State Atomic Energy Corporation Rosatom, the sole shareholder of JSC Atomenergoprom, approved Atomenegroprom's 2008 annual report and accounting statements.  The annual report structure meets the requirements of the Federal Financial Risks Service, includes information directly related to JSC Atomenergoprom and does not contain consolidated financial data for subsidiaries and affiliates. The Company's annual report is available at www.atomenergoprom.ru.

2008 was the first full year of JSC Atomenergoprom operations.  In 2008 Atomenergoprom companies' total revenue amounted to RUR305.5 billion, and the targets were exceeded by over 7%. The targeted net profit of RUR27 bln. was also achieved.  The holding's export earnings equaled $4.5 bln. (including HEU-LEU Agreement implemented by TENEX).

During the previous year the full-scale efficiency improvement program with regard to the Russian nuclear power generation complex, specifically nuclear power plants (NPP) construction, was launched.  Russian nuclear power generation complex became the world leader in the number of power units simultaneously under construction, which in Russia alone amount to nine.  The holding actively participated in the implementation of the Rosatom's Long-Term Action Plan approved by Decree No. 705 of the Russian Government dated September 20, 2008.

The last year turned out to be the record one for Russia in terms of NPP output – 162.3 bln. kW/h (by 2% more than in 2007).  This figure was achieved without commissioning of the new units, only through improved capacity factor, which equaled 79.5%.  As result of such improvement, Atomenergoprom ranked first among Russian generation companies in terms of power generation output.  In the meantime, Russian NPPs worked efficiently and safely.

Uranium production of the Russian uranium producers increased by 3% in 2008, i.e. up to 3,521 tons, of by 4.5% and 3,687 tons if JV Zarechnoye (Kazakhstan) output is taken into account. In the framework of geological exploration and uranium production projects development the Company formed a number of joint ventures in 2008 in Armenia, Namibia, Canada and Russia, and assessed potential Russia's involvement in uranium production projects in Ukraine, Mongolia and other countries.

Atomenergoprom consistently pursued the development of international cooperation. The company entered into contracts for comprehensive supplies of nuclear fuel after 2010 to NPPs in Slovakia, and the Option Agreement involving provision by JSC TVEL of fuel fabrication services for the operating and near-finished NPP units throughout their operation period. All these activities improved company's standing in the Eastern and Central European's markets. In furtherance of the intergovernmental treaty with China on the technical aid in connection with stage 4 construction of the Gas Centrifuge Plan the company entered into contracts with the Chinese Nuclear Energy Company for construction of the gas centrifuge plant, and a long-term contract for supply of Russian EUP/SWU. On March 20, 2008, in Moscow, Atomenergoprom and Toshiba Corporation entered into Framework Agreement on Business Cooperation, whereby the parties agreed to develop the cooperation feasibility studies and specific business plans for cooperation in various spheres. JSC Atomenergomash acquired the controlling block of shares in Ganz Energetika in Hungary and formed on the basis thereof a Russia-Hungary joint venture for production of NPP refueling equipment.

Atomenergoprom as the holding company also takes care of other key issues, such as corporate governance enhancement, general industry costs reduction, development of transparent and economically efficient tender-based procurement procedures in the nuclear industry, streamlining of production-related expenses and improvement of investments and capital expenditures efficiency.  In 2008 the company was actively involved in corporate construction and improvement of subsidiaries' management efficiency. JSC United Separation and Sublimate Complex was created as part of holding structure optimization. This company will unite all Russian enterprises engaged in separation activities. With a view to developing a state-of-the-art Russian polyacrilic and hydrocarbon-based fibers production process, the company established JSC Khimpromengineering. Further, it established the Russian Gas Centrifuge Engineering Center to act as the HQ to be responsible for design and production of primary and auxiliary equipment for separation enterprises within the nuclear fuel cycle and consolidation of R&D and production assets.

Russia continued to upgrade its nuclear technologies over the past year.  In 2008 the development and production deployment of the new generation gas centrifuges continued. JSC ChMZ completed construction of the superconductors production facility in furtherance of Russia's international obligations under ITER program.  The company developed technical and feasibility documents for TVSA-PLUS and TVS-2M with higher active zone for operations at Balakovo, Volgodonsk and Kalinin Nuclear Power Stations for 1.5 years under at the increased power levels.  The company worked out the five-year fuel cycle programs, design and feasibility documents enabling the use of 2nd generation fuel at Bogunice, Mohovce, Dukovany, Paks and Loviisa Nuclear Power Plants at the increased capacity levels.

The company took action to substantially improve the transparency in the nuclear industry. It opened three information centers on nuclear energy where anyone can obtain information on the industry status and development perspectives, whereas the data on radiation environment at nuclear facilities was made available to Internet users at www.russianatom.ru.