PJSC “Rosseti” management discussed year’s results and key development strategies with financial community

PJSC “Rosseti” management discussed year’s results and key development strategies with financial community 31.01.2017

Oleg Budargin, General Director of Rosseti, shared 2016 major results and company's activities outlined for 2017 at his meeting with representatives of the financial community in Moscow held on January 31. Both parties also discussed the strategic development of Rosseti Group under current economic conditions.

Oleg Budargin emphasised that the priority task of ensuring reliability of power distribution grids and main power transmission lines set for PJSC “Rosseti” by the President of Russia Vladimir Putin is now being successfully resolved. The breakdown rate has decreased by 50% and the disturbance duration has been reduced by 30%.

The head of the company said that the cumulative preliminary results in 2016 proved Rosseti Group's sustainable positions and had a positive impact on PJSC Rosseti’s investment appeal. In 2016 the company's capitalization made up 227 billion rubles with the growth by about 200%.

In particular, Budargin said: “Last year marked the significant increase in company's effectiveness and transparency. For the first time in its history the high financial performance allowed the company to pay out interim dividends in the first quarter of 2016. The company management’s efforts aimed at improving governance provided with ordinary shares transfer into the first level of the Moscow Exchange quotation list. The results show PJSC “Rosseti” management’s eager interest in steadily creating the long-term cost for its shareholders and investors.”

The company top managers also gave speeches on Rosseti's strategy development.

Oksana Shatokhina, Deputy Director General for Economics, informed about the success made in ensuring Rosseti Group financial strength and the changes to the legal framework in the power grid tariff control system. In addition, preliminary assessment on expected profit, not below 2015 index, the efficiency growth compared to 2015 and EBITDA growth were announced.

Egor Prokhorov, Deputy Director General for Finances, spoke about the major achievements and Rosseti Group's financial goals in the midterm, including developing the United Treasury system. In the course of 2016 PJSC “Rosseti” took advantage of the favorable financial market conditions for optimizing the debt portfolio. The corporate group made debt refunding at the amount of over 237 billion rubles in loans and borrowings that accounted to at least 43% of the Group debt portfolio in order to reduce the loans. At the end of 2016 the average weighted rate of the Group debt portfolio was reduced by 2.6 percentage points compared to 2015 which amounting up to 8.9% yearlong, while interest costs decreased by 8 billion rubles. The Group’s debt portfolio was reduced by approximately 20 billion rubles in total. By the end of the year the Group loan portfolio dropped for the first time since the establishment of Rosseti in 2013 which proved certain financial solvency.

Within the course of the United Treasury activities financial risks were minimized. The effectiveness of the Group liquidity management increased. In addition, operational expenditure was lowered, and specifically due to effective use of inter-group financing mechanisms.

Yuri Goncharov, Deputy Director General for Corporate Governance, presented the results of the company activities in corporate governance. Among priority projects the goal of corporate governance code development as recommended by the Bank of Russia was mentioned. The company activities resulted in Rosseti’s rating at 7++ level in “Developed Practice of Corporate Governance” assigned by the Russian Institute of Directors as a part of Corporate Governance National Rating approach.

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