En+ Group Announces 2016 Financial and Operational Results

18 APRIL 2017

Moscow, 18 April 2017 – En+ Group, a leading global vertically integrated hydro power and metals producer, today announces key financial and operational highlights for the full year ended 31 December 2016.

Maxim Sokov, CEO of En+ Group, commented: “These results reflect positive trends which we have seen continuing into 2017, notably stronger aluminum pricing and growing demand for electricity in Siberia. The market environment improved considerably in the second half of the year, enabling the Group to increase revenues and adjusted EBITDA in H2 2016 by 4.8% and 20.6% as compared to H2 2015, respectively.

En+ benefitted from an accelerated schedule for power capacity liberalisation and increased hydro power generation in Siberia. Meanwhile, the consolidation of our main hydro power assets has enabled us to transform En+ into an operating company and now we intend to utilise our streamlined structure to increase efficiency going forward. Our continued focus on operational excellence and on reducing costs across the business lays a strong foundation for growth in 2017.

UC RUSAL’s improved performance in Q4 was driven by growing aluminium sales volumes, while prices steadily increased over the course of last year. We expect stronger aluminium pricing to continue in 2017 and this will have a positive impact on the Group’s top and bottom line.”


Financial Performance

The En+ Group’s consolidated revenue* for the period totalled USD 9,776 million.

Revenues from the En+ Segment ("En+"), which predominantly consists of power operations supported by coal mining and logistics, remained stable at USD 2,482 million; UC RUSAL’s revenues totalled USD 7,983 million.

The En+ Group’s adjusted EBITDA reached USD 2,311 million in 2016. Adjusted EBITDA at UC RUSAL totalled USD 1,489 million. En+’s adjusted EBITDA grew to USD 822 million.

En+ consolidated its main power assets by increasing its stake in Irkutskenergo to 90.8% and in Krasnoyarsk HPP to 100%. It also acquired the dams connected to its three hydro power plants that had been leased previously.

* Consolidated revenue includes En+ revenue and UC RUSAL revenue reduced by intra-group balance.


Operational Performance

  • Electricity production up 6% y-o-y to 69.5 TWh
  • Green power output up 8% y-o-y to 56.7 TWh
  • Aluminium production up 1.1% y-o-y to 3.685 million tonnes
  • Aluminium sales up 4.9% y-o-y to 3.818 million tonnes

En+

En+’s power plants generated 69.5 TWh of electric energy in 2016, an increase of 6% versus 2015. En+ continued to provide a stable supply of electric and thermal power to its customers against a backdrop of rising electricity demand in Siberia, the Group’s main region of operations.

En+'s hydro power plants – Krasnoyarsk, Irkutsk, Bratsk, Ust-Ilimsk and Onda HPPs – ramped up total output by 8% year-on-year to 56.7 TWh, aided by the recovery of water levels in Siberia.

The Group’s thermal power plants reduced their power generation by 2% year-on-year to 12.78 TWh. Heat generation increased by 4% to 27.35 Gcal due to the colder winter and spring months in 2016 compared to 2015.

Overall electricity consumption in Siberia rose 1.8% year-on-year in 2016 to 207.1 TWh according to the System Operator of Russia’s United Power System. The key growth drivers were the launch of the first phase of Boguchany aluminium smelter and higher demand from the region’s oil and gas projects.

UC RUSAL

UC RUSAL’s aluminium production grew by 1.1% year-on-year to 3.685 million tonnes in 2016, making the company the second-largest aluminium producer globally.

Aluminium sales totalled 3.818 million tonnes, up 4.9% year-on-year. The increase was largely attributable to additional volumes from the Boguchansky aluminium smelter.

In 2016, sales of value added products grew to 1.677 million tonnes, an increase of 6.7% from the previous year.