OREANDA-NEWS. On 16 July 2009 was announced, that OGK-1 published Group’s unaudited consolidated financial report for the first quarter of 2009. The statement is prepared in compliance with the International Financial Reporting Standards (IFRS).

Consolidated accounting statement as of March 31, 2009.

For the period between January and March of 2009 total assets of the OGK-1 Group grew by 4.1% and amounted up to 51.97 billion Russian rubles at the end of the quarter. Fixed assets were 34.87 billion Russian rubles and grew by 2.1%.

The growth in the fixed assets was supported by the investment programme of OGK-1. The programme is directed at construction of the new generating facilities and technical upgrade of the existing generating facilities. Therefore the sum of capital investment in the fixed assets exceeded depreciation and replacement. The cost of the fixed assets of the OGK-1 Group grew by 2% up to 34.37 billion Russian rubles. The growth was facilitated by capital investment, in particular investment in the construction project of the third power generation unit of Kashirskaya GRES.

Current assets are 17.09 billion rubles – which is 8.5% above the amount of the current assets at the beginning of 2009.

For the period between January and March of 2009 net assets of OGK-1 Group grew by 6.5% and amounted up to 34.92 billion Russian rubles.

Total liabilities for the reporting period decreased by 0.4% and are equal 17.05 billion Russian rubles. These changes were caused by restructuring of the short-term borrowed funds which were directed at financing the investment programme

As a result of optimization of the credit portfolio and lowering of the debt burden provided under the integrated cost cutting programme implemented by the OGK-1 Group, credit and loan volume of the first quarter of 2009 decreased by 4.5% and equals 10.19 billion Russian rubles. .

During the reporting period the structure of the credit portfolio improved: long-term borrowed funds of the OGK-1 Group for the first quarter of 2009 grew by 51.8% and reached 5.03 billion Russian rubles; short-term borrowed funds decreased by 30% down to 5.16 billion Russian rubles. At the beginning of the year the ratio of the long-term to short-term credit in the credit portfolio was close to 40/60, by the end of the first quarter of 2009 the ratio was close to parity and at the end of the first six months, according to the immediate data, the credit structure shifted towards long-term funds and is close to 60/40.

Profit and loss statement for the first quarter of 2009

The revenue of the OGK-1 Group for the first quarter of 2009 was 11.87, which is 12.8% below the revenue of the first quarter of 2008. The main reason behind such a drop is a 16% decrease in generation by the electricity generating plants of OGK-1. This decrease is linked to lower energy consumption in the regions covered by GRES.

Moreover, consolidation of the OGK-1 Group’s share in the net assets of ZAO “Nizhnevartovskaya GRES”, among other factors, affected the decrease in the revenue and a change in the current activity expenses. According to the statement for the first quarter of 2008 the share was 100%, but according to the statement for the first quarter of 2009 the share was 75%-1 share (which is proportional to OGK-1 share in the authorized capital of OGK-1 and TNK-BP joint company - NVGRES HOLDING LIMITED, which is responsible for the implementation of the investment project at Nizhnevartovskaya GRES).

Current activity expenses of the OGK-1 Group for the first quarter of 2009 decreased by 21.2% down to 10.23 billion Russian rubles. The cost of production decreased faster than the revenue due to a decrease in the variable and fixed costs.

Financial income of the first three months of 2009 was 0.67 billion Russian rubles compared to 0.05 billion Russian rubles of financial expenses for the same period in 2008. The financial income consisted of interest income and positive difference in exchange rates raised through management of the available cash assets of NVGRES HOLDING LIMITED, which is part of the OGK-1 Group.

The profit from the current activities of the OGK-1 Group during the first quarter of 2009 was 2.6 times larger compared to the profit from the current activities during the first quarter of 2008 and reached 1.64 billion Russian rubles. The growth was caused by a larger decrease in the cost of production as compared to a decrease in the revenue.

Profit before taxes of the OGK-1 Group for the period between January and March of 2009 was 4 times larger compared to the same period in 2008 and was equal 2.31 billion Russian rubles. Profit tax expenses of the OGK-1 Group for the first quarter of 2009 grew by 35% up to 0.28 billion Russian rubles.

New profit of the OGK-1 Group for the first quarter of 2009 grew by 5.4 and amounted up to 2.03 billion Russian rubles. The growth in the net profit represents the economic effect from implementation of the integrated anti-crisis programme and a step-by-step (quarter-by-quarter) increase in the gas tariffs together with a one-time indexation (starting from January 2009) of the tariffs for the electric energy and heat. This step-by-step increase differs from a one-time increase of the tariffs conducted in previous years. We expect that this economic effect from the step-by-step increase in the tariffs for the price-limited gas will disappear by the end of the year; the growth of the tariffs will be 27.7% compared to the previous year.

Changes in the net profit were the result of the decrease in the purchasing expenses for commercial gas, for purchasing expenses for traded and overlimited gas; they were also the result of optimization of the operating generating equipment under decreased generation of the electrical energy which was caused by lower energy consumption. Moreover, this parameter was affected by financial income of 0.67 billion Russian rubles received as a result of investment of temporary available monetary funds.

Consolidated cash flow statement for the first quarter of 2009

Cash inflow from the current operations for the reporting period grew by 2.2 and reached 2.83 billion Russian rubles. It had a positive effect on the liquidity of the OGK-1 Group.