Donbassenergo and Vostokenergo Announce 1Q06 Results.

Donbassenergo (DOEN: BUY)increasedsales by 46.5% yoy to USD 82 mln. DOEN’s net income tripled and came to USD USD 1.95 mln. Vostokenergo (VSEN) increased sales by 71% yoy to USD 213 mln. VSEN’s net income amounted to USD 43 mln. Concorde Capital: DOEN increased its electricity supply by 10.4% yoy, while VSEN increased electricity supply by 20.8% yoy in 1Q06. Thus, the key component driving the companies’ revenue growth was tariff increases (33% for DOEN and 42% yoy for VSEN). We expect further increases in DOEN’s output due to the NERC’s interest in creating preferential conditions for DOEN’s Starobeshev power plant during the summer months.