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RusHydro announces 1Q 2012 IFRS results

JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces its consolidated interim unaudited financial information for the three months ended 31 March 2012 under International Financial Reporting Standards (IFRS).


RusHydro Group's financial results for the three months ended 31 March 2011 include the results of a number of retail companies[i], which were accounted for until the disposal date - March 28th, 2011, when these companies were contributed to the share capital of JSC Inter RAO UES in the course of the share issue of the latter.


1Q 2012 financial highlights (in RUR mn)

1Q 2012

1Q 2011


Total revenue, including




Revenue from operations




Government grants




Comparable revenue (less revenue of disposal group)




Total expenses




Comparable expenses (less expenses of disposal group)








Net profit




In the 1st quarter of 2012 total revenue decreased by 50% from RUR 169,944 mn to RUR 85,185 mn. The Group's total expenses decreased by 49% to RUR 71,280 mn against RUR 140,725 mn in the 1st quarter of last year. Reduction in the Group's revenues and expenses as compared to the same period of previous year is connected with the disposal of retail companies in late March 2011.


Comparable revenue (total revenue less revenue of disposal group) increased by 15% to RUR 85,185 mn. The growth is associated with the following factors:

- acquisition of LLC Energy Supply Company of Bashkortostan on September 12th, 2011, the financial results of which are included in the Group starting from the acquisition date;

- higher volumes of electricity generation by Group's hydropower plants due to the reconstruction of Sayano-Shushenskaya hydropower plant, improving hydrological conditions and optimization of water usage in hydropower plants of the Volga-Kama cascade;

- higher volumes of electricity generation and heat output by thermal power plants of RAO Energy System of East Group due to considerable consumption growth in the unified energy system of the Far East and in a number of isolated Far Eastern energy systems.

Comparable expenses (total expenses less expenses of the disposal group) grew by 33% to RUR 71,280 mn. The growth can primarily be attributed to the following factors:

- higher electricity purchases expenses in the Group's retail segment following the acquisition of LLC Energy Supply Company of Bashkortostan;

- higher fuel expenses for thermal generation in RAO Energy System of East Group as a result of increased purchases of fuel oil and coal due to disruptions in gas supply against the background of rising power and heat generation in the region;

- growth in depreciation due to commissioning of new facilities, primarily the coastal spillway of Sayno-Shushenskaya hydropower plant (put into operation in the 4th quarter of 2011).

- increased expenses for electricity distribution due to the growth in grid companies' tariffs.

In the reporting period EBITDA decreased by 37% to RUR 19,316 mn compared with RUR 30,890 mn for the same period of the previous year. Decrease of EBITDA is related to a change in the Group's structure and removal of the special investment component in RusHydro's capacity prices as of 2012.


The Group's quarterly net profit decreased by 59% to RUR 10,652 mn compared with RUR 25 858 mn in the 1st quarter of 2011.


Key indicators of RusHydro Group's financial position as of March 31st, 2012

As of March 31st, 2012, the Group's assets increased by RUR 29,820 mn to RUR 841,603 mn against the similar figure as of December 31st, 2011. The increase in assets is primarily due to growth in the Group's fixed assets and placing of short-term bank deposits.


As at the end of the reporting period the Group's liabilities rose by RUR 19,805 mn since December 31st, 2011, to RUR 305,929 mn. The increase in the liabilities was mainly caused by drawing loans under the credit lines opened in Sberbank of Russia, Gazprombank, UniCredit Bank Austria AG.

[i] JSC Altayenergosbyt, JSC Mosenergosbyt and its subsidiaries, JSC Saint Petersburg Sale Company and its subsidiaries, JSC Saratovenergo, JSC Tambov Energy Retail Company and JSC United Energy Retail Company.


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



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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