Investor Presentaiton
En+
GROUP
FINANCIAL STATEMENTS
EN+ GROUP IPJSC
Notes to the Consolidated Financial Statements
for the year ended 31 December 2021
En+ Group Annual Report 2021
EN+ GROUP IPJSC
Notes to the Consolidated Financial Statements
for the year ended 31 December 2021
(b) Disclosure
USD million
Cost
Balance at 1 January 2020
Goodwill
Other intangible
assets
Total
2,686
Additions
33
645
27
3,331
60
Disposals
(48)
(48)
Foreign currency translation
(234)
(19)
(253)
Balance at 31 December 2020
2,485
605
3,090
Additions
14
40
54
Disposals
(3)
(3)
Foreign currency translation
(8)
3
(5)
Balance at 31 December 2021
2,491
645
3,136
Amortisation and impairment losses
Balance at 1 January 2020
(450)
(505)
(955)
Amortisation charge
(10)
Disposals
48
(10)
48
Foreign currency translation
8
8
METALS
The aluminium segment represents the lowest level within UC RUSAL at which goodwill is monitored for
internal management purposes. The recoverable amount represents value in use as determined by discounting
the future cash flows generated from the continuing use of the plants within UC RUSAL's aluminium
segment.
Similar considerations to those described above in respect of assessing the recoverable amount of property,
plant and equipment apply to goodwill.
At 31 December 2021, management analysed changes in the economic environment and developments in the
aluminium industry and the Group's operations since 31 December 2020 and performed an impairment test
for goodwill at 31 December 2021 using the following assumptions to determine the recoverable amount of
the segment:
.
Total production was estimated based on average sustainable production levels of 3.8 million metric
tonnes of primary aluminium, of 8.4 million metric tonnes of alumina and of 16.7 million metric tonnes
of bauxite. Bauxite and alumina will be used primarily internally for production of primary aluminium;
The aluminium and alumina prices were based on the long-term aluminium and alumina price outlook
derived from available industry and market sources and were as follows:
Balance at 31 December 2020
(450)
(459)
(909)
2022
2023
2024
2025
2026
Amortisation charge
(11)
(11)
Impairment
(14)
(14)
Foreign currency translation
(3)
(3)
Aluminium sales prices, based on the long-term
aluminium price outlook, USD per tonne
Alumina sales prices, based on the long-term
2,623
2,476
2,371
2,375
2,411
Balance at 31 December 2021
(450)
(487)
(937)
alumina price outlook, USD per tonne
Nominal foreign currency exchange rates,
345
319
316
320
352
RUB per 1 USD
72.2
74.7
76.8
79.2
80.7
Net book value
Inflation in RUB
6.6%
4.5%
3.6%
4.2%
3.3%
At 1 January 2020
At 31 December 2020
At 31 December 2021
2,236
140
2,376
2,035
146
2,181
2,041
158
2,199
Inflation in USD
4.0%
2.1%
2.1%
2.0%
2.1%
STRATEGIC REPORT
CORPORATE GOVERNANCE
(c)
(d)
Goodwill additions for the years ended 31 December 2021 and 31 December 2020 relate to acquisition of
certain companies engaged in production and infrastructure areas and was determined as the difference
between the consideration paid and the fair value of acquired assets and liabilities.
Amortisation charge
The amortisation charge is included in cost of sales and administrative expenses in consolidated statement of
profit or loss and other comprehensive income.
Impairment testing of goodwill and other intangible assets
For the purposes of impairment testing, goodwill is allocated to the following CGUs. These units represent
the lowest level within the Group at which the goodwill is monitored for internal management purposes.
The aggregate carrying amounts of goodwill allocated to each business, and the related impairment losses
recognised, are as follows:
Operating costs were projected based on the historical performance adjusted for inflation;
Nominal foreign currency exchange rates applied to convert operating costs of the Group denominated
in RUB into USD and inflation in RUB and USD assumed in determining recoverable amounts were
as above;
The pre-tax discount rate was estimated in nominal terms based on the weighted average cost of capital
basis and was 11.5%;
A terminal value was derived following the forecast period assuming a 2.0% annual growth rate.
Values assigned to key assumptions and estimates used to measure the units' recoverable amount were based
on external sources of information and historical data. Management believes that the values assigned to the
key assumptions and estimates represented the most realistic assessment of future trends. The results were
particularly sensitive to the following key assumptions:
.
•
A 5% reduction in the projected aluminium and alumina price levels would result in a decrease in the
recoverable amount by 18% but would not lead to an impairment;
A 5% increase in the projected level of electricity and alumina costs in the aluminium production
would have resulted in a 6% decrease in the recoverable amount but would not lead to an impairment;
176
USD million
UC RUSAL
Angara HPPs (Irkutskenergo)
Strikeforce Mining and
Resources Limited
Allocated
goodwill
Accumulated
impairment
loss
Allocated
goodwill
Accumulated
impairment
loss
2021
2021
2020
2020
2,269
(449)
2,273
(449)
221
211
1
(1)
1
(1)
2,491
(450)
2,485
(450)
•
A 1% increase in the discount rate would have resulted in a 9% decrease in the recoverable amount
but would not lead to an impairment.
Based on results of impairment testing of goodwill, management concluded that no impairment should be
recorded in the consolidated financial statements as at 31 December 2021.
FINANCIAL STATEMENTS
Appendices
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