Rushydro delivers strong financial results in 2009

The main factors behind the revenue growth in 2009 were:
• increase in the share of sales at unregulated prices in accordance with the time schedule for liberalisation of the wholesale electricity and capacity market;
• year-on-year increase of special investment component included in the tariff for financing construction of the most important hydro-power facilities and technical rehabilitation and modernisation programs.

Growth in revenue was slightly set-off by decrease in revenue of retailing segment due to fall in volume of sold electricity and capacity.
Operating expenses amounted to 76,050 million roubles in 2009, a 10% decrease compared to 84,659 million roubles in 2008.

The drop in operating expenses was driven by:
• decrease in total volume of purchased electricity and capacity for providing for supplies under regulated agreements due to higher water flow during 2009 and liberalization of electricity and capacity market;
• decrease in operating expenses of retailing segment due to fall in volume of sold electricity and capacity

Оperating expenses include loss on disposal of property, plant and equipment damaged in the accident at Sayano-Shushenskaya HPP amounting to 5,604 million roubles. These property, plant and equipment objects have been insured under the insurance contract with OJSC IC ROSNO dated 25 December 2008 with insurance cover of 200 million USD. As ROSNO has acknowledged the accident as insurable case and at the reporting date the recoverability of the insurance asset was virtually certain, the Group has recognised the full amount of the insurance indemnity within its operating expenses.
As a result of the increase in revenue and drop in operating expenses and in the absence of impairment charges for reported period, the Group's operating profit amounted to 39,553 million roubles, compared to operating loss of 9,542 million roubles a year earlier.
The adjusted EBITDA in 2009 rose over 2008 by 55 % to reach 52,182 million roubles. EBITDA margin? reached 45 % compared to 31 % prior year.
Group's net profit in accordance with International Financial Reporting Standards amounted to 31,184 million roubles, compared to net loss of 19,481 million roubles in 2008.

Key indicators of the Group's financial position as of 31 December 2009:

As of 31 December 2009, total assets of RusHydro Group increased by 56,884 million roubles to 483,255 million roubles. This 13 raise compared to 31 December 2008 was primarily driven by:
• increase in cash and cash equivalents, including received from additional share issues and then deposited on bank accounts, amounted to 23,314 million roubles;
• increase of property, plant and equipment by 17,730 million roubles.

Total equity of the Group amounted to 403,283 million roubles as of 31 December 2009, compared to 343,613 million roubles on 31 December 2009. The 17 % rise was caused by profit for the period, additional share issues of 10 billion shares (the amendments to the Articles of Association of JSC RusHydro were registered on 2 April 2009) and 16 billion shares (the amendments to the Articles of Association of JSC RusHydro were registered on 12 October 2009) and gains arising on available-for-sale financial assets.
The total volume of the Group's liabilities as of 31 December 2009 amounted to 79,972 million roubles - a drop of 3 % compared to 31 December 2008.

Subsequent events (31 December 2009):
• 24 February 2010 — restored hydro-unit No. 6, with an installed capacity of 640 MW, was launched at JSC RusHydro branch Sayano-Shushenskaya HPP.
• 9 March 2010 — The Board of Directors of JSC RusHydro considered and approved the Group's investment programme for 2010 in the amount of 97.1 billion roubles.
• 22 March 2010 — restored hydro-unit No. 5 was launched at JSC RusHydro branch Sayano-Shushenskaya HPP. The start-up of hydro-unit No. 5 brought the plant's capacity up to 1,280 MW (before the accident it was 6,400 MW). The operation of the two hydro-units (Nos. 5 and 6) has greatly increased reliability of the electric power supply to the Siberian grid and minimised the high-water passage risks.
• 11 February 2010 — JSC RusHydro Board of Directors approved the amendments to the Employee's Share Option Programme, which extend the period during which participants can exercise their options to 2 years after 2 September 2010.

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