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FY2012 Key Results
(RAS)
Disclaimer
This presentation is not an offer or invitation to make offers (advertisement) in respect of purchase or subscr...
General Information on the Company
LENENERGO is the largest electricity distribution grid company (the
operator of 0,4-110...
53,41%
26,57%
7,15%
2,24%
3,60%
1,49%
5,54%
JSC IDGC Holding
St.-Petersburg
(CPMC)
JSC IDGC of Ural
ENERGYO SOLUTIONS RUSS...
High voltage grids
(FSK) LENENERGO
Third-party grid
organizations (TGOs)
Electricity trading
companies
End users
Generatio...
0
5
10
15
20
25
30
35
0,00
500,00
1000,00
1500,00
2000,00
2500,00
3000,00
3500,00
4000,00
MICEX MICEX PWR average АО ЛЭ
Se...
Key results of the Company in 2012
Indicator Unit 31.12.2011 31.12.2012
Δ in %
2012/2011
Productive electricity supply mln...
37 009
31 758
5 252
1 417
36 273
32 830
3 443
1 234
Выручка от
реализации
Себестоимость Пприбыль от
реализации
Чистая приб...
30 456 32 344
1 226 400
2011 2012
по передаче э/э по ТП
28 526 28 816
8 311 7 282
2011 2012
от передачи э/э от ТП
Formatio...
11%
11%
5%
42%
16%
15%
облигационный займ серии 04
Банк ВТБ
Связь-Банк
Сбербанк России
АБ Россия
Внешэкономбанк
Credit Por...
Implementation of the Investment Program of Lenenergo in 2012
CAPEX in 2012 totaled RUB 14 891 mln, that is RUB 170 mln, o...
RF Government Decree of
29.12.2011 #1178 on the
fundamentals of pricing
(revised RF Government
Decree of 30.06.2012 #663)
...
Indicator Leningrad region St.-Petersburg Total Lenenergo
Loss on electricity transmission, included by regulators through...
33 460
4 485
28 975
34 513
4 506
30 007
Отпуск в сеть Общие потери в сетях Полезный отпуск
2011 2012
28 439
27 672
29 095 ...
Services on Grid Connections in 2012
+ 77%
Conclusion and execution of contracts for grid connection
in 2011-2012., MW (pi...
JSC IDGC Holding and the Administration of St. Petersburg
exercised their pre-emptive right to acquire shares in
proportio...
Annex:
Tariff Models, Approved by Regional Regulators for 2012-2017
and Agreed by FTS of Russia
2012 2013 2014 2015 2016 2...
CONTACTS
JSC Lenenergo
196247, Russia, Saint-Petersburg, Constitution Sq., 1
Head of Department for Corporate Governance
a...
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FY2012 Key Results (RAS)

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2013

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FY2012 Key Results (RAS)

  1. 1. FY2012 Key Results (RAS)
  2. 2. Disclaimer This presentation is not an offer or invitation to make offers (advertisement) in respect of purchase or subscription to securities of Lenenergo. Neither the presentation, nor any part hereof, nor the fact of its representation or distribution serve as the basis for entering into any agreement or taking any investment decision; therefore, the presentation should not be relied upon in this respect. This presentation may contain estimates. The estimates are not based on actual circumstances and include statements in respect of the intentions, opinions or current expectations of JSC Lenenergo as regards the results of its activity, financial position, liquidity, prospects of growth, strategy and the industry, in which Lenenergo operates. Such estimates by their nature are characterized by presence of risks and uncertainty factors since they are related to the events and depend on the circumstances, which may fail to happen in the future. Lenenergo warns that the estimates are not a guarantee of the future parameters, and the actual results of Lenenergo activities, its financial position and liquidity, as well as development of the industry, in which it operates, may significantly differ from those included in the estimates contained herein. Besides, even if the results of the Company's activities, its financial position and liquidity, as well as the development of the industry, in which it operates, correspond to the estimates contained herein, such results and events are not indicative of the results and events in the future. This presentation contains the information received from third parties besides the official information on Lenenergo activities. This information has been received from the sources which are reliable in Lenenergo opinion. Nevertheless, we do not guarantee the accuracy of such information which may be reduced or incomplete. All opinions and estimates contained herein reflect our opinion as at the date of publication and are subject to change without notice. Lenenergo does not bear liability for the consequences of use of the opinions or estimates contained herein, or information incompleteness. Lenenergo does not undertake obligations in respect of revision or confirmation of the estimates and evaluations, as well as in respect of updating of the information contained herein.
  3. 3. General Information on the Company LENENERGO is the largest electricity distribution grid company (the operator of 0,4-110 kV networks), servicing the territory of Saint- Petersburg and the Leningrad region. It is a natural monopoly, which tariffs are set by the regulating authorities - Federal Tariff Service (FTS) and regional regulators Main types of activity: • electricity transmission & distribution • technological connection of new customers to networks The share of Lenenergo on the electricity transmission market as of 31.12.2012 - 70,3 % Service area: St.-Petersburg and the Leningrad region Main competitors: in St.-Petersburg - JSC SPbES, in the Leningrad region - JSC LOESK Assets Service area 87,3 thousand km Population of the region 6,2 mln people Unit 2010 2011 2012 Installed capacity MVA 20 741 21 427 21 952 0,4-110 kV OTL (on circuit) Km 39 419 39 783 40 053 0,4-110 kV (on line) Km 36 274 36 587 36 859 0,4-110 kV cable lines Km 18 622 19 554 20 400 35-110 kV substations pcs (MVA) 372 (13 466) 373 (13 742) 377 (13 969) 6-35 kV transformer substations pcs (MVA) 14 361 (7 275) 14 770 (7 686) 15 025 (7 983) * MCap is calculated based on the weighted average price at the MICEX SE Unit 31.12.2012 Productive electricity supply mln kWh 30 007 Connected capacity MW 523 Revenue RUB mln 36 273 EBITDA RUB mln 10 221 Net profit RUB mln 1 234 CAPEX RUB mln 14 891 MCap* as of 25.03.2013 RUB mln 7 926 Personnel people 6007 Key indicators RAS_2012FY | 1
  4. 4. 53,41% 26,57% 7,15% 2,24% 3,60% 1,49% 5,54% JSC IDGC Holding St.-Petersburg (CPMC) JSC IDGC of Ural ENERGYO SOLUTIONS RUSSIA LIMITED (EOS Russia) RUSENERGO FUND LIMITED JP Morgan Funds others PRODUCTION UNITS (ELECTRICITY TRANSMISSION) JSC Lenenergo CJSC Tsarskoselskaya Energy Company (96,95%)* CJSC Kurortenergo (98,13%)* CJSC Lenenergospetsremont (100%)* SubsidiariesBRANCHES Share Capital and Organizational Structure * – from the authorized capital electricity transmission and technological connection services design and construction work in power supply Management of objects under construction Service branch JSC Energy Service Company Lenenergo (100%)* energy services, services of energy saving and energy efficiency JSC IDGC Holding The city of St.-Petersburg (CPMC) Minority shareholders Russian Federation 53,41% (+ 7,15% - share of JSC IDGC of Ural) 26,57% 12,87% Vyborg power networks Gatchina power networks Kingisepp power networks St-Petersburg high-voltage power networks Novaya Ladoga power networks Suburban power networks Tikhvin power networks Cable network ** as of the last closing date of the shareholders register: 06.06.2012 considering the additional issue of ordinary shares in 2102 and the purchase of shares by IDGC of Ural Share capital structure of Lenenergo**, % from ordinary shares Authorized capital 1 228 325 624,08 Ordinary shares* 1 135 061 313,08 Preferred shares 93 264 311 Authorized capital of Lenenergo, pcs. (RUB) Organizational Structure of Lenenergo * In 2012, the authorized capital was increased by placing of 209 039 634,04 additional ordinary shares RAS_2012FY | 2 JSC Energouchet (40%)*manufacture, installation and repair of energy resources gauges
  5. 5. High voltage grids (FSK) LENENERGO Third-party grid organizations (TGOs) Electricity trading companies End users Generation wholesale electricity market Major TGOs in the region: in SPb – JSC SPbES, in LR – JSC LOESK • Independent electricity trading companies • Guaranteeing suppliers: JSC PSK, LLC RSK-Energo, LLC Rusenergosbyt, LLC Energy Holding • Direct consumers – participants of wholesale and retail electricity markets Payment of losses in Lenenergo networks TGK-1, OGK-6, NW GRES, LAES, etc. Consolidated revenue system* electricity fee purchase of electricity electricity transmission fee electricity transmission fee electricity electricity electricity 0,4-110 kV grids 0,4-10 kV grids> 220 kV grids electricity Business Model of Lenenergo: Cash Flows and Electric Power Flows *RGR of TGOs and RGR of FSK comprise RGR of Lenenergo Transmission services Distribution grid company electricity transmission fee Market share of TGOs . . . Branch of FSK UES – MES of North-West Wholesale electricity market 34% RAS_2012FY | 3
  6. 6. 0 5 10 15 20 25 30 35 0,00 500,00 1000,00 1500,00 2000,00 2500,00 3000,00 3500,00 4000,00 MICEX MICEX PWR average АО ЛЭ Securities in 2012 Against the Background of Investor Distrust Due to the Uncertainty of Tariff Regulation 31.12.2011 31.12.2012 ∆,% MICEX, p.p. 1402,23 1474,72 5,2% MICEX PWR, p.p. 2053,02 1707,42 -16,8% LSNG (MICEX), RUB 9,84 6,603 -32,9% LSNGP (MICEX), RUB 21,74 17,63 -18,9% Market capitalisation of Lenenergo, RUB mln* Dynamics of MICEX, MICEX Power and shares of Lenenergo in 2012 Year Dividends on ordinary shares, RUB per 1 share Dividends on preferred shares, RUB per 1 share Accrued dividends, RUB thousand for 2009 no 3,4933 325 804 for 2010 no 4,0804 380 559 for 2011 no 1,5198 141 742 ** In accordance with the Charter of JSC Lenenergo dividends are accrued on preferred shares of A-type in the amount of 10% of the net profit for the financial year ended MCap*, RUB mln 2010 2011 2012 2012/2011, % MICEX SE 27 372 11 139 7 759 -30,3% Dividend payments** * MCap is calculated based on the weighted average price at the MICEX SE at the end of the period RUBp.p. Shares of Lenenergo Quotation List MICEX SE B Tickers Ordinary shares LSNG Preferred shares LSNGP 12 266 12 373 11 836 10 982 8 227 7 705 7 049 7 080 8 132 7 871 7 931 7 759 янв.12 фев.12 мар.12 апр.12 май.12 июн.12июл.12 авг.12 сен.12 окт.12 ноя.12 дек.12 RAS_2012FY | 4 2010 2011 EPS (ordinary shares) 3,70 1,38 P/E (ordinary shares) 7,02 7,14 Payout ratio, % (preferred shares) 10,00% 10,00% Dividend yield, % (preferred shares) at the end of the year 11,39% 6,99% Key indicators on shares average OS 01/12 02/12 03/12 04/12 05/12 06/12 07/12 08/12 09/12 10/12 11/12 12/12
  7. 7. Key results of the Company in 2012 Indicator Unit 31.12.2011 31.12.2012 Δ in % 2012/2011 Productive electricity supply mln kWh 28 975 30 007 3,6% Electricity losses % 10,60% 10,37% -0,23 p.p. Connected capacity MW 321 523 63,1% Revenue, including: RUB mln 37 009 36 273 -2,0% - electricity transmission RUB mln 28 526 28 816 1,0% - grid connections RUB mln 8 311 7 282 -12,4% - other activity RUB mln 172 175 1,7% Cost RUB mln 31 758 32 830 3,4% Gross profit RUB mln 5 252 3 443 -34,4% Profit before tax RUB mln 2 361 2 154 -8,8% Net profit RUB mln 1 417 1 234 -12,9% For reference: ROE % 2,54% 2,08% -0,46 p.p. EBITDA RUB mln 8 630 10 221 18,4% EBITDA margin % 23,32% 28,18% 4,86 p.p. Net debt*/EBITDA - 2,34 2,19 - Investment program (disbursement) RUB mln 15 061 14 891 -1,1% * Net debt is calculated as total borrowings (including debt on interest %) minus cash assets and short-term investments CAPEX, RUB mln EBITDA, RUB mln Electricity losses, % Costs, RUB mlnRevenue, RUB mln 20 828 26 088 34 201 37 009 36 273 2008 2009 2010 2011 2012 17680 20815 27 488 31 758 32 830 2008 2009 2010 2011 2012 10,8 10,3 10,7 10,6 10,4 2008 2009 2010 2011 2012 5 566 8 190 10 356 8 630 10 221 2008 2009 2010 2011 2012 1 540 3 258 3 806 1 417 1 234 2008 2009 2010 2011 2012 Net profit, RUB mln 11 409 10 334 15 813 15 061 14 891 2008 2009 2010 2011 2012 Dynamics of key indicators for the 5 recent years RAS_2012FY | 5
  8. 8. 37 009 31 758 5 252 1 417 36 273 32 830 3 443 1 234 Выручка от реализации Себестоимость Пприбыль от реализации Чистая прибыль 2011 2012 8 630 10 221 2011 2012 -4 560 -6 573 6 418 6 494 -440 1 313 от прочей пром. деятельности от услуг по ТП от услуг по передаче э/э 36 273 3 443 2 154 1 234 Выручка от реализации Пприбыль от реализации Прибыль до налогообложения Чистая прибыль Formation of Financial Result in 2011 – 2012 -2% +3% -34 % -13% + 18 % Formation of sales profit and net profit, RUB mln EBITDA, Rub mln EBITDA margin, % 23% 28% EBITDA 10 221 100% Depreciation of fixed assets and intangible assets 6 278 12,1% Interest payable 1 788 17,5% Profit tax 920 9,0% Net profit 1 234 61,4% - = 1 417 1 234- 13% Net profit by types of activity, RUB mln Cost of sales 1 288 920 32 830 Balance of other incomes - expenses Profit tax Formation of net profit in 2012, RUB mln Net profit margin 3,4% Net profit in 2012 is formed mainly due to income from the identified non- metered and non-contractual electricity consumption Despite the decline in sales profit in 2012, net profit remained approximately at the level of 2011, EBITDA and EBITDA margin showed significant growth Gross profit margin 9,5% 2011 2012 RAS_2012FY | 6 from other activities from grid connections from electricity transmission Sales revenue Sales profit Profit before tax Net profit Sales revenue Cost of sales Sales profit Net profit
  9. 9. 30 456 32 344 1 226 400 2011 2012 по передаче э/э по ТП 28 526 28 816 8 311 7 282 2011 2012 от передачи э/э от ТП Formation of Revenue and Prime Cost in 2011 – 2012 37 009 36 273 77,1 % 22,5% 20,1% 79,4% Revenue by types of activity*, RUB mln -2% Prime cost by types of activity*, RUB mln 31 758 32 830+3% 95,9% 3,9% 98,5% 1,2% Structure of prime cost, RUB mln Dynamics of the prime cost structure, RUB mln 27 488 31 758 32 830Indicator 2011 2012 Δ in % 2012/2011 Controllable expenses 5 488 5 857 7% Materials 413 469 14% Production work and services 1 014 1 218 20% Payroll 2 693 2 790 4% Other expenses 1 369 1 380 1% Non-controllable expenses 26 270 26 973 3% Purchased power for compensation of losses 5 357 4 754 -11% Services of TGOs 7 969 8 029 1% Services of FSK 5 686 6 119 8% Depreciation of fixed assets and intangible assets 5 102 6 278 23% Lease payments 1 187 803 -32% Other expenses 969 990 2% Total expenses 31 758 32 830 3% 16,1% 46,8% 10,7% 19,1% 7,2% 4 885 5 488 5 857 22 602 26 270 26 973 2010 2011 2012 Подконтрольные затраты Неподконтрольные затраты Structure of prime cost in 2012 +12% +7% +16% +3% Other expenses Depreciation Payroll, social charges Production work and services Materials RAS_2012FY | 7 from electricity transmission from grid connections from electricity transmission from grid connections * Including other activities the amount of revenue and costs of which is less than 1% of the total sum Controllable expenses Non-controllable expenses
  10. 10. 11% 11% 5% 42% 16% 15% облигационный займ серии 04 Банк ВТБ Связь-Банк Сбербанк России АБ Россия Внешэкономбанк Credit Portfolio and Debt Position at the End of 2012 31.12.2011 31.12.2012 Δ in % 31.12.2012/ 31.12.2011 Equity capital 56 195 76 417 36% Liabilities, including: 51 584 55 323 7% Long-term borrowings 23 785 28 220 19% Short-term borrowings 27 799 27 103 -3% Equity to liabilities 1,09 1,38 - Leverage 32,5% 26,7% -5,8 p.p. Capital structure, RUB mln Debt position, RUB mln Borrowings flow in 2012, RUB mln * Net debt is calculated as the sum of credits and loans (including the debt on accrued but not paid interest) minus cash assets and short-term financial investments 31.12.2011 31.12.2012 Δ in % 31.12.2012/ 31.12.2011 Net debt at the end of the period* 20 197 22 360 11% Net debt/EBITDA 2,34 2,19 - 26 800 11 238 10 393 27 645 Кредитный портфель на 31.12.2011г. Привлечение (выборка) Погашение Кредитный портфель на 31.12.2012г. -+ 89 % - long-term borrowings Parameters of the bonded loan of Series 04 RU000A0JS785 Volume RUB 3 bn Rate, % 8,5 % Date of placement 24.04.2012 Maturity date 1 820th day Term of the offer 3 years Circulation period 5 years 11 564 14 405 20 197 22 360 1,4 1,4 2,3 2,2 0,00 0,50 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 5,00 0 5 000 10 000 15 000 20 000 25 000 2009 2010 2011 2012 Net Debt Net Debt/EBITDA Agency Rating Assigned Moody’s Ba2 (outlook – stable) Nov. 2009 Moody’s Interfax Rating Agency (rating on the national scale Aa2.ru (outlook - stable) Nov. 2009 Credit Rating Confirmed in Jan. 2013 Structure of credit portfolio at the end of 2012 Average rate 8,26% Net Debt/EBITDA RAS_2012FY | 8 Credit portfolio as of 31.12.2011 Credit portfolio as of 31.12.2012 Attraction Maturity Bonded loan of Series 04 VTB Bank Svyaz-Bank Sberbank of Russia AB Russia Vnesheconombank
  11. 11. Implementation of the Investment Program of Lenenergo in 2012 CAPEX in 2012 totaled RUB 14 891 mln, that is RUB 170 mln, or 1% lower than in 2011 (RUB 15 061 mln) CAPEX in 2010-2012, RUB mln, VAT not included Parameters of the investment program, RUB mln Indicator St.-Petersburg Leningrad region Lenenergo 2011 2012 Δ in % 2012/2011 2011 2012 Δ in % 2012/2011 2011 2012 Δ in % 2012/2011 Disbursement, RUR mln, VAT not included 10 829 11 515 6% 4 232 3 376 -20% 15 061 14 891 -1% Commissioning of FA, RUR mln 11 246 12 424 10% 5 077 3 651 -28% 16 323 16 075 -2% Commissioning of capacity, MVA 623 1 409 126% 373 502 35% 996 1 911 92% Commissioning of capacity, km 935 716 -23% 778 864 11% 1 713 1 581 -8% CAPEX, RUB mln 15 813 15 061 14 891 Indicator 2011 2012 Δ in % 2012/ 2011 Investment program, total 15 061 14 891 -1% Depreciation 5 133 2 935 -43% Additional issues, including loans attracted for additional issues - 1 292 - Payments by property 1 289 Lost income 1 917 184 -90% Bank credits 4 207 6 702 59% TC prepayments 3 804 2 489 -35% Funding sources of CAPEX in 2011-2012, RUB mln (VAT not included) 20% 9% 9% 1% 41% 21% TC prepayments Bank credits Depreciation Additional issue of shares Payments by property Lost income 932 996 1 911 1 507 1 713 1 581 Commissioning of capacity MVA km 2012 2011 2010 4 503 6 753 5 297 10 377 8 223 8 557 933 85 1 037 2010 2011 2012 ТПиР Новое строительство Прочие RAS_2012FY | 9 Re-equipment & reconstruction New construction Other
  12. 12. RF Government Decree of 29.12.2011 #1178 on the fundamentals of pricing (revised RF Government Decree of 30.06.2012 #663) Goal: the creation of funding sources of the investment program, allowing for executing accrued liabilities under grid connections and increasing the reliability of the electric grid complex of the region Tariff Decisions for Electricity Transmission Limitations of tariff decisions for 2013-2017 RF Government Decree of 29.12.2011 #1178 on the fundamentals of pricing Tariff rates in 1H – at the level of the end of 2011 Tariff rates in 2H – considering 11% growth Implying regulation for Lenenergo Limitations of tariff decisions for 2012 Average annual growth rate in 2013-2017: In SPB – no more 17,5% In LR – no more 14% 2012 approved 2012 fact ∆ in % from 2012 approved fact St.-Petersburg Revenues*, RUB mln 19 050 16 954 -11% Tariff, cop./kWh 98,7 88,7 -10% Leningrad region Revenues*, RUB mln 12 953 12 577 -3% Tariff, cop./kWh 117,1 112,9 -4% • Bylaw of the Tariff Committee of St.-Petersburg of 20.12.2011 #499-r (revised #105-r of 14.05.2012) • Order of LenRTC of 27.12.2011 #227-p (revised #87-p of 13.07.2012, #115-p of 28.09.2012, #126-p of 30.10.2012) Formation of actual revenue from electricity transmission in 2012 * Without deduction of load losses RAS_2012FY | 10 The main reasons for the decrease of the actual tariff rates relative to the approved ones: unequal distribution by quarters of the year of the volumes of the declared capacity in the contracts with trading companies; selection by the trading companies to calculate the most profitable type of tariff (one-rate / two-rate), while the tariff decisions are taken on the basis of calculations of all consumers by one type of tariff. The greatest deviation of revenues is in St.- Petersburg, where in making the tariff decisions the declared capacity of LLC Energy Holding was understated, whereas the declared capacity of JSC PSK was overstated, thereby these companies respectively selected two-rate (Energy Holding) and one- rate (PSK) tariffs; a different structure of productive electricity supply by voltage levels prevailing upon 2012 as compared to the structure approved by the regulator; consumption by the customer of generated voltage LLC KINEF in the Leningrad region, which was not accounted for when making tariff decisions
  13. 13. Indicator Leningrad region St.-Petersburg Total Lenenergo Loss on electricity transmission, included by regulators through smoothing -2 393 -2 737 -5 130 Deviation of actual expenses from those considered in the tariff model -14 -1 429 -1 443 Total actual loss on electricity transmission -2 407 -4 166 -6 573 Given the limitations of tariff growth in 2012 a loss on electricity transmission is included in the tariff model through the use of smoothing (which will be compensated in subsequent years): RUB mln Formation of RGR and Factors of Forming Losses in Electricity Transmission in 2012 Own funds for investment and expenses from profit LR 2 656 SPB -2 737 Loss on electricity transmission, included by regulators LR -2 393 SPB 4 584 Interest on loans, expenses from profit LR 1101 SPB 1 886 Smoothing LR 2 055 SPB 1 369 Own funds for investment LR -500 SPB 1 329 Depreciation LR 1 893 SPB 4 066 - - -= = Indicator Unit 2012 St.-Petersburg Leningrad region Controllable expenses RUB thousand 2 883 268 2 541 166 Non-controllable expenses RUB thousand 12 952 052 9 810 419 services of FSK RUB thousand 4 529 830 2 236 393 services of TGOs RUB thousand 3 396 238 4 762 948 losses in Lenenergo networks RUB thousand 3 850 655 2 296 303 Other non-controllable expenses RUB thousand 1 175 329 514 776 Recovery of the capital RUB thousand 3 089 704 2 066 775 Return on the capital RUB thousand 1 494 066 589 389 Smoothing RUB thousand -1 369 168 -2 055 024 Total required gross revenue RUB thousand 19 049 923 12 952 727 Productive electricity supply Mln kWh 19 295 11 059 Average tariff for electricity transmission Cop./kWh 987,3 1 171,3 Growth to the previous year % -0,2% 6,0% Excess of expenses in the business plan is mainly due to increase in depreciation on revaluation of fixed assets as of 01.01 2012 Growth of loss in the business plan is associated with the redistribution of power between the PSK and Energy Holding and the selection of tariff RAS_2012FY | 11
  14. 14. 33 460 4 485 28 975 34 513 4 506 30 007 Отпуск в сеть Общие потери в сетях Полезный отпуск 2011 2012 28 439 27 672 29 095 28 975 30 007 2008 2009 2010 2011 2012 Services on Electricity Transmission in 2012 +3,1% +3,6%+0,5% Dynamics of productive supply, mln kwh Dynamics of losses in the networks of Lenenergo, mln kWh, % In accordance with the approved program of energy saving and energy efficiency of Lenenergo for 2012-2017 target energy losses by the end of 2017 is expected at 9,21% to supply to the grid The result of measures to reduce electricity losses in 2012 Decrease in losses, mln kWh Decrease in technical losses 13,4 Decrease in commercial losses 116,1 The economic effect of implementing the program to reduce losses in 2012 RUB 170 mln - = 3 503 3 274 3 587 3 546 3 578 10,8 10,3 10,7 10,6 10,4 10 11 12 3 100 3 150 3 200 3 250 3 300 3 350 3 400 3 450 3 500 3 550 3 600 3 650 2008 2009 2010 2011 2012 0,38% from supply to the grid Structure of electricity supply to the grid in 2012 by groups of customers 29,0% 2,3% 1,2% 14,5% 0,4% 19,8% 32,7% Промышленные потребители Транспорт Сел. хоз-во и пищ. пром. Непромышленные потребители Бюджетные потребители Население ТСО Dynamics of indicators for electricity transmission in 2011-2012, mln kwh RAS_2012FY | 12 Supply to grid Total losses in networks Productive supply Industrial customers Transport Agriculture and food industry Non-industrial customers Budget organizations Population TGO
  15. 15. Services on Grid Connections in 2012 + 77% Conclusion and execution of contracts for grid connection in 2011-2012., MW (pieces) +63% The share of property contracts in revenues has steadily decreased: from 63% in 2010 to 25% in 2012 Revenue from TC, RUB mln 7 282 On current contracts (term of service after 01.01.2012) on expired contracts (term of service before 01.01.2012) 4 315 2 967 59% 41% on cash contracts on property contracts 5 428 75% 1 854 25% + + = 485 MW 321 MW 861 MW 523 MW заключено договоров закрыто договоров 2011 2012 6 302 pcs 14 561 pcs 20 159 pcs 6 949 pcs Indicator 2010 2011 2012 Δ in % 2012/2011 Revenues, RUB mln 10 164 8 311 7 282 -12% Connected capacity, MW 645 321 523 63% Average rate on contracts, RUB/MW 15 751 25 919 13 933 -46% Dynamics of revenues and average rate on contracts for grid connection Formation of revenues from grid connections in 2012 In 2012, there was an increase in the number of applications received in relation to 2011 by 50%, the growth of the declared capacity - by 27%. The group of applicants up to 15 kW was 89,4% of the total number of applications with a share of 9.4% of the total declared capacity111 По сроку оказания По способу оплатыby the term of services By payment method 14 688 19 870 29 832 2010 2011 2012 Dynamics of applications for grid connection, pieces (WM) 2270 2306 2934 RAS_2012FY | 13 Contracts concluded Contracts closed
  16. 16. JSC IDGC Holding and the Administration of St. Petersburg exercised their pre-emptive right to acquire shares in proportion to the existing stake in the ordinary shares of Lenenergo. End use of funds - renovation program of 6-110 kV cable network in St. Petersburg Results of the issue Shareholder Volume of purchase, RUB Volume of purchase, pieces Share from ordinary shares after the placement, % JSC IDGC Holding 2 043 433 581,28 140 345 713 53,41 St.-Petersburg (CPMC) 999 999 072,8 68 681 255 26,57 Other shareholders 184 417,58 12 666,04 20,02 The offering price – RUB 14,56 is defined as the weighted average price of one ordinary share upon trading results at the MICEX Stock Exchange for 3 months from 08.07.2011 to 07.10.2011 53,41% 26,57% 20,02% Subject of the Russian Federation – the city of St.- Petersburg (CPMC) Date of state registration of the report on the issue results: 18.09.2012 209 039 634,04 shares is placed for a total amount of RUB 3 043 617 072 Share from ordinary shares after the placement, % Payment procedure: JSC IDGC Holding introduced cash funds in payment for the shares , and the Administration of St.-Petersburg introduces the property. JSC IDGC Holding Other Annex: Results of the Additional Issue of Ordinary Shares in 2012 RAS_2012FY | 14
  17. 17. Annex: Tariff Models, Approved by Regional Regulators for 2012-2017 and Agreed by FTS of Russia 2012 2013 2014 2015 2016 2017 Saint-Petersburg Grown of average tariff from joint operations 3,2% 17,5% 14,1% 11,4% 10,1% 10,0% Investment program 10,0 9,6 9,0 9,1 8,3 8,2 Including from electricity transmission tariff 4,4 5,0 5,8 6,3 6,9 7,5 Loans payable at end of the year 15,7 16,6 17,2 16,8 15,2 12,4 Debt/EBITDA on transmission 4,9 2,6 2,2 1,7 1,3 0,9 Net profit -2,7 -0,5 0,2 1,3 2,5 3,9 Leningrad region Grown of average tariff from joint operations 6,0% 13,0% 12,9% 12,7% 12,1% 12,0% Investment program 3,4 4,8 5,3 5.8 3,2 3,3 Including from electricity transmission tariff 2,5 3,3 4,4 4,7 2,8 3,1 Loans payable at end of the year 10,6 12,2 14,0 15,1 11,2 6,0 Debt/EBITDA on transmission 17,6 4,0 3,1 2,5 1,3 0,5 Net profit -2,4 -0,4 0,5 1,2 3,3 5,3 RUB bln • Excess of tariff growth rates for electricity transmission over the forecast of social and economic development in 2013-2017 pursuant to the RG Government Decree of 30.06.12 #663 • Increase in the approved investment program for the Leningrad region of the costs for grid connection of privileged applicants in the amount of RUB 6 bn in 2013-2015 is made in accordance with p. 32 and p.87 of the Fundamentals of pricing approved by the RG Government Decree of 29.12.11 #1178, to avoid a direct impact on the growth of tariff Tariff projection is formed with the following conditions: RAS_2012FY | 15
  18. 18. CONTACTS JSC Lenenergo 196247, Russia, Saint-Petersburg, Constitution Sq., 1 Head of Department for Corporate Governance and Shareholders Relationship Andrey Smolnikov Tel./ fax +7 (812) 595 31 76 Smolnikov.AS@nwenergo.com Investor Relations Ulyana Davydova Tel. +7 (812) 494 39 06 Fax +7 (812) 494 37 34 ir@lenenergo.ru Davydova.UE@nwenergo.com www.lenenergo.ru

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