FEES.L Regulatory News (FEES)

Federal Grid Company Announces 1H 2013 RAS Financial Results

Moscow, 31 July 2013- Federal Grid Company of Unified Energy System ("Federal Grid Company" or "the Company") (Moscow Exchange, LSE: FEES), part of Russian Grids Group of companies,the operator of Russia's unified electricity transmission grid system, today announces its financial results for the six months ended 30 June 2013 under Russian Accounting Standards (RAS).

The Company's RAS accounts do not consolidate the results of Federal Grid Company subsidiaries or affiliated companies that operate as independent legal entities.

Key financial performance:

·; Revenue of RUB 74,816 million

·; Adjusted EBITDA* of RUB 46,661 million

·; Gross profit of RUB 15,791 million

·; Adjusted net profit* RUB 7,746 million

* excluding adjustments to provisions for the impairment of accounts receivable

Federal Grid Company's revenue for 1H 2013 increased by 12.75% year-on-year to RUB 74,816 million, primarily as a result of higher revenue from electricity transmission on the unified transmission grid.

Operating expenses and SG&A increased 18.7% year-on-year to RUB 64,855 million for 1H 2013. This increase was driven by a RUB 5,817 million, or 19.9%, year-on-year increase in depreciation costs related to newly commissioned UNEG facilities (as part of the Federal Grid Company investment programme, and due to a revaluation of fixed assets as of 31 December 2012); property tax increased two-fold, by RUB 1,219, year-on-year (in connection with the repeal of the property tax break for electricity transmission lines that took effect from 1 January 2013, in accordance with Federal Law #202-FZ dated 29 November 2012 on changes to the second part of the Russian Federation tax code).

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) for 1H 2013 increased year-on-year by RUB 4,581 million (10.89%) and amounted to RUB 46,660.8 million, primarily due to the increase in operating profit (excluding depreciation costs).

Federal Grid Company's net loss according to RAS for 1H 2013 was RUB 4,659 million, primarily due to marking to market the value of LLC Index Energetiki - FSK UES promissory notes and a decline in the price of OJSC INTER RAO UES shares on the Company's balance sheet.

The Company's adjusted net profit supported by operating cash flows (excluding net impairments on accounts receivable) for 1H 2013 was RUB 7,746.1 million.

Balance sheet as of 30 June 2013

Assets

Federal Grid Company's total assets increased by RUB 8,207 million (0.8%) from year end 2012 and stood at RUB 1,131,202 million as of 30 June 2013. Non-current assets amounted to RUB 1,025,064 million, and current assets amounted to RUB 106,138 million.

The RUB 13,398 million (1.3%) increase in non-current assets during the first six months of 2013 was primarily due to an increase in other non-current assets (works in progress) of RUB 35,131 million (9.7%) and a RUB 21,465 million (-3.7%) decrease in fixed assets as a result of depreciation charges.

The decrease in Federal Grid Company's current assets by RUB 5,191 million (-4.7%) during 1H 2013 was due to a RUB 12,692 million (-21%) decline in accounts receivable.

Federal Grid Company's capital decreased by RUB 1,282 million (-0.15%) during the period due to the effect of the 1H 2013 loss of RUB 4,659 million, balanced by an increase in registered share capital of RUB 3,377 following the FFMS registration of a 2012 additional share issue

In order to finance its investment programme, Federal Grid Company floated a first trancheof infrastructure bonds, in the amount of RUB 30 billion and maturing in 35 years, on the Moscow Exchange in June 2013. The coupon rate is inflation-protected and linked to the consumer price index (CPI) growth rate for the last year plus 1%.

As such, as of 30 June 2013 Federal Grid Company's loans and borrowings (excluding accrued interest) amounted to RUB 220,500 million.

Federal Grid Company's financial statements for 1H 2013 under RAS can be found on the Company's

website: http://www.fsk-ees.ru/eng/investors/financial_disclosure/ras_financial_reports/.

Enquiries:

About Federal Grid Company

Federal Grid Company is part of OJSC Russian Grids is the operator and manager of Russia's unified electricity transmission grid system. The company operates over 131,000 km of transmission lines and has over 334.8 GVA of installed transformer capacity. Based on the length of transmission lines and transformer capacity in place, Federal Grid is the largest publicly traded electricity transmission company in the world.

Federal Grid's business is to provide electricity transmission and technological connection services.It maintains and develops the grid system and supervises grid facilities and infrastructure in 75 regions of Russia, covering a territory of 14.8 million square kilometres. Its customers are regional distribution companies, electricity suppliers and large industrial enterprises. The Company is a natural monopoly with 79.64% stake controlled by Russian Grids.

Federal Grid Company was incorporated in June 2002 as part of reorganisation of Russia's electrical power industry.

Federal Grid Company's common shares are included on Moscow Exchange under the ticker FEES and the Company's GDRs are listed on the London Stock Exchange and traded under the same FEES symbol.

In 2012 the Company's IFRS consolidated revenue was RUB 140,313 million, while adjusted EBITDA was RUB 82,133 million, and adjusted profit for the period was RUB 29,956 million.

Further information can be found at www.federal-grid.com

Further information about Russian Grids can be found at www.rusgrids.ru