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to RUB 23.7bn. Inter RAO (IRAO) published strong 3Q21 results today due to its generation segment, which continued to benefit from the 7.8% YoY growth in electricity generation to 27.8mn MWh, favorable electricity pricing in the European part of Russia (+18.9% YoY in 3Q21) and the c. 20% YoY increase in the KOM capacity price. IRAO’s retail segment was up 10.9% YoY to RUB 183.9bn thanks to the recovery in electricity consumption, while electricity trading was up 2.4x to RUB 35bn thanks to the boom in electricity export volumes and beneficial prices on Nord Pool in Finland and Lithuania (+2.4-2.6x YoY in 3Q21). The total top line was 1.4% lower than our estimate and 2% stronger than Interfax consensus. On the cost side, we see that electricity transmission costs were up 8.3% YoY to RUB 65.6bn and the depreciation charge was up 4.2% YoY to RUB 7.6bn, while maintenance expenses were down 2.8% YoY to RUB 3.2bn in 3Q21. As a result, EBITDA rose 52.8% YoY
to RUB 38.5bn, 1.5% weaker than our forecast but 7.2% better than consensus. We also see that the bottom line grew at a pace of 31.2% YoY to RUB 23.7bn, 6.5% weaker than our forecast but 17.7% better than consensus.
ROSSETI’s distribution subsidiaries MRKC, MRKP and MRKV reported their 3Q21 IFRS results yesterday, 23 November.
ROSSETI Center. Revenue was up 9.3% YoY to RUB 25.4bn and adjusted EBITDA was up 5% YoY to RUB 5.5bn. The company reported a 54.6% YoY drop in net income to RUB 800mn vs. RUB 1.8bn in 3Q20. Revenue from electricity distribution was up 10.7% YoY, as electricity consumption in UES Center increased 7.5% YoY in 3Q21. Cash costs rose 10.5% YoY to RUB 19.9mn, and the bottom line was negatively affected by RUB 900mn in net financial costs vs. a net financial gain of RUB 100mn in 3Q20.
ROSSETI Center and Volga. Revenue was up 13.4% YoY to RUB 24.7bn,
while EBITDA rose 53% YoY to RUB 5.9bn. The company reported a 2.7x increase in net income to RUB 2.6bn in 3Q21. Revenue from electricity distribution was up 11.8% YoY, while connection fees were up 61.6% YoY to RUB 300mn. COGS rose 6.4% YoY to RUB 21.5bn and cash operating costs rose 4.9% YoY to RUB 18.8bn during the quarter.
ROSSETI Volga. Revenue was up 10.4% YoY to RUB 15.8bn, while adjusted EBITDA was up 36.3% YoY to RUB 1.5bn. The company’s net income stood at RUB 238mn vs. a net loss of RUB 224mn in 3Q20. Revenue from electricity distribution increased 10.4% YoY to RUB 15.6bn, as electricity consumption in UES Volga was up 8% YoY during 3Q21. Cash operating costs were up 8.2% YoY to RUB 14.2bn, while the subsidiary’s electricity loss decreased 0.28ppts to 4.56%. The subsidiary’s depreciation charge rose 8.2% YoY to RUB 1.4bn.
Rosseti and FSK reported their 9mo21 results.
Rosseti's top line increased 11% y/y to RUB798.8bn (on the back of volumes growth, the tariff increase and a slight rise in grid connection services, vs. the 40% gain in construction works). Costs grew 8.3% y/y. This led to EBITDA being up 17.9% y/y to RUB262.9bn, while net income was 34.5% higher y/y at RUB104.8bn, with the latter also supported by a RUB334mn write-off (vs. RUB5.3bn in 9mo20) and other income growth of 32% y/y.
159 RUSSIA Country Report December 2021 www.intellinews.com