DGAP-News: THE BOARD OF DIRECTORS OF IDGC OF NORTHERN CAUCASUS ADJUSTED BUSINESS PLAN FOR 2011

EquityStory.RS, LLC-News: IDGC of Northern Caucasus, JSC / Key
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THE BOARD OF DIRECTORS OF IDGC OF NORTHERN CAUCASUS ADJUSTED BUSINESS
PLAN FOR 2011

04.10.2011 / 17:50

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THE BOARD OF DIRECTORS OF IDGC OF NORTHERN CAUCASUS ADJUSTED BUSINESS PLAN
FOR 2011

Approving of adjusted KPI for 2011 and adjusted Programme for energy
conservation and increased energy efficiency of IDGC of Northern Caucasus
for 2011-2015 are also among key decisions.

The decisions were taken on the Company Board of Directors meeting that was
held in person at Holding IDGC, JSC headquarter (Moscow) on 27th Sept.
2011. The meeting was attended by the Company top-management and heads of
IDGC of Northern Caucasus, JSC and Holding IDGC, JSC departments.

In the whole, IDGC of Northern Caucasus adjusted business plan targets
operational profitability and financial stability. IDGC of Northern
Caucasus adjusted revenue is 10,228 RUB mn, that is 5 per cent higher than
the rate of 2010 in comparable conditions (without Dagenergo branch
operational results of 1st quarter 2010). Net income for 2011 is 170.1 RUB
mn. EBITDA for 2011 is 1,557.8 RUB mn. Forecast net assets are 18,593 RUB
mn, that is 16.6 per cent higher than 2010 rate.

IDGC of Northern Caucasus adjusted electricity throughput for 2011 is 9,351
mn kWh, that is 3.5 per cent higher than the result of 2010.

Key IDGC of Northern Caucasus adjusted business plan indicators for 2011

Unit of      Indicator   2010              2011?????????,%

measur-                  (in comparable                       

ement                    conditions)*

                                          Adjusted Adjusted  Adjusted plan/

                                          plan     plan/2010 2010 in   

                                                             comparable

                                                             conditions

Net income      RUB mn  10,460.8  9,769.6  10,228   -2.2     4.7

Costs           RUB mn  8,774.5   7,783.1  8,931    1.8      14.7

EBITDA          RUB mn  1,885.4   2,057.9  1,557.8  -17.4    -24.3

Net profit      RUB mn  613.5     870.3    170.1    -72.3    -80.5

Electricity     mn kWh  9,923.6   9,032.9  9,351    -5.8     3.5

throughput

Losses in grid  %       17.47     14.18    14.42    -3.1     0.2

CAPEX           RUB mn  2,187.2   2,187.2  7,032.1  221.5    221.5

* without Dagenergo branch operational results of 1st quarter 2010

IDGC of Northern Caucasus investment programme for 2011 is tripled compared
to the previous year. The transition of IDGC of Northern Caucasus grid
branches to RAB regulation and the Integrated programme of measures for
reducing excessive losses in the distribution grid made it possible to
increase the Company investment programme.

In addition, the Board of Directors of IDGC of Northern Caucasus approved
adjusted Programme for energy conservation and increased energy efficiency
for 2011-2015. The Programme key aim is to realise the Company potential of
energy conservation and performance efficiency increase. The Company will
perform the top strategy priority tasks such as following: electricity
losses reduction, energy conservation, development of an accounting system,
development ofan effective energy conservation policy.

Forecast financing of the Programme for 2011-2015 is about 17.5 RUB bn,
including state-financing in amount of 4.9 RUB bn. The Programme for energy
conservation and increased energy efficiency will make it possible to
reduce electricity losses in grids, to increase revenue from provision of
electricity transmission services, to reduce expenditures for electricity
to compensate for losses, to reduce resources for production needs, to
triple the number of account metre readings.

IDGC of Northern Caucasus, JSC is a Russian operational interregional
distribution grid company. The Company transmits electricity via a
distribution grid and provides customers with technological connections to
grid infrastructure on the territory of the North Caucasian Federal
District within six branches, one subsidiary and one company under
management. The Company serves 1.4 per cent of Russia–s territory and 6.1
per cent of the country–s population. The Company manages seven electricity
supply companies, which operate in seven Russian regions.
Average headcount number, including headcount of supply companies under
management, is 14,751. Number of substations is 23.6 thousands, installed
capacity is 13,682?V?. Electricity throughput in 2010 was 9,923.6 mn kWh.
Net assets as of 31st Dec. 2010 was more than 15.8 RUB bn. Market
capitalisation as of 31st Aug. 2011 was 2.6 RUB bn. Shares are listed on
RTS and MICEX (MRKK). Free-float is about 28%. Equity capital is 29.5 RUB
mn. Shares outstanding are 29,532,052. Share par value – 1 RUB. Holding
IDGC, JSC is a major shareholder (58.3 per cent).

IR-contacts:

website:   http://www.mrsk-sk.ru

IRO        Anna Kutsevich, Chief specialist Shareholder Relations

           Department

e-mail:    kucevich-af@mrsk-sk.ru; ir@mrsk-sk.ru

Tel.       +7 (8793) 40-17-90

End of Corporate News

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