Investors and Shareholders
Dear Shareholders,
2009 was a challenging year for OJSC Samaraenergo and for the country on the whole. The world financial crisis and, arising from this, a drop in production volumes, and a worsening of economic indicators for many of the industrial enterprises of Samara Oblast led to a fall in volume of electrical energy consumption. This factor influenced the volume of effective output by OJSC Samaraenergo. Compared to the previous year, the consumption of electrical energy by
The decrease of effective output and the increased liberalization of the electrical energy market heightened retail market competition. In this growing market OJSC Samaraenergo met with acute competition from energy organizations, which has meant an objective effort to concentrate production and to increase production efficiency; the fall in the market also led to increasing competition for income streams between technologically similar organizations, especially between network organizations.
Despite the financial and economic difficulties which arose, however, the Company has achieved high production results and has thus confirmed its standing as the largest sustainable and successful
In order to maximize the Company’s profit and obtain a competitive edge in both the retail and the wholesale markets within the reporting period OJSC Samaraenergo has continued its work on increasing the precision of its energy consumption and power forecasts, and on optimizing the structure of electrical energy purchasing in the new wholesale energy market. In 2009 OJSC Samaraenergo became a participant in trading sessions on the «Arena» stock exchange, thanks to which a reduction in energy cost price became possible.
In order to maintain the sustainable financial state of the Company, during the previous year measures were taken to improve the collection of moneys and to improve consumer paying culture. We should note that in 2009 the consumer base of OJSC Samaraenergo grew by 9667 subscribers (3500 legal entities and 6667 household consumers). By the end of 2009 the number of subscribers had reached 12 689 legal entities and 484 377 persons. This increase is due to the acceptance of new consumers into its service.
We must acknowledge that high staff professionalism and the effective Company management strategy helped overcome the influence of negative factors and to achieve success.
The analysis of OJSC Samaraenergo results for the year 2009 shows that the Company fulfilled the following goals:
- the annual KPI set by the OJSC Samaraenergo Board of Directors was achieved;
- the sustainable financial position was maintained;
- the sustainable performance of the Company on the retail market and its effective performance on the wholesale market was maintained;
- a sustainable electrical energy supply in the territory of Samara Oblast was ensured
In analyzing KPIs for the year 2009 the following must be taken into account:
- Network production was 17,032.9 million kW/h, which is 1.1% less than planned; Effective production was 15,334.2 million kW/h, which is 1.6% less than planned;
- Accounting loss totaled to 1,069,078 thousand Rubles, which is 65,485.1 thousand rubles less than planned.
The loss is due to a decline in the value of energy company shares held by the Company, in the context of the overall economic instability which has arisen from the negative effects of the world financial crisis.
In summarizing the results of the Company’s activities in 2009, we must in particular draw attention to the fact that the investment program which was aimed at improving the servicing of OJSC Samaraenergo has been implemented successfully. The investment program was based on the implementation of a range of socially oriented projects, such as the «Creation of Customer Service Centers in 12 population districts of Samara Oblast " and the «Creation of an Automated System of Energy Carrier Control and Measurement in the Urban District of Zhigulevsk».
The opening of Customer Service Centers (CSC) enabled the following:
— an increase in the service territory for OJSC Samaraenergo customers;
— an expansion of the range of services provided by OJSC Samaraenergo to customers;
— an improvement in the service quality for OJSC Samaraenergo customers;
— an improvement of the status of OJSC Samaraenergo as the guaranteeing supplier in the electrical energy retail market.
In the 2009 OJSC Samaraenergo annual investment program investments totaled 49,993 thousand rubles.
The implementation of a pilot project «Creation of an Automated System of Energy Carrier Control and Measurement for Household Consumers» in two houses in Zhigulevsk enabled the finalization of a system of settlements with customers by automated generation of statements for energy consumed, based on a
Special attention in 2009 was given to improving the efficiency of the OJSC Samaraenergo corporate management system, which was based on principles of accountability, transparency, and responsibility to shareholders and investors.
A substantial contribution to OJSC Samaraenergo performance is made by the work of the Board of Directors. Within this reporting period the Board had 10 meetings concerning the whole range of issues on the Company’s performance. In order to improve business planning, to ensure the Company’s financial and economic sustainability and to reduce operational expenditure, in 2009 the Board approved a new business planning schedule, and schedules for the formulation of budgets for cash flow, revenue, and expenditure. In order to implement the Company’s social policy and regulate social and labor relations, the Board approved the Collective Agreement for the years 2009–2010.
On the recommendation of the Board, the Annual General Meeting of Shareholders on 22 June 2009 made a decision to pay dividends according to the 2008 preferred shares results. The funds allocated to pay the distributed profit amounted to 3,654,000 rubles.
In discussing the OJSC Samaraenergo development strategy for the year 2010 we must note that under the complex conditions for the development of
- To maximize revenue (as the goal of any commercial enterprise) while maintaining a sustainable financial position and the status of a guaranteeing energy supplier.
- To retain and expand its current subscriber base by forming a more flexible policy of interaction with electricity consumers.
- To increase those Company assets which are aimed at improving the efficiency of its general business.
- To increase the productivity of business processes and the efficiency of the Company management system.
In order to achieve the said goals it will be necessary to continue to pursue the following lines of activity:
- The optimization of the structures of the main articles of expenditure.
- The optimization of algorithms for the management of the company’s financial resources.
- The diversification of business based on developing and offering of relevant services.
In considering the importance as a whole of the tasks at hand, the management team of OJSC Samaraenergo will in 2010 make every effort to execute the Company’s strategy. We are sure that the consolidation of effort on the part of the Company management and its shareholders will allow the Company to achieve a high performance and financial results in a competitive environment, and to maintain the Company’s successful progress in a competitive field.
Chairman,
Board of Directors of OJSC Samaraenergo
General Director
OJSC Samaraenergo M.
