“SAMRUK-ENERGY” JSC | Integrated ANNUAL REPORT

Liquidity and financial sustainability indicators

Fulfillment of external lenders’ covenants:

Covenant

Standard

2018 Actual

Deviationactual 2018/standard

Note

Debt/EBITDA

(EBRD. HBK)

No more than 4.5

3.18

–1.32

Is met

EBITDA/interest (EBRD)

No less than 3

2.95

–0.05

Is met *

According to the lender’s methodology of calculation the value of the covenant is – 3.77

Debt/Equity(EDB and KDB)

No more than 2

0.65

–1.35

Is met

Description

2016

Actual

2017

Actual

2018

Actual

2019

Forecast

2020

Forecast

Debt/EBITDA

5.41

4.64

3.18

3.82

2.56

Debt/Equity

0.75

0.75

0.65

0.65

0.53

Current liquidity

0.66

1.36

1.04

1.21

0.90

The Сompany’s financial stability in 2018 improved because of an increase in production volumes and tariffs, as well as a decrease in the debt burden and asset sales. By the end of 2018, the Company’s consolidated debt compared to 2017 decreased by 53 bln. tenge and amounted to 383 bln. tenge.

Actions taken “Samruk-Energy” JSC group of companies in order to improve financial sustainability

As of December 31, 2018, loans for total amount of 48.7 bln. tenge were early repaid, including:

  • EBRD, 4.4 bln. tenge;
  • “Halyk Bank” JSC, 38.5 bln. tenge;
  • “Sberbank” SB JSC, 5. 75 bln. tenge.

As part of work aimed at reducing finance costs, interest rates of existing loans across “Samruk-Energy” JSC group have decreased by 1–1.5 %.

Savings on interest expenses resulted from reduction of interest rates and early repayment of loans in 2018 amounted to 3 bln. tenge.

In addition, as required by the Debt and Financial Stability Management Policy of “Samruk-Kazyna” JSC, the Company developed an Action Plan for the Company’s entry into the green risk zone. This Action Plan involves the implementation of certain activities from 2017 to 2022, that aim to improve EBITDA, reduce costs and debt burden.