Lenenergo boosts EBITDA to IFRS 8.3% to 4 bln rubles in H1
ST. PETERSBURG. Aug 26 (Interfax) - OJSC Lenenergo increased its earnings before interest, taxes, depreciation and amortization (EBITDA) to International Financial Reporting Standards (IFRS) by 8.3% year-on-year in H1 2014 to 4.015 billion rubles, the company said in a statement.
The company's net debt grew by 10.2% since the beginning of the year to 25.674 billion rubles at the end of June.
Lenenergo posted a net profit to IFRS of 329.633 million rubles in the first half of 2014, 43.4% less than in the same period last year. Revenue rose 31.7% to 18.185 billion rubles. In particular, revenue from electricity transmission increased by 36.5% to 15.504 billion rubles, from technological connection - by 24.3% to 1.652 billion rubles.
According to the statement, the increase in revenue from electricity transmission was attributed to the increase of average tariff by 26.2% in connection with the increase in approved joint operation tariffs for electric power transmission services in 2014 in comparison with joint operation tariffs in 2013. In addition, the joint operation scheme of electric power transmission services in the zone of LLC RKS-Energo was changed, therefore the revenue for this zone was not reflected in the account of OJSC Lenenergo in H1 2013.
Other earnings in January-June amounted to 1.03 billion rubles, down 8%. The main portion of earnings, according to the company, came from the consumption of electricity that was not covered by contracts.
Lenenergo's operating expenses increased by 37% in the accounting period to 16.538 billion rubles. In particular, expenses on electricity transmission services on the grids of adjacent distribution companies rose by 41%, which is related to the attempt to change the joint operation scheme of electric power transmission and calculations for services rendered in the zone of operations of the adjacent grid organization OJSC LOESK in 2013. These expenses were not reflected in the account of OJSC Lenenergo in H1 2013.
Labor costs increased by 12%, the amortization of fixed assets rose by 20%. There has been a substantial increase in reserves for claims and court cases because of possible disagreements with adjacent grid companies in terms of cost and power transmission services, including with OJSC St. Petersburg Electric Grids and OJSC Petrodvorets Electric Grids.
Lenenergo is the largest regional power grid company in northwestern Russia, serving an area of 87,100 square kilometers with a population of more than 6 million. The company operates a grid of 38,800 km of overhead power lines, almost 16,000 km of cable lines and more than 13,800 substations of various voltages.
The company's main shareholders are OJSC Russian Grids 53.41% of ordinary shares) and the administration of St. Petersburg (26.57%).