PJSC RusHydro (HYDR)
PJSC RusHydro: RusHydro announces 1H 2019 IFRS results
29-Aug-2019 / 13:20 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 1H 2019 IFRS results
August 29, 2019. Moscow, Russia. RusHydro Group (hereinafter referred to as
the "Group", ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces its
condensed consolidated interim unaudited financial information prepared in
accordance with International Financial Reporting Standards (IFRS) for the
2nd quarter and 1st half of 2019.
Key highlights for the 2Q and 1H of 2019:
- Total revenue in 1H'19 was flat to 1H'18 and came in at RUB 200,848 mn
(-0.2%), in 2Q'19 - RUB 91,084 (-1.4%);
- EBITDA in 1H'19 - RUB 50,770 mn (-153% y-o-y); in 2Q'19 - RUB 21,206 mn
(-24.8% y-o-y);
- Operating expenses increased in 2Q and 1H by 10.1% y-o-y and 7.2% y-o-y,
respectively, mostly as a result of fuel cost increase and growth of
purchased electricity and capacity costs;
- Adjusted net profit in 1H'19 - RUB 31,109 mn (-22.6% y-o-y); net profit
in 1H'19 - RUB 29,385 mn (-23.8% y-o-y ).
- Financial results reflected decrease of electricity production in 1H'19
on the back of reduced water inflows to the majority of reservoirs of the
HPPs. Nonetheless, the situation changed in July as water inflows to the
main reservoirs were at the long-run average or above it. Water reserves
at Sayano-Shushenskoye reservoir at the end of August was 8% above the
long-run average and at last year's level, while Bureyskoye reservoir is
currently filled to the maximum level.
2Q and 1H 2019/2018 highlights (in RUB mn) *
2Q/19 2Q/18 chg. 1H'19 1H'18 chg.
(restated) (restated)
Revenue 91,084 92,376 -1.4% 200,848 201,285 -0.2%
Operating 76,459 69,465 10.1% 163,117 152,198 7.2%
expenses
Other 192 2,270 -91.5% 470 4,896 -90.4%
operating
profit
Operating 14,817 25,181 -41.2% 38,201 53,983 -29.2%
profit**
EBITDA*** 21,206 28,212 -24.8% 50,770 59,949 -15.3%
Net profit 12,873 14,663 -12.2% 29,385 38,580 -23.8%
Net profit 12,720 18,366 -30.7% 31,109 40,214 -22.6%
(adj.)****
Operating results
Total electricity generation by RusHydro Group's power plants amounted to
29,587 GWh in 2Q'19, a decrease of 16.7% as compared to the corresponding
period last year, in 1H'19 - 58,539 (-13.1%). In 2Q'19 total electricity
generation by RusHydro Group's hydropower and pumped storage plants
decreased by 20.9% to 22,530 GWh, electricity generation by the Group's
thermal power plants increased by 0.8% to 6,998 GWh, and electricity
generation by renewables increased by 0.1% to 113 GWh as compared to the
corresponding period of 2018. Consequently, in 1H'19 of the year total
electricity generation by RusHydro Group's hydropower and pumped storage
plants decreased by 17.7% to 41,657 GWh, by renewables - by 4.5% to 217 GWh,
while electricity generation by the Group's thermal power plants increased
by 1.2% to 16,720 GWh as compared to the same period of 2018. Total
electricity generation by Boguchanskaya hydropower plant***** in 2Q'19
amounted to 3,619 GWh, an increase of 7.7% as compared to 2Q 2018, in 1H -
7,360 (+19.4%).
Heat output by thermal plants of RAO ES East Subgroup in 2Q'19 increased by
0.2% to 4,627 GCal as compared to the corresponding period last year. In the
1H'19, heat output decreased by 4.9% against 1H'18 to 16,800 GCal.
Total electricity output by RusHydro's retail companies, operating in
Chuvashia, Ryazan and Krasnoyarsk regions in the 2Q'19 decreased by 4.8% to
4,305 GWh as compared to 2Q'18. In 1H'19, total output decreased by 5.8% as
compared to the corresponding period last year and amounted to 9,902 GWh.
Key events of the 1H of 2019
? On January 2, 2019, the Cental and Western districts of Yakutia were
connected to the Unified Energy System of Russia. PJSC Yakutskenergo, a
subsidiary of PJSC RusHydro, transferred the supervision and control of
the territory to the System Operator;
? On February 8, 2019, PJSC RusHydro has divested its 40% share in LLC
VolgaHydro, a hydropower equipment manufacturing joint venture in the
Saratov region, to Voith Group for RUB 450 mn;
? On March 29, 2019, PJSC RusHydro and UC RUSAL commissioned the first
stage of Boguchany aluminium smelter (BoAZ), part of Boguchanskiy Energy
and Metals Complex (BEMO). Total funding of the smelter's first phase with
annual operational capacity is estimated at 298 thousand tons of aluminium
amounts to USD 1.69 bn. It is being financed by own funds of partners in
BEMO project along with project financing from VEB.RF (formerly -
Vnesheconombank);
? On April 19, 2019, The Board of Directors approved PJSC RusHydro's
dividend policy which stipulates for a base scenario of dividend payout
ratio at 50% of the company's IFRS net profit. At the same time, a minimal
payout level is set at the average amount of dividends paid over the last
three years. Such measure guarantees shareholders a minimal dividend
amount and improves the company's investment attractiveness. The changes
to the dividend policy will be in effect for three years;
? On April 29, 2019, the first phase of placement of RusHydro's additional
share issue for the construction of Pevek-Bilibino 110 kV high-voltage
overhead lines in light of upcoming reconstruction of the Chaun-Bilibino
power system following decommissioning of the Bilibinskaya nuclear power
plant took place. PJSC RusHydro has placed 7,000,092,298 shares including
700,000,000 shares in favor of the Russian Federation represented by the
Federal Agency for State Property Management (Rosimushchestvo) at one
ruble per share;
? On June 28, 2019, AGM of PJSC RusHydro elected new Board of Directors
and approved 2018 dividends of RUB 0.0367388 per share in total amount of
RUB 15.9 bn (50% of the Group's net profit for 2018 under IFRS, and an
increase of 42% over the amount distributed in dividends for 2017).
Revenue
Revenue breakdown in 2Q and 1H 2019/2018 (in RUB mn)
2Q'19 2Q'18 chg 1H'19 1H'18 chg
Electricity sales 63,269 65,273 -3.1% 134,049 136,343 -1.7%
Incl. grants as per 6,105 6,600 -7.5% 12,176 13,196 -7.7%
Resolution of the
Russian Gov't No. 895
(premium to the price
translated to the
budgets of the
regions of Russian
Federation)******
Heat and hot water 7,754 7,423 4.5% 24,745 24,093 2.7%
sales
Capacity sales 11,378 10,248 11.0% 23,441 21,420 9.4%
Other sales 5,767 6,406 -10.0% 11,545 12,601 -8.4%
Other government 2,916 3,026 -3.6% 7,068 6,828 3.5%
grants
Total revenue 91,084 92,376 -1.4% 200,848 201,285 -0.2%
In 1H'19, total revenue of the Group amounted to RUB 200,848 mn as compared
to RUB 201,285 in the 1H'18. The change is associated with the following key
factors:
? decrease in revenue from electricity sales of PJSC RusHydro by RUB 4,699
mn due to decline in production of hydropower plants;
? increase in revenue from electricity of RAO ES East subgroup (incl.
government subsidies) by RUB 1,328 mn on the back of tariff and sales
volume growth;
? increase in revenue from electricity sales in ESC Rushydro subgroup by
RUB 920 mn following new supply agreements;
? increase in capacity sales revenue by RUB 2,021 mn on the back of sales
volume growth of PJSC DEK;
? increase in heat and hot water sales revenue by RUB 652 mn following
tariff growth aided by increase in production;
? decrease in other sales revenue by RUB 1,056 mn is mainly driven by
decrease in revenue from grid connections and electricity distribution
services in PJSC Yakutskenergo and PJSC Magadanenergo as well as decrease
of revenue from transportation services at JSC VOSTEK.
Operating expenses*******
Operating expenses in 2Q and 1H 2019/2018 (in RUB mn)
2Q'19 2Q'18 chg 1H'19 1H'18 chg
(restated) (restated)
Employee 19,886 18,152 9.6% 39,075 37,158 5.2%
benefit
expenses
Fuel expenses 14,350 13,021 10.2% 38,034 34,260 11.0%
Purchased 10,712 8,393 27.6% 24,572 20,010 22.8%
electricity
and capacity
Grid company 8,759 9,182 -4.6% 18,823 20,071 -6.2%
services on
electricity
distribution
Third parties 8,171 8,129 0.5% 15,608 15,722 -0.7%
services
Depreciation 6,076 5,456 11.4% 12,460 10,933 14.0%
Taxes other 2,980 3,031 -1.7% 5,745 6,077 -5.5%
than on income
Other 2,605 2,509 3.8% 4,162 4,008 3.8%
materials
Water usage 1,049 1,093 -4.0% 2,041 1,996 2.3%
expenses
Other expenses 1,871 499 274.9% 2,597 1,963 32.3%
TOTAL 76,459 69,465 10.1% 163,117 152,198 7.2%
Total operating expenses in the 1H'19 amounted to RUB 163,117 mn as compared
152,198 mn in the 1H'18 due to the following factors:
? increase in purchased electricity and capacity by RUB 4,562 mn partially
covered by additional revenue mostly at RAO ES East Subgroup following
change in volume and tariff increase;
? increase in fuel expenses mainly in JSC DGK by RUB 2,170 mn as a result
of fuel purchase price increase following procurement results and in PJSC
Kamchatskenergo by RUB 591 mn or as a result of purchase price increase of
heating oil and its increased consumption due to restrictions in
consumption of other types of fuel (gas, coal);
(MORE TO FOLLOW) Dow Jones Newswires
August 29, 2019 07:20 ET (11:20 GMT)
© 2019 Dow Jones News
