JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces its non-consolidated financial results under Russian accounting standards (RAS) for the 1st quarter of 2013. Key highlights: - Revenue up 26% to RUR 25,444 mn on strong 1Q power production and favorable pricing environment; - OPEX up 10% on higher power purchases and depreciation; - EBITDA up 38% to RUR 16,115 mn; EBITDA margin expanded by 5 p.p. to 63%; - Net profit – RUR 9,337 mn (+48%), adjusted for non-cash items – RUR 11,188 mn (+49%). Key financials for the 1Q 2013 under RAS (in RUR mn) 1Q 2013 | 1Q 2012 | chg | Revenue | 25,444 | 20,190 | 26% | Operating costs | (12,258) | (11,106) | 10% | Operating profit | 13,186 | 9,084 | 45% | Other revenue (adj.)[1] | 1,182 | 723 | 63% | Other expenses (adj.)[2] | (2,907) | (1,617) | 80% | EBITDA[3] | 16,115 | 11,695 | 38% | Net profit | 9,337 | 6,328 | 48% | Net profit (adj.)[4] | 11,188 | 7,495 | 49% |
In the first quarter of 2013, revenue increased by 26% to RUR 25,444 mn as compared to RUR 20,190 mn in the same period of 2012. The underlying factors behind the change in revenue were: - significant increase in electricity generation by the Volga-Kama cascade of hydropower plants in the first quarter of 2013 and inline growth of power sales on the “day-ahead” market; - increase in electricity prices on the “day-ahead” market; - increase in sales volumes and sale prices under free bilateral agreements; - increase in volumes and tariffs of regulated power sales; - increase in capacity prices under competitive capacity selection. As illustrated in the table below (RUR mn), the dominant share of revenues comes from electricity and capacity sales: | 1Q 2013 | 1Q 2012 | chg | Electricity sales, incl.: | 17,180 | 12,833 | 34% | Electricity sales under unregulated bilateral contracts | 2,167 | 1,269 | 71% | Capacity sales | 8,108 | 7,225 | 12% | Heat sales | 60 | 56 | 7% | Other sales | 96 | 76 | 26% | TOTAL | 25 444 | 20 190 | 26% |
Operating costs increased 10% to RUR 12,258 mn as compared to the same period of 2012. Operating costs (in RUR mn) | 1Q 2013 | 1Q 2012 | chg | Purchased power | 3,331 | 2,823 | 18% | Depreciation | 2,929 | 2,612 | 12% | Labor expenses | 1,497 | 1,438 | 4% | Property tax | 1,381 | 1,304 | 6% | Repairs & maintenance | 461 | 563 | -18% | Services of System Operator, ATS, CFS | 640 | 572 | 12% | Other third-party services | 271 | 238 | 14% | Insurance expenses | 222 | 213 | 4% | Security expenses | 345 | 298 | 16% | Leasing expenses | 252 | 359 | -30% | Water tax | 221 | 182 | 21% | Other | 708 | 504 | 40% | TOTAL | 12,258 | 11,106 | 10% |
Major factors for change in operating costs were: - growth in expenses for purchased power in connection with free bilateral agreements for the sale of electricity to optimize the company’s cash flow[5]; - higher depreciation due to commissioning of a number of facilities into operation. As a result, operating profit for the reporting period increased by 45% as compared to last year to RUR 13 186 mn. Other revenue (adj.) for the first quarter of 2013 was RUR 2,907 mn, other expenses (adj.) stood at RUR 1,182 mn. The largest portion of other expenses was a provision for mark-to-market revaluation of listed equity stakes in the amount of RUR 1,451 mn. EBITDA increased by 38% to RUR 16,115 mn. RusHydro's net profit for the reporting period increased by 48% to RUR 9,337 mn. Net profit adjusted for non-cash items was RUR 11,188 mn, a 49% increase as compared to last year. RusHydro's key financial position indicators as of March 31st, 2013 The Company's total assets increased by RUR 46,922 mn as of March 31st, 2013, or 6% against the similar figure as of December 31st, 2012, reaching RUR 800,701 mn. The growth in assets in January-March 2013 was mainly a result of depositing in banks of proceeds from domestic bonds placement in the amount of RUR 20,459 mn. As of March 31st, 2013, total obligations stood at RUR 198,665 mn compared with RUR 161,081 mn as of the beginning of the reporting period. The increase was attributed primarily to placement of RUR 20 bn of domestic bonds. The Company's debt portfolio rose 16% to RUR 113,447 mn; long-term loans make up 61% of the total debt portfolio. The Company's equity for January-March 2013 increased by 2% to RUR 602,036 mn against RUR 592,698 mn as of the beginning of the reporting year. The growth is primarily connected to an increase in undistributed profit in the amount of RUR 9,361 mn. The full financial statements in Russian only are available on the Company’s website at: http://www.rushydro.ru/investors/reports The Company plans to publish its consolidated results for the 1st quarter of 2013 under International financial reporting standards (IFRS) in July 2013.
[1] Adjusted for the income from redemption and novation of promissory notes for a total of RUR 39,240 mn. [2] Adjusted for the expense from redemption and novation of promissory notes for a total of RUR 39,240 mn. [3] EBITDA calculated as gross profit before depreciation. [4] Net profit adjusted for the mark-to-market revaluation of listed equity stakes, reserves for financial investment impairment, assets and potentially uncollectible accounts receivable. This indicator is not reported in the official financial statements under RAS and has been calculated and put into the press release for reference. [5] According to the regulations of the Russian wholesale power market, the supplier of electricity intending to enter into bilateral contracts must purchase the same amount of electricity from the market to fulfill its contractual obligations. In IFRS statements these costs are netted against corresponding revenue. |
