31.01.2012
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RusHydro Reports 19% Growth in Consolidated Net Income in the 9 months of 2011 under IFRS

 

RusHydro Group (ticker symbol: MICEX, LSE - HYDR; OTCQX - RSHYY) announces its consolidated interim unaudited financial information for the nine months ended September 30, 2011 under International financial reporting standards (IFRS).

 

RusHydro Group's financial results for the reporting period include results of a number of retail companies[1], which were accounted for until the disposal date - March 28, 2011, when these companies have been transferred to JSC INTER RAO UES as contribution to the share capital. In the 2010 financial statements these assets were classified as disposal group. The results for the reporting period also include the financial results of LLC Energy Supply Company of Bashkortostan as of the date of acquisition (September 12, 2011).

 

Table 1. Financial Highlights for the 9 months ended 30 September 2011 (in RUR mln)

9M 2011

9M 2010

Change, %

Revenue

196,767

298,960

-34.2%

Revenue, excl. disposal group

100,982

89, 497

12.8%

Operating expenses

(153,715)

(257,420)

-40.3%

Operating expenses, excl. disposal group

(66,545)

(57,367)

16.0%

EBITDA[2]

53,642

50,598

6.0%

Net income

33,159

27,873

19.0%

 

RusHydro Group's revenue for the nine months ended 30 September 2011 decreased by 34.2% and totaled RUR 196,767 mln compared to RUR 298,960 mln for the same last year period. Revenue, excluding disposal group, increased by 12.8% to RUR 100,982 mln. While the decrease in reported revenue is associated with divestment of retail companies, the positive dynamics in comparable figures is explained by growth in electricity output following the restoration of hydraulic units of Sayano-Shushenskaya, improving hydrological conditions in the 3rd quarter and implementation of water saving policies for Volga-Kama hydropower plants. The liberalization of the wholesale power market also translated to higher power prices on the day-ahead market year-on-year, which also spurred the topline increase. The growth in revenue was marked for all the reporting segments, except retail, which is again explained by disposal of the retail companies in March 2011.

 

The operating expenses for the nine months ended September 30, 2011 totaled RUR 153,715mln - a 40.3% decrease in comparison with RUR 257,420 mln for the same period of 2010. Operating expenses, excluding disposal group, increased by 16% to RUR 66,545 mln. The growth is attributed to an increase in electricity distribution expenses of the retail segment following the hike in electricity distribution tariffs, increase in employee benefit expenses on the back of enrollment of new personnel for new generation capacities and overhaul of compensation and benefits packages for employees. In the reporting period, the company booked a RUR 1,130 mln loss on disposal of property which is primarily attributed to a write-off of documentation and research results for Evenkiyskaya (Turukhanskaya) hydropower plant that was put on hold following evaluation. EBITDA for the first nine months of 2011 increased by 6% to RUR 53,642 mln against RUR 50,598 mln for the same period of the previous year. EBITDA growth was driven by increase in volumes sold at free (non-regulated) prices following the wholesale electricity market liberalization as well as by the growth of free (non-regulated) electricity prices.

 

Net income of RusHydro Group for the nine months ended September 30, 2011 increased by 19.0% and totaled RUR 33,159 mln.

 

Key indicators of RusHydro Group financial position as of 30 September 2011

 

As of Septemer 30, 2011, RusHydro Group's assets increased by RUR 10,878 mln to RUR 661,882 mln - a 1.7% increase compared to December 31, 2010. RusHydro's Group liabilities as for the end of reporting period decreased by RUR 7,277 mln or by 5.5% as of September 30, 2011 and stood at RUR 125,615 mln.

 

The gain on the exchange of financial assets held for sale and disposal group for an additional stake in INTER RAO UES totaled RUR 750 mln.

 

The consolidated interim financial information is available at RusHydro website: http://www.eng.rushydro.ru:8080/investors/reports/finreports/iasfinrep



[1] The following companies were acquired in 2010 from JSC RAO Energy System of East Group and JSC Lenenergo and were accounted for all reported periods using predecessor method: JSC Mosenergosbyt, JSC Saint-Petersburg Sale Company, JSC Altayenergosbyt, JSC Tambov Energy Retailing Company, JSC Saratovenergo and JSC United Energy Retailing Company.

[2]  EBITDA is calculated as operating profit before depreciation of PP&E and non-cash impairment and disposal charges

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