Font size:
Site colours:
Company Registrar 8–800–700–03–70
Bolshaya Pirogovskaya ulitsa, 27 building 2, Moskva, Russia, 119435  ·   +7 (495) 664–88–40   ·  office@interrao.ru

Previous material:

Fitch Ratings upgrades the international credit rating of Inter RAO Group

Inter RAO Group Publishes IFRS Interim Consolidated Financial Statements for the First Six Months of 2019

14 August 2019

Indicator, billion rubles*

H1 2019

H1 2018

+/-

Revenue

520.5

460.7

13.0%

OPEX

470.8

422.4

11.5%

Operating income

57.8

43.5

32.9%

Net income

47.9

38.3

25.2%

EBITDA

78.1

59.4

31.5%

Capital expenditures

10.7

13.8

-22.0%

 

Indicator, billion rubles*

As of June 30, 2019

As of December 31, 2018

+/-

   Total assets

738.5

728.6

1.4%

Total equity

517.0

485.5

6.5%

Loans and borrowings

6.2

9.7

-36.4%

Lease liabilities

58.4

50.1

16.5%

Net debt1

-172.6

-166.7

3.5%

* — Financial indicators are provided based on these IFRS financial statements in billion rubles rounded to one decimal. Percentage ratios are calculated based on the data from the IFRS financial statements expressed in million rubles.

The changes in the Group's financial performance were significantly influenced by the following key factors and events:

  • Commissioning of leased power plants in the Kaliningrad Region in 2018 and in H1 2019: Mayakovskaya TPP with the installed capacity of 157 MW and Talakhovskaya TPP with the installed capacity of 159 MW and Pregolskaya TPP with the installed capacity of 455 MW;
  • Commissioning of Zatonskaya TPP with the installed capacity of 440 MW in Bashkortostan in March 2018 under capacity supply agreements (CSAs);
  • An increase in payment for capacity under capacity supply agreements (CSA) due to a CSA delta payment in the cost of capacity for a number of generating facilities;
  • The pricing environment on the market (one day ahead): growth in the first and second price zones;
  • Increase in average end consumer sales prices in the Supply Segment of the Group;
  • Increase of sales volume and profit margin in the Group's Trading segment.

CONSOLIDATED STATEMENT ON TOTAL INCOME

The Group's revenue increased by 13.0% (59.8 billion rubles) to 520.5 billion rubles.

The increase in revenue in the Supply Segment by 36.6 billion rubles (11.8%) to 347.0 billion rubles is related to higher average sales prices of guaranteeing suppliers for end consumers and engagement of new customers by guaranteeing suppliers and independent retailers, and to the fact that new guaranteeing suppliers began to operate in the Vladimir Region and in the Vologda Region.

The increase in revenue in the Electric Power Generation in the Russian Federation Segment by 10.9 billion rubles (17.6%) to 72.8 billion rubles is mainly due to the commissioning of Mayakovskaya TPP, Talakhovskaya TPP and Pregolskaya TPP leased by the Group in the Kaliningrad Region.  CSA delta payment in the cost of capacity generated an additional positive impact. Besides, the price rise for electricity in the first price zone and load optimization of new energy efficient equipment in order to maximize contribution margin from selling electricity when there is cheap generation surplus had a positive impact as well.

Revenue in the Thermal Power Generation in the Russian Federation Segment, which comprises TGK-112 Group and Bashkir Generation Company, increased by 2.9 billion rubles (7.2%) to 42.4 billion rubles. This increase resulted from the commissioning of the Zatonskaya TPP under CSA in March 2018, an increase in electricity output at the Karmanovskaya TPP, and the growth of selling prices at JSC TGK-11 and JSC Tomsk Generation on the day-ahead market.

Revenue of the Trading in the Russian Federation and Europe Segment increased by 7.7 billion rubles (26.2%) with respect to comparable reporting period and amounted to as much as 37.1 billion rubles in H1 2019. The revenue increased due to higher exchange prices and increase in supply to Lithuania, Finland and Poland, and the fact that the average ruble exchange rate decreased by 2.8% against the euro.

Revenue of the Foreign Assets Segment increased by 0.9 billion rubles (7.0%) and amounted to as much as 13.0 billion rubles. The main growth effects are due to an increase in volumes and prices of supplies of Moldavskaya TPP, and an increase in the average ruble/dollar exchange rate by 10,1% in comparison with the corresponding period of 2018.

Operating expenses increased by 48.4 billion rubles (11.5%) as compared to the corresponding period of 2018 and amounted to 470.8 billion rubles, which is lower than the growth of revenue.

The cost of purchased electricity and capacity increased by 29.0 billion rubles (16.0%) as compared to the same period of the previous year and amounted to 210.0 billion rubles, due to the higher market prices for capacity mainly in CSA segment, and higher volumes and market prices for purchased electricity in the Supply Segment, as well as the start of operation of guaranteeing suppliers in the Vladimir Region and in the Vologda Region.

Electricity transmission fees increased by 7.0 billion rubles (6.2%) to 120.7 billion rubles due to the performance of enterprises in the Supply Segment, which is related to the increased electricity consumption and its transmission fees.

Process fuel costs increased by 5.5 billion rubles (9.6%) to 62.8 billion rubles. The growth at JSC Inter RAO — Electric Power Plants was related mainly to an increase in power generation, comprising new power plants in the Kaliningrad Region, combined with indexation of gas price and an increase in coal price. This was partially offset by a decrease in costs at Trakya Elektrik plant, as there was no output in the reporting period due to excessive supply on the Turkish market.

EBITDA increased by 31.5% amounting to 78.1 billion rubles.

In the Electric Power Generation in the Russian Federation Segment, EBITDA increased by 12.5 billion rubles (41.0%) to 42.9 billion rubles. The growth is caused by getting a markup on the power supply agreement price for Cherepetskaya TPP, Yuzhnouralskaya TPP and Urengoyskaya TPP, an increase in generation of a number of plants, as well as commissioning of plants in the Kaliningrad Region.

In Domestic Heat Generation Segment, EBITDA increased by 1.5 billion rubles (13.1%) to 13.1 billion rubles, driven by the commissioning of the Zatonskaya TPP in March 2018 and by a production increase at the Karmanovskaya TPP. Higher sales prices delivered by the TGC-11 Group in sectors such as competitive capacity auctions (CCA), capacity supply agreements (CSA) and one day ahead market (ODA) acted as an additional driver.

In the Trading in the Russian Federation and Europe Segment, EBITDA increased by 5.3 billion rubles (2.1 times) and amounted to 10,1 billion rubles in H1 2019. This change can be mostly attributed to the increased supply to Finland, Lithuania and Poland in the context of rising exchange prices and lower ruble-to-euro exchange rate.

EBITDA for the Sales in the Russian Federation Segment remained virtually unchanged at 11.0 billion rubles. The result was caused by the positive impact of tariff and balance decisions, offset by a number of one-time effects related mainly to the application of IFRS 15 "Revenue from Contracts with Customers".

In the Foreign Assets Segment, EBITDA increased by 1.0 billion rubles (31.2%) and amounted to 4.3 billion rubles. The growth is mainly due to effects associated with the completion of the Trakya Elektrik project in Turkey, together with an increase in the average exchange rate of the US dollar against the ruble.

Net income for the first six months of 2019 amounted to 47.9 billion rubles, having increased by 9.6 billion rubles as compared to the corresponding period of 2018.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Total assets increased by 9.9 billion rubles (1.4%), amounting to 738.5 billion rubles.

Following the results of the first six months of 2019, the Group's total assets increased due to the accumulation of the cash flow from operating activities. In addition, in the statement of financial position the Group recognized the value of right-of-use assets under a lease agreement for movable and immovable property of Pregolskaya TPP. The completion of this plant simultaneously led to a decrease in the volume of accounts receivable under construction contracts and for advances made.

Equity increased by 31.5 billion rubles (6.5%), amounting to 517.0 billion rubles.

Equity growth resulting from the recognition of net profit for the reporting period was partially offset by the effect of distribution of dividends to shareholders.

Loans and borrowings decreased by 36.4% to 6.2 billion rubles. Leasing obligations (including the share in the joint ventures) increased by 8.3 billion rubles and amounted to 58.4 billion rubles.

Total loans and borrowings of the Group decreased by 3.5 billion rubles (36.4%) to 6.2 billion rubles as a result of scheduled repayment of loans and repayment ahead of schedule.

The ratio of long-term debt to short-term debt as of June 30, 2019 amounted to 12.7% versus 87.3% (on December 31, 2018 – 14.2% versus 85.8%).

Growth in lease-related obligations by 8.3 billion rubles (16.5%), with regard to the share of the Group in the joint ventures, was mainly associated with the commissioning of Unit 3 and Unit 4 at the Pregolskaya TPP in H1 2019.

1 Including deposits for a period from 3 to 12 months and lease liabilities (including the share of lease liabilities in joint ventures).

2 TGK-11 Group is represented by heat producers JSC TGK-11 (Omsk) and JSC Tomsk Generation, and heat distribution network operators JSC Tomsk RTS and JSC Omsk RTS.

Next material:

Inter RAO senior executives receive state awards
Consolidated
financial statements
prepared according to
IFRS
for H1 2019
View report

Reference

Inter RAO Group is a diversified energy holding serving various segments of Russian and international electric power industry. The Group is the leading exporter and importer of electricity in Russia actively increasing electricity generation and sales, and developing new lines of business.

The corporate strategy of Inter RAO is focused on making Inter RAO a global energy enterprise, a key player in the global energy market, and Russia's leading electric utility by energy efficiency. Inter RAO Group owns and operates approximately 33.3 GW of installed power generation capacity.

www.interrao.ru