“SAMRUK-ENERGY” JSC | Integrated ANNUAL REPORT

Macroeconomic factors

According to the data from Statistics Committee. consumer inflation slowed down in December 2018 compared with the previous month and amounted to 0.7 % (0.9 % in November), reaching a minimum of 5 years in annual terms and amounted to 5.3 % (7.1 % in 2017). Food and non-food products + 1.9 % provided the main contribution to the annual increase in prices separately, as well as services + 1.5 %. (source NB RK).

Dynamics of currency exchange rates:

 

31.12.2017

31.12.2018

%

KZT/USD

332.33

384.2

116

KZT/EUR

398.23

439.37

110

KZT/RUB

5.77

5.52

96

Financial and economic overview of the Company’s activities

PRINCIPLES OF ACCOUNTING POLICY

The Company’s operations in 2018 in power and coal sectors were carried out in accordance with the approved plans.

For the purposes of a single approach to preparing a report on business and financial performance, “Samruk-Energy” JSC group of companies uses the equity method in consolidation. In addition, in accordance with existing accounting policies. Property, plant and equipment and intangible assets are recognized at initial cost. i.e., without taking into account revaluation. Subsidiaries are included in the consolidated financial statements using the acquisition method. Acquired identifiable assets. as well as liabilities and contingent liabilities received at a business combination are recognized at fair value at the date of acquisition, regardless of the size of the non-controlling interest.

Based on the foregoing, when using the equity method in the consolidated balance sheet, turnovers of such big companies as “Ekibastuzs SDPP-2 Plant” JSC, coal assets company Forum Muider B.V., 50 % of interest of which belong to “Samruk-Energy” JSC, were excluded.

When forming the consolidated financial result of "Samruk-Energy" JSC, the share of profit on these companies is presented in the item “share of profit / loss of organizations accounted for using the equity method and investments impairment”.