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. Last Updated: 07/27/2016

Sales Push UES Profit Up Sixfold

State utility Unified Energy System on Friday reported a rise in 2006 sales and profits due to increased electricity sales and prices and one-off gains.

Sales rose 17 percent to $35.2 billion, beating the average forecast of $32.3 billion in a poll of analysts.

Net profit rose almost six times to $5.9 billion due to one-off gains, UES said. Earnings before interest, taxation, depreciation and amortization, or EBIDTA, rose 13 percent to $6.5 billion.

The average net profit forecast in the poll was $745 million with estimates ranging from $134 million to $1.17 billion excluding one-off gains. Analysts had expected EBITDA at $5.78 billion.

"The results are close to expectations although they are distorted by one-offs, which was also expected," said Alexander Kornilov, an analyst at Alfa Bank.

UES said the one-off gains were mainly due to the creation of a financial reserve to compensate for assets depreciation. Without one-offs, net profit attributable to minority shareholders rose 11 times to $2.6 billion. It also said spending rose by 18 percent to $32.28 billion as gas price hikes and coal and fuel oil price hikes outpaced electricity price rises, which are set by the state.

n CFO Sergei Dubinin said UES might float its 37 percent stake in Mosenergo on the open market if it failed to agree on a buyout with Gazprom. Gazprom said Friday that it had acquired control of Mosenergo by swapping its share in chemical unit Sibur for additional shares in the utility.