Results of the Board of Directors meeting on June 29, 2020
July 2, Moscow, Russia. PJSC RusHydro (ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces that the Company's Board of Directors held a meeting in absentia on June 29, 2020.
The Board of Directors approved the report on interim results of the business plan execution for the first quarter of 2020 including the report on execution of investment program as well as comprehensive rehabilitation and modernization program.
PJSC RusHydro’s investment program amounted to RUB 5.2 bn including RUB 3.7 bn for comprehensive modernization program.
PJSC RusHydro’s electricity production in the first quarter amounted to 22.9 GWh, an increase of 19.2% as compared to the corresponding period of 2019 and 23% above the plan. The increase in production was driven by record water inflows to the reservoirs of the hydropower plants on the Volga and Kama rivers on the back of abnormally warm winter weather as well as increased water inflows to the reservoirs of the hydropower plants located in the Far East.
PJSC RusHydro’s first quarter RAS net profit reached RUB 14.3 bn, an increase of 14% as compared to the corresponding period of 2019. EBITDA increased by 25% to RUB 24.4 bn while revenue increased by 19% year-on-year and reached RUB 34.7 bn.
The Board of Directors approved the report on execution of the company's comprehensive procurement program for the first quarter of 2020.
In the first quarter, PJSC RusHydro has carried out 818 procurement procedures, all in electronic format. The effect of carrying out procurement procedures amounted to RUB 556.19 mn.
The Board of Directors approved the report on implementation of Plan for divestment of none-core assets for the first quarter of 2020 and made changes to the register of the Group’s none-core assets. A number of infrastructure facilities not related to operational activities were included to the register. PJSC RusHydro has achieved the plan on divestment of none-core assets and decreased the maintenance cost of none-core assets by RUB 23.6 mn.
The Board has also approved gratuitous transfer of two traffic roads and bridge not utilized in RusHydro’s operations to Federal Agency for State Property Management (Rosimushestvo) of the Saratov region.
The Board of Directors took into consideration performance reports of committees of the Board of Directors for 2019-2020 reporting year.
During the period, 6 committees held 56 meetings, 10 in joint presence where 151 topics covered.
The Board of Directors approved the following transactions for consolidation of RusHydro Group’s power assets in the Sakhalin region:
The purchase transaction of JSC SEK’s shares and subsequent transfer to the authorized share capital of JSC RAO ES East is carried out according to the agreement signed by PJSC RusHydro, JSC RAO ES East and the government of the Sakhalin region in 2017 for consolidation of the region’s power assets by PJSC Sakhalinenergo. JSC SEK is construction management company, which has carried out investment projects in the power sector of Sakalin region including construction of the 4th power generation unit of Yuzhno-Sakhalinskaya CHPP-1 and grid infrastructure.
The Board of Directors approved the transaction on preparation phase of modernization of Vladivostokskaya CHPP-2.
In accordance with the resolution of the government of the Russian Federation Vladivostokskaya CHPP-2 was selected among the projects for modernization of thermal generation in Russia. The project with guaranteed return on investment includes modernization of part of the generating equipment and reconstruction of facility’s area for installation of generating equipment.
Implementation of the project will take place once PJSC RusHydro purchases the facility from JSC DEK. In this respect, the Board of Directors approved the purchase of the asset from JSC DEK for market price confirmed by an independent appraiser, as well as PJSC RusHydro’s operation of the asset afterwards.
The Board of Directors took into consideration information on the execution status of priority projects in the Far East as of 31.03.2020.
RusHydro is finalizing construction of the CHPP in the city of Sovetskaya Gavan, has completed design and technical pricing audit of the first phase of construction of Pevek-Bilibino two 110kV overhead lines.
The Board of Directors has approved the updated action plan and KPIs for 2019-2021 to transition PJSC RusHydro to predominant usage of domestic manufactured software.
The Board of Directors took into consideration the report on subsidiaries’ material transactions – intercompany rent agreements of material value.
The Board of Directors took into consideration information on the results of compliance assessment of Vyacheslav Pivovarov and Maksim Bystrov with independence criteria provided by the listing rules of PJSC Moscow Exchange and has determined them as independent.
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