Inter RAO: revenue up 14% but EBITDA turns negative – a quarter with a 24.3 bn loss

On August 14, 2026, Inter RAO reported results for Q2 2026. Revenue rose 14.1% YoY to RUB 430,075 mn, but EBITDA was minus RUB 12,977 mn and net loss reached RUB 24,335 mn. This review examines what drove the negative operating profit and how it squares with revenue growth.

Key takeaways

— Revenue grew 14.1% in Q2, but EBITDA turned negative at RUB 12,977 mn.

— Operating loss of RUB 23,909 mn – driven by higher fuel and electricity purchase costs.

— Net loss of RUB 24,335 mn – first in recent years, net margin at minus 5.7%.

— Debt burden: net debt at minus RUB 155,405 mn, net debt/EBITDA at minus 2.57 over 12 months.

— Capex rose to RUB 54,310 mn in Q2, while operating cash flow was only RUB 10,165 mn.

— Trailing dividend yield at 14.4%, but payouts may not be covered by free cash flow.

— EV/EBITDA at 0.79 – below its three-year average of 0.97, shares cheaper than their history.

Key figures, RUB bn

Revenue grew 14.1% in Q2, but EBITDA turned negative at RUB 12,977 mn.

In Q2 2026, Inter RAO's revenue reached RUB 430,075 mn, up 14.1% YoY. Growth accelerated from the previous quarter, when revenue rose 18.6% YoY. The main contribution came from the Russian supply and generation segments, as well as trading.

However, operating performance deteriorated sharply: EBITDA for the quarter was negative at minus RUB 12,977 mn, versus plus RUB 38,499 mn in Q2 2025. EBITDA margin was minus 3.0%, compared to 10.2% a year earlier. This is the first negative EBITDA quarter in the period under review.

Operating loss of RUB 23,909 mn – driven by higher fuel and electricity purchase costs.

Operating profit in Q2 was minus RUB 23,909 mn, versus plus RUB 28,144 mn a year earlier. Key cost lines rose: electricity and capacity purchase costs increased from RUB 139,662 mn to RUB 168,757 mn, fuel costs from RUB 37,665 mn to RUB 41,351 mn. Transmission costs also grew, from RUB 95,984 mn to RUB 113,385 mn.

In the segment breakdown, heat generation (TGK-11 and Bashkiria Generation) and power engineering contributed negatively. Heat generation segment EBITDA totaled RUB 1,170 mn versus RUB 3,589 mn a year earlier, while power engineering turned to minus RUB 2,194 mn from plus RUB 3,844 mn in Q2 2025.

Net loss of RUB 24,335 mn – first in recent years, net margin at minus 5.7%.

Net loss for Q2 was RUB 24,335 mn, versus net profit of RUB 35,705 mn a year earlier. Net margin fell to minus 5.7% from plus 9.5% in Q2 2025. The loss resulted from negative operating profit, as well as higher interest expenses on leases and negative exchange rate differences.

For H1 2026, net profit was RUB 68,685 mn versus RUB 82,940 mn for the same period in 2025. The 17.2% decline reflects a weak Q2, despite a strong Q1 when net profit was nearly flat YoY.

Debt burden: net debt at minus RUB 155,405 mn, net debt/EBITDA at minus 2.57 over 12 months.

At the end of Q2, Inter RAO's net debt was minus RUB 155,405 mn, meaning the company remains a net creditor. During the quarter, net debt increased by RUB 168.2 bn, and over 12 months by RUB 66.5 bn, but remains negative. Net debt to EBITDA for the last 12 months is minus 2.57.

The increase in net debt is related to higher cash and cash equivalents, as well as changes in loans and borrowings. Loans and borrowings rose from RUB 5,559 mn at end-2025 to RUB 7,915 mn as of June 30, 2026. Lease liabilities decreased from RUB 81,555 mn to RUB 79,034 mn.

Capex rose to RUB 54,310 mn in Q2, while operating cash flow was only RUB 10,165 mn.

In Q2, capex reached RUB 54,310 mn versus RUB 35,635 mn a year earlier. Operating cash flow was significantly lower at RUB 10,165 mn, versus RUB 12,899 mn in Q2 2025. Thus, free cash flow for the quarter was negative.

For H1 2026, capex reached RUB 101,588 mn, while operating cash flow was only RUB 16,931 mn. Construction in progress increased from RUB 239,404 mn at end-2025 to RUB 308,390 mn as of June 30, 2026, indicating a large investment program.

Trailing dividend yield at 14.4%, but payouts may not be covered by free cash flow.

Over the last 12 months, Inter RAO paid dividends of RUB 0.3214 per share, providing a yield of 14.4% at the current price. Our model estimates the next payout at RUB 0.32 per share, implying a forward yield of 14.4%. The fair yield for this stock, in our view, is 10.5%.

With the price at RUB 2.5205 before the release and a 7.5% decline after, the current price offers a forward yield above fair. However, with negative free cash flow in Q2 and a large investment program, paying dividends in full may require using accumulated cash.

EV/EBITDA at 0.79 – below its three-year average of 0.97, shares cheaper than their history.

EV/EBITDA over the last 12 months is 0.79, below the three-year average of 0.97. P/E LTM is 3.21. Market capitalization is RUB 234,325.8 mn. Despite the weak quarter, the valuation remains below its own history.

The low multiple reflects both the sector's historical undervaluation and the current deterioration in operating performance. With negative EBITDA for the quarter and uncertainty about margin recovery, the discount to the average may persist.

Valuation on the latest reported figures

Bottom line

Q2 2026 was anomalous for Inter RAO: revenue grew 14.1%, but EBITDA and net profit turned deeply negative. The cause is a sharp rise in operating costs, especially fuel and electricity purchases, while the company retains a huge net cash position. The investment program remains large, and free cash flow is negative, raising questions about dividend funding. The key question for shareholders is whether the company can restore margins in H2, or if losses become persistent.