Page 160 - RusRPTDec21

FSK posted revenue growth of 5.4% y/y (with a 7.6% y/y increase in electricity transmission revenues and 28% y/y uptick from construction revenues vs. a 74% y/y reduction of the grid connection revenues). Costs outpaced revenues, rising 10% y/y (due to grid losses costs and higher construction costs), while other income slid 22% y/y. Adjusted EBITDA printed 3.6% higher y/y, at RUB107.7bn. Net income came in 6.5% lower y/y at RUB54.7bn.
Mosenergo 9mo21 – recovery due to operational environment.
Mosenergo's 9mo21 IFRS results, reported on 3 November, came in fully in line with our expectations. The key factors, which impacted the results were as follows.
· 13.8% YoY recovery in electricity generation
· 26.0% YoY heat sendout growth
· 13.7% YoY increase in the RSV price for Mosenergo stations
· The end of DPM for one more unit from the beginning of 2021
· Costs dynamics
· Finance expenses moderated due to the negative one-off in 9mo20
· The positive contribution from REP Holding in 3Q21, which meant an
improvement from the 1H21 numbers, though still posting a net loss for 9mo21.
As a result, the company reported RUB 155,317mn of revenues, up 27% YoY increase. Along with the costs growth, adjusted EBITDA printed at RUB 27,689mn, 26% higher YoY and in line with our forecasts. On an unadjusted basis, EBITDA increased 22% YoY, 1% below our forecast. Net income improved 37% YoY to RUB 7,341mn, exceeding our estimates by 3% due to the tax credit reported. Capex continued to be elevated due to the DPM2 capex, implying 70% YoY growth in investments. Although the company was net cash at the end of 2Q21, as of the end of 3Q21 Mosenergo had a net debt of RUB 4.3bn due to capex growth. However, leverage remains minimal, at 0.11x.
9.2.11 Metallurgy & mining corporate news
● Gold & Diamonds
Polymetal has held an Investor Day, featuring CEO Vitaly Nesis. Management increased its 2022-23 capex guidance $80-110mn, mainly due to the higher capex consideration for POX-2.
However, the guidance on production from own mines in 2024-25 was raised 5-11%, which more than offsets the capex effect from the NAV standpoint. Also, the company is considering constructing Pacific POX, partly in order to process third party concentrate, to be located on the coast in the Russian Far East, though there are few details yet. Furthermore, the company expects to make two exploration announcements in the next 12 months about new greenfields of significant size, which could possibly be long-term growth opportunities. Overall, we see a mid-single-digits upside risk to our NAV estimate, given the increase in the long-term output guidance and
160 RUSSIA Country Report December 2021 www.intellinews.com