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BGC LLC Announces RAS Financial Results for the Full Year 2014

BGC LLC Announces RAS Financial Results for the Full Year 2014
16 February 2015

Bashkir Generation Company (BGC LLC) announced RAS (Russian Accounting Standards) financial results for the full year 2014.

Indicator *

12 months of 2014

12 months of 2013

Change, %

Revenue

42.0

38.4

+9.4

Operating expenses

37.4

35.6

+5.1

Sales profit

4.6

2.8

+64.3

Net profit

2.7

1.7

+58.8

Indicator *

December 30, 2014

December 31, 2013

Change, %

Total assets

35.3

32.1

+10.0

Equity

30.2

24.6

+22.8

Loans and borrowings

1.3

0.5

+160.0

Net debt **

0.1

0.4

-75.0

* Billion rubles unless indicated otherwise.

** Net debt is defined as Short-term loans and borrowings plus Long-term loans and borrowings less Cash and cash equivalents less Bank deposits.

OPERATING RESULTS

Indicator

12 months of 2014

12 months of 2013

Change, %

Electricity generation, million kWh

19,567

19,699

-0.7

Heat distribution from collectors, million Gcal

16.9

16.7

+1.2

Capacity utilization (power generation), %

53.8

53.7

+0.2

Capacity utilization (heat), %

21.5

25.7

-16.3

INCOME STATEMENT

Revenue of BGC LLC was 42.0 billion rubles for the full year 2014, up 3.6 billion rubles (9.4%) from 2013.

The largest part of the revenue — 58.1% or 24.4 billion rubles — is attributable to electricity sales. This item increased by 1.8 billion rubles (7.8%) year-on-year owing to an 8.9% increase in average electricity sales price on the WECM partially offset by a 1.0% reduction in sales volume.

Revenue from capacity sales was 5.9 billion rubles (14.1% of the total revenue) in the reporting period, up 0.3 billion rubles (5.3%) from 2013. This change reflects a 7.7% increase in average capacity sales price resulting from the indexation of regulated tariffs, higher CCA capacity sales price, and a 2.2% reduction in sales volume due to repairs of Units 1 and 2 at Karmanovskaya TPP.

Revenue from heat sales was 10.1 billion rubles (24.1% of the total revenue), up 0.8 billion rubles (8.0%) from 2013. This increase reflects the indexation of heat and thermal capacity tariffs resulting in a 6.6% increase in average tariff to 600.69 rubles per Gcal, and a 230.7 thousand Gcal (1.4%) increase in heat delivery, which reached 16.89 Gcal, in 2014.

Operating expenses increased by 1.8 billion rubles (5.1%) to 37.4 billion rubles in the reporting period. This change primarily reflects a 1.1 billion ruble (4.4%) increase in fuel costs. Just a minor increase in gas costs is the result of the management team's effort to reduce costs and sel ect suppliers offering the best pricing.

Gross profit was 4.6 billion rubles in 2014 compared to 2.8 billion rubles in 2013.

Primary drivers of this increase include the optimization of capacity utilization at power plants resulting in reduced use of inefficient thermal power generation, and the signing of new gas supply agreements with independent suppliers.

Sales profit increased by 1.8 billion rubles (64.3%) year-on-year to 4.6 billion rubles.

Balance of other income/(expenses) was (1.1) billion rubles compared to (0.5) billion rubles in 2013, primarily reflecting the need to establish reserves for accounts receivable and the property tax adjustments.

As the result, net profit of BGC LLC for the full year 2014 increased by 58.8% to 2.7 billion rubles, compared to 1.7 billion rubles in 2013.

BALANCE SHEET

Total assets of BGC LLC as of December 31, 2014 were 35.3 billion rubles, up 3.2 billion rubles (10.0%) from December 31, 2013. This increase reflects changes in current and non-current assets.

Non-current assets increased by 4.1 billion rubles (15.9%), mostly due to the merger of PGU TPP-5 LLC into BGC LLC.

Current assets as of December 31, 2014 decreased by 0.9 billion rubles (13.8%) to 5.5 billion rubles. Primary drivers of this change include the merger of PGU TPP-5 LLC into BGC LLC, the reduction of accounts receivable due to partial repayment of debt for electricity sold on WECM, and the increase in cash and cash equivalents resulting from receipt of customer payments.

Liabilities of BGC LLC as of December 31, 2014 were 5.1 billion rubles, down 2.3 billion rubles (31.1%) fr om December 31, 2013. This change mostly reflects the settlement of accounts payable.

# # #

BGC LLC is a major regional energy company in Russia and a fully owned subsidiary of JSC Inter RAO coordinating the operation of Bashkir Heat Distribution Networks LLC (BashRTS LLC) and several subsidiaries. BGC LLC has 4,145 MW and 8,851 Gcal/h of installed power generation and heat production capacity. With an authorized capital stock of 24 billion rubles, BGC LLC is a fully owned subsidiary of JSC Inter RAO. www.bgkrb.ru

Inter RAO Group is a diversified energy holding serving various segments of Russian and international electric power industry. The Group is the leading exporter and importer of electricity in Russia actively increasing electricity generation and sales, and developing new lines of business. The corporate strategy of Inter RAO is focused on making Inter RAO a global energy enterprise, a key player in the global energy market, and the leading Russian energy company by energy efficiency. Inter RAO Group owns and operates over 35 GW of installed power generation capacity. www.interrao.ru

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