Annual Report 2017
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Annual Report 2017 Efficiency improvement and sustainable development Annual Report 2017 Efficiency improvement and sustainable development TVEL | ANNUAL REPORT 2017 TABLE OF CONTENTS 2 3 Table of Contents page page page page Key results Competencies of Second Social Partnership of TVEL enterprises of TVEL Business Core in the Territories 8 Fuel Company 80 Fuel Company 103 Development 131 of Presence Message From the Chairman of the Board 3 Governance Intellectual Сapital 101 5 Appendices of Directors 4 Corporate governance 51 Innovative Activities in the Nuclear Industry 101 1. Auditor’s Report 182 Message from President 6 Scheme of TVEL JSC Corporate Governance Bodies 53 Second Business Core Development 103 2. Financial Statements 184 Key results of TVEL Fuel Company 8 Board of Directors 54 Intellectual Property 109 3. Report of the Internal Control and Audit Department Milestones 2017 10 Report of the Board of Directors of TVEL JSC on the results Human Сapital 112 of TVEL JSC Following the Results of “Public Annual of the Company development in the priority fields 55 HR Policy 112 Reporting Preparation” Audit Process 195 Sole Executive Body 56 4. Independent Assurance Report 196 1 Staff Composition 112 About TVEL Fuel Company Share Capital Structure 57 5. Statement on Public Assurance 199 TVEL Fuel Company 15 Personnel Engagement 117 Related-Party Transactions and Major Transactions 57 6. RUIE Public Endorsement of the Report 201 World Market of Front End Nuclear Fuel Cycle 18 Motivation and Reward System 118 Management Efficiency Improvement 58 7. Table of Considerations of Suggestions Fabrication Market 18 Non-Material Benefits for Employees 120 Organizational Structure of TVEL JSC 58 by the Stakeholders 202 Uranium Conversion and Enrichment Markets 18 Development of Staff Capacities 120 Efficiency Improvement of Production Support Front End Nuclear Fuel Cycle Market Growth Outlook 20 Unified Youth Policy 124 Office Functions 58 Contact Details 203 Position of TVEL Fuel Company in the World Market Social Programs 124 Concentration of Production 59 of the Front End of Nuclear Fuel Cycle 21 Information Technologies 59 Interaction with Trade Unions 126 Operating Results of TVEL Fuel Company in the Anti-Corruption 61 Occupational Health and Safety 126 NFC Front End Market 24 Internal Control System 63 Social Сapital 131 Key Results 2017 24 Procurement Management 65 Social Partnership in the Territories of Presence 131 Goals and plans in the midterm 25 Social and Charitable Activity 138 4 Performance Results Stakeholder Engagement 145 2 Natural Сapital 147 Strategy of TVEL Fuel Company Financial Capital 71 Mission and Values 29 Ecological Policy 147 Investment Management 71 Strategy 32 Environmental Impact 149 Results 2017 71 Business Model 39 Financial Results 74 Expenses Related to Environment Protection 157 Risk Management 42 Cost Reduction 78 Nuclear and Radiation Safety 159 Manufactured Capital 79 Fire and Disaster Prevention 164 Business Assets and Operational Results 79 About the Report 167 Production Management 95 Terms and Definitions 172 Quality Management 99 Abbreviations 177 TVEL | ANNUAL REPORT 2017 MESSAGE FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS 4 5 Message from the Chairman of the Board of Directors Over the course of its 20-year history TVEL JSC Yuri Olenin Chairman of the Board faultlessly delivered on all contractual of Directors of TVEL JSC, Deputy Director General — commitments, which allowed the Company Director of the Division for Innovation Management of to acquire the global stature and sustainable ROSATOM State Corporation goodwill of a reliable supplier of safe and effective nuclear fuel Dear colleagues transparency and expanding dialogue with important for the whole nuclear industry is the Complex, Novosibirsk Chemical Concentrates and friends, stakeholders — all of these efforts clearly show Proryv or Breakthrough project being realized Plant, and Bochvar Institute. the development vectors of the entire nuclear at the site of Siberian Group of Chemical TVEL Fuel Company shows steady progress TVEL Fuel Company is one of the basic divisions industry in the near future. Enterprises in Seversk: creation of the unique allowing to expect successive achievement of ROSATOM which is of key importance both TVEL Fuel Company expands the geographical platform for closed nuclear fuel cycle and minor of its strategic goals while strictly preserving for the Russian nuclear industry and for the reach of its export supplies. In 2017, TVEL JSC actinides afterburn will enable the Fuel Division safety principles and following the sustainable development of international business. By concluded several major contracts for the whole to move to a new technological level. development priorities. strengthening its technological, manufacturing operation period of the nuclear power plants TVEL Fuel Company is traditionally committed and financial potential, the Company continues under construction in Egypt, Turkey and Belarus. to high environmental stadards. The Company to create new high-quality and reliable fuel Along with the development of the traditional supports national and regional environmental products for the world nuclear power industry fuel market for Russian design reactors, the events on a regular and proactive basis, while serving the interests of its customers. Company continues to promote fuel for Western demonstrating high corporate responsibility The priorities set by the Nuclear Fuel Division design PWR reactors. regarding environmental protection and fully comply with the strategic areas of activity Technological leadership of the Company conservation of the natural wealth of the country. in ROSATOM State Corporation. Penetrating regarding front end of nuclear fuel cycle is The Company has unique competences for new markets and creation of new products, traditionally associated with the creation of new decommissioning of the nuclear facilities and innovative development, operational efficiency types of nuclear fuel for the power and research rehabilitating the areas up to the environmentally growth, sustainable development, increasing reactor models. At the same time, strategically acceptable level in Angarsk Electrolysis Chemical Table of Contents TVEL | ANNUAL REPORT 2017 MESSAGE FROM PRESIDENT 6 7 Message from President Natalia Nikipelova President of TVEL JSC USD billion Foreign orders portfolio for products and services of FE NFC for a 10 year 10.8 period (as of year-end 2017) Dear colleagues, Western design. Power unit No.3 of NPP Ringhals for the near future include the creation of new events to protect the environment. These (Sweden) successfully completed the regular designs and modifications of fuel assemblies projects were carried out in parallel with In 2017, TVEL Fuel Company of Rosatom operation cycle of TVS-K in the reactor core, for VVER type reactors, design improvement the traditional work to eliminate the nuclear showed solid financial and operational with an agreement reached to expand the pilot for TVS-K fuel, development and market launch “legacy” of the first Soviet atomic project, as performance, continued to strengthen its operation program. of the products with mixed uranium-plutonium well as to ensure radiation safety and reduce positions in the global market, develop new In 2017, the Company launched the projects fuel for thermal and fast neutron reactors (MOX the impact of enterprises on the environment. business areas and improve operating efficiency. of strategic importance aimed at improving the fuel, REMIX fuel, MNUP fuel), as well as the TVEL Fuel Company spent RUB 2.2 billion for Summarizing the 2017 results, TVEL Fuel operational efficiency. One of such projects creation of accident tolerant fuel. Market launch environmental protection in 2017. Company’s revenue amounted to RUB 180.7 involves the concentration of mechanical of an efficient tolerant fuel based on the existing In 2018 TVEL JSC and its subsidiaries will billion, which is comparable to the previous year, enterprises of TVEL Fuel Company within the FA for Russian and foreign design reactors will continue their dynamic work on implementation while the net profit compared to 2016 increased production sites of Tochmash VPA (Vladimir open a new historical page in terms of reliability of all previously launched projects with the aim by 19% up to RUB 55 billion. The ten-year region) and Kovrov Mechanical Plant (Kovrov). and safety improvement of the nuclear power to introduce TVEL Fuel Company to a new efficy export orders portfolio for traditional products All enterprises of the nuclear fuel division industry worldwide. level, while improving current products and increased up to USD 10.8 billion, including the accomplish the projects aimed at reducing TVEL Fuel Company gives traditional priority creating new types of products, diversifying its fuel supply contracts for new foreign power production sites areas and costs. to the sustainable development of the cities business and classically reliable fuel supply to units of Russian design: El Dabaa NPP (Egypt), The year 2017 laid the foundation for the and the regions where our enterprises are NPPs both in Russia and abroad. Akkuyu NPP (Turkey), Ostrovets NPP (Belarus). dynamic development of new business areas, located. Along with charitable activities and In cooperation with its traditional partners TVEL Fuel Company started the process of implementation of social projects, our work in TVEL JSC continued transferring nuclear power creating industry-based