been made in 2013 and currently there are no outstanding unvested awards.
16. NET PROFIT/(LOSS) FROM OPERATION OF PROPERTIES
Net property profit/(loss) is connected with Tsvetnoy department store operational activity.
2013 2012
Concession revenue 16,044 11,479
Gross sales of goods 8,280 8,330
Gross revenue 24,324 19,809
Cost of goods sold (5,093) (7,055)
Maintenance and utilities (6,078) (6,434)
Staff costs (6,972) (5,543)
Professional services (2,081) (4,916)
Property tax (2,896) (3,119)
State duties (597) (2,604)
Total property operating costs (23,717) (29,671)
Net profit/(loss) from operation of properties 607 (9,862)
Concession revenue for 2013 includes a contractually fixed portion of US$4,130,000 (2012: US$2,413,000).
The increase in staff costs in 2013 was as a result recruiting additional staff with a consequent reduction in external professional services. 60 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
17. GENERAL AND ADMINISTRATIVE EXPENSES
2013 2012
Wages and salaries 4,590 4,388
Consulting and other professional services 4,173 3,462
Subsistence and office consumables expenses 1,856 3,287
Share-based payment 1,405 2,602
Property tax 197 374
Others 809 238
Total general and administrative expenses 13,030 14,351
18. NET GAIN ON DISPOSAL
2013 2012
Net proceeds from sales 22,000 6,444
Cost of the projects (12,974) (5,785)
Reversal of impairment – 5,726
Translation difference 217 –
Total net gain on disposal 9,243 6,385
At 4 October 2013 an agreement for the sale of 100% shares in Grikima Holding Ltd which owns the Victory Park project was signed. The compensation received totaled 
US$22,000,000 (excluding bank charges). The disposal of this project is in line with the Group’s strategy of focusing on the development of large-scale residential schemes 
and frees up capital for the Group’s other projects.
At 17 December 2012 an agreement for the sale of 100% shares in Canalet Holding Ltd which owns Zemlianoy project was signed between the Group companies and 
Salerno Investments Ltd. The compensation received totaled US$6,000,000 (excluding bank charges).
At 24 September 2012 an agreement for the sale of 100% shares in Swainhouse Enterprises Ltd which owns Maya project was signed between the Group companies and 
Cypress Enterprises Ltd. The compensation received totaled US$500,000 (excluding bank charges).
19. FINANCE INCOME AND COSTS
Finance income 2013 2012
Foreign exchange gains – 5,899
Interest income 140 1,571
Bank interest 281 800
Derivative transaction – 1,287
Total finance income 421 9,557
Finance costs 2013 2012
Foreign exchange loss 8,108 –
Interest expenses 16,501 17,525
Consumer Price Index adjustments on bonds – 142
Total finance costs before capitalisation 24,609 17,667
Capitalised finance costs (16,501) (17,442)
Total finance costs 8,108 225 61 RGI International Limited Annual Report & Accounts 2013
20. EARNINGS PER SHARE
The basic and diluted earnings per share have been calculated by dividing the net loss attributable to the owners of the Company by the weighted average number of 
Ordinary Shares outstanding during the period.
The basic and diluted earnings per share are presented below:
2013 2012
Income attributable to owners of the Company 894 (54,324)
Weighted average number of Ordinary Shares outstanding during the year 163,566,019 161,786,978
Basic and diluted earnings per share for the income attributable to the owners of the Company during the year 
(expressed in US$ per share) 0.01 (0.34)
21. SEGMENT INFORMATION
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (CODM). The chief operating 
decision-maker who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer,  
who makes strategic decisions.
For the purpose of financial reporting for the year ended 31 December 2013 the Group identified two reportable segments: Assets management (Tsvetnoy department 
store) and Development (Development projects of the Group).
Due to the nature of trading of the Tsvetnoy Project it is managed separately from the other activities of the Group. The Tsvetnoy project has its own management team 
who report to the CEO and have the objective of increasing rental and other revenues from this investment. The Asset management segment earns revenue by leasing  
out the sales floor space, acting as an agent in retail and selling goods in its own shopping space.
The major source from which the Development segment derives its revenue is the sale of apartments in Microgorod «V Lesu» which commences in 2014.
The Group does not split the business into geographical segments due to the fact that all business activities are performed in one geographical area, Moscow and the 
Moscow Region.
The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies.
SEGMENT
DEVELOPMENT ASSET MANAGEMENT TOTAL
2013 2012 2013 2012 2013 2012
Revenue from external customers – – 24,324 19,809 24,324 19,809
Retail operating costs – – (23,717) (29,671) (23,717) (29,671)
Other operating income 757 1,012 – – 757 1,012
General and administrative expenses (13,030) (14,351) – – (13,030) (14,351)
Marketing expenses (4,460) (4,574) – – (4,460) (4,574)
Unrealised gain/(loss) on investment property, net 21,829 (27,091) – – 21,829 (27,091)
Share in result of jointly-controlled entity 284 (9,772) – – 284 (9,772)
Gain on disposal, net 9,243 6,385 – – 9,243 6,385
Segment result 14,623 (48,391) 607 (9,862) 15,230 (58,253)
Depreciation and amortisation (7,719) (7,945)
Finance (costs)/income, net (7,687) 9,332
Income tax 1,130 (1,966)
Profit/(loss) 954 (58,832)
Reportable segment assets 691,035 584,129 227,497 254,115 918,532 838,244
Reportable segment liabilities (367,971) (261,790) (156,173) (153,935) (524,144) (415,725)
The Group’s business is strictly divided into two segments leaving no Group companies that are not included in either of the two segments, the total amounts of the 
segments assets and liabilities, revenues and expenses for 12 months of 2013 and 2012 are equal to the summary amounts of these financial statements items 
cumulatively for the Group. In this regard no reconciliations between the total of the reportable segments’ assets and liabilities, revenues and expenses and the Group’s 
corresponding amount are performed. Intersegment revenue and expenses are immaterial. 62 RGI International Limited Annual Report & Accounts 2013
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated
22. CONTINGENCIES, COMMITMENTS AND OPERATING RISKS
Legal proceedings
On 22 April 2013 the Company has begun legal action against Litonor Financial Limited (‘Litonor’), its development partner in the Khilkov luxury residential project in 
central Moscow (Note 7).
The action claims damage from Litonor following Litonor’s failure to perform its obligations in accordance with the partnership agreement dated 19 September 2006.
The action was launched in the District Court of Nicosia, Cyprus (‘the Court’) by RGI. Residential Holdings Limited (‘RGI Residential’), a Cyprus registered subsidiary of RGI. 
RGI Residential owns a 50% stake in LLC Stolichnoe Podvorie, the developer of the Khilkov project.
Further to the above action and pursuant to an application by RGI Residential, the Court has granted an injunction preventing Litonor from disposing of its shares in the 
Khilkov project.
The aim of the legal action is to encourage the partner to fulfill his obligations under the partnership agreement. The Company believes that these legal actions will speed 
up the Khilkov project development or recover fully the investments (including the acquisition price).
Tax contingencies
The Company has exempt tax status in Guernsey. The Group also operates in the Cypriot and Russian tax jurisdictions.
Russian tax and customs legislation which were enacted or substantively enacted at the end of the reporting period were subject to varying interpretations when being 
applied to the transactions and activities of the Group. Consequently, tax positions taken by management and the formal documentation supporting the tax positions 
may be successfully challenged by relevant authorities. Russian tax administration is gradually strengthening, including the fact that there is a higher risk of review of tax 
transactions without a clear business purpose or with tax incompliant counterparties. Fiscal periods remain open to review by the authorities in respect of taxes for three 
calendar years preceding the year of review. Under certain circumstances, if a court determines that the taxpayer has obstructed or hindered a tax inspection, reviews may 
cover longer periods.
Russian transfer pricing legislation enacted during the year affects all transactions from 1 January 2012. It introduces significant reporting and documentation 
requirements. The transfer pricing legislation that is applicable to transactions on or prior to 31 December 2011 also provides the possibility for tax authorities to make 
transfer pricing adjustments and to impose additional tax liabilities in respect of all controllable transactions, provided that the transaction price differs from the market 
price by more than 20%. Controllable transactions include transactions with interdependent parties, as determined under the Russian Tax Code, all cross-border 
transactions (irrespective of whether performed between related or unrelated parties), transactions where the price applied by a taxpayer differs by more than 20% from 
the price applied in similar transactions by the same taxpayer within a short period of time, and barter transactions. Significant difficulties exist in interpreting and 
applying transfer pricing legislation in practice. Any prior existing court decisions may provide guidance, but are not legally binding for decisions by other, or higher level, 
courts in the future.
Tax liabilities arising from transactions between companies are determined using actual transaction prices. It is possible, with the evolution of the interpretation of the 
transfer pricing rules, that such transfer prices could be challenged. The impact of any such challenge cannot be reliably estimated; however, it may be significant to the 
financial position and/or the overall operations of the entity.
The Group includes companies incorporated outside of Russia. The tax liabilities of the Group are determined on the assumption that these companies are not subject to 
Russian profits tax, because they do not have a permanent establishment in Russia. This interpretation of relevant legislation may be challenged but the impact of any 
such challenge cannot be reliably estimated currently; however, it may be significant to the financial position and/or the overall operations of the entity.
As Russian tax legislation does not provide definitive guidance in certain areas, the Group adopts, from time to time, interpretations of such uncertain areas that reduce 
the overall tax rate of the Group. While management currently estimates that the tax positions and interpretations that it has taken can probably be sustained, there is  
a possible risk that an outflow of resources will be required should such tax positions and interpretations be challenged by the relevant authorities.
Capital expenditure commitments
At 31 December 2013, the Group had contractual capital expenditure commitments in respect of property development totaling US$92,035,774 (2012: US$95,213,000).
The Group has already allocated the necessary resources in respect of these commitments. The Group believes that future net income and funding will be sufficient to 
cover this and any similar such commitments.
Guarantees
During the reporting period the Group has not granted or provided collateral to third parties, except for the liens provided to Sberbank in relation to the Tsvetnoy and 
Microgorod «V Lesu» Projects and liens provided to Nomos-Bank (Note 12). 63 RGI International Limited Annual Report & Accounts 2013
Insurance policies
The Group holds insurance policies in relation to its assets, operations, and in respect of public liability or other insurable risks. The total insurance coverage is 
US$465,885,000 (2012: US$233,160,000).
Environmental matters
The enforcement of environmental regulations in the Russian Federation is evolving and the enforcement posture of government authorities is continually being 
reconsidered. The Group periodically evaluates its obligations under environmental regulations. As obligations are determined, they are recognised immediately. 
Potential liabilities, which might arise as a result of changes in existing regulations, civil litigation or legislation, cannot be estimated but could be material. Under 
existing legislation, the Directors believe that there are no significant liabilities for environmental damage.
Operating environment of the Group
The Russian Federation displays certain characteristics of an emerging market, including relatively high inflation and high interest rates. Tax, currency and customs 
legislation within the Russian Federation is subject to varying interpretations and frequent changes and contribute to the challenges faced by entities currently operating 
in the Russian Federation. The future economic direction of the Russian Federation is heavily influenced by the fiscal and monetary policies adopted by the government, 
together with developments in the legal, regulatory, and political environment. Management is unable to predict all developments in the economic environment which 
could have an impact on the Group’s operations and consequently what effect, if any, they could have on the financial position of the Group.
The market in Russia for many types of real estate has demonstrated some recovery from the impact of the volatile global financial markets. As such the carrying value of 
the property development portfolio has been updated to reflect market conditions at the end of the reporting period. Management is unable to reliably determine the 
effects on the Group’s future financial position of any potential future deterioration in the liquidity of the financial markets and the increased volatility in the currency  
and equity markets. Management believes it is taking all necessary measures to support the sustainability and growth of the Group’s business in the current business and 
economic environment.
Management determined impairment provisions by considering the economic situation and outlook at the end of the reporting period. Provisions for trade receivables are 
determined using the ‘incurred loss’ model required by the applicable accounting standards. These standards require recognition of impairment losses for receivables that 
arose from past events and prohibit recognition of impairment losses that could arise from future events, no matter how likely those future events are.
23. RELATED PARTY TRANSACTIONS
Parties are generally considered to be related if the parties are under common control or if one party has the ability to control the other party or can exercise significant 
influence or joint control over the other party in making financial and operational decisions. In considering each possible related party relationship, attention is directed 
to the substance of the relationship, not merely the legal form.
The Group had no other transactions and balances with related parties disclosed elsewhere in these financial statements or detailed below during the reporting period 
ended 31 December 2013 and 31 December 2012.
Borrowings
LAFAR
MANAGEMENT
LIMITED
STOLICHNOE
PODVORIE LLC
Total outstanding loans and accrued interest due from related parties on 1 January 2012 27,436 3,832
Loans issued to related parties during 2012 26 –
Total interest income during 2012 1,438 355
Translation difference – 238
Total outstanding loans and accrued interest due from related parties on 31 December 2012 28,900 4,425
Loans issued to related parties during 2013 15 –
Total interest income during 2013 – –
Translation difference – (318)
Total outstanding loans and accrued interest due from related parties on 31 December 2013 28,915 4,107
Lafar Management Limited is a jointly-controlled entity in which the Group holds an economic interest of 50%. Litonor Financial Limited holds the remaining 50% of the 
voting shares of Lafar Management Limited. Lafar Management Limited holds 100% of the share capital of its Russian subsidiary, LLC Stolichnoe Podvorie. 64 RGI International Limited Annual Report & Accounts 2013
23. RELATED PARTY TRANSACTIONS continued
Key management remuneration
In the reporting period, the Directors of the Group received compensation in the form of salary and other benefits classified as short-term in accordance with  
IAS 19 “Employee Benefits”. The total remuneration and benefits accrued to the Directors, excluding the share-based payments (Note 15), was US$2,472,000  
(2012: US$2,594,000). There are no other individuals who are not members of the Board of Directors who are considered to be key management in the Group.
DIRECTORS’ REMUNERATION AND BENEFITS 2013 2012
Andrey Nesterenko, Chief Executive Officer (appointed 17 May 2013) 1,083 404
Alan Hibbert, Chief Financial Officer (until 31 May 2013) 442 508
Yoram Evan, Director (until 31 May 2013) 386 435
Emmanuel Blouin, Non-Executive 120 120
Reginald Webb, Non-Executive 102 120
Mark Holdsworth, Non-Executive 102 120
Jacob Kriesler, Non-Executive Chairman (until 8 March 2013) 80 120
Timothy Fenwick, Non-Executive (until 3 July 2013) 60 120
Boris Kuzinez, President (until 8 March 2013) 30 465
Alexey Titov, Non-Executive (appointed 31 May 2013) 22 –
Emanuel Kuzinez, Director (until 8 March 2013) 20 120
Yuriy Borisenko, Non-Executive (until 5 July 2013) 15 34
Pavel Altuhov, Non-Executive (until 11 March 2013) 6 28
Kevin Hennessy, Non-Executive (appointed 11 December 2013) 4 –
Total remuneration and benefits accrued 2,472 2,594
In addition the awards shares were granted to executive Directors as a part of its Long-Term Incentive Plan (Note 15).
There are no long-term remuneration and benefits provided by compensation agreements with the key management and Non-Executive Directors, other than the  
Plan described above.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS continued
All amounts in US$ thousands unless otherwise stated SHAREHOLDERS’ INFORMATION
Financial Calendar
• Annual General Meeting 28 May 2013
• Announcement of 2013 first quarter results May 2013
• Announcement of 2013 interim results August 2013
• Announcement of 2013 third quarter results November 2013
Nominated adviser:
Shore Capital and Corporate Limited
Bond Street House 
14 Clifford Street 
London W1S 4JU
Legal Advisers to the Company:
As to English Law: 
Latham & Watkins  
99 Bishopsgate  
London EC2M 3XF  
United Kingdom  
As to Russian Law: 
Georgiev & Partners 
40/2 Prechistenka Street 
119034 Moscow
As to Guernsey Law: 
Collas Crill 
Glategny Esplanade, Po Box 140, 
Glategny Court St Peter Port 
Guernsey GY1 4EW
Corporate PR:
Citigate Dewe Rogerson
3 London Wall Buildings 
London Wall 
London EC2M 5SY
Company Secretary and Registered Office:
JTC (Guernsey) Limited 
Frances House  Sir William Place  
St Peter Port  Guernsey  GY1 4EU
Company registration number 44527
Registrar:
Computershare Investor Services (Jersey) Limited
Queensway House, Hilgrove Street, St Helier, Jersey, JE1 1ES 
Real Estate Consultants:
Jones Lang LaSalle, LLC
2 Letnikovskaya St. Bld. 2 Moscow 115114 RGI International Limited
Guernsey
PO Box 175, Frances House,  
Sir William Place,
St Peter Port, Guernsey,  
GY1 4EU
JTC (Guernsey) Limited – the Company’s Secretary
Tel:  +44 (0) 1481 723573
Fax:  +44 (0) 1481 732131
E-mail:  info@rgi-international.com
Moscow
119034, Moscow,  
Russia,  
Korobeinikov lane, 1
Tel:  +7 (495) 933 61 80
Fax:  +7 (495) 989 70 62
E-mail:  info_rus@rgi-international.com
RGI INTERNATIONAL GROUP ANNUAL REPORT & ACCOUNTS 2013