JSC «TGC-1» announces its unaudited consolidated financial results according to IAS for the 6 months ended June 30, 2009

TGC-1 announces the publication of unaudited condensed consolidated financial report for the 6 months ended 30 June 2009 prepared in accordance with International financial reporting standards.

Revenue increased by RUR 3,672 m (+20%) to RUR 21,246 m. The increase is due to the growth of volumes of heat and electricity sales, as well as the rise of tariffs and expansion of the unregulated sector of the electricity market in Russia.

Sales of electricity are up by RUR 1,357 m (+15.5%), which is explained by the increase of volumes of sales, higher tariffs in the regulated market, and expansion of sales at unregulated prices due to further liberalization.

Sales of heat in January-June 2009 were up RUR 2,218 m (+26.4%) on the back of higher volumes of sales and highes sale price to tariff increase.

Other sales increased by RUR 97m (+22.9%) due to more connection fees.

Operating expenses decreased by RUR 129m (-0.7%) to RUR 18,006m. The decrease was mainly due to changes in the fuel mix (substitution of expensive production at Company’s CHPPs by production on HPPs which led to considerable fuel savings).

The revenue growth coupled with decrease in costs – RUR 3,672m and RUR 129m respectively – led to the positive cash flow from operating activities in the amount of RUR 3,240m (1H 2008 – RUR 561m) and a net profit in the amount of RUR 2,401m vs. RUR 407m in 1H 2008.

Table 1. Key financial highlights of TGC-1 in the 6 months of 2008-2009