Êyiv, Ukraine - AVANGARDCO INVESTMENTS PUBLIC LIMITED (LSE: AVGR) (the «Company» or «AVANGARDCO IPL»), the largest producer of shell eggs and egg products in Ukraine and number one producer in Eurasia, today issues its trading update for the six months of 2012 ended June 30, 2012.

Nataliya Vasylyuk, Chief Executive Officer of AVANGARDCO IPL, commented:

“I am pleased with our performance in the first half of 2012. AVANGARDCO IPL has continued to deliver growth in the two key segments of shell eggs and egg products both through increasing its production, as well as retail sales and exports, and growing sales prices supported by the consolidation of the Ukrainian egg market. Our feed costs, on the other hand, have remained stable due to our policy of forward purchasing grains at fixed price levels. Accordingly we have not been, nor do we expect to be negatively affected, by the continuing price fluctuations of corn resulting from the bad weather in the United States.”

The total poultry flock grew by 6.2% year on year, with the number of laying hens increasing by 9.6%.

Production: The Company increased its production volume of shell eggs by 8.0% year on year as a result of the growth in the population of laying hens.

Sales: During the reporting period, sales to external customers increased by 12.8% year on year as the Company continued to develop its sales channels and focus on exports and on national retail chains.

Sales Through Supermarkets: In the first half of 2012, the share of shell egg sales through modern retail chains (supermarkets) reached 31% of total sales to third parties (1H 2011: 30%).

Export: In the first half of 2012, the Company has increased its export volumes of shell eggs by 2347.6% compared to a year ago. In addition to its core target markets, the Company has started exporting shell eggs to new markets such as Mauritania, Libya, the Republic of Djibouti, Gambia and Angola. A large share of the export sales of eggs went to Iraq. This progress indicates not only the stability of the demand, but also to the steadily growing interest in the Company's products.

During the second half of 2012 the Company plans to develop the export to the African continent. Currently the Company is holding talks in Benin, Sierra Leone, Guinea and Liberia.

Average Price: In the first half of 2012, the average egg price increased by 24.5% year on year as a result of the overall growth of shell egg prices, significant growth in export volumes of the Company and increase in sales to supermarkets.

Our Brand: The first half of 2012 results have shown robust growth in sales of “Kvochka”-branded eggs. Furthermore, the sales of branded shell eggs during the same period have increased by 7 times year on year. "Kvochka" accounts for the majority (86%) of the total sales of branded shell eggs, followed by “Organic Eggs” and “Kvochka Domashnie " brands which generate 9% and 5% of the total sales of branded shell eggs, respectively. The Company has introduced these brands to the market at a later stage to address the demand in the premium segment.

“Kvochka”-branded shell eggs are sold in the following national retail chains across Ukraine: Silpo, ATB, Metro, Velyka Kyshenya, Eco-Market, Karavan, Vopak, Fora, Expansion and Kray. These retail chains account for approximately 60% of Ukraine’s modern trade format turnover and amount to 1,170 outlets. The Company has completed the first stage of building a national distribution network with «Kvochka»-branded products offered in the majority of national chains. The Company is now rolling out the second stage of its network development by extending its presence to regional chains and the traditional retail.

The Company continues to support the launch of “Kvochka”-branded eggs through an integrated marketing campaign. The Company has launched a website dedicated to “Kvochka” brand (www.kvochka.com.ua) to provide consumers with additional information about the product.

Production: In the first half of 2012 Imperovo Foods egg processing plant operated at full capacity and increased the volume of shell eggs processed by 1.3% year on year.

Average price: The average sales price for dry egg products increased by 9.1% year on year primarily due to the changes in the product mix during the reporting period and the increase in sales prices of processed eggs products on the market.

Export: In the first half of 2012 the Company has commenced exporting egg products to new markets – Taiwan and Egypt.

In the second half of 2012 the Company is planning to launch the export of liquid eggs products in South-East Asia and MENA countries.

The construction of two poultry complexes for egg production "Avis" and "Chornobaivske" in Khmelnytsky and Kherson regions is going according to the schedule.

Avis: The development of the second stage of the site for the rearing young laying hens at "Avis" poultry complex has been completed. Currently, the Company is in the process of construction and assembly.

The construction of the second stage of the site for the laying hens is progressing according to the schedule. The capacity of the facilities for the laying hens is expected to increase to 5 million heads when they are fully commissioned in the first quarter of 2013.

At the moment, both production sites are fully compliant with European standards. The Company has purchased equipment from OFFICINE FACCO & C.SpA and Big Dutchman International GmbH. The actual utilization of the sites corresponds to the operational plans of the Company.

Chornobaivske: At the end of the first half of 2012, the first stage of the site for the rearing young laying hens was operating at full capacity. The Company starts the construction works for the second stage of the rearing facility.

At the end of the reporting period the first stage of the facilities for the laying hens was operating at 20% of its capacity. Birds placement is continuing according to the schedule. In September 2012, the Company plans to hold an official opening ceremony of the first stage of the facilities for the laying hens.

At the moment, both sites are fully compliant with European standards. The Company purchased equipment from SALMET International GmbH. These facilities are operating in accordance with the Company’s plans.

Imperovo Foods Egg Processing Plant: The first stage of the capacity expansion at Imperovo Foods egg processing plant was completed. Currently the Company is working on doubling the capacity for processing eggs from 3 to 6 million units per day.

To view the progress in the construction of operational facilities at "Avis" and "Chornobaivske" egg processing complexes please click here.

For investor's inquiries:

Alina Korniets
AVANGARDCO IPL
Acting Head of Investor Relations

Phone: +38 044 593 28 60
Mobile: +38 067 664 49 99
e-mail: a.korniets@avangardco.ua