28 Apr 2016 12:24
Federal Grid Company Announces Q1 2016 RAS Results
Moscow, 28 April 2016 - Federal Grid Company of Unified Energy System ("Federal Grid Company" or "the Company"; Moscow Exchange, LSE: FEES), part of PJSC ROSSETI Group of Companies, and the owner and operator of the Unified National Electricity Grid ("UNEG"), announces its financial results for the first quarter of 2016 under Russian Accounting Standards (RAS).
The Company's RAS statements do not consolidate the results of Federal Grid Company's subsidiaries or affiliated companies that operate as independent legal entities.
Key financial results
Item (mln RUB) | Q1 2015 | Q1 2016 | Change, % |
Revenue | 39,868 | 43,645 | 9.5% |
Electricity transmission services | 39,169 | 41,570 | 6.1% |
Technological connection services | 258 | 1,670 | 6.5x |
Cost of sales | 32,330 | 34,071 | 5.4% |
Cost of sales, excluding electricity purchases, property tax, depreciation and amortisation
| 8,201 | 7,379 | (10.0%) |
Management expenses | 1,533 | 1,427 | (6.9%) |
Management expenses, excluding property tax, depreciation and amortisation | 1,047 | 962 | (8.1%) |
Other income and expenses, net | (361) | 7,929 | - |
Profit from sales | 6,006 | 8,147 | 35.6% |
Adjusted EBITDA* | 27,606 | 32,344 | 17.2% |
Net profit | 862 | 10,449 | 12.1x |
Adjusted net profit** | 1,715 | 5,826 | 3.4x |
* excluding accrual and recovery of provisions for doubtful debts, revaluation of assets and fees from technological connections;
** generated by cashflows (adjusted for balance accrual / recovery of provision of doubtful debts, revaluation of fixed assets and financial investments).
Federal Grid Company's performance in the first quarter of 2016 demonstrates the continuing growth in efficiency of the Company's operations, supported by optimisation of operating expenses and efforts to improve collection of payments.
The Company's net profit for Q1 2016 amounted to RUB 10,449 million, which was 12 times higher than in the first quarter of 2015. Net profit before non-cash operations also grew by more than three times from RUB 1,715 million to RUB 5,826 million.
Adjusted EBITDA (excluding non-cash operations, income from technological connections, property tax, depreciation and amortisation) rose by RUB 4,738 million (17.2%) year-on-year, and amounted to RUB 32,344 million.
The Company's revenue in Q1 2016 grew by 9.5% year-on-year, driven by:
· Electricity transmission services grew by RUB 2,401 million (6.1%);
· Technological connection services grew 6.5 times, or by RUB 1,412 million, as a result of the completion and receipt of payment for technological connections services to electricity stations.
Federal Grid Company continued implementing measures to optimise costs. Operating expenses excluding electricity purchases, depreciation & amortisation, and property taxes decreased by RUB 822 million (10.0%) year-on-year, while management costs (excluding depreciation & amortisation) declined by RUB 85 million (-8.1%). Year-on-year growth in certain other expenses during Q1 2016 was to to higher tax payments due to the phased repeal of the property tax concession, as well as increased rates for electricity purchased by the Company.
Item | Q1 2015 | Q1 2016 | Change, % |
Operating expenses and management costs | 33,862 | 35,498 | 4.8% |
Electricity purchases | 3,245 | 4,375 | 34.8% |
Electricity transmission | 931 | 617.45 | (33.7%) |
Taxes, other than income | 3,015 | 3,416 | 13.3% |
Depreciation and amortisation | 19,505 | 20,469 | 4.9% |
Personnel-related expenses | 4,139 | 3,995 | (3.5%) |
Other costs (materials and services) | 3,027 | 2,625 | (13.3%) |
Federal Grid Company is undertaking steps to improve payment discipline. The improvement in the share of on-time payments compared to Q1 2015, combined with agreements on restructuring of overdue payments, was reflected in the improvement in other costs and expenses (as a result of the reversal of allowances for bad debt).
Balance Sheet as of 31 March 2016
Assets
Federal Grid Company's total assets for Q1 2016 were practically unchanged from 1 January 2016, increasing by RUB 6,131 million (0.5%) to RUB 1,274,433 million. Non-current assets accounted for RUB 1,120,076 million, while current assets equalled RUB 154,357 million.
Federal Grid Company's equity increased by RUB 10,449 million (1.2%) during the reporting period. This change is attributable to the profit generated in the first quarter of 2016.
The Company's gross debt (including interest) as of 31 March 2016 was lower than at the beginning of the year, and equalled RUB 279,425 million.
Federal Grid Company's financial statements for Q1 2016 under RAS are available on the Company's website in the Financial Disclosure/RAS Financial Reports section at the link:
http://www.fsk-ees.ru/eng/investors/financial_disclosure/ras_financial_reports/
FEES.L (FEES)