Moscow 15 April, 2004. RAO "UES of Russia" has released its financial statements for 2003 prepared in accordance with the Russian Accounting Standards (RAS).

According to 2003 balance sheet, the operating income of RAO "UES of Russia" declined to RUB51.6 billion from RUB52.5 billion last year. At the same time, because of the inflation, the cost of goods, works, and services sold grew to RUB 17.2 billion from RUB 16.9 billion. In the 12 months of 2003, the Company's sales profit fell by RUB1.5 billion to RUB 30.8 billion year on year.

The net profit of RAO "UES of Russia" for the 12 months of 2003 was RUB24.6 billion compared to RUB31.0 billion in 2002. Such amount of net profit was due to the fact that RAO "UES of Russia" used its right provided by the Russian laws not to show in its financial statements the results of the subsequent appraisal and depreciation of investments in its subsidiaries and dependent companies.

The accounts payable of RAO "UES of Russia" decreased more than 2.2 times over the reporting period: to RUB23.1 billion as of 31 December 2003 from RUB52.2 billion as of 1 January 2003. Such decrease in the payables was chiefly due to the payment of amounts owed as contributions to the authorized capitals of the companies newly established in 2003 : OAO "UES FGC", OAO "UES SO-CDA", etc.

As at 31 December 2003, the accounts receivable of RAO "UES of Russia" amounted to RUB35.7 billion, up from RUB 35.1 billion at the beginning of 2003. The increase in the receivables was due to the fact that the Company's financials reflected its participation in the establishment of other business entities, and to the increased amount of taxes paid by the Company as a result of its contributions to the authorized capital of the companies established in the course of RAO UES restructuring.