FEES.L Regulatory News (FEES)

Federal Grid Company Announces 9M 2012 RAS Financial Results

Moscow, November 1, 2012 - Federal Grid Company of Unified Energy System ("Federal Grid Company" or "the Company") (MICEX-RTS, LSE: FEES) today announces its financial results for9 months 2012 under Russian Accounting Standards (RAS).

Key financials:

·; Revenue of RUB 101,458 million

·; EBITDA of RUB 63,678 million

·; Gross profit of RUB 23,630 million

·; Net profit (loss) of RUB 6,417 million

·; Adjusted net profit supported by operating cash flows of RUB 17,901 million

Federal Grid Company's revenue for 9 months 2012 decreased by RUB 3,336 million (3%) year-on-year (y-o-y) and amounted to RUB 101,458 million. The decline in revenue can primarily be attributed to lower electricity transmission tariffs approved by the Russian Federal Tariff Service on 01.04.2011.

Operating costs including administrative expenses increased by RUB 18,210 million, or 22% y-o-y, to RUB 84,349 million due to due to higher depreciation charges from commissioning of new facilities underthe Company's investment programme.

Earnings before interest, taxation, depreciation and amortisation (EBITDA) decreased by RUB 4,743 million (7%) y-o-y and amounted to RUB 63,678 million as a result of lower revenues and higher operating costs due to capacity additions under the Company's investment programme.

Federal Grid Company's other income for 9 months 2012 fell by RUB 47,743 million, or 45% y-o-y, to RUB 105,094 million. The Company's other costs for 9 months 2012 amounted to RUB 111,334 million, constituting a decrease of RUB 54,365 million (49%) y-o-y.

These changes were due to the inclusion in the Company's H1 2011 accounts of the exchange of shares in generating companies for shares in INTER RAO UES.

Federal Grid's net profit for 9M 2012 was RUB 6,417 million (a 65% decrease y-o-y). This was due to reduced sales revenue as a result of higher depreciation charges on newly commissioned facilities underthe Company's investment programme and provisions for doubtful debts and non-cash operations as a result of the transaction with INTER RAEO UES.

Adjusted net profit supported by operating cash flows of RUB 17,901 million

Balance sheet as of 30 September 2012

Assets

Federal Grid Company's total assets increased by RUB 41,736 million (4%) during 9M 2012 and at the end of the period stood at RUB 1,079,229 million. These include non-current assets of RUB 980,360 million and current assets of RUB 98,869 million.

Non-current assets grew by RUB 60,859 million (7%), driven principally by higher volumes of incomplete construction under the Company's investment programme.

Current assets declined by RUB 19,123 million (16%), due to a reduction in short-term financial investments (repayment of promissory notes).

Liabilities

Federal Grid Company's capital increased by RUB 8,637 million (1%) during the period due to an increase of RUB 2,219 million in the Company's charter capital as a result of registration with the Federal Financial Markets Service of an additional share issue in 2011 and a reduction in an uncovered loss by RUB 6,646 million (34%).

The Company's long-term debt (loans and borrowings) as of 30 September 2012 increased by RUB 30,000 million to RUB 160,000 million, while short-term obligations grew by RUB 2,482 million, representing increases of 23% and 40%, respectively, since 31 December 2011. This was primarily due to raising of new long-term loans and bond placements to finance the Company's approved investment programme.

Commenting on the results for 9 months 2012, First Deputy Chairman of the Management Board Andrey Kazachenkov said:

Federal Grid Company's principal financial results for 9 months 2012 are EBITDA of RUB 63,678 million and adjusted net profit supported by operating cash flows of RUB 17,901 million.

The Company continues pursuing a long-term development programme to improve operationaland investment efficiency.

Another landmark during the reporting period was the closure of two debt issues: the RUB 10 billion issue with a 2.5-year put option and the RUB 10 billion issue with a 4.5-year put option. These placementsare significant for the Russian debt market and have helped to establish new market standards for issuesof long-term debt by first-class borrowers.

Federal Grid Company is thus continuing to pursue balanced financial policies to support the long-term development of Russia's backbone electricity grid.

Federal Grid Company's financial statements for 9M 2012 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 the operator and manager of Russia's unified electricity transmission grid system, including high voltage transmission lines, and holds the status of a natural monopoly.

The Company's assets include over 124,000 km of transmission lines and 854 substations with over 322 GVA of 35-750 volt transformer capacity. Based on the length of transmission lines and installed transformer capacity, Federal Grid is the largest publicly traded electricity transmission companyin 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 73 regionsof Russia, covering a territory of 13.6 million square kilometres. Its customers are regional distribution companies, electricity suppliers and large industrial enterprises.

Since 1 January 2010, Federal Grid has operated under a 5-year regulatory asset base (RAB) model.

The Company was incorporated in June 2002 as part of reorganisation of Russia's electrical power industry. The largest shareholder, with a 79.55% stake, is the Russian Federation Government.

Federal Grid Company's ordinary shares are listed on the MICEX-RTS stock exchange under the ticker FEES and the Company's GDRs are traded on the London Stock Exchange under the same FEES symbol. The Company's shares are included in the MSCI Emerging Markets and MSCI Russia indices.

In 2011 the Company's IFRS revenue for 2011 was RUB 139,571 million (up 23% compared to 2010), adjusted EBITDA as RUB 83,760 million (a 24% increase from 2010), and adjusted net profit was RUB 38,241 million (up 37% on 2010).

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