Chapter 2
Strategic review

2.6. The company on the securities market

2.6.1. INVESTOR RELATIONS

RusHydro actively develops its relations with the market participants and improves Company’s transparency. Disclosure is made in compliance with the requirements of the Russian legislation, Russian and foreign regulators of the securities markets, Company’s internal regulations and rules of the stock exchanges on which the securities are traded.

The website provide information on the activities of PJSC RusHydro (the Board of Directors decisions, information about the upcoming and past meetings of shareholders, financial statements, news of the Company, its subsidiaries and affiliates, etc.).

In 2015, the Company’s representatives of participated in the largest international investor conferences, including conferences arranged by Bank of America Merrill Lynch, Deutsche Bank, Raiffeisen Bank, Sberbank, and also in the VTB Capital Investment Forum “Russia Calling!”, and held a number of meetings with representatives of the Russian and foreign investment funds. Also, in April 2015, RusHydro held the Investor Day, a meeting of analysts and investors with the Company’s management.

The Company regularly holds conference calls for analysts, investors and rating agencies on the financial results. A schedule of key Investor Relations events – IR Calendar is published on the Company’s website.

Shareholders can get the answers to their queries related to exercise of their rights by calling the hotline arranged by registrar of the Company JSC “ROST Registrar” or sending a request via e-mail. Depositary receipt holders may contact the depositary bank The Bank of New York Mellon, or PJSC RusHydro on all issues.

2.6.2. Authorized share capital

Authorized share capital of PJSC RusHydro as of December 31, 2015

List of shareholders owning more than 2% shares (as of December 31, 2015)

Information about the registered persons as of the end of each quarter is disclosed in the issuer’s quarterly reports on the website.

Source: JSC Registrator R.O.S.T.

The Company’s shareholders are more than 340 thousand domestic and foreign investors. The government holds a controlling stake. There were no significant changes in the structure of owners and holders of share capital during 2015.

As of 31.12.2015, the Group’s had 21,786,611,933 available shares of RusHydro. The Company doesn’t own its shares.

The Company did not place shares in 2015.

The total number of persons entitled to attend the general meeting of shareholders of the issuer, persons

Source: Quarterly Report

2.6.3. Stock trading on the Russian market

Since 2008, RusHydro shares have been included in the quotation list of Tier 1 and traded on the MICEX Stock Exchange under the ticker symbol HYDR, and in March 2013, the Company’s shares were among the first on the Russian Stock Market admitted to trading in the T+2 trading system with partial collateral and deferred trade execution.

The company’s shares are components of major stock market indices both the Russian, such as MICEX, RTS, MICEX the Power, RTS-Utilities, MICEX BMI, an index of companies state-owned shares (SCI) MICEX), and international: MSCI Russia, FTSE All World Emerging Europe.

2015 Share performance and trade volume dynamics

Trading results for the shares on the stock market

Source: moex.com

2013-2015 The dynamics of quotations of shares RusHydro compared with the key indices

Source: moex.com

For the period from 2013 to 2015 the price of RusHydro’s shares declined by 7% and the MICEX index rose by 19%, industry MICEX Power index lost 45%.
Key factors influencing the dynamics of quotations of shares of RusHydro in the reporting year:

• The problems of the Russian economy, the weakening of the RUBle, growth of inflation;
• Changing attitudes of global investors to the emerging markets;
• Actions of the Russian Government to limit the electricity prices growth;
• The competitive capacity auctions (KOM) results of the dynamics of electricity prices on the spot market;
• Commissioning of new facilities, including under power delivery contracts;
• Liberalisation of hydro capacity market of Siberia;
• Development of plans aimed at solving the problems of financial stability of PJSC RAO Energy Systems of the East.

The Company’s market multipliers*

Capitalisation, RUB million

Source: moex.com

2.6.4. Company securities on the international securities markets

As of December 31, 2015, RusHydro had 224,417,076 depositary receipts equivalent to 22,441,707,600 ordinary shares, comprising 5.8% of the outstanding shares of the Company.

Development stages of the dr programme

Depository receipts programmes

Results of depositary receipts trading on the LSE

Source: Bloomberg

2014 ADR performance and trading volume, LSE (IOB), 2015

An analysis of the Company’s structure of holders of depositary receipts for the past three years shows a significant proportion of investors who hold investment strategy Value (value) and Growth (growth). In 2015, the number of investors with an active strategy of Growth at Reasonable Price (GARP), also growth in the number of investors with a strategy (Index) has increased significantly.

An analysis of the geographical structure of depositary receipts holders demonstrates that the main holders are investors from the United States and the United Kingdom, and during 2015, the number of investors from German increased.

2013-2015 distribution of dr holders by investment strategy

Source: Depositary Bank: The Bank of New York Mellon.

2013–2015 geographic distribution of dr holders

Source: Depositary Bank: The Bank of New York Mellon.

2.6.5. Dividend policy

The Company’s dividend is aimed at strategic development of RusHydro as well as shareholder value creation through achievement an optimal balance between dividend payouts and capitalisation of the Company’s profits.

To ensure transparency in determining the amount of dividend payments, RusHydro adopted a Provision on dividend policy. The Board of Directors prepares recommendations on the size of the dividend for approval by the General Meeting of shareholders, focusing on net income, determined in accordance with the consolidated financial statements of the Group for RusHydro International Financial Reporting Standards and Russian Accounting Standards, as well as the Company’s need to finance its investment programme.

The amount of annual dividends must not be less than 5% of the Company’s consolidated net profit under IFRS.

RUB billion

record dividend
in 2015

2.6.5.1. Payment of declared (accrued) dividends on the company’s shares for 2014

According to the decision of the Annual General Meeting of Shareholders held on June 26, 2015, RUB 6,032,750 were paid as dividends for 2014 (about 20% of the Company’s net profit under RAS or 25% of consolidated net profit of RusHydro Group in under IFRS), which is about 15% higher than the amount paid for 2013.

Payments were made in full to all registered shareholders, except for RUB 22,298,396.28, which were not paid for the reasons that may not be controlled by the Company: the absence of registration or incorrect address and mailing address; incorrect bank details of recipients of income referred to in the application (statement), provided by the registrar, the method of payment “bank transfer”.

The Company fulfilled its obligations on dividend payment to the federal budget, the amount paid was RUB 4,032,108,851.94.

There was no arrearage in dividends payable to the federal budget by the Company.

Dividend history

2.6.6. Bonds

As of December 31, 2015, RusHydro had eight outstanding bond issues with a total par value of 60 billion rubles. In the end of 2015, the Company fully repaid its Eurobond issue in total amount of RUB 20 bn.

Main parameters of the bond issue

Credit ratings Fitch Ratings on bonds of PJSC RusHydro

3.1.
Business model