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01.03.18.03.05.04.21.04.12.05.27.05.15.06.01.07.19.07.04.08.22.08.07.09.23.09.11.10.220.127.116.11.01.12.20.12.16.01.01.02.17.02.09.03.27.03.12.04.On the whole, in April the situation on the world stock markets remained exceptionally favorable (see Table 1). The major stock indicators of both developed and developing countries were characterized by growth. The only exception was the Russian stock market and a number of emerging markets.
260% Dow Jones Industrial Average 240% NASDAQ Composite The RTS Index 220% 200% 180% 160% 140% 120% 100% 80% Corporate news.
The OAO LUKoil On April 13, the rating agency Fitch granted the OAO LUKoil the rating of an issuer of foreign and national exchange denominated securities of the BBB- grade, as well as the short-term rating of the Flevel. The rating forecast was stable. At the same time, the agency granted the BBB- rating to the issue of convertible bonds of the OAO LUKoil amounting to US $ 350 million, which were issued by the LUKinter Finance BV. As it was indicated in the agency’s statement, the “stable” forecast with respect to the rating was based on the persistence of high profitability levels of company’s operations in the future, what should be ensured by a stable growth in oil extraction and production of oil products, persistence of the favorable price situation on the world oil market, and enhancing market access of LUKoil as concerned the attractive export markets, especially those in the North America. On the other hand, the unfavorable tax legislation, high export duties, and transportation costs, as well as the growing competition on the Russian market of oil products were treats to this rating.
Also in April, there was published the data that in March of 2006 the amount of trade with the OAO LUKoil securities at the London Stock Exchange (LSE) reached US $ 6.298 billion. This figure was the last registered historical monthly record since the start of trading with these securities and is evidence of the highest liquidity of LUKoil securities. The previous record was registered in February of 2006, when the amount of trade with LUKoil securities at the LSE made US $ 5.9 billion. In March of 2006, the number of transactions with the company’s securities made 12 083 pieces, what also makes it the absolute leader.
The OAO Gazprom On April 18, 2006, the company announced that its depositary receipts (DR) of the tier one program was launched, as well as that simultaneously there was changed the ratio between the number of ordinary shares of the OAO Gazprom and DR (from ten shares per one DR to four shares per one DR).
The Gazprom shares already in circulation prior to the change were automatically converted in corre 01.03.21.03.11.04.02.05.20.05.10.06.01.07.22.07.12.08.02.09.23.09.14.10.04.11.25.11.16.12.09.01.30.01.20.02.10.03.31.03.21.04.spondence with the said ratio (taking into account the limitations in force). In the framework of the first tier ADR program, depositary receipts should freely circulate at the over the counter US stock market, as well as European stock markets. The maximum amount of ordinary shares, which may be the base asset for all ADR issued by the OAO Gazprom, should not exceed 35 per cent of the authorized capital of the OAO Gazprom.
The RAO UES of Russia On April 24, the company published the financial statement of the RAO UES of Russia group for the first 9 months of 2005 prepared in accordance with the International Accounting Standards (IAS).
Thus, over the first 9 months of the year the aggregate assets of the RAO UES of Russia Group increased by RUR 60.459 billion and as on September 30, 2005, made RUR 1187.457 billion. Of this amount, the value of the non-current assets made RUR 966.150 billion, increasing by RUR 33.billion, whereas the current assets of the company made RUR 221.307 billion, what was by RUR 26.718 billion above the values of the respective indicators registered in the beginning of the year.
Over the first 9 months of the year, the debtor indebtedness of the company increased by RUR 20.billion, and as on September 30, 2005, made RUR 131.445 billion. In the first 9 months of 2005, the creditor indebtedness of the company made RUR 145.216 billion increasing by RUR 18.624 billion since the beginning of the year. The most significant factors behind the said changes in the debtor and creditor indebtedness of the company over this reporting period were seasonal factors. In particular, as concerned the debtor indebtedness the most significant factors were the increasing advance payments made to the suppliers and contractors, VAT due to be refunded, as well as advance tax payments. The increase in the creditor indebtedness was primarily a result of the seasonal growth in debts to suppliers and contractors.
In the first 9 months of the year, the revenues of the Group derived from its core activities made RUR 544.517 billion, what was by RUR 66.804 billion (or 14 per cent) above the indicator registered in the respective period of the preceding year. In January through September of 2005, the expenditures of the RAO UES of Russia Group for its core activities increased by RUR 67.391 billion (or by 15 per cent) and made RUR 502.551 billion. The profits of the group made RUR 41.966 billion in January through September of 2005, what was by about RUR 587 million below the level registered in the respective period of the preceding year. The net profits of the Group over the first 9 months of the year made RUR 9.749 billion (RUR 14.103 billion over the first 9 moths of 2004). The decline in the values of the net profit indicator occurred primarily due to the fact that the rates of expenditures for the core activities over proceeds.
The OAO Rostelekom On April 3, 2006, the OAO Rostelekom announced the audited results of its operations in 2005 in accordance with the Russian Accounting Standards (RAS). Thus, in 2005, the earnings of the OAO Rostelekom made RUR 40 291.7 million, what was by 7.5 per cent above the indicator registered in the preceding year. At the same time, the expenditures borne by the company with respect to its usual types of operations made RUR 28 330.6 million increasing by 10.9 per cent as compared with the figures registered in the preceding year. The main factor behind the increase in the expenditures was the growing payments the company made to the Russian and foreign communications operators, the planned increase in expenditures for personnel, as well as a growth in depreciation payments.
The company’s EBITDA indicator (earnings before interest, depreciation, tax, and amortization) in 2005 made US $ 14 587.7 million, what was by 4.3 per cent above the respective indicator of the last year. The sales profit of the company grew by 0.3 per cent in comparison with the figures registered in 2004 and made RUR 11 961.1 million. By the end of 2005, the net profits of the OAO Rostelekom made RUR 9 027.9 million, increasing by 25.0 per cent in comparison with the figures registered in 2004.
Besides, on April 21, the company published the results of the meeting of its Board of Directors, which discussed the issues pertaining to the general meeting of the OAO Rostelekom shareholders on the results of 2005. The Board of Directors also determined the date, on which there should be made the list of persons having the right to take part in the general meeting of shareholders and eligible to receive dividends for year 2005 (the date, on which the register was closed – May 5, 2006).
The Board of Directors took the decision to recommend the general meeting of shareholders to set the following amount of dividends for year 2005:
– RUR 3.7178 per share as concerned preferred shares. The aggregate payments pertaining to preferred stocks should make RUR 902.8 million, or 10.0 per cent of the OAO Rostelekom net profits in 2005 in accordance with the RAS.
– RUR 1.5617 per share as concerned ordinary shares. The aggregate payments pertaining to ordinary stocks should make RUR 1 138.0 million, or 12.6 per cent of the OAO Rostelekom net profits in 2005 in accordance with the RAS.
The total amount of dividend payments planned by the OAO Rostelekom on the basis of the results of 2005 should make RUR 2 040.8 million, what was by 14.3 per cent above the amount of dividends the company paid in 2004.
Dynamics of international stock market indices Change within the Change since the Data as on April 26, 2006 Value month (in %)8 beginning of the year (in %) RTS (Russia) 1 627.51 15.04% 36.73% Dow Jones Industrial Average (USA) 11 283.25 1.15% 4.02% Nasdaq Composite (USA) 2 330.30 1.12% 3.86% S&P 500 (USA) 1 301.74 0.66% 2.60% FTSE 100 (UK) 6 086.60 2.54% 7.13% DAX-30 (Germany) 6 078.80 3.19% 11.54% CAC-40 (France) 5 235.34 1.66% 10.10% Swiss Market (Switzerland) 8 041.00 0.85% 5.41% Nikkei-225 (Japan) 1 970.29 1.68% 3.72% Bovespa (Brazil) 39 738.00 8.33% 18.60% IPC (Mexico) 20 360.61 7.56% 13.58% IPSA (Chile) 2 213.23 1.92% 14.11% Straits Times (Singapore) 2 583.61 2.79% 9.04% Seoul Composite (South Korea) 1 431.15 7.50% 3.01% ISE National-100 (Turkey) 45 352.51 8.65% 13.98% Morgan Stanley Emerging Markets Free Index 836.40 8.42% 18.30% The Foreign Exchange Market.
In April, the dominating trends observed on the foreign exchange market were the Ruble appreciation with respect to the US dollar and its depreciation against the Euro. The major factors behind these dynamics were the regular surge in oil prices, as well as the dynamics of the international forex market, where there was observed a significant appreciation of the Euro against the US dollar. As it has been already noted above, the April comments of the US FRS were understood by investors as evidence of the end of the cycle of increase in the base US interest rate, what created incentives for the dealing against the US dollar. Therefore, the trends prevailing on the international foreign exchange market automatically translated to the Russian market. Taking into account the fact that in certain periods the RF Central Bank limited its participation in trading, the Ruble continued to consolidate its positions with respect to the US currency and, at the same time, depreciated with respect to the Euro.
By the end of the month, in the period from April 1 till April 26, the US $ depreciated by RUR 0.275 (by 0.994 per cent) and made RUR 27.42 per US $. The aggregate volume of trade in the US Dollar at the SELT in the period from April 3 till April 21 made about US $ 32.99 billion; over this In relation to the levels registered on March 29, 2006.
period, the average daily turnover made US $ 2.19 billion (as compared with about US $ 33.87 billion and US $ 1.99 billion registered in the respective period of March). Over this period, the maximal amount of trade with the US dollar was registered on April 7 and made about US $ 3.5 billion, whereas the minimal amount of trade was observed on April 5 (US $ 1.19 billion).
Dynamics of the Official USD/RUR and EUR/RUR Exchange Rates in 2005-40.39.Official USD/RUR exchange rate 38.Official EUR/RUR exchange rate 18.104.22.168.22.214.171.124.29.28.27.FIGURE 8.
Dynamics of the Dollar/Euro Exchange Rate on the International Markets 126.96.36.199.1.1.This April, the Ruble liquidity in the banking sector demonstrated an insignificant decrease in comparison with the figures registered in March of 2005: the average balances of correspondent accounts of credit organizations with the Bank of Russia made about RUR 323.44 billion as compared with RUR 325.3 billion registered in March.
roubles 01.03.16.03.31.03.15.04.30.04.15.05.30.05.14.06.29.06.14.07.29.07.13.08.28.08.12.09.27.09.12.10.188.8.131.52.184.108.40.206.26.12.10.01.25.01.09.02.24.02.11.03.26.03.10.04.25.04.USD/EURO 01.03.31.03.30.04.30.05.29.06.29.07.28.08.27.09.220.127.116.11.26.12.25.01.24.02.26.03.25.04.In the period from April 1 till April 26, the exchange rate of the Euro against the US $ on the world market increased by US $ 0.026 (by 2.13 per cent) and made US $ 1.2395 per Euro. In April, at the background of the Euro appreciation against the US dollar observed on the forex market the European currency also appreciated with respect to the Ruble. In the period from April 1 till April 26, the European currency appreciated against the Ruble by RUR 0.332 (by 0.98 per cent) from RUR 33.627 per Euro to RUR 33.959 per Euro. The aggregate turnover of trade at the SELT amounted to Euro 409.million in the period from April 3 till April 21, while the average daily turnover was registered at about Euro 27.33 million (about Euro 328.9 million and Euro 19.35 million in March). Therefore, over the period under observation there was registered a significant increase in the amount of trading with the European currency on the Russian forex market. In April, the maximal amount of trade with Euro was registered on April 18 and made Euro 44.88 million, whereas the minimal amount of trade was observed on April 17 (Euro 8.16 million).
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