En + En + Group

En + Group was established in 2002 as a holding company - a shareholder of several enterprises in the aluminum industry. By acquiring and consolidating assets into separate structures, in ten years the company has become one of the largest business groups in Russia in the mining, metallurgical and energy industries. The group's activities are related to such areas as aluminum production, alumina, electricity production, coal mining, and other minerals, and we are actively expanding our presence in new industries related to the extraction and processing of natural resources in the East of Russia.

Oleg Deripaska is the president and controlling shareholder of En + Group.

Performance indicators

2023: 11.5% decline in revenue to $14.65 billion

En + Group completed 2023 with revenue of $14.65 billion, which is 11.5% less than a year earlier ($16.55 billion). Net profit during this time decreased by 61.2% - from $1.85 billion to $716 million. Such data are presented in the group's IFRS statements, which TAdviser got acquainted with in July 2024.

From the materials of En + Group, it follows that in 2023 the revenue of the metallurgical segment decreased by 12.6% year-on-year, to $12.21 billion, mainly due to a drop in the price of aluminum by London Metal Exchange (LME), and the revenue of the energy segment decreased by 7.7%, amounting to $3.59 billion due to weakening exchange rate. ruble

Adjusted EBITDA for 2023 decreased by 30.8%, to $2.16 billion. Net debt decreased by 13.9% as of December 31, 2023 and amounted to $8.72 billion.

The volume of aluminum sales in 2023 increased by 6.6% to 4.2 million tons against the background of the sale of excess reserves accumulated at the end of 2022 during the reporting period. However, this growth was offset by a decrease in aluminum prices on the London Metal Exchange by 16.8% compared to 2022 to $2,252 per ton, and a decrease in the average selling price by 18% to $2,439 per ton.

Generation at the group's hydroelectric power plants in 2023 remained at the level of 2022 and amounted to 68.8 billion kWh. At the same time, the group's total electricity generation increased by 1.5% and amounted to 85.2 billion kWh. The increase in electricity sales and the rise in electricity prices were offset by a significant increase in the US dollar exchange rate that continued throughout the year.

A significant decline in aluminum prices, a rapid rise in the dollar and continued external pressure due to general geopolitical tensions had a significant impact on the group's results in 2023. En + is forced to overcome the consequences of logistics challenges and export restrictions, maintaining its focus on ensuring commodity independence and the development of new markets, the press release said[1]

History

2024

En + Group became the owner of a hotel in Vladivostok

In June 2024 En+ Group , the company expanded its presence in the hotel market, real estateVladivostok becoming the owner of a large hotel in the city center. A member of the group, Park Hotel Burduguz LLC acquired the Azimut Vladivostok company, which owns most of the building of the 4-star Azimut City Hotel Vladivostok Hotel. Obat became known on July 8, 2024. More. here

Appointment of Vladimir Kolmogorov as general director

On May 22, 2024, the Russian energy and metallurgical holding En + replaced the general director for the second time in 5 months. Mikhail Hardikov's place was taken by the director of Eurosibenergo Vladimir Kolmogorov. Read more here.

Why En + is building a data processing factory, and how AI will help it reduce fuel costs at thermal power plants

Large industrial companies in the process of digitalization, as a rule, face a number of challenges related to the storage and processing of large amounts of data, and now also with the need to move away from imported software. In an article prepared for the TAdviser portal, Dmitry Khalin, Deputy General Director for Information Technology and Digital Transformation at En +, tells how their company is coping with them. Read more here.

2023

Ural bought EnSer

On December 14, 2023, Avtomobilny Zavod JSC Urals Chelyabinsk region Russia completed a deal to acquire a local supplier of electrical and thermal energy, EnSer JSC. The value of the asset is not disclosed at that date. More. here

Investing 60 billion rubles in the construction of a 1 GW wind farm in the Amur region

On September 11, 2023, the En + group announced a project for the construction of a wind farm (WES) in the Belogorsk district of the Amur region. The corresponding agreement was concluded with the Far East and Arctic Development Corporation (KRDV) and the Government of the Amur Region.

Within the framework of the agreement, the parties will interact on assessing natural and climatic conditions as part of the construction of a wind farm in the Amur Region with a capacity of 1,058 MW, join forces to develop a large-scale project using state support tools. Capital investments in construction are estimated at 60 billion rubles.

En + announced a project for the construction of a wind farm (WES) in the Belogorsk region

The rich nature of the Far East makes it possible to launch new and develop existing green power projects. The Far Eastern regions are actively introducing alternative energy sources. Of course, until the sun and wind are able to completely replace traditional coal and fuel oil. But in many cases, generation based on their energy provides additional energy capacity. We will support them. We are starting one of these projects today, "said Yuri Trutnev, Deputy Prime Minister of the Russian Federation - Plenipotentiary Representative of the President of the Russian Federation in the Far Eastern Federal District.

The Blagoveshchensk wind farm with a capacity of up to 1 GW is focused on exports to China of up to 3 billion kWh per year. Electricity is planned to be supplied to the Chinese province of Heilongjiang through the existing Amurskaya-Haihe power transmission line.

They do not have such a wind potential to the south. There is demand in this province, in addition, China is interested in electricity with a low carbon footprint, - explained the head of the energy business En + Mikhail Hardikov, adding that it is planned to conclude a long-term agreement on the sale of electricity with the Chinese side[2]

2020: Creation of a mining farm in Siberia in conjunction with BitRiver

On November 5, 2020, aluminum and electricity producer En + Group announced the creation of a joint venture with the operator of the bell center mining cryptocurrencies BitRiver. The partners agreed to develop projects in the field of cryptocurrency mining using renewable energy. here More.

2018: Initiative to sell electricity to miners

On February 14, 2018, it became known about the plans of En + entrepreneur Oleg Deripaska to sell to miners cryptocurrencies electricity for 1 billion rubles in 2018. The group invites miners to sites near its power plants in Siberia.

According to Vedomosti, citing En + CEO Maxim Sokov, the company is negotiating with several funds that are engaged in attracting investments in the construction of mining farms. They will act as consumers of electricity, he explained.

Oleg Deripaska

Sokov stressed that funds are looking for potential investors, including from China and the United States.

This step will allow En + to diversify its client portfolio, - said the CEO.

En + will offer miners to build cryptocurrency mining farms near En + power plants. In total, the En + group has five sites for miners: Irkutsk hydroelectric power station with a capacity of 662 MW and CHPP with a capacity of 665 MW, hydroelectric power station in Bratsk, whose capacity is 4500 MW, Ust-Ilim hydroelectric power station (3840 MW) and CHPP (525 MW).

Future electricity rates have not been disclosed. In 2018, the total demand of miners for the company's electricity could be 100 MW.

Natalya Porokhova, head of the ACRA research and forecasting group, suggested that the announced annual demand for electricity could bring En + from $10 to $15 million. VTB Capital analyst Vladimir Sklyar told the publication that, taking into account 2017 prices, the company can gain about 980 million rubles. A Vedomosti source said that En + managers are counting on about this amount of profit

Founder and CEO of Fundery Eduard Lanchev considers this En + project profitable:

The most expensive part in mining is electricity. Therefore, electric producers will earn the most on miners. Yes, it is profitable.[3]

Notes