1st Quarter Results

ROSSETI ANNOUNCES Q1 2017 IFRS RESULTS

8 June 2017, Moscow, Russia - PJSC ROSSETI (LSE: RSTI), the largest electricity transmission and distribution grid company in Russia, announces the interim (unaudited) IFRS results for Rosseti Group (the "Group") for Q1 2017.

Financial performance:

· Revenue: RUB 230.9 billion (Q1 2016: RUB 218.1 billion)

· EBITDA: RUB 67.5 billion (Q1 2016: RUB 67.4 billion)

· Adjusted EBITDA1: RUB 84.1 billion (Q1 2016: RUB 69.7 billion)

· Net profit: RUB 23.6 billion (Q1 2016: RUB 24.0 billion)

· Adjusted net profit2: RUB 39.4 billion (Q1 2016: RUB 25.8 billion)

· Net cash flows from operating activities RUB 49.0 billion (Q1 2016: RUB 43.8 billion)

[1] Adjusted EBITDA is calculated as EBITDA (earnings before interest, tax, depreciation and amortization for the reporting period) less losses on impairment of financial investments and impairment of receivables, and losses on regaining control of a subsidiary.

[2] Adjusted net profit for the reporting period is calculated as the period’s net profit less losses impairment of financial investments, impairment of receivables, and related deferred income tax expense, and losses on regaining control of a subsidiary.

Key corporate highlights:

The Board of Directors approved the new Power Grid Complex Environmental Policy which determines fast growth while maximizing rational use of natural resources and preserving the environment as the underlying principle of ROSSETI's operation.

The Moscow Exchange resolved to transfer PJSC ROSSETI's shares from Quotation List Level 2 to Quotation List Level 1. In accordance with regulations of the Bank of Russia and the Moscow Exchange, the securities included in Quotation List Level 1 and their issuers are required to comply with the strictest requirements in terms of liquidity, financial statements and corporate governance.

Based on 2016FY results, PJSC ROSSETI was announced the winner of the Effective Internal Control and Audit 2016 National Award by Russia's National Union of Internal Auditors and Controllers in the Best Company for Reliability of Internal Controls category.

A new Code of Corporate Ethics and Conduct of PJSC ROSSETI was adopted.

New Methodology for Calculation and Assessment of Key Performance Indicators (KPIs) for PJSC ROSSETI General Director was approved.

PJSC ROSSETI has announced the interim (unaudited) IFRS results for Q1 2017. In Q1 2017, PJSC ROSSETI made RUB 23.6 billion in net profit, with EBITDA at RUB 67.5 billion.

Key IFRS financial results:

In Q1 2017, the Group's revenue grew by RUB 12.8 billion, or 5.9% year-on-year, to RUB 230.9 billion. Revenue from electricity transmission rose by 9.1% to RUB 203.7 billion.

Revenue from electricity and capacity sales decreased by RUB 1.4 billion, or 6.8% year-on-year, mostly due to discontinued sales of electricity to a company which is part of the FGC UES Group.

Other revenue was down by RUB 2.8 billion due to lower volume of services performed by the FGC UES Group's subsidiaries under general contract agreements (an almost four-fold decline, down by RUB 2.2 billion) as key project milestones were completed in the previous reporting periods.

Operating expenses in Q1 2017 were largely flat year-on-year at RUB 186.3 billion.

The net profit dynamics in Q1 2017 was also affected by the recognition of other expenses resulting from changes in the Group's structure (regained control of OJSC Nurenergo, a subsidiary). Excluding this effect, adjusted net profit for Q1 2017 would have increased by 52.7% year-on-year to RUB 39.4 billion, with adjusted EBITDA up 20.7% to RUB 84.1 billion.

More detailed information on the IFRS consolidated interim condensed financial information for the three months ended March 31, 2017 can be found via the National Storage Mechanism at: http://www.morningstar.co.uk/uk/NSM or at the Company's website http://www.rosseti.ru/eng/ 

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For further information please contact:

PJSC ROSSETI

Horizon

PJSC ROSSETI holds interests in and manages 15 distribution grid companies and a transmission grid company in Russia. The Company together with its subsidiaries owns and operates 2.3 million kilometers of electricity transmission and distribution lines with a total installed transformer capacity of 761 GVA. The Company operates in 78 regions of Russia.

Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of PJSC ROSSETI. 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. 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 industry, as well as many other risks specifically related to PJSC ROSSETI and its operations.