Enel Russia posted better results despite lower production in 1H 2016

Published on Thursday, 28 July 2016

EBITDA increase driven by lower operational costs.

MAIN FINANCIAL HIGHLIGHTS (millions of RUB)

 

1H 2016

1H 2015

Change

Revenues

33,170

34,547

-4.0%

EBITDA

6,041

5,773

+4.6%

EBIT

4,363

1,793

+143.3%

Net income

787

(981)

-

Net debt at the end of the period

24,836

24,5471

+1.2%

“Our company’s financial results reflect the good progress achieved against our strategic plan. Lower operational costs positively affected our performance, boosting recurrent EBITDA despite a slight decrease in revenues. As a result, net income also increased, posting a figure ahead of the yearly targeted one. We will continue to work on our operating efficiency in order to lay a solid foundation for further progress to be achieved in the second half of the year”

– Carlo Palasciano Villamagna, General Director of Enel Russia

Moscow, July 28th, 2016 — Today, PJSC Enel Russia has published its operating results and reviewed IFRS financial results for the first half of 2016.

Revenues down, largely attributable to an outage at Nevinnomysskaya’s CCGT Unit at the beginning of 2016, resulting in lower revenues from the power and capacity markets.

Additional downside effect came from lower power consumption in the Urals brought about by warmer average temperatures in the area, and higher hydro output in the Southern region.

Reduction partially offset by higher DPM tariff thanks to the increased yield from government bonds which is one of the component for DPM tariff calculation, as well as higher regulated heat and power sales due to the July 2015 tariffs increase.

Despite lower revenues, EBITDA increased thanks to an improved generation margin and flat fixed costs.

Lower fuel cost mainly attributable to improved coal prices as Russian rouble remained strong versus Kazakh Tenge during the second quarter of 2016 and lower production of CCGTs and some other gas facilities.

On a like-for-like basis, i. e. net of 800 million RUB of insurance compensation received at the beginning of 20152, EBITDA would increase by a solid 21.4% on the first half of 2015.

EBIT grew significantly due to EBITDA increase and to lower depreciation and amortization resulting from the significant assets impairment carried out during the second half of 2015.

Net income reflected the aforementioned EBIT increase, only partially offset by higher net financial charges due to one-off costs related to Royal Bank of Scotland loan refinancing.

Net debt at the end of the period in line with the figure posted as of December 31st, 2015.

OPERATIONAL HIGHLIGHTS

 

1H 2016

1H 2015

Change

Net power output (GWh)

19,108

20,587

-7.2%

Power sales (GWh)

22,100

23,644

-6.5%

Heat sales (thousand Gcal)

2,955

2,968

-0.4%

t power output reduction largely attributable to the outage at Nevinnomysskaya’s CCGT unit during the first three months of 2016.

Sredneuralskaya output decreased by 10.3%, affected by lower power consumption due to warmer average temperatures in Urals, as well as planned maintenance at its CCGT facility held in the second quarter of 2016.

Nevinnomysskaya conventional output decreased by 20.2% mainly due to higher hydro output in the Southern region.

Reftinskaya and Konakovskaya output slightly increased thanks to better availability and maintenance works carried out at nuclear facilities in the Central region, respectively.

Power sales down due to the aforementioned drop in the net power output.

Heat sales in line with the figure posted in the first half of 2015.

An Enel Group subsidiary, PJSC Enel Russia operates the following power plants: Konakovskaya GRES, Nevinnomysskaya GRES, Sredneuralskaya GRES and Reftinskaya GRES. The company’s total gross installed electrical capacity is 9,428.7 MW (equivalent to 8,878.4 MW net installed capacity) and thermal capacity is 2.382 Gcal/h. PJSC Enel Russia’s authorised capital is 35,371,898,370 roubles, which is divided into ordinary shares with a par value of 1 rouble. The Enel Investment Holding B.V. share in the company’s authorised capital is 56.43%, PFR Partners Fund I Limited’s share is 19.03%, Prosperity Capital Management Limited’s share is 8.23%, VTB Bank’s share is 3.87% and other minority shareholders’ share is 12.44%. PJSC Enel Russia shares are listed in Level 1 MICEX quotation list. The company was established in Yekaterinburg on October 27th, 2004 as OJSC OGK-5. On July 7th, 2009 by the resolution of Annual General Shareholders’ Meeting the company was renamed OJSC Enel OGK-5 and on August 8th, 2014 the Federal Tax Service registered the new version of the company’s charter with the name OJSC Enel Russia. On June 25th, 2015 the company changed its legal type and was renamed PJSC Enel Russia.