Key Performance Indicators (KPI) System
The Key Performance Indicators System is used to sum up the results of Transneft’s economic activities in the reporting. The planned values of the Transneft key performance indicators for 2020 were approved by the decision of the Board of Directors dated 24 December 2019 (Minutes No. 22) and updated by the decision of the Board of Directors of Transneft dated 19 October 2020 (Minutes No. 18).
The final assessment of all key performance indicators of Transneft’s economic activity at the end of 2020 is 100%.
| Indicator (KPI) | Unit of measurement | Plan for 2020 | Execution status in 2020 |
|---|---|---|---|
| Integrated indicator of trunk pipeline system reliability, environmental and industrial safety | % | 100 | Achieved |
| Specific accident rate at trunk pipelines | emergency situations per 1,000 km of trunk pipelines | 0.072 | Achieved |
| Reduction of specific air pollutant emissions during oil and petroleum products transportation via trunk pipelines | % | 1 | Achieved |
| Integrated operational activity efficiency indicator | % | 100 | Achieved |
| Amount of dividends | RUB million | 42,326 | Achieved |
| Operating expenses reduction percentage | % | 2 | Achieved |
| Annual volume of direct purchases from SMEs | % | 20.0 | Achieved |
| Reduction of specific electricity consumption during oil transportation over trunk pipelines under comparable conditions | % | 0.8 | Achieved |
| Raising labour productivity in oil and petroleum products transportation | % | -9.4 | Actual achieved value of -9.6 |
| The deviation from the plan was due to the early transfer of employees of the divisions of Transneft Security Services to Transneft transport subsidiaries (reorganisation of departmental security in pursuance of the Decree of the Government of the Russian Federation dated 05 March 2020 No. 234) | |||
| Integrated indicator of investment activities efficiency | % | 100 | Actual reached value 99 |
| This is due to a deviation from the ROIC KPI plan | |||
| Return on invested capital (ROIC) | % | 5.8 | Actual achieved value of 5.7 |
| This is mainly due to a decrease in the petroleum products transportation volumes. | |||
| Execution of the Development Programme financing plan | RUB million VAT included | 195,187 | Achieved |
| Execution of the Capital Investments Use Plan envisaged in the Development Programme | RUB mln, excluding VAT | 178,613 | Achieved |
| Execution of the Action Plan for Reduction of Capital Costs within the Development Programme | RUB mln, excluding VAT | 3,871 | Achieved |
| Keeping investment project deadlines | units | 1 | Achieved |
| Implementation of the Revamping Oil Trunk Pipelines for Transportation of Oil to Refineries in Krasnodar Territory project was postponed to 2021, as the construction of the connected facility (Afipsky Refinery) was not finished | |||
| Execution of the Pipe Replacement Plan (the line part) | km | 871 | Achieved |
| Execution of the Storage Tank Construction and Revamping Plan | units | 75 | Achieved |
| Integrated indicator of innovation activities efficiency | % | 100 | Achieved |
| Financing of innovative projects, including R&D, from own funds given as a percentage of Transneft’s revenue from oil transportation services (according to RAS) | % | 1.42 | Achieved |
| Number of titles of protection for intellectual property obtained during the reporting period and two previous years | pcs. | 95 | Achieved |
| Number of titles of protection for intellectual property obtained during the reporting period | pcs. | 40 | Achieved |
| Integrated effect of in-house commercialisation of innovative projects, including R&D, for the reporting period and two previous years in terms of percentage of Transneft’s revenue from oil transportation services by RAS | % | 1.49 | Achieved |
| Quality indicator for the updated Investment Development Programme/IDP (in the year of the update) / IDP execution quality indicator (in subsequent years) | % | 90 | n/a |
| The Report on the implementation of the IDP for 2019, approved at the meeting of the Board of Directors of Transneft (Minutes No. 11 dated 29 May 2020), was submitted for assessment to the Ministry of Energy of Russia, the Ministry of Education and Science of Russia and the Ministry of Economic Development of Russia. Favourable conclusions on the Report were received from the federal executive authorities. As of the date of approval of the LTDP Report, a meeting of the Interagency Task Force on Technological Development under the Government Commission for the Modernisation of the Economy and Innovative Development of Russia on the issue of setting of the value for the indicator of quality of the IDP has not been held by Transneft | |||
| Total debt to EBITDA ratio | - | 2.5 | Achieved |
| Integrated indicator for evaluating the results of the implementation of the corporate import substitution plan | % | 100 | Actual achieved value of |
| This is due to a deviation from the “Share of foreign equipment in total equipment procurements” and “Share of foreign goods (excluding equipment) in total goods procurements” KPI plans | |||
| Share of foreign equipment in total equipment procurements | % | 3 | Actual achieved value of 3.6 |
| The deviation is due to the consequences of the spread of the new coronavirus infection | |||
| Share of foreign goods (excluding equipment) in total goods procurements | % | 7.5 | Actual achieved value of 7.7 |
| The deviation is due to the consequences of the spread of the new coronavirus infection | |||
| Share of foreign software in total software procurements | % | 40 | Achieved |
| Share of foreign works and services in total works and services procurements | % | 0.5 | Achieved |
In accordance with the Methodological Recommendations for the Formation and Application of Key Performance Indicators of Joint Stock Companies, whose shares are owned by the Russian Federation, and certain non-profit organisations, in order to determine the amount of remuneration for their management staff (Order of the Government of the Russian Federation
| Area | Key Performance Indicator | Specific weight (%) | Unit of measurement | Target value for 2021 |
|---|---|---|---|---|
| Participation in the achievement of the Decent, Effective Work and Successful Entrepreneurship national goal | Execution of the Development Programme financing plan | 10 | RUB million | 208,836.7 |
| Participation in the achievement of the Opportunities for Self-Fulfilment and Development of Talents national goal | Integral indicator of trunk pipelines facilities reliability | 20 | coefficient | 10.04 |
| Reduction of specific electricity consumption during oil transportation over trunk pipelines under comparable conditions | 10 | % | 0.9 | |
| Participation in the achievement of the Opportunities for Self-Fulfilment and Development of Talents national goal | The volume of products manufacture developed as a result of the implementation of research and development (R&D) plans and innovative projects of Transneft | 10 | RUB million | 7,000 |
| Financial and economic key performance indicators | Return on invested capital (ROIC) | 10 | % | 6.0 |
| Total debt to EBITDA ratio | 10 | coefficient | 1.5 | |
| Decrease in specific operating expenses for oil transportation under comparable conditions | 10 | % | 2.3 | |
| Amount of dividends | 20 | RUB bn | 50% of normalised consolidated IFRS net income for 2020 | |
| Bonus reduction indicator | Specific accident rate at trunk pipelines | -15 | accidents per 1,000 km of line | 0.069 |