Echo Capital Group closed the 2nd quarter of 2008 with net profit exceeding PLN 31 million (15% growth as compared to the 1st quarter of 2008). Net income exceeded PLN 91 million and is equivalent to earnings of the 1st quarter of year. Accrued net profit after 2 quarters of 2008 equals PLN 54 million and the value of revenues is PLN 183 million.

Net profit of the 2nd quarter of 2008 is significantly lower than the profit earned during the same period of the preceding year, due to significant appraisal value of the Pasaż Grunwaldzki shopping and entertainment center, which was then opened in Wrocław as the largest project yet executed by Echo Investment Group.

The factors influencing the bottom line during the current period include revenues earned on sales of housing projects and letting of office and commercial space, as well as quarterly adjustment of appraisal of the Group’s properties, accounting for changes arising out of EUR and USD exchange rate fluctuations.

Net operating revenues were lower than in the 2nd quarter of last year due to reduced leasable space as a consequence of sale of four commercial projects in Lodz and in Kielce to Catalyst Capital fund of London.

An important factor influencing the bottom line earned during the current period was the booking of revenues under final agreements of sale of a housing project in Warsaw at Inflancka Street (stage 2). Higher value of revenues was further affected by the income earned from letting of office and commercial space.

Overall value of assets exceeded 1 billion EUR and the value of equity reached nearly half a billion EUR, showing over 11% growth as compared to data of the same period of previous year.
As at the end of the 2nd quarter of 2008, Echo Investment Capital Group was holding nearly 240 million PLN of cash and cash equivalents. As a consequence of debt repayment, the proportion of short-term and long-term debt to total assets decreased in comparison to the same period of the previous year and is now 45.5%.

In the 2nd quarter of 2008, Echo Capital Group carried out projects commenced during preceding period, prepared new developments, and signed significant contracts.

A contract was made with a construction company called Fakt Budownictwo Sp. z o.o. of Kielce for execution of core and shell construction of the 2nd stage of the Malta Office Park complex in Poznan. The 1st stage of that project, successfully let to tenants in 98%, will be opened in the 2nd half of 2008.

The scope of project management and general contracting agreement with Modzelewski & Rodek construction company, concerning development of the Park Postępu office complex in Warsaw at the junction of Postepu and Domaniewska Streets in the Mokotów district, was extended.

Echo Capital Group signed a project management and general contracting agreement with Vectra S.A. concerning a prestigious luxury apartment building at Kazimierzowska Street in Warsaw, Mokotów district.

According to the approved development strategy assuming reduction of operating risks, Echo Investment intends to achieve geographical diversification of its contemplated projects and invests in Central and Eastern Europe countries.

It is now preparing to enter a new market – representatives of the Company are working on the opportunities of carrying out new projects in Ukraine and are running detailed studies of the Ukrainian real estate market.