MOESK : Income of PJSC MOESK according to IFRS in 9 months of 2016 totalled 2.63 bln rub

Today PJSC MOESK announces its financial results according to IFRS in 9 months of 2016.

According to the consolidated statements, the Group's proceeds in 9 months of 2016 totalled 100.61 bln rub., in particular, PJSC MOESK earned 92.40 bln rub. from power transmission and 5.60 bln rub. from technological connection. Proceeds from power transmission services compared to the same period in 2015 grew due to the goring power consumption and 'boiler' net supply. The decrease in proceeds from technological connection in the reporting period compared to 2015 was due to the expansion from 01 October, 2015, of the privileged category of consumers up to 150 kW including Doing Business consumers and the falling demand caused by the business recession.

Cost totalled 93.95 bln rub. The growth of operational expenses compared to 9 months of 2015 was due to the growing prices in terms of conventionally uncontrolled expenses to purchase power losses, as well as the growing FSK and TSO service rates based on rate balance decisions outstripping the growth of the Company's own requisite gross proceeds.

Despite the limit on the rate growth pace and the inflation load on cost, PJSC MOESK achieved a growth of gross profits from power transmission compared to the same period in the previous year due to implementing plans of optimizing controllable operational expenses and the reduction of power losses. In 9 months of 2016, losses totalled 7.46%, in the same period of the previous year, 7.75%.

EBITDA in 9 months of 2016 totalled 24.53 bln rub. The Group's profit in 9 months of 2016 totalled 2.63 bln rub.

Key impact on the falling figures of EBITDA and net profits compared to the same period in 2015 was exercised by the growth of the Company's other expenses, to wit, the charging of reserves for dubious debts and assessment liabilities of the Company plus the growth of other non-monetary expenses.

The decrease in the average borrowing rate by 0.8 percentage point compared to the same period in the previous year down to 9.52%, which is below the current key rate of the Central Bank of the Russian Federation attests to the success of the Company's management in managing the credit portfolio. This is reflected in the confirmation of the long-term rating of issuer's default in foreign and national currencies of PJSC MOESK by the International Agency Fitch Ratings at BB+ with a stable forecast.

An important fact of the Company's business in 9 months of 2016 was the payment of record dividends for 2015, 50% of net profits according to IFRS. Therefore, aggregate payments totalled 6.3 bln rubles or 12.97 kop. per ordinary share of the Company.

FOR REFERENCE: The consolidated interim financial statements of the Group cover the following subsidiaries: OJSC Moskabelsetmontazh (MKSM), OJSC Moskabelenergoremont (MKER), OJSC Electrical Equipment Repair Factory (RETO), OJSC Energotsentr.

Table 1. Summary report on the financial status

Indicator	Unit	9 months of 2016	9 months of 2015	9 months of 2016 9 months of 2015
Noncurrent assets	million rubles	299,584	286,442	4.59%
Current assets	million rubles	26,303	29,818	-11.79%
Total assets	million rubles	325,887	316,260	3.05%
Equity	million rubles	165,140	165,474	-0.21%
Long-term liabilities	million rubles	83,196	83,506	-0.38%
Short-term liabilities	million rubles	77,551	67,280	15.27%
Total equity and liabilities	million rubles	325,887	316,260	3.05%

Table 2. Summary report on profit or loss and other consolidated income

Indicator	Unit	9 months of 2016	9 months of 2015	9 months of 2016 9 months of 2015
Revenue	million rubles	100,611	93,502	7.61%
- electric power transmission	million rubles	92,397	83,839	10.21%
- revenue from grid connection services	million rubles	5,597	6,834	-18.10%
- other revenue	million rubles	2,617	2,829	-7.50%
Operating costs	million rubles	-93,950	-80,274	17.04%
Other operating incomes	million rubles	1,616	1,084	49.08%
Financial income	million rubles	158	925	-82.92%
Financial expenses	million rubles	-4,700	-3,872	21.39%
Profit before tax	million rubles	3,735	11,365	-67.14%
Profit tax expense	million rubles	-1,102	-2,779	-60.35%
Profit of the reporting period	million rubles	2,633	8,586	-69.34%
Basic and diluted profit per ordinary share	rubles	0.0541	0.1757	-69.21%
For reference: EBITDA	million rubles	24,533	29,871	-17.87%

Table 3. Operating costs

	Unit	9 months of 2016	%	9 months of 2015	%	Change (absolute)
LGO services	million rubles	26,877	29%	21,798	27%	5,079
Services of FGC UES	million rubles	12,221	13%	10,946	14%	1,275
Depreciation	million rubles	16,256	17%	15,558	19%	698
Compensation for losses	million rubles	9,684	10%	7,851	10%	1,833
Staff costs	million rubles	13,378	14%	13,412	17%	-34
Other expenses	million rubles	15,534	17%	10,709	13%	4,825
Total operating costs	million rubles	93,950	100%	80,274	100%	13,676

Table 4. Summary cash flow statement

Indicator	Unit	9 months of 2016	9 months of 2015	9 months of 2016 9 months of 2015
Cash from operating activities	million rubles	18,649	23,555	-20.83%
Cash used in investment activity	million rubles	-21,332	-20,707	-3.02%
Cash from/(used in) financial activity	million rubles	2,523	-4,251	-159.35%
Cash and equivalents as of the reporting period end	million rubles	240	2,902	-91.73%