| PJSC RusHydro (HYDR) PJSC RusHydro: RusHydro announces 9M 2019 RAS results 30-Oct-2019 / 09:41 CET/CEST Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. The issuer / publisher is solely responsible for the content of this announcement.
RusHydro announces 9M 2019 RAS results October 30, 2019. Moscow, Russia. PJSC RusHydro (MOEX, LSE: HYDR; OTCQX: RSHYY) announces non-consolidated financial results under Russian accounting standards (RAS) for the nine months ended September 30, 2019. Key highlights: - EBITDA - RUB 58,801 mn;
- Reported net profit - RUB 34,255 mn;
- Since July 1st 2017, a surcharge to capacity prices in 1and 2 price zones in order to attain base level of end-user tariffs in the Far East of Russia is reflected in PJSC RusHydro's revenue and operating expenses[1]. In 9M19, the surcharge totaled RUB 26,245 mn, in the 9M18 - RUB 28,663 mn; Adjusted for the surcharge revenue and expenses (here and below in the text) were:
- Revenue - RUB 89,386 mn;
- Operating expenses - RUB 43,211 mn.
Key financials for 3Q and 9M 2019 under RAS (in RUB mn), excluding surcharge | | 9M'19 | 9M'18 | chg | 3Q'19 | 3Q'18 | chg | | Revenue (adj. for surcharge) | 89,386 | 96,057 | -7% | 29,711 | 32,329 | -8% | | Operating expenses (adj. for surcharge) | (43,211) | (43,358) | -0.3% | (14, 560) | (15,098) | -4% | | Operating profit | 46,175 | 52,699 | -12% | 15,151 | 17,231 | -12% | | EBITDA[2] | 58,801 | 65,103 | -10% | 19,417 | 21,362 | -9% | | Net profit | 34,255 | 37,514 | -9% | 10,998 | 10,896 | 1% | | Net profit (adj.)[3] | 33,778 | 37,015 | -9% | 10,839 | 10,914 | -1% | Revenue In nine months of 2019, revenue decreased by 7% or RUB 6,671 mn to RUB 89,386. Revenue breakdown (RUB mn) | | 9M'19 | 9M'18 | chg | 3Q'19 | 3Q'18 | chg | | Electricity sales | 57,330 | 64,992 | -12% | 19,438 | 22,457 | -13% | | Capacity sales | 31,780 | 30,765 | 3% | 10,179 | 9,799 | 4% | | Other sales | 276 | 300 | -8% | 94 | 73 | 29% | | TOTAL | 89,386 | 96,057 | -7% | 29,711 | 32,329 | -8% | | | | | | | | | Operating expenses Operating expenses in the nine months of 2019 stayed flat to the corresponding period of 2018 and amounted to RUB 43,211 mn. The main changes were observed in the following items: - Purchased electricity and capacity (increase of RUB 337 mn) due to higher day-ahead market prices;
- Property tax (decrease of RUB 968 mn) due to amendments to the Tax code of the Russian Federation affecting property tax, cancelling tax for movable property effective of Jan 1, 2019;
- Rent decreased by RUB 467 mn due to purchase of Gotsatlinskaya HPP and Zaragizhskaya HPP from subsidiaries with simultaneous increase in property tax and depreciation by RUB 95 mn and RUB 230 mn, respectively. Operating expenses breakdown (in RUB mn)
| | 9M'19 | 9M'18 | chg | 3Q'19 | 3Q'18 | chg | | Depreciation | 12,625 | 12,404 | 2% | 4,266 | 4,131 | 3% | | Purchased electricity and capacity | 6,227 | 5,890 | 6% | 1,760 | 2,058 | -14% | | Labor expenses, taxes and contributions | 5,487 | 5,250 | 5% | 1,818 | 1,758 | 3% | | Property tax | 4,551 | 5,519 | -18% | 1,532 | 1,841 | -17% | | Other third-party services | 2,542 | 2,567 | -1% | 923 | 969 | -5% | | Repairs and maintenance | 2,444 | 2,191 | 12% | 952 | 971 | -2% | | Power system services | 2,328 | 2,253 | 3% | 801 | 773 | 4% | | Water tax | 1,510 | 1,470 | 3% | 620 | 536 | 16% | | Security expenses | 1,321 | 1,309 | 1% | 442 | 475 | -7% | | Insurance expenses | 1,287 | 1,245 | 3% | 455 | 443 | 3% | | Rent | 989 | 1,456 | -32% | 278 | 477 | -42% | | Other | 1,900 | 1,804 | 5% | 713 | 666 | 7% | | TOTAL | 43,211 | 43,358 | -0.3% | 14.560 | 15,098 | -4% | Profit Operating profit for nine months of 2019 decreased by 12% or RUB 6,524 mn as compared to the same period last year and amounted to RUB 46,175 mn. Reported net profit for nine months of 2019 decreased by 9% to RUB 34,255 mn. Nonetheless, in the third quarter of 2019 net profit increased by 1% to RUB 10,998 mn as compared to the corresponding period of 2018. Net profit adjusted for non-cash items decreased by 9% and reached RUB 33,778 mn. The difference between the reported and adjusted net profit is attributed mainly to the following non-cash effects: - gain (net) on reversal of bad debt reserves in the amount of RUB 288 mn;
- gain on reversal of other reserves in the amount of RUB 189 mn.
RusHydro's financial position as of September 30, 2019 The Company's total assets increased by RUB 20,480 mn as of September 30, 2019, or 2% against the similar figure as of December 31, 2018, reaching RUB 1,057,286 mn. As of September 30, 2019, total liabilities increased by 1% or RUB 2,096 mn as compared to the similar figure as of December 31, 2018 and amounted to RUB 187,640 mn. The Company's debt portfolio decreased by 6% as compared to the beginning of the reporting year and reached RUB 139,498 mn. Long-term loans comprise 83% of the total portfolio. The Company's equity in nine months of 2019 increased by 2% to RUB 869,589 mn against RUB 851,206 mn as of the beginning of the reporting year. The full financial statements are available on the Company's website at: http://www.eng.rushydro.ru/investors/reports RusHydro Group will announce consolidated 3Q and 9M'19 IFRS results on November 28, 2019. *** About RusHydro RusHydro Group is one of Russia's largest generating companies. RusHydro is the leading producer of renewable energy in Russia with over 400 generating facilities in Russia and abroad. The company also manages a number of R&D, engineering and electricity retail companies. Group's thermal assets are operated by subsidiary - RAO Energy System of East in the Far East of Russia. Total electricity generation capacity of the Group is 39.4 GW, heat capacity - 18.9 thousand GCal/h. Russian Federation owns 60.56% in RusHydro, the rest is held by other institutional and individual shareholders (over 360,000). The company's stock is traded on the MICEX and RTS stock exchanges. Company's GDRs in the IOB section of LSE, ADRs - in OTCQX. For more information: Investor Relations Department Tel. +7 (495) 122 0555 ext. 1607, 1319, 1304 ir@rushydro.ru 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.
[1] In July 2017, the Resolution of the Russian Government No. 895 "On reaching basic rates (tariffs) for electric power (capacity) in the territories of the Far East Federal region (the "Far East")" became effective, under which rates for consumers in the territories of the Far East should be reduced starting from 1 January 2017 to the basic level (RUB 4.00 / kWh). According to the Resolution of the Russian Government No. 1614-r of 28 July 2017, PJSC RusHydro was appointed as the recipient of a premium to the price for capacity provided by the Company in the price zones of the wholesale market under CCS agreements. The premium to the price for capacity is set in order to achieve the basic level of rates (tariffs) for electricity (capacity) planned for the next regulation period in the Far East constituent regions. Within the amounts defined by Resolution No. 1615-r of the Russian Government dated 28 July 2017, the Company translates the collected amounts of margin in the form of free-of-charge targeted contributions to the budgets of the respective regions. The Group companies being guaranteeing suppliers will receive compensation for the shortage of income related to the reduction of rates, through subsidies from the Far East constituent regions. In November 2017, according to the Resolution of the Russian Government No. 2527-r of 15 November 2017 the rate for consumers in the territories of the Far East basic was set at RUB 4.30 / kWh. [2] EBITDA calculated as gross profit before depreciation. [3] Net profit adjusted for the mark-to-market revaluation of listed equity stakes, reserves for financial investment impairment, assets and potentially uncollectible accounts receivable, contingencies This indicator is not reported in the official financial statements under RAS and has been calculated and put into the press release for reference.
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