02.05.2012
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RusHydro increases its 1Q2012 adjusted net profit under RAS by 3%

JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces its unconsolidated 1st quarter 2012 financial results under Russian accounting standards (RAS).

 

1Q 2012 key financial highlights (RUR million):

 

  

1Q 2012

1Q 2011

Change

Revenue

20,190

22,509

-10%

Operating costs

(11,106)

(8,480)

31%

Gross profit

9,084

14,029

-35%

Other income

723

1,618

-55%

Other expenses

(1,617)

(4,748)

-66%

EBITDA[1]

11,695

16,214

-28%

Net profit

6,328

8,052

-21%

Net profit (adjusted) [2]

5,170

4,996

3%

 

In the 1st quarter 2012, total revenue decreased 10% to RUR 20,190 mn against RUR 22,509 mn in the 1st quarter 2011. Key factors contributing to the revenue change include:

- decrease in revenue from capacity sales following the removal of the investment component in capacity prices for RusHydro's hydropower plants formed via capacity auctions, as well as implementation of tariff regulation for hydro capacity in Siberian price zone as of the 2nd quarter 2011 (instead of competitive capacity prices);

- decrease in electricity prices on the day-ahead market in the European price zone caused by an increase in price-taking supply, due to a change in accounting for minimal generated capacity in compliance with Rules of the wholesale market for electricity and capacity, and the absence of suppliers with high price bids among price-determining suppliers in the 1st quarter 2012.

 

As illustrated in the table below (RUR mn), the dominant share of revenues comes from electricity and capacity sales:

 

 

1Q 2012

1Q 2011

Change

Electricity sales

12,833

11,281

14%

Capacity sales

7,225

11,137

-35%

Heat sales

56

51

10%

Other sales

76

40

90%

Total revenues

20,190

22,509

-10%

 

In the 1st quarter 2012, operating costs rose 31% compared with the same period in 2011 and reached RUR 11,106 mn.

 

Principal factors behind change in costs were:

- growth in expenses for purchased power in connection with free bilateral agreements for the sale of electricity concluded in the 1st quarter 2012;

- higher depreciation due to commissioning of a number of facilities into operation, including the coastal spillway of the Sayano-Shushenskaya hydropower plant (put into operation in 2011) and acquisition of five dams (dams of Bratskaya, Ust'-Ilimskaya and Irkutskaya hydropower plants) from the Russian state as payment for shares of the additional share issue.

 

Due to the above-mentioned, RusHydro's gross profit for the reporting period decreased 35% year-on-year to RUR 9,084 mn.

 

In the 1st quarter 2012, other revenues amounted to RUR 723 mn and other expenses were RUR 1,617 mn. The largest portion of other expenses was losses from the mark-to-market revaluation of JSC Inter RAO UES shares in the amount of RUR 1,158 mn.

 

EBITDA decreased by 28% as compared to the 1st quarter 2011, amounting to RUR 11,695 mn. This was mainly due to the emoval of the investment component in tariffs since 2012.

 

RusHydro's net profit for the reporting period decreased 21% to RUR 6,328 million. The adjusted net profit for the reporting period rose 3% to RUR 5,170 mn.

 

RusHydro's key financial position indicators as of March 31st, 2012:

 

The Company's total assets increased RUR 26,621 mn as of March 31st, 2012, or 4% against the similar figure as of December 31st, 2011, reaching RUR 686,913 mn.

 

The growth in assets was mainly caused by a RUR 22,869 mn increase in financial investments. This can be attributed to:

- granting long- and short-term loans in the total amount of RUR 11,424 mn to the Company's subsidiaries and affiliates;

- placing short-term bank deposits (up to three months) in the total amount of RUR 11,145 mn.

 

As of March 31st, 2011, total obligations stood at RUR 145,108 mn compared with RUR 124,815 mn as of the beginning of the reporting period. The increase was attributed primarily to raising loans from Sberbank of Russia and UniCredit Bank Austria AG in the amount of RUR 17,325 mn. The Company's credit portfolio rose 27% to RUR 87,691 mn; long-term loans make up 96% of the total debt portfolio.

 

The Company's equity in the 1st quarter 2012 increased 1% to RUR 541,730 mn against RUR 535,402 mn as of the beginning of the reporting year. This was primarily due to a RUR 6,321 mn increase in non-distributed profit.

 

The financial statements (in Russian) are available on the Company's web site:

http://rushydro.ru/investors/disclosure/reports/finreports2/2012

 



[1] EBITDA calculated as gross profit before depreciation.

[2] Net profit adjusted for the mark-to-market revaluation of listed equity stakes, reserves for financial investment impairment, assets and potentially uncollectible accounts receivable.







The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of JSC RusHydro and/or its subsidiaries and affiliates. These statements are only predictions, and actual events or results may differ materially from these statements. JSC RusHydro does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events.
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