2016 ANNUAL REPORT
www.ena.am | 2016 Annual report | 1 CONTENTS 01
TASHIR GROUP OF COMPANIES ...... 4 PRESIDENT’S NOTE 02
BOARD OF DIRECTORS CHAIRMAN’ S NOTE ...... 5 DIRECTOR GENERAL’S NOTE
03
COMPANY’S MARKETING, COMMERCE 3.1 Company background scope ...... 6 AND SALES PERFORMANCE, COMPANY’S 3.2 Main Activities ...... 8 POSITIONING IN THE FIELD 3.3 Production and technological potential ...... 9 3.4 Company’s Performance State Regulation Peculiarities ...... 10 3.5 ...... 11 3.6 ...... 12 04 INFORMATION ON ENERGY ...... 14 SOURCES USAGE VOLUME 05 COMPANY’S PERFORMANCE GENERAL 5.1 Dynamics of the main production and FINANCIAL INDICATORS. PRODUCTION financial indicators ...... 18 PERFORMANCE 5.2 Company’s growth outlook ...... 30
2 | 2016 Annual report | www.ena.am 06
INVESTMENT PERFORMANCE ...... 32
07
COMPANY’S JOINT STOCK CAPITAL STRUCTURE ...... 36
08
COMPANY’S DIRECTORS BOARD STAFF ...... 38
09
NCORPORATED SOCIAL LIABILITIES 09.1 Brief review ...... 40 10.2 ...... 42 11.3 ...... 44
10
ENVIRONMENT PROTECTION ...... 46
11
...... 48 ADDITIONAL INFORMATION FOR SHAREHOLDERS TASHIR GROUP OF COMPANIES PRESIDENT’S NOTE
was again reduced. We launched a project to incorporate international management standards, which will increase the management system
cooperation with international financial institutions. The key to our success was the high professionality of the personnel, the competence and flexibility of the management team and the modern technologies used in the work.
The main goal our team sets for the future is still to maintain high growth rates of the company together with the improvement of the quality of services provided to the population of Armenia. The Company's profit amounted to 23.3 billion AMD in
for future development, in the next five years the Company will implement a large-scale investment program amounting to 97,4 billion AMD.
Adhering to the principles of corporate social responsibility in 2016 ENA continued charitable activities by supporting educational, medical and sports programs, aimed at improving the quality of life of the Armenian population, contributing to preservation of the cultural and historical heritage of Armenia, caring for the younger generation in the name of the future prosperity of the country.
Undoubtedly, the key factor of successful work of 2017 is an anniversary year for ENA. We are getting the Company is the coordinated work of the whole 15 years old. During this time, it was possible to team while the main priority for us is to create conditions for full fulfillment of the potential of each to manifestations of market and financial instability. employee. We are especially proud of our large team The company has repeatedly been tested for of professionals who are able to solve problems strength. And today, ENA takes its rightful place of any complexity. Thanks to them the company managed to reach the leading positions and improve Armenia. the quality of services rendered to the population of our country. The past year of 2016 was a new challenge for the Company, which we successfully got through in Taking responsibility for ensuring the sustainable all key directions. The Company fulfilled the main and progressive development of our business, I want production targets for 2016, set forth by the plan, budget and investment program. Thanks, among the highest demands and expectations in the future as well.
SAMVEL KARAPETYAN
4 | 2016 Annual report | www.ena.am DEALING with tasks successfully
The results of the past year have again demonstrated both the advantages of the Company's business model and our ability to achieve success even in the most ensure the reliability and optimization of the business structure. As this report shows, the Company has become taken. The past year has been intense and successful for the Company due to the achieved growth in operating activities. It also showed that all elements of the energy chain of our business continued to demonstrate of Directors is aware of the changes taking place in the world and pays much attention to an adequate response to them. Throughout 2016, the Company paid special attention to strategy issues, competent project planning and strict investment discipline. KAREN DARBINYAN Chairman of the Board of Directors CJSC Electric Networks of Armenia
Good Governance
the shareholder value. Reliability and skillful corporate governance must underlie everything that we do. In 2016, we managed to reduce operating costs, and the Company's capital investments amounted to 10 billion drams.
We use our strengths – the experience of our people, advanced technologies and the ability to build strong relationships necessary to implement large-scale projects. Year after year, the strong team of ENA proves that they care not only about the results of activities, but also about the ways to achieve these results.
On behalf of the whole team, I would like to thank our KAREN HARUTYUNYAN customers who give us their trust. The opinion of each of Director General You is important for us! CJSC Electric Networks of Armenia
www.ena.am | 2016 Annual report | 5 03.COMPANY’S MARKETING, COMMERCE AND SALES PERFORMANCE, COMPANY’S POSITIONING IN THE FIELD
3.1. Company background scope
«Electric Networks of Armenia» CJSC (hereinafter referred to as the Company/ENA) was registered in April 1997 in Yerevan,
Four regional electric networks («Northern Electric At the end of 2011, 100% of the Company’s shares Networks», CJSC, «Southern Electric Networks» CJSC were transferred to INTER RAO Holding B.V. "Yerevan Electric Networks" and «Central Electric (the 100% owner of Interenergo B.V.), which is a Networks» CJSC) joint it in May 2002. The company subsidiary of OJSC «INTER RAO UES». "Electric Networks of Armenia" was privatized by sale of 100 % of shares to Midland Resources On September 2015, the Tashir Group and Inter RAO Holding company. Group signed a sale/purchase contract in respect to electric power assets of the Republic of Armenia. In June 2005 on the basis of the agreement between Tashir Group has been fully engaged to undertake companies Interenergo B.V. and Midland Resources the commitment for «Electric Networks of Armenia» Holding Ltd. the Company went under the control of CJSC management and operation. the Group of INTER RAO UES, 100 % of shares were acquired by Interenergo B.V. company, the affiliate of INTER RAO UES.
6 | 2016 Annual report | www.ena.am www.ena.am | 2016 Annual report | 7 3.2. Main Activities
ENA’s performance is the transmission and distribution of the electric energy throughout the territory of the Republic of Armenia.
For power transmission ENA uses own aerial and cable (ground-based) lines, substations and distribution units, with voltage from 0,4 up to 110 kV.
8 | 2016 Annual report | www.ena.am 3.3. Production and technological potential
The company owns: 9056 26 substations and transformation units, thousand kilometers of aerial electric lines, including: including:
102 110 kV substations with total power 2,8 thousand kilometers of 110 kV aerial preset as 4478 МWА; electric lines;
8465 6(10) kV transformation units with 2,3 thousand kilometers of 35 kV aerial total power preset as 3200 МWА; electric lines;
226 35 kV substations with total power 8,28 thousand kilometers of 6(10) kV preset as 1736 МWА; aerial electric lines;
261 6(10) kV distribution units. 12,8 thousand kilometers of 380 V voltage aerial lines. 5,8 thousand kilometers of (ground) cable lines of electric transmission, including:
0,1 thousand kilometers of 35 kV (ground) cable lines of electric transmission;
2,4 thousand kilometers of (ground) cable lines of electric transmission with 380 voltage.
3,3 thousand kilometers of 6(10) kV (ground) cable lines of electric transmission;
www.ena.am | 2016 Annual report | 9 3.4. Company’s Performance State Regulation Peculiarities
The Company is a natural monopoly in the sphere of sale and purchase of electricity. According to purchase of electricity by the Company in the transit and distribution, provided to the Company, are established by the Public Services Regulatory Commission of RA (hereinafter referred to as «the PSRC»). the appendix to the license of the Company and is specified in the agreement on purchase and sale of shares of the Company, signed in 2002 between the RA Government and Midland Resources Holding Ltd. In 2013 (now it’s the INTER RAO Holding B.V. that appears as a Party (Side) of the Agreement instead of the Midland Resources Holding Ltd.).
10 | 2016 Annual report | www.ena.am methodology
annually and consists of several stages. At the first cost of purchased electric energy, stage the PSRC with the Company make projection on sale of electricity by the Company in Armenia in other operating costs, the natural measurement (kilowatt-hour) for a year, including for separate voltage (220 and 380 volt, 6, reserve on accounts receivable, 10, 35 and 110 kilovolt) and per time of use (day and night). As a result the PSRC forms the projection for allowed pre-tax profit,
depreciation of the fixed assets, the projection for the total revenue of the Company from the sale of electricity in the domestic market of Armenia in monetary expression. compensation of the deficiency of margin (from 2013).
according to the methodology for calculating of the In accordance with the actual tari methodology, the Company’s revenues from sales of electricity must be equal to the sum of the cost of acquisition of realized electricity and the tari margin, which includes:
www.ena.am | 2016 Annual report | 11 12 | 2016 Annual report | www.ena.am Electric power sales rates for subscribers in Armenia First time the rates were increased on April 1, have been established in 1999, and since that time 2009, and the next change took place on July 7, have been changed just and only due to segregation of rates of certain kinds system had been reviewed. After, with a purpose of (in accordance with voltage and time of the day). the energy framework financial strengthening, on August 1, 2014, an appropriate resolution of PSRC (Public Services Regulation Commission), came into force, and the rates were correspondingly reviewed starting with August 1, 2015.
From August 1, 2016, the decrease of the margin. On December 23 PSRC actual rates are as following below: February 1, 2017.
,2 37 4,7 3,2 6,2 3 4 4 3,2 ,7 ,2 ,2 3 30 33 36
35 kv 110 kv 6-10 kv 0.38 kv
Daytime rate Night time rates are valid starting with 23:00 (11 PM) and till 07:00 (7 AM), and are calculated only if
Night time rate meter.
Voltage
Sales Rates (in AMD, including VAT).
On the results of 2016 ENA takes the 3rd place in the list of prominent tax - payers and is the biggest employer in RA.
www.ena.am | 2016 Annual report | 13
SOURCES USAGE VOLUME
The Company purchases the electric energy immediately from power generating (producing) companies on the basis of straight contracting, but in volumes, that are being determined by the system dispatcher unit, appearing as the «Electric Energy System Operator» CJSC, which operates the electricity production and flows regimes and shifts.
14 | 2016 Annual report | www.ena.am Electric Energy Purchase Framework
24% TPP
35% ANPP
37% HPP
Usually the rate for the energy produced by small HPPs, is being established in the beginning of (each) year and is valid throughout the whole year.
Energy purchase Period/station «Armenian Nuclear Power Plant» CJSC «Hrazdan TPP» OJSC «Gazprom Armenia» CJSC (5th power block) TPP» CJSC «Yerevan Global Hydro Cascade Contour CJSC «International Energy Corporation» Small HPPs Import Total
mln kWt*h January 261 77 0 81 95 16 45 0 577 February 239 67 0 44 74 23 56 9 512 March 249 0 0 52 65 31 84 0 482 April 233 0 0 0 77 50 120 0 480 May 184 0 0 0 57 44 149 0 434 June 241 0 0 0 59 47 135 0 482 July 245 18 0 1 65 75 101 0 505 August 240 27 0 46 78 68 61 0 520 September 141 28 0 134 102 11 49 0 464 October 0 43 145 155 94 4 49 0 490 November 0 79 127 150 98 15 58 29 557 December 161 70 51 175 117 11 49 0 635 TOTAL 2 195 409 323 838 982 396 957 38 6 137 Rate, AMD/ kW*h, without 6.42 33.10 33.00 17.77 6.65 4.50 21.07 6.3 ¢ VAT (from USA* 01.08.2016) 2571.10 507.85 215.15 823.10 909.57 444.31 839.65 0 6310.73
Rate, AMD/ kW*h, without 4.597 35.775 35 18.5 4.562 4.135 22.082 VAT (from (till 01.08.2015)
Rate, AMD/ kW*h, without 4.772 30.771 33.4 15.111 6.648 1.727 19.848 VAT (from (till 01.08.2015)
*due to CBA exchange rate to the end of the month
www.ena.am | 2016 Annual report | 17 GENERAL FINANCIAL INDICATORS. PRODUCTION PERFORMANCE 5.1. Dynamics of the main production and financial indicators
THE DYNAMICS OF THE MAIN PRODUCTION AND FINANCIAL INDICATORS COULD BE DESCRIBED AS FOLLOWING:
mln AMD
% Financial Results 2016 2015 changes
Benefit 192 743 181 005 6.5
Energy purchased (117 695) (110 768) 6.3
Power transmission services (7 091) (7 840) -9.6
Marginal profit 67 956 62 397 8.9 Salaries, associate payments and taxes by actually (20 195) (19 129) 5.6 paid wages Deterioration/amortization (6 734) (6 370) 5.7
Technical maintenance and repair expenses (1 279) (1 320) -3.1
Use of stock/reserves (2 020) (3 028) -33.3
Reserve rehabilitation/devaluation expenses 695 (591) -217.6
Other operational expenses 1790 2 160 -17.1
Other operational expenses (6 873) (7 022) -2.1
OPERATIONAL PROFIT 33 340 27 095 23.0
Financial incomes 91 3 619 -97,5
Financial costs and expenses (4 562) (6 321) -27.8
28 869 24 392 18.4
Profit tax expenses (5 584) (3 385) 65.0
23 285 21 007 10.8
EBITDA 41 058 34 718 18.3
The increase of the margin contribution in decrease of the exploitation costs, comparison with 2015 is conditioned by: financial costs decrease.
www.ena.am | 2016 Annual report | 19 Company’s Production Performance Indications
mln AMD
% 2016 2015 changes
Transmission facilities total length (km) 32 051 31 800 1.0
High voltage networks (110kV and higher) 2 800 2 778 0,01
Medium voltage networks (35-10 kV) 14 100 13 989 0,4
Low voltage networks (0,4 kV and lower) 15 300 15 284 0,2
Transformers division power (МWА) 9 678 9 436 0,2
Power network release (mln kWh) 6 040 6 207 -2,7
Network energy losses (mln kWh), total 587 712 -17.6
Technological 587 623 -5.8
The same % as per network release 9.7% 10.0% -3.2
Commercial 0 89 -100.0
The same % as per network release 0.0% 1.4% -100.0
Persent of total losses to total 9.7% 11.5% -15.3% network release
Electric power sales (mln kWh) 5 430 5 468 -0,7
20 | 2016 Annual report | www.ena.am The dynamics of the production performance general indicators shows: the electric transmission lines total length growth, which is conditioned by investments to the main capital, the decrease of the electric energy total (summarized) losses in network, as a result of commercial losses shortening. Company’s Financial Condition
mln AMD
2016 2015 % Indications changes
ASSETS
Non-current assets 121 244 106 961 13.4
Current assets 32 602 39 656 -17.8
Assets in total 153 845 146 617 4.9
CAPITAL AND OBLIGATIONS
Stock funds 51 089 31 501 62.2
LONG TERM OBLIGATIONS
State subsidies 4 243 4 489 -5.5
Credits and loans 32 127 41 981 -23.5
Commercial and other credit obligations 55 68 -19.4
Clearly suspended tax liabilities 5 559 4 452 24.9
Total for long term obligations 41 985 50 990 -17.7
SHORT TERM OBLIGATIONS
State subsidies 244 243 -0,0
Credits and loans 31 458 19 646 60.1
Commercial and other credit obligations 26 072 42 609 -38.8
Commercial and other credit instruments 2 997 1 347 122.5
Reserves 0 280 -100.0
Total for short-term obligations 60 771 64 126 -5.2
Total obligations 102 756 115 116 -10.7
Total for funds and obligations 153 845 146 617 4.9
22 | 2016 Annual report | www.ena.am The Company discharged the whole past-due debt on power and reduced tha loan portfolio.
The financial state of the Company got better as a result of the measures taken by the management of the Company.
www.ena.am | 2016 Annual report | 23 Funds Flow
mln AMD
% 2016 2015 changes
OPERATIONAL ACTIVITIES
Net profit 23 285 21 007 10.8
CORRECTION OF NON-FINANCIAL ITEMS FOR VERIFICATION OF PRE-TAX LESION WITH NET FUNDS FLOWS
Deterioration and amortization 6 734 6 370 5.7
Impairment (reversal)/losses (695) 591 -217.6
Loss on disposal of property and equipment 430 400 7.6
Loss on write-o of inventories 0 823 -100.0
Amortisation of government grants (246) (250) -1.8
Reversal of provision for litigations and claims 280 0 -
Reversal of tax provision 0 (239) -100.0
Accrual of vacation reserve 2 017 2 143 -5.9
Net finance costs 4 471 2 702 65.4
Income tax expense 5 584 3 385 65.0
CHANGES IN:
Inventories 996 135 637.9
Trade and other receivables 2 926 (10 753) -127.2
Trade and other payables (19 010) 2 745 -792.5
Cash flow from operations before income 26 214 29 060 -9.8 taxes and interest paid
24 | 2016 Annual report | www.ena.am mln AMD
% 2016 2015 changes
Discharge of income tax (1 903) 0 -
Interest paid (3 031) (3 786) -19.9
Net cash proceeds from operational activities 21 281 25 274 -15.8
INVESTMENT PERFORMANCE
Main assets purchase (17 794) (5 676) 213.5
Non-material assets purchase (130) (153) -14.7
Main assets sales revenues 401 124 223.4
Obtained interest (%) 45 148 -69.6
Net cash flows targeted for investment activities (17 478) (5 557) 214.5
FINANCIAL ACTIVITIES
Income from credits and loans 126 997 74 908 69.5
Disbursement of credits and loans (130 907) (95 748) 36.7
Net cash flows targeted for/proceeded from (3 910) (20 840) -81.2 investment activities
Net decrease/increase of cash flows and (107) (1 123) -90.5 equivalents
Financial funds and equivalents as for January 1 1 435 2 550 -43.7
Exchange rates impact on financial funds and 14 8 76.6 equivalents
Financial funds and equivalents as for December 31 1 342 1 435 - 6.5
www.ena.am | 2016 Annual report | 25 Financial & Industrial Performance Indications
Reference Index Calculation formula 2016 2015 2014 2013 2012 value
Total assets profit/average value assets 15-40 15.50 14.55 -7.59 -7.41 -7.98 profitability (ROA) (%)
current assets/current Current liquidity index ≥2 0.54 0.62 0.43 0.54 0.58 liabilities
(current assets- Urgent liquidity index inventories)/current ≥0.8 0.49 0.57 0.37 0.45 0.47 liabilities
Financial equity/total balance ≥0.5 0.33 1.21 0.02 0.10 0.18 independence index
(equity+non-current Souverinity index ≥0.75 0.60 0.56 0.43 0.57 0.67 liabilities) total balance
26 | 2016 Annual report | www.ena.am Financial and economic activities indications describe the Company’s activity as a profitable one, and such indicators as the assets profitability stands for that.
Solvency and the credit risk rate are improving which can be seen through and loans correlation. 2012-2016
Comparative analysis of EBITDA
41 058 2016
34 718 2015
10 164 2014
3 362 2013
5 306 2012
28 | 2016 Annual report | www.ena.am 2016 2015 2014 2013 2012
Benefit 192 743 181 005 157 935 132 101 112 281
Energy purchased (177 695) (110 768) (112 887) (96 996) (78 073)
Power transmission services (7 091) (7 840) (8 192) (5 245) (3 948)
Marginal profit 67 956 62 397 36 856 29 860 30 260
Salaries, associate payments and (20 195) (19 129) (18 961) (18 166) (17 084) taxes by actually paid wages
Deterioration/amortization (6 734) (6 370) (6 156) (5 735/ (5 563)
Technical maintenance and repair (1 279) (1 320) (1 360) (1 346) (993) expenses
Use of stock/reserves (2 020) (3 028) (3 137) (3 234) (2 788)
Reserve rehabilitation/devaluation 695 (591) 367 (792) (214) expenses
Other operational income 1 790 2 160 2733 2 659 1 466
Other operational expenses (6 873) (7 022) (8 310) (6 591) (8 080)
Operational profit 33 340 27 095 2 032 (3 345) (2 997)
Financial incomes 91 3 619 190 257 404
Financial costs and expenses (4 562) (6 321) (12 073) (6 450) (7 828)
PRE-TAX profit (lesion) 28 869 24 392 (9 851) (9 538) (10 421)
Profit tax expenses (5 584) (3 385) (826) (349) 227
NET profit (lesion) 23 285 21 007 (10 677) (9 887) (10 194)
EBITDA 41 058 34 718 10 164 3 362 5 306
www.ena.am | 2016 Annual report | 29 5.2 5.2Company’s Company’s growth growth outlook outlook
30 | 2016 Annual report | www.ena.am 2017-2020 MAIN TARGETS
decrease of the power loss indications economical, political and technological data down to 8% level monitoring,
securing the billing collection for the power permanent control and liquidity supplied at the level not less than 99% management,
providing subscribers with power supply in implementation of the Investment accordance with RA Program, targeted to the qualified energy regulations supply to customers in accordance with RA regulations
To reach the objectives planned, the Company supposes to implement to arrange mutual cooperation with state asequence of the key extents: authorities, Public Services Regulatory Commisssion, shareholders and other governmental entities, installation of so called ASKOUE system (Automated system of commercial billing of electric power), development, capsulation and implementation of the Company’s strategic growth plan, ISO standards implementation, business processes automatization, customer service improvement.
credit portfolio refurnishing,
www.ena.am | 2016 Annual report | 31
PERFORMANCE
During the year of 2016 the Company has coped 12 002 219 thousand AMD (without VAT) capital investments
12 002 219 thousand AMD 26.05% 36.07%
3 127 124 4 329 144 THOUSAND AMD THOUSAND AMD technical reequipment and new newconstructions constructions and and reconstruction enhancementenhancement
14.88% 22.99%
1 786 264 2 759 697 THOUSAND AMD THOUSAND AMD other investments as otherother work work of solid of solid capital injections (capital)(capital) kind kind
32 | 2016 Annual report | www.ena.am Funding formed 18 893 477 thousand AMD (including VAT), comprising:
18 893 477 thousand AMD 19.64% 12.29%
2 855 581 6 140 285 THOUSAND AMD THOUSAND AMD technical reequipment and new constructions and reconstruction enhancement
47.97% 20.11%
6 973 956 2 923 654 THOUSAND AMD THOUSAND AMD other investments as other work of solid capital injections (capital) kind
www.ena.am | 2016 Annual report | 33 Main assets forming 10 941 049 thousands AMD (without VAT) input, comprising:
10 941 049 thousand AMD
new newconstructions constructions 3 013 350 and enhancementand enhancement 38.99% THOUSAND AMD
27.54% 3 013 350 otherother investments investments as as capitalcapital injections injections THOUSAND AMD
24.98% 2 733 200 technical reequipment and reconstruction THOUSAND AMD
8.49% 928 729 other work of solid THOUSAND AMD (capital) kind
34 | 2016 Annual report | www.ena.am Purak 35 kV substation reconstruction
The implementation of this project will allow to shoot the lack of power capacity in the heart of Yerevan and to deal with technological connection claims with total capacity of 7,15 MWA.
During upcoming five years the "Circus" Station and other 35/110 Company plans to implement a kV stations construction; number of large projects as described below: Installation of ASKOUE system
The implementation of this project will allow the Company to reduce the indicator of power losses down to the level of 9 %.
www.ena.am | 2016 Annual report | 35
CAPITAL STRUCTURE
The authorized capital of the Company forms 18 654 221 100 RA drams and is divided to 246 423 simple stock shares, each with nominal 18 654 221 100 value of 75 700 RA drams. There are no DRAMS privileged shares in the authorized capital of the Company. 246 423 From 28.12.2016 the shareholder PIECES of 100% shares of the Company was LIORMAND HOLDING LIMITED. On April 14, 2017 a 75 700 contract was signed between DRAMS LIORMAN HOLDING LIMITED ans "Tashir capital" CJSC on the aquisition of 70% shares of the Company.
36 | 2016 Annual report | www.ena.am Before that the shareholder of 50.0002029% shares (123212.000 stock shares) of the Company was the INTER RAO Holding B.V. The shareholder of 49.9997971% shares (123212.000 000 stock shares) of the Company was the LIORMAND HOLDING LIMITED.
www.ena.am | 2016 Annual report | 37 08.COMPANY’S DIRECTORS BOARD STAFF
29.12.2016, according to the Decision of «Electric Networks of Armenia» CJSC Shareholders Annual Meeting (Decision of the Sole Shareholder N3/16), the Director’s Board has been elected as follows:
Directors Board Chairman
Directors Board Vice-chairman
KAREN DARBINYAN
Date of Birth: 15.08.1972 Citizenship: RA First elected as a Directors Board Member on: 29.12.2016 NAREK KARAPETYAN Share in the authorized capital: 0% Date of Birth: 01.11.1990 Part of simple shares owned Citizenship: RA by person: 0% First elected as a Directors Board Member on: 29.12.2016 Share in the authorized capital: 0% Part of simple shares owned by person: 0%
38 | 2016 Annual report | www.ena.am Directors Board Members
VAROUZHAN ARTENYAN
Date of Birth: 06.06.1964 Citizenship: RF First elected as a Directors Board Member on: 29.09.2015 Share in the authorized capital of the Company: 0% Part of simple shares owned by person: 0%
SERGEY POGOSOV IGOR BULATOV HAYK IGNATYAN
Date of Birth: 01.11.1964 Date of Birth: 04.04.1983 Date of Birth: 03.06.1979 Citizenship: RF Citizenship: RF Citizenship: RF First elected as a Directors Board First elected as a Directors Board First elected as a Directors Board Member on: 29.12.2016 Member on: 29.09.2015 Member on: 29.09.2015 Share in the authorized Share in the authorized Share in the authorized capital: 0% capital: 0% capital: 0% Part of simple shares owned Part of simple shares owned Part of simple shares owned by person: 0% by person: 0% by person: 0%
www.ena.am | 2016 Annual report | 39 09.INCORPORATED SOCIAL LIABILITIES
09.1 Brief review
The incorporated social liability, as a principal of Starting with 2012, in all the schools, Company holds corporate management, plays a significant role at all trainings on power usage rules, and, while holding the stages of solutions preparation and managerial that trainings, Company’s employees in a children- decision making, and appears as one of the basic friendly manner describe what power is, how it is criterions for the sustainable development of the being supplied and how one can use it safely. Company. Among most significant charity and sponsorship The «Electric Networks of Armenia» CJSC, appearing projects should be stated separately: providing help as the largest employer in the Republic of Armenia, to kid houses in Vanadzor and Yerevan, shelters for provides worthy working conditions and appropriate children with physical and mental decease (Mother social packages for its employees. Theresa’s Shelter in Spitak, «Prkutyun» Shelter in Yerevan), for families in Gyumri, financial support to Herein, we consider as one more achievement the socially vulnerable groups of population, supporting education and culture. The social incorporated as well as all those steps that are being made for liability, as a principle of corporate management, professional skills improvement. A great deal of plays a big role at all the stages of decision making attention is paid to sports – particularly, to football, and appears as one of the basic factors for the chess and backgammon tournaments. The ENA sustainable development of the Company. permanently arranges football matches between
the Company’s trade union, which, in the framework of the Corporate Agreement, disburses 50% retire bonus for World War 2 and Labor veterans (about 180 people), supports handicaps, Company’s employees medical treatment etc.
40 | 2016 Annual report | www.ena.am www.ena.am | 2016 Annual report | 41 and HR policy
During the reported period, the priorities of the Company’s performance in the aspect of human capital were the improvement of management, including Company’s chart organization, increase implementation, safety issues etc.
42 | 2016 Annual report | www.ena.am The HR policy of the Company is targeted to:
skills improvement, teaching and training,
social partnership development, extension of the corporate policy role, specialists,
career planning and development.
www.ena.am | 2016 Annual report | 43
The roaster number of the Company 7 118 employees
higher professional education 2 308 PERSONS, INCLUDING:
59.66% 29.20% 11.14%
1 377 674 257
specialists clerks managers, workers team leaders (laborers)
167 3 158 11 485 485 persons possess persons possess high associates associates of the of Company the Company 2 higher educations, professional education, possesspossess common common high higheducation. education.
44 | 2016 Annual report | www.ena.am The personnel structure by age categories looks as follows:
Under 30 829 11.65% From 31 to 40 1 175 16.51% From 41 to 50 1 722 24.19% From 51 and over 3 392 47.65%
also as presented below:
Categorized structure
24.71% 9.99% 65.30%
1761 712 4 654 specialists clerks managers, workers team leaders (laborers)
www.ena.am | 2016 Annual report | 45 10.ENVIRONMENT PROTECTION
The Company operates a number of units, making impact on environment because of waste disposing and keeping, noise and electrical induction impact.
The impact mentioned cannot be completely cancelled, but the Company works hard to minimize and to compensate it.
46 | 2016 Annual report | www.ena.am ОThe basic principles of the Company’s environmental policy are:
priority of the implementation of best technological international cooperation in the field of practices existing, in comparison with arrangements to minimize the environmental impact of the as well as supporting research in the aspect of working equipment (considering the technical- environmental impact assessment and climate economical justification), change,
taking preventive steps to liquidate negative transparency and availability of environmental environmental consequences, database, urgent acknowledgement of all the stakeholders in a case of breakdowns, environmental consequences and troubleshooting,
Within the purpose of industrial safety the Company reducing the production waste generation and implements technical supervision on design, environmentally safe operating with those, construction and operation works, supports the development and implementation of arrangements aimed to prevent industrial errors, breakdowns and accidents,
It’s seems important to note, that the Directors’ Board has defined as a priority the development, certification and implementation of environmental management concept, in accordance with ISO 14001:2004.
www.ena.am | 2016 Annual report | 47 11.ADDITIONAL INFORMATION FOR SHAREHOLDERS
«Electric Networks of Armenia» CJSC contact information:
Address: 127 Armenakyan Street, Yerevan 0047, Republic of Armenia Phone: +374 (10) 650 086 Fax: +374 (10) 655 457
Website: www.ena.am Taxpayer ID: 01520882 Banking details: 160485017828, «VTB Armenia Bank» CJSC
Registrator
According to the appropriate signed Agreement, registrator of «Electric Networks of Armenia» CJSC is «ArmSwisBank» CJSC Address: 10 V. Sargsyan Street, Yerevan, Republic of Armenia Registrator’s contact phones: +374 (10) 540 782; +374 (10) 540 696 Registrator’s license details: No license requirements.
Auditor:
The Company’s auditor is: «KPMG» CJSC («KPMG ARMENIA») Auditor’s contact phones: +374 (10) 566 762 Auditor’s license details: № 002 April 10, 2002
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