OREANDA-NEWS.  September 06, 2012. OGK-3 Group financial statements released reflect performance of OGK-3 and its 11 service, heat trading and coal mining subsidiaries. All subsidiaries are fully owned by the Group. The majority of subsidiary revenues come from intra-group operations, reported the press-centre of OGK-3.

Statement of comprehensive income

The revenue of OGK-3 Group dropped insignificantly, by 0.2 billion RUB (0.9%) compared to 2011, in H1 2012, amounting to 21.1 billion RUB against 21.3 billion RUB. The change was primarily caused by a decline in revenue from the sale of electricity (by 1.0%), due to the 4.8% reduction of the average sale price of electricity on the day-ahead market, while electricity generation grew by 3.2%.

Group the operating expenses increased by 4.4 billion RUB (+ 22.4%) in H1 2012 and reached 24.0 billion RUB, mainly because of the forming of the provision for the impairment of property, plant and equipment and facilities under construction.

After the review of the impairment of property, plant and equipment and facilities under construction as of June 30, 2012, the recoverable amount of property, plant and equipment and facilities under construction of the Gusinoozyorsk GRES fell. This was due to a slow-down of the forecasted growth rate of the capacity rate against previous estimates. In this regard, a loss from impairment amounting to 3.6 billion RUB was recognized for some property, plant and equipment and facilities under construction, as well as advanced payments made for the construction of the branch of the Gusinoozyorsk GRES state district power plant.

As a result, the operating profit of the Group without taking into account of the provisioning costs amounted to 0.7 billion RUB in H1 2012 against a profit of 1.7 biillion RUB made by the Group a year ago. The following factors were crucial in this result:

- the 0.5 billion RUB growth of the cost of fuel (by 3.6%) to 12.5billion RUB;

- the 0.1 billion RUB increase in transportation services (a 75.9% increase) to RUB 0.3 billion.

As the result, its EBITDA, dropped by 0.9 billion RUB (-33.3%) and amounted to 1.8 billion RUB.

Financial income fell by 0.2 billion RUB (by 22.2%) and totaled 0.7 billion RUB in the reporting period, primarily due to the cut in financial investment and allocation of cash for funding the Group’s investment program.

Deposits in foreign currencies and the change of the structure of deposit agreements the OGK-3 Group had concluded brought it a foreign exchange gain of 0.1 billion RUB in H1 2012 against the 0.5 billion RUB loss it had posted in H1 2011.

The H1 2012 consolidated net loss of OGK-3 was –1.6 billion RUB, against its 1.6 billion RUB in net profits in H1 2011.

Without the loss from impairment of property, plant and equipment for H1 2012, the net profit in the reporting period amounted to 2.0 billion RUB.
 
The statement of financial position

The total assets of OGK-3 Group grew by 0.7 billion RUB (+ 0.7%) and amounted to RUB 101.6 billion as of June 30, 2012.

As of June 30, 2012, fixed assets surged by 16.0% and totaled 68.4 bln RUB. The surge of fixed assets resulted from the 9.2 billion RUB (+15.9%) increase in property, plant and equipment that amounted to 66.8 billion RUB as of the end of the reporting period, due to the implementation of the investment program of OGK-3 Group, including the construction under the power supply agreements of the Cherepets GRES and the Yuzhnouralsk GRES.

As of June 30, 2012, other fixed assets grew by 0.2 bln RUB (15.4%) due to an increase in a long-term VAT on advance payments made for capital construction.

Current assets were reduced by 20.8% to 33.3 billion RUB. The change of the current assets was due to reduced financial investments in the form of deposits with maturities of 3 to 12 months (RUB 20.5 billion), increased amounts of temporary free cash deposited for up to a 3 month term, as well as a 12.9 billion RUB growth of balances on operating accounts for financing the investment program.

The reporting period also saw a 27.4% (1.8 billion RUB) decline in accounts receivable due to the reduction of the VAT’s payable amount and augmented reserves by 0.5 billion RUB (plus 18.5%) due to the growing inventory of process fuel (coal).

As of June 30, 2012, capital equity grew by 0.2 billion RUB (0.2%) and amounted to RUB 90.9 billion.

Total liabilities for the reporting period grew by 0.6 billion RUB (5.9%) and amounted to 10.8 billion RUB. The growth was caused by increased accounts payable that added 2.0 billion RUB (plus 37.0%) and totaled 7.4 billion RUB due to settlements with suppliers and contractors for investment projects and fuel.

OGK-3 Group did not take out loans or borrow money in the reporting period.

The consolidated IFRS financial statement of JSC OGK-3 for H1 2012 is available on the company’s website.