Results of the Board of Directors on March 28, 2014
JSC RusHydro (ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces that the Company's Board of Directors held a meeting in absentia on March 28, 2014.
The Board of Directors approved the report on insurance protection of RusHydro in 2013.
Insurance costs in 2013 totaled RUR 904,767 ths, which is 5.5% less than the planned amount.
The Board of Directors approved the amended Regulations on the dividend policy of RusHydro.
The previous version of Regulations on the dividend policy of RusHydro was approved by the Board of Directors in 2009, and amended in 2012. The amendments to dividend policy are attributable to changes in the Russian legislation in relation to dividend payment procedure and taxation and also to switch in dividends calculation based on International Financial Reporting Standards (IFRS). The amended dividend policy meets the Company’s mid-term development trends and strategic goals and is also aimed at improvement of its investment appeal.
According to the previous version of Regulations on the dividend policy the dividends were paid out of consolidated net profit of RusHydro Group calculated in accordance with the Russian accounting standards (RAS). The amended dividend policy provides for dividends payout of consolidated net profit of RusHydro Group calculated under IFRS.
The Board of Directors commissioned RusHydro’s representatives in the governing bodies of Small HPPs of Stavropolye and Karachaevo-Cherkessia LLC to approve the construction contract between Small HPPs of Stavropolye and Karachaevo-Cherkessia LLC and JSC ChirkeyGESstroy for construction of Small HPP ‘B. Zelenchuk’, qualified as an interested –party transaction.
The installed capacity of a new plant will amount to 1.2 MW, the average annual output – 7 mn kWh. Capital expenditures will amount to RUB 165 mn (according to 2013 prices). The construction is planned to be completed by 2015.
The Board of Directors approved the report on implementation of comprehensive development program of Cheremushki settlement infrastructure for 2010-2014 in 2013.
Total financing of the program in 2013 exceeded RUB 160 mn.
The Board of Directors approved the report on technological assessment and price audit of the Kankunskaya HPP, Ussuriyskaya TPP, Leningradskaya PSPP investment projects for 2013.
On July 15, 2013, in accordance with the guideline of the government of Russia the Board of Directors of RusHydro considered carrying out a technological assessment and price audit of the investment projects with completed prefeasibility studies and resolved to carry out a public technological assessment and price audit of the Kankunskaya HPP, Ussuriyskaya TPP, Leningradskaya PSPP projects, chosen as pilot.
The Board of Directors approved the list of investment projects, implemented or planned for implementation within the investment program of RusHydro, earmarked for technological assessment and price audit.
These projects include: new construction projects (Ust’-Srednekanskaya, Gotsatlinskaya HPPs), renewable energy projects (Zaragizhskaya small HPP), comprehensive modernization works, implemented in terms of technical upgrade and reconstruction (Votkinsakaya, Nizhegorodskaya, Volzhskaya, Chirkeyskaya and Zhigulevskaya HPPs).
The Board of Directors moved the deadlines for execution of the Board’s commissions.
Review of the activity concept of the Fund for scientific and technical development, the Fund’s investment policy statement and regulations, review of the report on implementation of priority projects within the innovative development program of RusHydro and the report on cooperation with scientific and educational organizations have been moved.
The activity concept of the Fund for scientific and technical development, the Fund’s investment policy statement and regulations might be reviewed after receipt of the government’s guideline which should also be approved by the Ministry of energy of Russia.
The review of the report on implementation of priority projects within the innovative development program of RusHydro and the report on cooperation with scientific and educational organizations has been moved as it should include the accounting data and might be submitted for the Board of Directors’ review no earlier than May 1st of the year after the reporting.
The Board of Directors approved the report on implementation of the Company’s charitable and sponsor activities program in 2013.
In 2013, RusHydro implemented its assistance program to people suffered from flood in the Far East of Russia. The Company allocated RUB 200 mn as a social support to people suffered from the flood and RUB 20 mn were also allocated as a charitable contribution.
In 2013, RusHydro continued implementation of its long-term comprehensive charitable program "The Sail of Hope", including core charitable projects of the Company.
Overall amount of funds spent on charity and sponsorship in 2013 exceeded RUB 1 bn.
The Board of Directors approved charitable and sponsor activities plan of RusHydro for 2014. The Company plans to allocate funds in the amount of over RUB 700 mn for charitable and sponsor issues.
The Company will continue to support orphanages and boarding schools, educational programs, sports activities, etc.
The Board of Directors approved the agreement between RusHydro and NP Hydropower of Russia for R&D and technological works, qualified as an interested-party transaction, and determined the price of the agreement in the amount of RUB 80,001,784.55 (including VAT).
NP Hydropower of Russia has won a tender for these services.
The Board of Directors approved RusHydro’s agreement, qualified as interested-party transaction. In accordance of p. 184.108.40.206 of Regulations on disclosure of information the details of these transactions will be made available after their implementation in compliance with regulatory requirements of the Russian Federation.
The Board of Directors approved a guarantee agreement between RusHydro and ING Bank (Eurasia) in regards to the letter of credit in the amount of up to USD 56,100,000 secured by CJCS Yakutshaya TPP No.2 (construction manager, wholly-owned by RusHydro).
In accordance with the agreement between CJCS Yakutshaya TPP No.2 and GE PACKAGED POWER, INC. for delivery of four gas turbine units for construction of the Yakutshaya TPP No.2 (1st stage), an irrevocable confirmed standby letter of credit should be opened. RusHydro’s guarantee was a mandatory requirement for opening the letter of credit.
The first stage of the Yakutskaya TPP No.2 is one of the four fossil-fuel projects in the Far East of Russia, implemented by RusHydro and its subsidiary, RAO ES of East. The new plant will allow to replace the retired capacities of operating Yakutskaya TPP, create spare capacity and help to improve reliability of power supply in Sakha, Yakutia. The installed capacity of the 1st stage of the Yakutskaya TPP No.2 will amount to 193 MW, heat capacity – 469 GCal/h.
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.
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