Bashkirenergo publishes financial results for 9 months of 2011
EquityStory.RS, LLC-News: OJSC Bashkirenergo / Key word(s): Quarter
Results
Bashkirenergo publishes financial results for 9 months of 2011
29.11.2011 / 06:30
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PRESS-RELEASE
November 29, 2011
Bashkirenergo publishes financial results for 9 months of 2011
November 29, 2011, Ufa (Russian Federation, Republic of Bashkortostan) -
OJSC 'Bashkirenergo' (MICEX, RTS: BEGY, ISIN: RU0009044242) - publishes
consolidated financial statements for nine months ended 30 September, 2011
prepared in accordance with IFRS.
On September 12, 2011 a deal was struck between JSC 'RusHydro' and OJSC
'Bashkirenergo' to sell LLC 'Energeticheskaya Sbytovaya Kompaniya
Bashkortostana' (LLC ESKB) to LLC ESK RusHydro (a subsidiary of JSC
'RusHydro'). OJSC 'Bashkirenergo' in return for selling its power retail
business received consideration in the amount of 5.7 bln. RUR.
The financial results of the sold retail company LLC 'ESKB' are presented
in a separate line of the consolidated statement of comprehensive income
'Profit from the discontinued operations' in compliance with IFRS. As a
result, operations of sales and purchases of electricity and capacity
between the companies of the Group and LLC ESKB were reflected in revenue
and operational expenses in the consolidated financial statements.
KEY FINANCIAL RESULTS:
- The Company's revenue for the first nine months of 2011 is decreased by
9% to 40,948 mln RUR (1,423 mln USD) compared to the same period of
2010. The third quarter of 2011 saw decline of revenue of 17% to 11,563
mln RUR (398 mln. USD).
- Operating profit increased by 34% year-over-year reaching 4,238 mln RUR
(147 mln USD) after 9 months of 2011. In the third quarter of 2011
operational profit made a hike of 1,404% to third quarter of 2010 up to
346 mln RUR (12 mln USD).
- OIBDA after 9 months of 2011 was 6,827 mln RUR (237 mln USD) or 19%
higher comparing with the same period last year. The same result for
the third quarter of 2011 was 1,200 mln RUB (41 mln USD), or 32% higher
year-to-year.
- Net profit for the 9 months period of 2011 amounted to 7,782 mln RUR
(271 mln USD) increased by 236 % compared to the same period last year.
- Net profit from continuing operations in 9 months of 2011 increased by
44% to 3,242 mln RUR (113 mln USD) compared to 2010 results. In the
third quarter of 2011 net profit from continuing operations amounted to
241 mln RUR (8 mln. USD) compared to net loss in the same period last
year.
- OIBDA margin for the 9 months increased from 13% in 2010 to 17% this
year.
- As at September 30, 2011 the Company's financial debt amounted to 2,498
mln RUR (78 mln USD), with debt/OIBDA ratio at the level of 0.37.
KEY OPERATING RESULTS:
- OJSC 'Bashkirenergo' total power generation in the first nine months of
2011 was 16,739 mln kWh, gaining 2.7% year-over-year.
- The capacity factor of OJSC 'Bashkirenergo' power stations rose by 1.7%
to 60% (an increase of 1 b.p. compared to first nine months of 2010).
- Heat output of the Company amounted to 16,873 thousand Gcal gaining
1.4% over the results of the same period of 2010.
- The specific consumption of equivalent fuel decreased by 2.8 g/kWh for
electricity generation to 323.4 g/kWh, and by 1.1 kg/Gcal for heat
output to 144 kg/Gcal compared to the 9 month period last year.
- The transmitted electricity losses in the first nine months of 2011
increased from 1.45% to 1.47% in the transmission grid, with
distribution grid losses increasing from 8.31% to 8.52%.
Andrey Makarov, CEO of OJSC 'Bashkirenergo' commenting the financial
results of the first nine months and the third quarter of 2011 has stated:
'OJSC 'Bashkirenergo' financial results from operational activities
traditionally look weaker compared to other quarters due to seasonal
factors. However the Company finished the quarter with operational profit
versus the operational losses last year. Nevertheless, there were even
better positive news for shareholders concerning the the closed deal of
selling the power retail company for 5.7 bln RUR. The final decision on
the distribution of profit for the 9 months of 2011 will be taken at the
extraordinary general shareholders meeting to be held on December 28, 2011,
but the recommendations of the Board of directors on the amount of
dividends to be paid are expected to be out tomorrow. Undoubtedly for all
the cititzens of the republic and the Company employees the most important
event of the previous quarter was the implementation of the winter season
preparation program. Upon the implementation of all the measures OJSC
'Bashkirenergo' received a preparedness passport for 2011-2012
autumn-winter season.'
RESULTS OVERVIEW
The third quarter of 2011 witnessed a small 0.7% decline the OJSC
'Bashkirenergo' power output to the same period last year mostly due to
shift in repairs and maintenance schedule. The 9 months 2011 power
generation increased by 2.7% to 16,739 mln kWh. The Unified Power System of
the Russian Federation in the first nine months of the year increased its
power generation by only 1.7% up to 755.9 bln kWh, and the UPS Urals total
power output increased by 2.2% amounting to 186.79 bln kWh. The OJSC
'Bashkirenergo' share in the total Russian power output reached 2.21% and
in the UPS Urals amounted to 8.96%.
The growth in heat output of OJSC 'Baskirenergo' third quarter reached 8.8%
amounting 2,917 thousand Gcal due to the rising heat consumption from major
consumers. In 9 months of 2011 the heat output increased 1.4% compared to
last year results amounting to 16,873 thousand Gcal.
A decrease in specific consumption of equivalent fuel for electricity
generation (-2.8 g/kWh) and heat output (-1.1 kg/Gcal) compared to 9 months
last year substantially contributed to a positive financial results of OJSC
'Bashkirenergo'. The biggest impact on fuel consumption rate was made by
the implemented energy saving and energy efficiency programs, including the
redistribution of heating load from boilers of LLC BashRTS to CHPP-2 and
Salavatskaya CHPP coupled with the 3.9%.growth of the cogeneration output
by CHPPs.
Key Financial Performance Indicators, in mln RUR
^
3rd quarter Change 9 months Change
Indicator 2011 2010 % 2011 2010 %
Revenue 11,563 13,937 -17% 40,948 45,239 -9%
Operating expenses (11,217) (13,914) -19% (36,710) (42,082) -13%
Operating Profit 346 23 1 404% 4,238 3,157 34%
Profit before income tax 345 13 2554% 4,209 3,128 35%
Income tax expenses (104) (101) 3% (967) (872) 11%
Profit/(losses) from
continuing operations 241 (88) n/a 3,242 2,256 44%
(Expenses)/ profit from
discontinued operations 4,209 19 22 053% 4,540 59 7 595%
Profit/(losses) for the
period 4,450 (69) n/a 7,782 2,315 236%
OIBDA 1,200 911 32% 6,827 5,758 19%
OIBDA margin 10% 7% 3 b.p. 17% 13% 4 b.p.
EBIT margin 3% 0% 3 b.p. 10% 7% 3 b.p.
Net margin 2% - n/a 8% 5% 3 b.p.
°
Key Operating Results
^
3rd quarter Change 9 months Change
Indicator 2011 2010 % 2011 2010 %
Installed electric capacity, MW 4,294 4,245 1.2% 4,272 4,246 0.6%
(average)
Installed heat capacity, Gcal/h 13,274 13,284 -0.1% 13,272 13,284 -0.1%
(average)
Electricity generation, mln kWh 5,263 5,299 -0.7% 16,739 16,304 2.7%
Heat output, thousand Gcal 2,917 2,681 8.8% 16,873 16,645 1.4%
Electric capacity factor, % 56 57 -1.8% 60 59 1.7%
Specific consumption of equivalent 338 341 -0.9% 323 326 -0.9%
fuel for electricity generation,
g/kWh
Specific consumption of equivalent 149 152 -2.0% 144 145 -0.7%
fuel for heat output, kg/Gcal
Distribution grid losses, % 6.38% 6.37% 0.01b.p. 8.52% 8.31% 0.22b.p.
Transmission grid losses, % 1.41% 1.41% 0b.p. 1.47% 1.45% 0.02b.p.
°
REVENUE
Revenue reduction in the statements for the nine months of 2011 is result
of reclassification of all operations of LLC ESKB into the separate line
'Profit from the discontinued operations' due to the decision made to sell
the retail company.
Considering the fact that before January 1, 2011 OJSC 'Bashkirenergo' had
the status of the guaranteeing provider (retail company) with LLC ESKB
acting only as an agent, its deconsolidation had the most impact on revenue
and operational expenses for 2010 and 2011.
OPERATING EXPENSES
The decision to sell the retail company mostly impacted the amount of
purchased electricity which decreased after 9 months of 2011 by 74%
compared to the same period last year to 2,747 mln RUR (95 mln USD).
Fuel costs for 9 months of 2011 representing 52% of total operating
expenses increased 11% to 19,136 mln RUR (665 mln USD) and were driven by
a 15% gas price indexation, as well as by a 2.3% rise in power output by
thermal power plants. The slower growth pace of fuel costs compared to gas
price hike is explained by the reduction in specific consumption of
equivalent fuel.
Fixed costs which represent 36% of total operating expenses of the 9 month
period of 2011 amounted to 13,086 mln RUR (455 mln USD) staying at the same
level as last year.
Staff costs being the largest item of fixed costs (17% of total operating
expenses) rose by 6% against 9 months of 2010 to 6,175 mln RUR (215 mln
USD).
Repairs and maintenance after 9 months of 2011 together with costs of
materials and spare parts (6% of operating expenses) were cut down 9% the
same period last year amounting to 2,303 mln RUR (80 mln USD) mostly due to
a 40% cut in expenditure on material and spare parts.
Other operating expenses dropped by 51% to 795 mln RUR (28 mln USD).
FINANCIAL POSITION
As of the balance sheet date, the total assets of OJSC 'Bashkirenergo'
amounted to 67,142 mln RUR (2,106 mln USD) increasing by 16% from the
beginning of the year.
The share of non-current assets exceeded 79% of total assets and amounted
53,154 mln RUR (1,668 mln USD), while the share of current assets was 21%
or 13,989 mln RUR (439 mln USD). During the first nine months of 2011
non-current assets increased by 3% as a result of 7% increase in property,
plant and equipment due to new commissioning and increase of construction
in-progress. The disposal of LLC ESKB lead to a 10 times increase of
current assets with the amount of cash and deposits reaching 6,864 mln RUR
(215 mln USD).
Capital and reserves as at September 30, 2011 made up 84% of the total
equity and liabilities amounting to 56,542 mln RUR (1,774 mln USD). Upon
the disposal of the retail company deferred taxes and income tax to be paid
became the largest liability (2,322 mln RUR or 73 mln USD). Trade and other
payables (1,913 mln RUR of 60 mln USD) along with advances received from
customers (1,781 mln RUR or 56 mln USD) form 6% of capital and liabilities.
The free cash flow grew 95% to 6,482 mln RUR (225 mln USD) mostly due to
5,7 bln RUR (179 mln USD) of cash received from the disposal of a
subsidiary.
CAPITAL EXPENDITURE
Investment program in the 9 months of 2011 made up 4,742 mln RUR (165 mln
USD) increasing by 133% compared to the same period last year.
On August 29, 2011 the new CCGT-60 unit at CHP plant-2 of Ufa was
commissioned resulting in an increase of the electric installed capacity of
the power plant by 47 MW, and the heat installed capacity by 35 Gcal/h. The
total project cost amounted to 1,543 mln RUR. From September 1, 2011 the
new unit started the power and capacity supply to the Wholesale electricity
and capacity market.
EVENTS AFTER THE REPORTING DATE
On October 14, 2011 the Board of Directors of OJSC 'Bashkirenergo' took a
decision to hold the extraordinary general shareholder meeting with the
question of the payment of dividends for the 9 month period of 2011 and the
election of the new Board of Directors.
On November 1, 2011 the JSC 'System operator of the Unified power system'
in accordance with the rules of the wholesale electricity and capacity
market summed up the results of the Competitive selection of capacity (KOM)
for 2012. The capacity from 12 power station of OJSC 'Bashkirenergo' were
selected totaling 47,340 MW or 3,945 MW monthly average. Beside the
capacities which passed KOM this year additional capacities from CCGT-60 at
CHP plant-2 of Ufa, and SGU-1 at CHP plant 1 of Ufa were also sold.
As the result of the competitive selection of capacity 1 MW of capacity of
OJSC 'Bashkirenergo' power stations was priced 118,118 RUR per month.
OUTLOOKS
According to the management forecast the OJSC 'Bashkirenergo' 2011
financial results beat last year's results, subject to high of electricity
prices at OREM.
The set KOM prices for the 2012 capacity being 4% lower than in this year
makes the management take even more cost cutting measures of the fixed
costs in order to maintain the generation business margins.
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
30/09/2011 31/12/2010
ASSETS
Non-current assets
Property, plant and equipment 51,035 47,675
Advances paid for acquisition of property, plant and
equipment 1,890 3,450
Inventories 166 183
Trade and other receivables 12 121
Other non-current assets 51 59
53,154 51,488
Current assets
Inventories 1,546 1,169
Trade and other receivables 3,396 2,658
Advances paid and prepaid expenses 245 427
Investments 4,615 42
Income tax prepaid 170 181
VAT recoverable and other taxes prepaid 1,768 1,272
Cash and cash equivalents 2,248 569
13,988 6,318
TOTAL ASSETS 67,142 57,806
EQUITY AND LIABILITIES
Capital and reserves
Share capital 1,093 1,093
Treasury shares (282) (282)
Retained earnings 55,731 49,023
Equity attributable to owners of the parent company 56,542 49,834
Non-controlling interests - 285
TOTAL EQUITY 56,542 50,119
Non-current liabilities
Loans and borrowings 2,201 -
Employee benefit obligations 586 584
Deferred tax liabilities 1,194 1,549
Other non-current liabilities 285 82
4,266 2,215
Current liabilities
Loans and borrowings 297 160
Trade and other payables 1,913 1,377
Advances received from customers 1,781 2,230
Accrued expenses and provisions 444 760
Income tax payable 1,128 108
Other taxes payable 771 837
6,334 5,472
TOTAL LIABILITIES 10,600 7,687
TOTAL EQUITY AND LIABILITIES 67,142 57,806
°
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
Three months ended Nine months ended
September September September September
30, 2011 30, 2010 30, 2011 30, 2010
Revenue
Electricity and capacity 9,702 11,514 30,942 34,173
Heat energy 1,083 1,084 7,736 7,453
Other revenue 778 1,339 2,270 3,613
11,563 13,937 40,948 45,239
Operating expenses
Fuel (5,353) (4,880) (19,136) (17,172)
Purchase of electricity (755) (3,992) (2,747) (10,624)
Staff costs (1,965) (1,892) (6,175) (5,812)
Depreciation (854) (888) (2,589) (2,601)
Materials and spare parts (261) (503) (685) (1,147)
Repair and maintenance (601) (577) (1,618) (1,389)
Transmission of electricity (201) (456) (1,338) (974)
Charity (378) (201) (537) (504)
Water usage (121) (90) (403) (282)
Taxes, other than income tax (101) (100) (300) (303)
Loss on disposal of property,
plant and equipment (30) 37 42 49
Change in provision for tax
and legal contingencies (66) 3 16 523
Rent (41) (36) (111) (88)
Change in allowance for
doubtful receivables (265) 99 (311) (173)
Impairment of advances paid 1 12 (22) 34
Other operating expenses (226) (450) (795) (1,619)
Operating profit 346 23 4,239 3,157
Finance income 10 - 11 -
Finance cost (11) (10) (40) (29)
Profit before income tax 345 13 4,210 3,128
Income tax (104) (101) (967) (872)
Profit from continuing
operations 241 (88) 3,243 2,256
(Losses)/ Profit from
discontinued operations 4,209 19 4,540 59
PROFIT FOR THE PERIOD 4,450 (69) 7,783 2,315
TOTAL COMPREHENSIVE INCOME FOR
THE PERIOD 4,450 (69) 7,783 2,315
Attributable to:
Owners of the parent company 4,450 (88) 7,783 2,285
Non-controlling interests - 19 - 30
EARNINGS PER SHARE FROM
CONTINUING AND DISCONTINUED
OPERATIONS
Basic earnings per share (in
Roubles) 4.29 (0.11) 7.47 2.13
Diluted earnings per share (in
Roubles) 4.29 (0.11) 7.47 2.13
EARNINGS PER SHARE FROM
CONTINUING OPERATIONS
Basic earnings per share (in
Roubles) 0.21 (0.13) 3.08 2.07
Diluted earnings per share (in
Roubles) 0.21 (0.13) 3.08 2.07
°
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
Nine months Nine months
ended September 30, ended September 30,
2011 2010
OPERATING ACTIVITIES
Profit before income tax 8,750 3,187
Adjustments for:
Depreciation 2,589 2,601
Change in provision for tax and
legal contingencies (16) (523)
Change in provision for unused
vacations and bonuses (301) (41)
Income on disposal of property,
plant and equipment (42) (49)
Change in allowance for
doubtful receivables 308 173
Change in employee benefits (32) 36
Income from the disposal of a
subsidiary (5,445) -
Finance income (11) -
Finance losses 47 29
Other adjustments 22 (33)
Operating cash flow before
movements in working capital 5,869 5,380
Change in inventories (460) 218
Change in trade and other
receivables (3,004) 133
Change in advances paid and
prepaid expenses (53) (833)
Change in taxes receivable,
other than income tax (720) 425
Change in trade and other
payables 3,013 (444)
Change in advances received
from customers 237 (352)
Change in taxes payable, other
than income tax (24) 81
Net cash provided by
operations 4,858 4,608
Income tax paid (485) (926)
Interest paid (13) (34)
Net cash generated from
operating activities 4,360 3,648
INVESTING ACTIVITIES
Disposal of Special Purpose
Entities (158) -
Purchase of property, plant and
equipment (4,742) (2,034)
Proceeds from disposal of
property, plant and equipment 287 242
Net cash proceeds from the
disposal of a susidiary 5,246 -
Purchase of investments (4,622) (447)
Proceeds from disposal of
investments 34 514
Dividends and interest
received 11 -
Net cash generated from/(used
in) investing activities (3,944) (1,725)
FINANCING ACTIVITIES
Dividends paid (1,075) (1,237)
Repurchase of ordinary shares - (282)
Proceeds from loans and
borrowings 7,172 12,751
Principal repayments on loans
and borrowings (4,834) (13,019)
Net cash used in financing
activities 1,263 (1,787)
Net increase/(decrease) in cash
and cash equivalents 1,679 136
Cash and cash equivalents at
beginning of the period 569 598
Cash and cash equivalents at
end of the period 2,248 734
°
OJSC 'Bashkirenergo' - is a major regional utility company in Russia,
ranked 5 by installed electric capacity and 7 by installed heat capacity
among the Russian territorial generating companies. By the amount of heat
output OJSC 'Bashkirenergo' is among the 10 major heat producing companies
in the world. OJSC 'Bashkirenergo has a dominating position at the
electricity and heat market of the Republic of Bashkortostan, which is one
of the top-ten developed regions of Russia. The OJSC 'Bashkirenergo' owns
companies which produce electricity and heat, conduct their transmission to
consumers. The Installed electric capacity is 4,295 MW, the installed heat
capacity is 13,141 Gcal/h.
Contacts :
^
Head of Investor Relations
OJSC 'Bashkirenergo'
Maxim Kochetkov
tel: + 7 (495) 228-07-74
+ 7 (963) 990-67-66
kochetkov@bashkirenergo.ru
°
Statements contained in this press release may contain forward-looking
information that reflects management's current view and estimates of future
economic circumstances, industry conditions, company performance, and
financial results. Any statements, expectations, capabilities, plans and
assumptions contained in this press release that do not describe historical
facts such as statements regarding the declaration or payment of dividends,
the direction of future operations, the implementation of principal
operating and financing strategies and capital expenditure plans, the
factors or trends affecting financial condition, liquidity or results of
operations are forward-looking statements and involve a number of risks and
uncertainties. There is no guarantee that these results will actually
occur. The statements are based on many assumptions and factors, including
general economic and market conditions, industry conditions and operating
factors. Any changes in such assumptions or factors could cause actual
results to differ materially from current expectations.
End of Corporate News
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Language: English
Company: OJSC Bashkirenergo
Kommsomolskaya st,126
450096 Ufa
Russia
Phone: + 7 (347) 269-43-59
E-mail: secr@iap.bashkirenergo.ru
Internet: www.bashkirenergo.ru
ISIN: RU0009044242
End of News EquityStory.RS, LLC News-Service
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147862 29.11.2011
EquityStory.RS, LLC-News: OJSC Bashkirenergo / Key word(s): Quarter
Results
Bashkirenergo publishes financial results for 9 months of 2011
29.11.2011 / 06:30
---------------------------------------------------------------------
PRESS-RELEASE
November 29, 2011
Bashkirenergo publishes financial results for 9 months of 2011
November 29, 2011, Ufa (Russian Federation, Republic of Bashkortostan) -
OJSC 'Bashkirenergo' (MICEX, RTS: BEGY, ISIN: RU0009044242) - publishes
consolidated financial statements for nine months ended 30 September, 2011
prepared in accordance with IFRS.
On September 12, 2011 a deal was struck between JSC 'RusHydro' and OJSC
'Bashkirenergo' to sell LLC 'Energeticheskaya Sbytovaya Kompaniya
Bashkortostana' (LLC ESKB) to LLC ESK RusHydro (a subsidiary of JSC
'RusHydro'). OJSC 'Bashkirenergo' in return for selling its power retail
business received consideration in the amount of 5.7 bln. RUR.
The financial results of the sold retail company LLC 'ESKB' are presented
in a separate line of the consolidated statement of comprehensive income
'Profit from the discontinued operations' in compliance with IFRS. As a
result, operations of sales and purchases of electricity and capacity
between the companies of the Group and LLC ESKB were reflected in revenue
and operational expenses in the consolidated financial statements.
KEY FINANCIAL RESULTS:
- The Company's revenue for the first nine months of 2011 is decreased by
9% to 40,948 mln RUR (1,423 mln USD) compared to the same period of
2010. The third quarter of 2011 saw decline of revenue of 17% to 11,563
mln RUR (398 mln. USD).
- Operating profit increased by 34% year-over-year reaching 4,238 mln RUR
(147 mln USD) after 9 months of 2011. In the third quarter of 2011
operational profit made a hike of 1,404% to third quarter of 2010 up to
346 mln RUR (12 mln USD).
- OIBDA after 9 months of 2011 was 6,827 mln RUR (237 mln USD) or 19%
higher comparing with the same period last year. The same result for
the third quarter of 2011 was 1,200 mln RUB (41 mln USD), or 32% higher
year-to-year.
- Net profit for the 9 months period of 2011 amounted to 7,782 mln RUR
(271 mln USD) increased by 236 % compared to the same period last year.
- Net profit from continuing operations in 9 months of 2011 increased by
44% to 3,242 mln RUR (113 mln USD) compared to 2010 results. In the
third quarter of 2011 net profit from continuing operations amounted to
241 mln RUR (8 mln. USD) compared to net loss in the same period last
year.
- OIBDA margin for the 9 months increased from 13% in 2010 to 17% this
year.
- As at September 30, 2011 the Company's financial debt amounted to 2,498
mln RUR (78 mln USD), with debt/OIBDA ratio at the level of 0.37.
KEY OPERATING RESULTS:
- OJSC 'Bashkirenergo' total power generation in the first nine months of
2011 was 16,739 mln kWh, gaining 2.7% year-over-year.
- The capacity factor of OJSC 'Bashkirenergo' power stations rose by 1.7%
to 60% (an increase of 1 b.p. compared to first nine months of 2010).
- Heat output of the Company amounted to 16,873 thousand Gcal gaining
1.4% over the results of the same period of 2010.
- The specific consumption of equivalent fuel decreased by 2.8 g/kWh for
electricity generation to 323.4 g/kWh, and by 1.1 kg/Gcal for heat
output to 144 kg/Gcal compared to the 9 month period last year.
- The transmitted electricity losses in the first nine months of 2011
increased from 1.45% to 1.47% in the transmission grid, with
distribution grid losses increasing from 8.31% to 8.52%.
Andrey Makarov, CEO of OJSC 'Bashkirenergo' commenting the financial
results of the first nine months and the third quarter of 2011 has stated:
'OJSC 'Bashkirenergo' financial results from operational activities
traditionally look weaker compared to other quarters due to seasonal
factors. However the Company finished the quarter with operational profit
versus the operational losses last year. Nevertheless, there were even
better positive news for shareholders concerning the the closed deal of
selling the power retail company for 5.7 bln RUR. The final decision on
the distribution of profit for the 9 months of 2011 will be taken at the
extraordinary general shareholders meeting to be held on December 28, 2011,
but the recommendations of the Board of directors on the amount of
dividends to be paid are expected to be out tomorrow. Undoubtedly for all
the cititzens of the republic and the Company employees the most important
event of the previous quarter was the implementation of the winter season
preparation program. Upon the implementation of all the measures OJSC
'Bashkirenergo' received a preparedness passport for 2011-2012
autumn-winter season.'
RESULTS OVERVIEW
The third quarter of 2011 witnessed a small 0.7% decline the OJSC
'Bashkirenergo' power output to the same period last year mostly due to
shift in repairs and maintenance schedule. The 9 months 2011 power
generation increased by 2.7% to 16,739 mln kWh. The Unified Power System of
the Russian Federation in the first nine months of the year increased its
power generation by only 1.7% up to 755.9 bln kWh, and the UPS Urals total
power output increased by 2.2% amounting to 186.79 bln kWh. The OJSC
'Bashkirenergo' share in the total Russian power output reached 2.21% and
in the UPS Urals amounted to 8.96%.
The growth in heat output of OJSC 'Baskirenergo' third quarter reached 8.8%
amounting 2,917 thousand Gcal due to the rising heat consumption from major
consumers. In 9 months of 2011 the heat output increased 1.4% compared to
last year results amounting to 16,873 thousand Gcal.
A decrease in specific consumption of equivalent fuel for electricity
generation (-2.8 g/kWh) and heat output (-1.1 kg/Gcal) compared to 9 months
last year substantially contributed to a positive financial results of OJSC
'Bashkirenergo'. The biggest impact on fuel consumption rate was made by
the implemented energy saving and energy efficiency programs, including the
redistribution of heating load from boilers of LLC BashRTS to CHPP-2 and
Salavatskaya CHPP coupled with the 3.9%.growth of the cogeneration output
by CHPPs.
Key Financial Performance Indicators, in mln RUR
^
3rd quarter Change 9 months Change
Indicator 2011 2010 % 2011 2010 %
Revenue 11,563 13,937 -17% 40,948 45,239 -9%
Operating expenses (11,217) (13,914) -19% (36,710) (42,082) -13%
Operating Profit 346 23 1 404% 4,238 3,157 34%
Profit before income tax 345 13 2554% 4,209 3,128 35%
Income tax expenses (104) (101) 3% (967) (872) 11%
Profit/(losses) from
continuing operations 241 (88) n/a 3,242 2,256 44%
(Expenses)/ profit from
discontinued operations 4,209 19 22 053% 4,540 59 7 595%
Profit/(losses) for the
period 4,450 (69) n/a 7,782 2,315 236%
OIBDA 1,200 911 32% 6,827 5,758 19%
OIBDA margin 10% 7% 3 b.p. 17% 13% 4 b.p.
EBIT margin 3% 0% 3 b.p. 10% 7% 3 b.p.
Net margin 2% - n/a 8% 5% 3 b.p.
°
Key Operating Results
^
3rd quarter Change 9 months Change
Indicator 2011 2010 % 2011 2010 %
Installed electric capacity, MW 4,294 4,245 1.2% 4,272 4,246 0.6%
(average)
Installed heat capacity, Gcal/h 13,274 13,284 -0.1% 13,272 13,284 -0.1%
(average)
Electricity generation, mln kWh 5,263 5,299 -0.7% 16,739 16,304 2.7%
Heat output, thousand Gcal 2,917 2,681 8.8% 16,873 16,645 1.4%
Electric capacity factor, % 56 57 -1.8% 60 59 1.7%
Specific consumption of equivalent 338 341 -0.9% 323 326 -0.9%
fuel for electricity generation,
g/kWh
Specific consumption of equivalent 149 152 -2.0% 144 145 -0.7%
fuel for heat output, kg/Gcal
Distribution grid losses, % 6.38% 6.37% 0.01b.p. 8.52% 8.31% 0.22b.p.
Transmission grid losses, % 1.41% 1.41% 0b.p. 1.47% 1.45% 0.02b.p.
°
REVENUE
Revenue reduction in the statements for the nine months of 2011 is result
of reclassification of all operations of LLC ESKB into the separate line
'Profit from the discontinued operations' due to the decision made to sell
the retail company.
Considering the fact that before January 1, 2011 OJSC 'Bashkirenergo' had
the status of the guaranteeing provider (retail company) with LLC ESKB
acting only as an agent, its deconsolidation had the most impact on revenue
and operational expenses for 2010 and 2011.
OPERATING EXPENSES
The decision to sell the retail company mostly impacted the amount of
purchased electricity which decreased after 9 months of 2011 by 74%
compared to the same period last year to 2,747 mln RUR (95 mln USD).
Fuel costs for 9 months of 2011 representing 52% of total operating
expenses increased 11% to 19,136 mln RUR (665 mln USD) and were driven by
a 15% gas price indexation, as well as by a 2.3% rise in power output by
thermal power plants. The slower growth pace of fuel costs compared to gas
price hike is explained by the reduction in specific consumption of
equivalent fuel.
Fixed costs which represent 36% of total operating expenses of the 9 month
period of 2011 amounted to 13,086 mln RUR (455 mln USD) staying at the same
level as last year.
Staff costs being the largest item of fixed costs (17% of total operating
expenses) rose by 6% against 9 months of 2010 to 6,175 mln RUR (215 mln
USD).
Repairs and maintenance after 9 months of 2011 together with costs of
materials and spare parts (6% of operating expenses) were cut down 9% the
same period last year amounting to 2,303 mln RUR (80 mln USD) mostly due to
a 40% cut in expenditure on material and spare parts.
Other operating expenses dropped by 51% to 795 mln RUR (28 mln USD).
FINANCIAL POSITION
As of the balance sheet date, the total assets of OJSC 'Bashkirenergo'
amounted to 67,142 mln RUR (2,106 mln USD) increasing by 16% from the
beginning of the year.
The share of non-current assets exceeded 79% of total assets and amounted
53,154 mln RUR (1,668 mln USD), while the share of current assets was 21%
or 13,989 mln RUR (439 mln USD). During the first nine months of 2011
non-current assets increased by 3% as a result of 7% increase in property,
plant and equipment due to new commissioning and increase of construction
in-progress. The disposal of LLC ESKB lead to a 10 times increase of
current assets with the amount of cash and deposits reaching 6,864 mln RUR
(215 mln USD).
Capital and reserves as at September 30, 2011 made up 84% of the total
equity and liabilities amounting to 56,542 mln RUR (1,774 mln USD). Upon
the disposal of the retail company deferred taxes and income tax to be paid
became the largest liability (2,322 mln RUR or 73 mln USD). Trade and other
payables (1,913 mln RUR of 60 mln USD) along with advances received from
customers (1,781 mln RUR or 56 mln USD) form 6% of capital and liabilities.
The free cash flow grew 95% to 6,482 mln RUR (225 mln USD) mostly due to
5,7 bln RUR (179 mln USD) of cash received from the disposal of a
subsidiary.
CAPITAL EXPENDITURE
Investment program in the 9 months of 2011 made up 4,742 mln RUR (165 mln
USD) increasing by 133% compared to the same period last year.
On August 29, 2011 the new CCGT-60 unit at CHP plant-2 of Ufa was
commissioned resulting in an increase of the electric installed capacity of
the power plant by 47 MW, and the heat installed capacity by 35 Gcal/h. The
total project cost amounted to 1,543 mln RUR. From September 1, 2011 the
new unit started the power and capacity supply to the Wholesale electricity
and capacity market.
EVENTS AFTER THE REPORTING DATE
On October 14, 2011 the Board of Directors of OJSC 'Bashkirenergo' took a
decision to hold the extraordinary general shareholder meeting with the
question of the payment of dividends for the 9 month period of 2011 and the
election of the new Board of Directors.
On November 1, 2011 the JSC 'System operator of the Unified power system'
in accordance with the rules of the wholesale electricity and capacity
market summed up the results of the Competitive selection of capacity (KOM)
for 2012. The capacity from 12 power station of OJSC 'Bashkirenergo' were
selected totaling 47,340 MW or 3,945 MW monthly average. Beside the
capacities which passed KOM this year additional capacities from CCGT-60 at
CHP plant-2 of Ufa, and SGU-1 at CHP plant 1 of Ufa were also sold.
As the result of the competitive selection of capacity 1 MW of capacity of
OJSC 'Bashkirenergo' power stations was priced 118,118 RUR per month.
OUTLOOKS
According to the management forecast the OJSC 'Bashkirenergo' 2011
financial results beat last year's results, subject to high of electricity
prices at OREM.
The set KOM prices for the 2012 capacity being 4% lower than in this year
makes the management take even more cost cutting measures of the fixed
costs in order to maintain the generation business margins.
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
30/09/2011 31/12/2010
ASSETS
Non-current assets
Property, plant and equipment 51,035 47,675
Advances paid for acquisition of property, plant and
equipment 1,890 3,450
Inventories 166 183
Trade and other receivables 12 121
Other non-current assets 51 59
53,154 51,488
Current assets
Inventories 1,546 1,169
Trade and other receivables 3,396 2,658
Advances paid and prepaid expenses 245 427
Investments 4,615 42
Income tax prepaid 170 181
VAT recoverable and other taxes prepaid 1,768 1,272
Cash and cash equivalents 2,248 569
13,988 6,318
TOTAL ASSETS 67,142 57,806
EQUITY AND LIABILITIES
Capital and reserves
Share capital 1,093 1,093
Treasury shares (282) (282)
Retained earnings 55,731 49,023
Equity attributable to owners of the parent company 56,542 49,834
Non-controlling interests - 285
TOTAL EQUITY 56,542 50,119
Non-current liabilities
Loans and borrowings 2,201 -
Employee benefit obligations 586 584
Deferred tax liabilities 1,194 1,549
Other non-current liabilities 285 82
4,266 2,215
Current liabilities
Loans and borrowings 297 160
Trade and other payables 1,913 1,377
Advances received from customers 1,781 2,230
Accrued expenses and provisions 444 760
Income tax payable 1,128 108
Other taxes payable 771 837
6,334 5,472
TOTAL LIABILITIES 10,600 7,687
TOTAL EQUITY AND LIABILITIES 67,142 57,806
°
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE THREE AND NINE MONTHS ENDED 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
Three months ended Nine months ended
September September September September
30, 2011 30, 2010 30, 2011 30, 2010
Revenue
Electricity and capacity 9,702 11,514 30,942 34,173
Heat energy 1,083 1,084 7,736 7,453
Other revenue 778 1,339 2,270 3,613
11,563 13,937 40,948 45,239
Operating expenses
Fuel (5,353) (4,880) (19,136) (17,172)
Purchase of electricity (755) (3,992) (2,747) (10,624)
Staff costs (1,965) (1,892) (6,175) (5,812)
Depreciation (854) (888) (2,589) (2,601)
Materials and spare parts (261) (503) (685) (1,147)
Repair and maintenance (601) (577) (1,618) (1,389)
Transmission of electricity (201) (456) (1,338) (974)
Charity (378) (201) (537) (504)
Water usage (121) (90) (403) (282)
Taxes, other than income tax (101) (100) (300) (303)
Loss on disposal of property,
plant and equipment (30) 37 42 49
Change in provision for tax
and legal contingencies (66) 3 16 523
Rent (41) (36) (111) (88)
Change in allowance for
doubtful receivables (265) 99 (311) (173)
Impairment of advances paid 1 12 (22) 34
Other operating expenses (226) (450) (795) (1,619)
Operating profit 346 23 4,239 3,157
Finance income 10 - 11 -
Finance cost (11) (10) (40) (29)
Profit before income tax 345 13 4,210 3,128
Income tax (104) (101) (967) (872)
Profit from continuing
operations 241 (88) 3,243 2,256
(Losses)/ Profit from
discontinued operations 4,209 19 4,540 59
PROFIT FOR THE PERIOD 4,450 (69) 7,783 2,315
TOTAL COMPREHENSIVE INCOME FOR
THE PERIOD 4,450 (69) 7,783 2,315
Attributable to:
Owners of the parent company 4,450 (88) 7,783 2,285
Non-controlling interests - 19 - 30
EARNINGS PER SHARE FROM
CONTINUING AND DISCONTINUED
OPERATIONS
Basic earnings per share (in
Roubles) 4.29 (0.11) 7.47 2.13
Diluted earnings per share (in
Roubles) 4.29 (0.11) 7.47 2.13
EARNINGS PER SHARE FROM
CONTINUING OPERATIONS
Basic earnings per share (in
Roubles) 0.21 (0.13) 3.08 2.07
Diluted earnings per share (in
Roubles) 0.21 (0.13) 3.08 2.07
°
OJSC BASHKIRENERGO AND SUBSIDARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 SEPTEMBER 2011 (UNAUDITED)
IN MILLIONS OF RUSSIAN ROUBLES
^
Nine months Nine months
ended September 30, ended September 30,
2011 2010
OPERATING ACTIVITIES
Profit before income tax 8,750 3,187
Adjustments for:
Depreciation 2,589 2,601
Change in provision for tax and
legal contingencies (16) (523)
Change in provision for unused
vacations and bonuses (301) (41)
Income on disposal of property,
plant and equipment (42) (49)
Change in allowance for
doubtful receivables 308 173
Change in employee benefits (32) 36
Income from the disposal of a
subsidiary (5,445) -
Finance income (11) -
Finance losses 47 29
Other adjustments 22 (33)
Operating cash flow before
movements in working capital 5,869 5,380
Change in inventories (460) 218
Change in trade and other
receivables (3,004) 133
Change in advances paid and
prepaid expenses (53) (833)
Change in taxes receivable,
other than income tax (720) 425
Change in trade and other
payables 3,013 (444)
Change in advances received
from customers 237 (352)
Change in taxes payable, other
than income tax (24) 81
Net cash provided by
operations 4,858 4,608
Income tax paid (485) (926)
Interest paid (13) (34)
Net cash generated from
operating activities 4,360 3,648
INVESTING ACTIVITIES
Disposal of Special Purpose
Entities (158) -
Purchase of property, plant and
equipment (4,742) (2,034)
Proceeds from disposal of
property, plant and equipment 287 242
Net cash proceeds from the
disposal of a susidiary 5,246 -
Purchase of investments (4,622) (447)
Proceeds from disposal of
investments 34 514
Dividends and interest
received 11 -
Net cash generated from/(used
in) investing activities (3,944) (1,725)
FINANCING ACTIVITIES
Dividends paid (1,075) (1,237)
Repurchase of ordinary shares - (282)
Proceeds from loans and
borrowings 7,172 12,751
Principal repayments on loans
and borrowings (4,834) (13,019)
Net cash used in financing
activities 1,263 (1,787)
Net increase/(decrease) in cash
and cash equivalents 1,679 136
Cash and cash equivalents at
beginning of the period 569 598
Cash and cash equivalents at
end of the period 2,248 734
°
OJSC 'Bashkirenergo' - is a major regional utility company in Russia,
ranked 5 by installed electric capacity and 7 by installed heat capacity
among the Russian territorial generating companies. By the amount of heat
output OJSC 'Bashkirenergo' is among the 10 major heat producing companies
in the world. OJSC 'Bashkirenergo has a dominating position at the
electricity and heat market of the Republic of Bashkortostan, which is one
of the top-ten developed regions of Russia. The OJSC 'Bashkirenergo' owns
companies which produce electricity and heat, conduct their transmission to
consumers. The Installed electric capacity is 4,295 MW, the installed heat
capacity is 13,141 Gcal/h.
Contacts :
^
Head of Investor Relations
OJSC 'Bashkirenergo'
Maxim Kochetkov
tel: + 7 (495) 228-07-74
+ 7 (963) 990-67-66
kochetkov@bashkirenergo.ru
°
Statements contained in this press release may contain forward-looking
information that reflects management's current view and estimates of future
economic circumstances, industry conditions, company performance, and
financial results. Any statements, expectations, capabilities, plans and
assumptions contained in this press release that do not describe historical
facts such as statements regarding the declaration or payment of dividends,
the direction of future operations, the implementation of principal
operating and financing strategies and capital expenditure plans, the
factors or trends affecting financial condition, liquidity or results of
operations are forward-looking statements and involve a number of risks and
uncertainties. There is no guarantee that these results will actually
occur. The statements are based on many assumptions and factors, including
general economic and market conditions, industry conditions and operating
factors. Any changes in such assumptions or factors could cause actual
results to differ materially from current expectations.
End of Corporate News
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Language: English
Company: OJSC Bashkirenergo
Kommsomolskaya st,126
450096 Ufa
Russia
Phone: + 7 (347) 269-43-59
E-mail: secr@iap.bashkirenergo.ru
Internet: www.bashkirenergo.ru
ISIN: RU0009044242
End of News EquityStory.RS, LLC News-Service
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147862 29.11.2011