Address of the Chairman of the Board of Directors

Dear shareholders, investors and colleagues!

One of the most significant developments in the Russian energy market in the past few months was the approval of the electric power industry modernisation programme. Unipro has participated in this programme.

In 2018, the Company demonstrated stable results, having produced 46.6 bln KWh of electric power. The 2018 demand for Unipro’s production capacities exceeded the market average for heat generation, and reached 47%. The company retained leading positions in the market and remains one of the most efficient companies in the heat and power sector of Russia.

Despite difficult market conditions due to overcapacity and low demand for the electric power consumption, Unipro has managed to achieve stable financial results. According to the accounting statements prepared in compliance with RAS (Russian Accounting Standards), the EBITDA amounted to RUB 28.8 billion for 2018. I should mention that Unipro EBITDA profitability remains on the significant level and totals 35.5%, demonstrating the highest results in the market.

The repair works at Power Unit No. 3 of Berezovskaya GRES remain the core project for Unipro. The unit commissioning, expected in Q4 2019, will provide Unipro with the substantial growth of operational cash flow.

New dividend policy of Unipro PJSC, consolidating the core principles of dividend payment to shareholders till 2022, was approved by the Company’s Board of Directors. Unipro intends to pay substantial dividends at least twice a year. The dividend for 2019 will amount to RUB 14 bln. The resumption of capacity payment for Berezovskaya GRES Power Unit No. 3 will enable Unipro PJSC to raise dividend payments significantly and keep them at RUB 20 bln per year over 2020–2022.

Dear colleagues! On behalf of the Board of Directors of Unipro PJSC, I would like to thank each of you for your substantial contribution to the operational and financial performance achieved in 2018.

Dear shareholders! On behalf of all the employees of Unipro PJSC, I would like to express my gratitude for your trust in us. We will make every effort to meet your present and future expectations!

Yours sincerely,
Eckhardt Rümmler^*,
Member of the Board
of Directors, Unipro PJSC