Press Release

Commentary on Financial Results for the fiscal year 2011

Avenir Group is presenting its consolidated financial results for the fiscal year 2011 according to the International Financial Reporting Standards.

Precisely, revenue growth increased with the consolidated turnover reaching €150.694.797 versus €127.277.901 in 2010, increase of 18,4% despite the economic downturn and negative economic conditions of 2011, affecting the Groups business in Greece as well in Cyprus.

Group's Gross Profit reached €9.965.749, an increase of 6.7 % versus €9.346.358 for the corresponding period of 2010.

Cutting back administrative expenses has been the main objective for the Management in 2011. More specific Avenir S.A (mother company of the group), presented reduction of 22% in administrative expenses while the cutting back of the Group's expenses reached only 3,2% (despite Megabet's 16% decrease in expenses) due to the Group's subsidiary company Eurogoal.

Net Profits for the Group present losses of €24.479.179, as a result of:

• Negative economic situation in Cyprus which affected Group's betting activity.
• Substantial depreciation of the capital of the subsidiary Eurogoal ‘group' due to the investigated defraudation and transferring of all operations and partners-agents  to another company by the former CEO and executives of Eurogoal in Cyprus.
• Massive decrease in the financial performance of sportsbetting in one of the two Cypriot Groups, Eurogoal, primarily in relation to expected income due to illegal activities from Eurogoal's employees and agents that are being investigated by the Cypriot Police.
• Substantial decrease of the financial results due to the increase of bank rates which are being applied for depreciation causes, as a result of the downgrade of the Greek as well as of the Cypriot Economy.

The most important issue that affected financial results of year 2011 was firstly, as mentioned above, the dramatic decrease of Eurogoal's financial results, especially in relation to the expected income by Management. Secondly, the methodical transfer of the entire network of Eurogoal's agents early in 2012, to another company established by the former General Manager Assistant and his associates of Eurogoal in Cyprus. In addition, the former General Manager of the Group in Cyprus seems that fully supported both financially and practically the above mentioned actions. This resulted to a significant impairment of the company's surplus value as of 31.12.2011.  The turnover percentage of the group represented by the Eurogoal network in 2011 was 13,9%, although its contribution in administrative expenses represented 30% and its net profitability was negative for approximately €600.000.

In order to restitute and press charges Avenir's Management appointed a reputable Law Firm in Cyprus to take legal action to the Cypriot Judicial Authorities. We have been briefed that (based on the conclusive evidence and supportive documents available to our Legal Consultants), all the evidence composes a strong case of criminal offences and civil claims.  Civil claims according to the lawsuit for impairment of assets are expected to exceed 20.000.000 €.

Finally, total assets during 31.12.2011 reached 28.864.697€, whereas total equity reached 17.018.762€.

In the Cypriot Market, despite the negative progress and methodical withdrawal of Eurogoal's network agents, our Group will continue to develop its own network of LBO's. New agencies have already joined the Group in the first quarter of this year and the network will gradually continue to grow under the Group's strict conditions regarding timing and location. The ultimate goal of the company's business plan, targets for 20 new LBO's which will provide our full range of licensed products.

It should be outlined that the past two years Cypriot Authorities are trying to amend the legislative framework which supervises betting and gaming in Cyprus. Although, betting industry is a comprehensive and fully regulated market since 1990; lack of legislative framework for gambling (casino games and RNG) has created the need for a domestic legislation which will regulate gambling accordingly. Up until now, any operator, like AVENIR Group, holding international licenses, either for betting or games (casino and RNG) can operate normally. Gaming activities for the Group in 2011 represented 80% of turnover (€ 121, 3 million). Management strongly believes that the Cypriot Market, despite the contrary provided plans discussed occasionally within the Cyprus parliament, will be eventually forced to comply with EU directives; as it has already happened in Greece and other European countries.

Avenir was not active in the Greek Betting and Gaming Market during 2011 due to the fact that domestic legal framework was not fully integrated. Following recent development in August 2011 and the enactment of law 4002/11, the Group is fully prepared to initiate its activities as soon as this promising market legally opens up. Pending on final amendments of the official paper and the clear description of the terms of the licensing procedure, the Group will aim to enter the Online Sports betting market as well as the Online Live Casino (via the websites www.megabetsports.comand www.megabetcasino.com ). Furthermore, the VLT market which is regulated by the same law is of great importance for the Group. The group is legally active within the field since 2009 through ‘Casino Venues' in ferries travelling in international routes from Greece to Italy (5 vessels) and from Albania to Italy (1 vessel). In 2011, precisely, this activity presented turnover increase by 6.48% and gross profit increase by 4.45%. This financial result is greatly encouraging given the fact that the Greek as well as the European economy suffers by unprecedented conditions of economic recession.

The issuance of the Convertible Bond Loan, decided in the beginning of 2012, and its successful partial or overall outcome, is a necessary precondition in order for the Group to materialize its objectives. The Group has sufficient expertise and know – how in the relevant fields, adequately regulated nowadays in Greece, which can be proved by its active involvement in the industry for the past decade.

Finally it's worth mentioning the Group's participation in the Privatization of ODIE (Hellenic Horce race Betting Organisation), where after 44 years of managing betting activities is to become private. The privatization process started in November 2011, when Avenir Group participated among 40 International Groups (according to the press). Only four companies were qualified in the final shortlist by the contractor and project director. Avenir group was among the four selected ones, the shortlist included PMU (France), Phumelela (North Africa) and Intralot Group (Greece). The competition is at the second stage while the submission of binding offers is expected to be completed within 2012.