Regular Meeting of JSC RusHydro’s Board of Directors
JSC RusHydro (ticker symbol: RTS, MICEX, LSE: HYDR; OTCQX: RSHYY) announces that on June 28th, 2011 a meeting of JSC RusHydro's Board of Directors took place via absentee voting.
The Board of Directors noted a report on intermediate implementation results for the Company's 2011 business plan, taking into account Q1 2011 (including a report on the implementation of the Q1 2011 Investment Program).
Total actual generation and the productive electricity supply for the Company as a whole stood at 89.4 % and 89.8% of the plan respectively in Q1 2011. A failure to meet planned numbers ed occurred due to the hydrological situation in the catchment area of main rivers and by reduced water resources in water reservoirs of the Volzhsko-Kamsky Cascade of HPPs at the beginning of the year.
RusHydro did not plan an increase in installed hydro-power capacity at its affiliates in Q1 2011.
Financing under the Investment Program totaled RUR 11.3 bln, which includes own funds - RUR 9.1 bln and borrowed funds - RUR 2.2 bln.
Quarterly financing plans have been fulfilled and the Investment program has been disbursed at 79 % of plan. The principal reason for deviation from the plan was that counteragents did not fulfill their contractual obligations under Retooling and Equipment Reconstruction projects in full.
The Board of Directors approved a report concerning the execution of JSC RusHydro's key performance indicators (KPIs) for Q1 2011.
The Board of Directors approved updated financing sources for the Company's Investment Program and updated its quarterly financing plan and investment disbursement for 2011.
Updated financing sources for RusHydro's 2011 Investment Program reduced the investment component in the tariff and increased the attraction of credit resources. This is stipulated by decisions made by the Russian Government (17.02.2011) concerning the reduction in tariff sources for RusHydro, as well as by a regulation passed by the Russian Government (29.12.2010).
Annual financing volumes for projects will remain the same. RusHydro has updated the sources, maintaining the annual financing volume for the Investment Program.
The Board of Directors approved a commercial property lease agreement concluded between RusHydro and JSC FGC UES.
Within the framework of this agreement, RusHydro hands over and FGC accepts a part of the hydro-power facilities of the Zhigulevskaya HPP for temporary use to accommodate and service the 220 and 500 kV overhead power transmission line supports.
The Board of Directors has also approved related party transactions- the bi-lateral electricity and purchase contracts and appendices thereof concluded between RusHydro and JSC INTER RAO UES.
The Board of Directors has defined a price settlement formula for electricity generated by the Zeiskaya HPP and the Bureiskaya HPP and sold by RusHydro to JSC INTER RAO UES under the bi-lateral electric power sale and purchase contracts concluded in regions of the Russian Federation that are not in the wholesale market price zones. The established settlement formula is valid till 31.12.2011.
The Board of Directors approved a contract for the free-of-charge transfer by RusHydro of a dam 1,957 running meters long in favor of the municipal formation of the Talakan Workers' Settlement, as well as a public amenities center located in the Talkan Settlement.
These facilities are non-core in nature for RusHydro, and in connection with this fact, the Bureiskaya HPP does not need to operate them. This free-of-charge facilities transfer takes place under the auspices of the 2011 Non-core Assets Disbursement Plan.
The Board of Directors has approved the List and Financing Procedure for activities that fall under the Comprehensive Infrastructure Development Program being fulfilled at the urban-type Cheremushki Settlement for the 2010-2014 period; these activities must be completed in 2011.
In 2011, the Program includes: constructing a roofed ice arena, an educational-production, information and innovation center, reconstructing two blocks of a local hospital, refurbishing local secondary school No. 1 and constructing children's playgrounds. In total, RusHydro plans to allocate RUR 500 mln for these purposes in 2011.
The Board of Directors made a decision to amend and make additions to the Register of RusHydro's non-core assets, as approved by a decision of the Company's Board of Directors (25.02.2011).
These amendments update available data and are stipulated, in particular, by updating the asset list.
The Board of Directors approved an asset transfer and obligations for the design and construction of a mini-hydro-power plant on the Chibit River from CJSC Hydro-engineering Siberia to JSC Mini HPPs of the Altai Region.
This decision was made in light of a planned liquidation of CJSC Hydro-engineering Siberia and a transfer of the construction management company's functions for constructing the Chibit Mini Hydro-power Plant on the Chuya River in the Ulagansky District of the Republic of Altai to JSC Mini HPPs of the Altai Region.
The Board of Directors noted reports concerning the results of activities performed by the Audit Committee, the Investment Committee, the Reliability, Energy Efficiency and Innovations Committee and the Human Resources and Remunerations Committee under the auspices of the Board of Directors from 30.06.2010 to 30.06.2011.
The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of RusHydro. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially from these statements. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to RusHydro and its operations.