Inter RAO YEES : PJSC Inter RAO released RAS reporting for the first nine months of 2017

PJSC Inter RAO has released financial statements for the first nine months of 2017 prepared in accordance with the Russian Accounting Standards (RAS).

* in RUB billion, unless indicated otherwise. Percentage change (%) is calculated using accounting data in thousand rubles.

** Short-term loans and borrowings plus Long-term loans and borrowings less Cash and cash equivalents less Short-term financial investments (cash in bank accounts).

Income statement

Revenue of PJSC Inter RAO for the first nine months of 2017 was 31.5 billion rubles, down 1.6 billion rubles (4.8%) from the first nine months of 2016.

Revenue from electricity export was 21.2 billion rubles, down 2.4 billion rubles (10.3%) from the first nine months of 2016. This change is related mainly to a decrease in sales in physical terms to Belarus (by 18.5%), Ukraine (by 15.3%) and Georgia (by 14.5%), and a decrease in the ruble equivalent of the sale price related to a reduced exchange rate in the first nine months of 2017 compared to the same period in 2016. Revenue from WECM electricity and capacity sales for the first nine months of 2017 was 9.9 billion rubles, up 2.9 billion rubles (42.1%). This change is related to an increase in electricity import. Revenues from other sales for the first nine months of 2017 amounted to 0.4 billion rubles, a decrease of 2.1 billion rubles (85.7%) is due to changes in the schedule of supplies of power generation equipment for export.

Cost of goods sold for the first nine months of 2017 was 25.4 billion rubles, which is 0.8 billion rubles (3.2%) higher than in the same period of 2016. The change in cost of goods sold reflects several partially offsetting factors, including a 2.1 billion ruble (91.2%) increase in the cost of electricity import due to the increase in electricity import from Kazakhstan (by a factor of 2.17), a 0.5 billion ruble (2.5%) increase in the cost of electricity and capacity purchased at WECM, a reduction in other cost of sales by 1.9 billion rubles (87.4%) as part of implementation of projects on exporting power generation equipment.

Gross profit for the first nine months of 2017 was 6.1 billion rubles compared to 8.5 billion rubles in the same period of 2016.

Selling costs in the first nine months of 2017 were 2.3 billion rubles, down 0.1 billion rubles (5.8%) year-on-year. The main factors contributing to lower selling costs are the lower costs of infrastructure services as a result of the change in electricity exports, as well as the changes in the payment of electricity losses since August 2017 in accordance with Order of Russia's Government dated July 7, 2017 No. 810.

General and administrative expenses for the first nine months of 2017 were 3.7 billion rubles, down 0.2 billion rubles (4.6%) year-on-year.

Profit from sale for the first nine months of 2017 was 0.1 billion rubles compared to 2.2 billion rubles in the same period of 2016.

Income from share ownership in other companies changed by 0.3 billion rubles (26.4%) and amounted to 0.8 billion rubles, which was related to smaller dividend payments from Group subsidiaries.

Interest receivable for the first nine months of 2017 was 2.6 billion rubles. The 1.5 billion ruble (35.9%) reduction in the interest receivable compared to the same period of 2016 is related primarily to several partially offsetting factors, including an increase in deposits in the form of minimum balances on current accounts, a decrease of the deposit portfolio, repayment of loans and a change in the interest rate on loans granted to Group companies.

Balance of other income/expenses for the first nine months of 2017 was 0.2 billion rubles compared to 31.1 billion rubles for the same period of 2016. The primary driver of this change compared to the same period in 2016 was the one-off income from the sale of a 40.007% ownership stake in PJSC Irkutskenergo recorded in the financial statements, combined with the recognition of contingent liabilities on the joint and several guarantee of an option agreement with SC Vnesheconombank.

As a result, the net profit for the first nine months of 2017 was 5.4 billion rubles, compared to 37.4 billion rubles for the same period of 2016.

Balance sheet

As of September 30, 2017, total assets of PJSC Inter RAO increased by 8.5 billion rubles (1.9%), to 446.4 billion rubles, compared to December 31, 2016.

Non-current assets decreased by 0.9 billion rubles (0.2%) to 360.8 billion rubles compared to the beginning of the year.

Current assets for the first nine months of 2017 increased by 9.4 billion rubles (12.3%). The main reason for the change is the increase in the amount of money placed on deposits as compared to December 31, 2016, as well as the decrease in financial investment due to the partial repayment of loans.

As of September 30, 2017, the debt load amounted to 17.9 billion rubles. The debt portfolio is represented by short-term borrowed intra-group resources. The net debt of PJSC Inter RAO was -40.1 billion rubles compared to -41.7 billion rubles as of the beginning of the year.

Total debt (excluding loans and borrowings) increased by 0.4 billion rubles (5.4%) compared to the beginning of the year and amounted to 8.4 billion rubles as of September 30, 2017. The main reason is the increase in short-term current debt owed to suppliers and contractors under the terms of the contracts concluded.