Press releases – 2008

Results for the year ended 31 December 2007

06 May 2008

Chagala Group Limited ("Chagala"), the specialist London listed Kazakh real estate developer and operator, is pleased to announce its results for the year ended 31 December 2007.

Financial Highlights:

• Total revenues up 18.0% to US$22.07 million (2006: US$18.7 million)
• Room & Rent revenue increased 13.3% to US$16.5 million (2006: $14.5 million)
• Food & beverages revenue up 34.5% to US$5.6 million (2006: US$4.2 million)
• Operating profit increased by 20.3% to US$6.0 million (2006: US$5.0 million)
• Fair value of land, premises and equipment on an IFRS basis¹ up 53.0% to US$123.9 million (31 December 2006: US$80.9 million)
• Market NAV as appraised by DTZ will be announced in early June 2008

Operational Highlights:

• Achieved full occupancy of 235 apartments, leased at sustainable rates
• Announced joint venture agreement with Maverick, an oil and gas field service company, to acquire, renovate and operate residential and recreational facility in Aksai
• Received approval from the Atyrau regional authority for mixed use development in Atyrau on the Caspian Sea
• Strengthened landbank with the acquisition of 45 hectares of land in Atyrau and four hectares of land for the Aksai joint venture
• Signed Chagala Zere Malls joint venture with Zere to develop shopping malls of approximately 30,000 square metres each in five locations
• Agreed term sheet for US$53.5 million first tranche of new credit facility with HSBC Bank Kazakhstan and Raiffeisen Zentralbank Österreich AG

Tim Abson, Chief Executive of Chagala, said:

"I am extremely pleased with the performance of Chagala Group in 2007, our first year as a listed company. We had an excellent second half of the year following a challenging first six months.

Revenue was strong and we achieved a significant rise in the fair value of our land, premises and equipment on an IFRS basis. In line with this we also expect to announce an increase in market NAV as appraised by DTZ in June 2008. We have proved to be a strong and resilient company capable of meeting the challenges posed by turmoil in the financial markets and uncertainty in the Kazakh energy industry to deliver high-quality projects that improve the living and working conditions of our clients.

Trading in the first quarter of 2008 has continued to be strong and we remain confident of meeting expectations for the full year."

Notes:

1. Increase in IFRS Fair value of land, premises and equipment based on valuation by KPMG.

There will be a conference call for investors and analysts at 10:00am UK time and a presentation available on www.chagalagroup.com. The dial in number for this call is +44 (0) 20 7190 1232.

For further information:

The full press release in PDF format