TRADING UPDATE FOR THE FIRST HALF 2011

August 2, 2011

Poultry Division 

Sales volumes in the Poultry division in the first half of 2011 increased by a robust 18% to approximately 117,990 tonnes of sellable weight compared to approximately 99,860 tonnes for the first half of 2010.  

Prices for poultry sales in dollar terms increased by 9% from $2.30 per kg in the first half of 2010 to $2.51 per kg in the first half of 2011 (excluding VAT)*. Compared to the first quarter of 2011, the price in the second quarter increased by 7% to $2.59 per kg. 

Prices in rouble terms increased almost by 4% from 69.11 roubles per kg in the first half of 2010 to 71.79 roubles per kg in the first half of 2011 (excluding VAT). Compared to the first quarter of 2011, the price in the second quarter increased by 2% from 71.07 to 72.39 roubles per kg.  

Pork Division 

Sales volumes in the Pork division in the first half of 2011 stayed almost flat at 41,070 tonnes of live weight, compared to 40,936 tonnes in the first half of 2010.  

In dollar terms, prices for pork sales increased by 14% from $2.36 per kg of live weight in the first half of 2010 to $2.70 per kg of live weight in the first half of 2011 (excluding VAT)*. Compared to the first quarter of 2011, the price in the second quarter increased by 10% from $2.57 to $2.84 per kg.  

Prices in rouble terms increased by 9% from 71,09 roubles per kg in the first half of 2010 to 77.41 roubles per kg in the first half of 2011 (excluding VAT). Compared to the price in the first quarter of 2011 of 75.27 roubles per kg, the price in the second quarter increased by 6%.  

Meat Processing Division 

Sales volumes increased by 6% to 70,097 tonnes from 66,200 tonnes for the first half of 2010. 

Prices in dollar terms increased by 17% from $3.81 per kg in the first half of 2010 to $4.47 per kg in the first half of 2011 (excluding VAT)*. Compared to the first quarter of 2011, the price in the second quarter increased by 8% from $4.30 to $4.64 per kg. 

Prices in rouble terms increased by 12% from 114.66 roubles in the first half of 2010 to 127.98 roubles per kg in the first half of 2011 (excluding VAT). Compared to the price in the first quarter of 125.75 roubles per kg, the price in the second quarter of 2011 increased by 3%.  

Commenting on the performance, Sergei Mikhailov, CEO of Cherkizovo Group said: "In addition to delivering strong results across all segments in the first half of 2011, we have confirmed our status as the most active player on the Russian meat market through the acquisition of Mosselprom, one of Russia’s best known meat producers. Furthermore, we have started construction of the country’s largest poultry production complex in the Lipetsk region.  

We are now in the process of integrating Mosselprom within the Group’s production structure. Achieving synergies will help us to increase operational efficiency in our poultry segment, where we continue to deliver against our large scale capacity increase projects. This spring we opened two large poultry production facilities in our Bryansk and Penza clusters and we soon plan to launch two incubation facilities which will be amongst the largest not just in Russia, but across Europe.  

Our production results in the pork segment were affected by the extreme weather conditions that we witnessed last summer, however now we see this segment begin to stabilize. We have also begun integrating our new asset “Orelselprom”, which was acquired through the Mosselprom transaction.  

In the meat processing segment we see a steady increase in demand for our meat products and we continue to work on increasing the efficiency and improving the resource base of this segment. In May we announced the launch of the meat processing plant in Kaliningrad that we bought last year.  

Management is confident that the Group will continue to improve operating efficiency and deliver against its strategy."