PJSC “Rosseti” announces financial results on RAS for 2016

PJSC “Rosseti” announces financial results on RAS for 2016 03.03.2017

PJSC “Rosseti” received net profit of 222.4 billion rubles in 2016. Its revenues amounted to 26.7 billion rubles and the prime cost - to 4.3 billion rubles.

Oksana Shatokhina, Deputy Director General for Economic Affairs commented on 2016 results as follows:

“The rise in value of affiliated companies financially controlled by PJSC “Rosseti” was the major reason for net profit growth. Excluding the evaluation of financial investments net profit has made up 21.4 billion rubles and increased six fold since 2015.

Positive dynamics of financial indicators are linked to efficient management of the power grid and subsequent growth in affiliated companies financially controlled by PJSC “Rosseti” by 201 billion rubles. Total market capitalization of affiliated companies increased by 143%.

Net profit made it possible to increase the cost of net assets and bring this indicator to the level well above authorized capital. Thus, following the results of the accounting period net assets have made up 383.5 billion rubles that exceed the cost of authorized capital by 185.4 billion rubles.

It is also necessary to note the positive dynamics of PJSC “Rosseti” share price on the securities market since early 2016 that led to the growth of market capitalization, which made up to 228.6 billion rubles by the end of 2016. The positive dynamics of share price proves efficient management of PJSC “Rosseti” state ownership”.

Other qualitative results also prove the efficient work of PJSC “Rosseti”, including:

– reliability of the power grid increased: the breakdown rate decreased by 12% in 2016. The average duration of power interruption decreased by 4%;

– labor efficiency increased by 7%;

– electric power dissipation is reduced up to the level of 8.8% for Rosseti Group;

– operating performance is up and operating expenses are reduced by 17% to reach 2015 level without causing damage to reliable power supply, power supply quality and accessibility as per resolutions of the Russian government;

– as of December 31, 2016 the Group's weighted average debt portfolio rate equaled 8.9% per annum which is by 2.9% lower than interest rate on credits over a year according to Russia's Central Bank data. PJSC “Rosseti” active policy on credit portfolio control, including through the United Treasury, allowed Rosseti Group to save expenditures of over eight billion rubles for debt management in 2016 at the level of 545 billion ruble debt portfolio. Successful performance of the United Treasury was approved by PJSC “Rosseti” Board of Directors in December 2016;

– Development Plans of PJSC “Rosseti” affiliates and associated companies are worked out and are currently under implementation order to ensure financial viability of PJSC “Rosseti” affiliates and associated companies, including profit indicators, to normalize the debt level and to perform obligations for technological connection, to ensure reliability and the development of the power grid of Russian regions, and to carry out major investment projects;

– following the results of the 1st quarter of 2016 PJSC “Rosseti” dividends are paid at the amount of 1.8 billion rubles. Thus, for the first time in its history PJSC “Rosseti” paid capital stock share dividends. Based on the resolution to be made by Russian government PJSC “Rosseti” shall consider a possibility to pay additional dividends at year-end 2016.

Shatokhina said: “The results of PJSC 'Rosseti' activities prove the effective performance of functions and tasks set forth by the state pursuant to the development strategy of Russia's power grid, efficiency improvement of power grid assets control and confirm the accuracy and feasibility of further activities by the management in order to increase efficiency of the power grid.”

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