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Veles Capital - RusHydro: 1Q 2019 IFRS preview - Jun 5, 2019

RusHydro: 1Q 2019 IFRS preview     

RusHydro will present its IFRS 1Q 2019 results on Thursday, June 6 after 2:00 pm MSK.

We expect lower pace of the EBITDA and the net profit backed by 9% YoY drop of output and rising costs of fuel, which we expect to total +12% YoY. The power energy’ price growth (9-11%) at the forward market should equalize a share of negative effect; and in terms of the net profit, that would be the positive effect of the input provided by the revision of the forward contracts.

We assume that despite of the poor record, the stock would still follow an upside trend that started late last year.

We do not expect the market to overreact to the report as the dividend policy that has been revised in late April, marked the minimal volume of dividend payout (currently providing for a 6.5% in terms of the dividend yield).

The conference call is scheduled 4:00 pm MSK

We might be interested in comments regarding the time constraints of commissioning the Far East stations and the features of their modernization within the framework of the DPM-2 program.

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