Rusgidro · RUS:HYDR
Rusgidro — RusHydro Group — Q1 2017 Earnings Presentation
28 slides from Rusgidro's earnings presentation, Jun 7, 2017
Slide 1: RusHydro Group 1Q 2017 IFRS results & market update
RusHydro Group 1Q 2017 IFRS results & market update June 7, 2017
Slide 2: Disclaimer
Disclaimer This document does not constitute or form part of any advertisement of securities, any offer or invitation to sell or issue or any solicitation of any offer to purchase or subscribe for, any securities of the Company in any jurisdiction, nor shall it or any part of it nor the fact of its
Slide 3: Agenda
I. Key highlights & operating results II. Financial results III. Segment review IV. Market update
Slide 4: Key highlights of 1Q 2017
Key highlights of 1Q 2017 Key figures 30.2 18.8 29.1 -2.0% ~187 9.6 55 4.66 reduction of RUB bn RUB bn TWh manageable cash costs RUB bn RUB bn RUB bn kop./share Consolidated EBITDA Consolidated net profit in 1Q 2017 Financial debt of Fair value of 5-year non- Equity raised from VTB Dividend for 2016
Slide 5: RusHydro Group 1Q 2017 operating results
RusHydro Group 1Q 2017 operating results Total electricity production by power plants of RusHydro Group in 1Q 2017 – 29,1 TWh (-5.4%). Total production by hydropower plants (HPPs) and pump storage hydropower plants (PSHPPs) of RusHydro Group in 1Q 2017 – 20.5 TWh (-3.4%), production by thermal a
Slide 6: Hydro production trends 2014-2017
Hydro production trends 2014-2017 Center of Russia, GWh Siberia, GWh 2014 2014 5 500 2015 3 500 2015 5 000 2016 2016 2017 3 000 2017 4 500 Long-run average Long-run average 4 000 2 500 3 500 2 000 3 000 1 500 2 500 2 000 1 000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun J
Slide 7: Water inflows to major reservoirs in 2014-2017
Water inflows to major reservoirs in 2014-2017 Water inflow to reservoirs of the Volgo-Kama cascade, m³/s Water inflow to the Sayano-Shushenskaya HPP, m³/s 50 000 6 000 45 000 5 000 40 000 35 000 4 000 30 000 25 000 3 000 20 000 2 000 15 000 10 000 1 000 5 000 0 0 J F M A M J J A S O N D J F M A M J
Slide 8: Electricity spot market overview
Electricity spot market overview Non-indexation of gas tariffs for industrial consumption in 2016, expected increase as of 2H 2017 – 3%. Increase in cross-flow between the 1st and 2nd price zones after removal of restrictions in 2014 led to long-term growth of average prices in Siberia. Full c
Slide 9: Regulated market overview
Regulated market overview Capacity prices in pricing zones, ‘000 RUB/MW/month (1) Weighted avg capacity tariffs in pricing zones, ‘000 RUB/MW/month 2 247 2 313 2 304 2 076 2 066 2 104 1 859 124,8 127,5 179 189 182 186 190 191 114,4 116,4 112,5 119 118 124 132 66,1 125 113 113 111 110 115 82 42,4 42,
Slide 10: Financial results
I. Key highlights & operating results II. Financial results III. Segment review IV. Market update
Slide 11: 1Q 2017 financial results review
1Q 2017 financial results review(1) Key highlights Key growth factors: 1Q 2017 EBITDA – RUB 30.2 bn (+11.1%), comparable EBITDA growth – 14.7%; ↗ growth of capacity sales from newly commissioned Zelenchukskaya hybrid HPP; Underlying (adjusted) net profit(2) in 1Q 2017 – RUB 20.4 bn (+21%), rep
Slide 12: 1Q 2017 EBITDA: cost analysis
1Q 2017 EBITDA: cost analysis 1Q EBITDA – cost analysis 1.5 0.0 -0.1 -0.4 0.9 -4.4 5.7 -0.2 30.2 27.2 +11.1% EBITDA 1Q'16 Revenue Other operating income Purchased electricity Employee benefit Electricity distribution Fuel expenses Third parties services Other expenses EBITDA 1Q'17 and capacity expen
Slide 13: Operating expenses in 1Q'2017
Operating expenses in 1Q’2017 (1) 1Q’2017 operating expenses Comparable 1Q’2017 operating expenses OPEX 1Q'16 87.0 OPEX 1Q'16 (excl. ESCB) 78.4 Employee benefit expenses 0.4 Employee benefit expenses 0.5 Purchased electricity and capacity -5.7 Purchased electricity and capacity -0.2 Fuel costs -1.5
Slide 14: RusHydro Group debt profile
RusHydro Group debt profile (1) Key highlights Debt repayment profile (2) (RUB bn) Total financial debt as of Apr 30, 2017, amounted to RUB 187 bn A low interest and FX risk debt portfolio with ca. 93% of the facilities being RUB-denominated and ca. 79% bearing fixed interest rate Strong relat
Slide 15: Segment review
I. Key highlights & operating results II. Financial results III. Segment review IV. Market update
Slide 16: 1Q 2017 revenue: segment review
1Q 2017 revenue: segment review (1) 1Q’17 revenue – segment review Comparable 1Q’17 revenue – segment review (2) 1.1 2.1 0.1 1.1 0.4 -8.9 2.1 0.1 104.4 98.8 -5.4% 98.8 95.1 +3.8% Revenue 1Q'16 PJSC RusHydro ESC RusHydro RAO ES East Other Revenue 1Q'17 Revenue 1Q'16 PJSC RusHydro ESC RusHydro RAO ES
Slide 17: 1Q 2017 EBITDA: segment review
1Q 2017 EBITDA: segment review 1Q’17 EBITDA – segment review 0.5 0.2 0.1 -0.4 2.6 Disposal of LLC ESC Bashkortostan to Inter RAO Group in Dec 2016 30.2 27.2 +11.1% EBITDA 1Q'16 PJSC RusHydro ESC RusHydro Subgroup RAO ES East Subgroup Other segments Misc & EBITDA 1Q'17 undistributed operations Compar
Slide 18: Segment review (1/3) – PJSC RusHydro
Segment review (1/3) – PJSC RusHydro Revenue, bn RUB Key highlights Revenue, external Revenue, intergroup RusHydro’s average achieved selling spot power prices in 27.1 27.7 +2.1% European Russia in 1Q’17 – RUB 1,271/MWh (+0.5%); in Siberia in 1Q’17 – RUB 900/MWh (-3.4%). 3.4% decrease of electri
Slide 19: Segment review (2/3) – RAO ES East Subgroup
Segment review (2/3) – RAO ES East Subgroup Revenue, bn RUB Key highlights Revenue, external Revenue, intergroup Electricity generation by the plants of RAO ES East in 1Q 2017 – 52.8 +4.0% 54.8 9,291 GWh (-9.2%) due to higher hydro electricity output by Zeyskaya and Bureyskaya hydropower plants; 5
Slide 20: Segment review (3/3) – ESC RusHydro subgroup (electricity retail)
Segment review (3/3) – ESC RusHydro subgroup (electricity retail) (1) Revenue, bn RUB Key highlights Retaining profitability levels on the back higher operational +2.0% -34% efficiency even in continuing situation of insufficient retail tariffs; 26.2 17.3 17.0 17.3 Electricity output by RusHydro
Slide 21: Market update
I. Key highlights & operating results II. Financial results III. Segment review IV. Market update
Slide 22: Key drivers of 2017 financial performance
Key drivers of 2017 financial performance Key positive factors in 2017 ↗ Maintaining high operational results of 2016 on the back of favorable hydrological conditions; ↗ Substitution of expensive thermal generation by hydro output due to high inflows in the Far East; ↗ Commissioning of Zelenchukskay
Slide 23: Best dividend story and practice among Russian SOE utilities
Best dividend story and practice among Russian SOE utilities Dividends (RUB bn) Board of Directors of RusHydro recommended the AGM to pay out 50% of 2016 19.9 IFRS net profit or 4.66 kopecks per share. 15.0 As of 2015, RusHydro dividend policy provides for dividend payment based on consolidated
Slide 24: RusHydro Group investment plan 2017-2022
RusHydro Group investment plan 2017-2022, RUB bn, including VAT Adjustment primarily due to shift of launch and funding Overall capacity commissioned in 2016 – 240.9 MW, including: timelines of fossil fuel power projects in the Far East, as • 140 MW – Zelenchukskaya hybrid hydro & pumped storage p
Slide 25: Evaluation of efficiency of forward contract
Evaluation of efficiency of forward contract 2017 2018 2019 2020 2021 Forward nominal value p. 2 ∗ rate p. 6∗5+Commission p.3−dividends p.7+dividends outflow p.8 1 Effective forward rate 7.4% /5 Forward norminal value p. 2 2 Forward nominal value, Rub mn 55 000 3 Commission for organizing the transa
Slide 26: 2017 outlook
2017 outlook Continued trend of strengthening financial stability and optimization of debt portfolio • Further optimization of borrowing costs and maintaining comfortable debt repayment schedule • Target net debt / EBITDA ≤ 2.0 • RusHydro rating S&P upgrade in May 2017 to further strengthen compan
Slide 27: Preliminary 2017 disclosure and IR calendar
Preliminary 2017 disclosure and IR calendar June 17-19 Renaissance Capital Investor Conference (Moscow) June 20-21 VTB Capital Forum (London) June 26 Annual General Meeting of Shareholders 1 July 10 Dividend record date (2) July 20 1H 2017 operational results July 31 1H 2017 RAS results August 29 1H
Slide 28: IR contact details
Thomson Reuters Extel 2014: No.1 IR Team in Russian Utilities Best IRO, Russian Utilities Thomson Reuters Extel 2013: No.1 IR Team in Russian Utilities Best CFO, mid-cap (Russia), #1 Best IRO. mid-cap (Russia), #2 Best overall IR, mid-cap (Russia), #3 Thomson Reuters Extel 2012: No.1 IR