Page 79 - RusRPTJan22

8.3.3 ECM news
Lukoil has resumed its buyback, according to a company press release.
Between 26 November and 1 December, it purchased 464,950 shares (0.07% of the authorised capital) and 393,441 ADRs, or 0.06% of the share capital. The shares were purchased at an average price of RUB 6,528.72/sh, and the ADRs at USD 87.38/share. We calculate that for the week, the company purchased USD 74.9mn worth of shares, or 6% of the weekly turnover, which is generally supportive for the share price. We remind investors that the company’s official dividend policy suggests that cash spent for a buyback must reduce the dividends amount unless it is paid via debt financing. If the buyback was financed from Lukoil’s cash flows, the DPS for 2021 might decrease from RUB 820 to RUB 812 on our numbers, which means a DY just 0.1pp lower. We note that the last time the company conducted a share repurchase was back in February 2020 and it was financed from debt, so did not affect the dividends.
Lukoil purchased 132,457 shares and 245,269 GDRs as part of its buyback from 6-10 December. Total spending was c. $33.8mn, down from $56.6mn during the first week of the company’s buyback, when Lukoil purchased 644,319 shares and GDRs. The volume-weighted average price for the second week of the buyback is c. $89.54/GDR.
Novatek announced on 6 December, that it had bought 145,640 shares
and GDRs as part of its buyback from 29 November-3 December. The implied average price is $227.2/GDR, as the company spent a total of c. $3.3mn. Novatek has spent $552.8mn of the $600mn allocated to its buyback since it began in 2012 and has purchased 6.6mn shares YtD, spending c. $166.8mn.
Novatek’s Board of Directors has approved a new buyback programme for the company's shares of up to $1bn over five years and terminated the previous programme, announced on June 2012, which had a limit of $600mn. During the last programme, the company bought 37mn shares, about 1.2% of the total shares outstanding, spending some $502mn (83.7% of the programme amount), we calculate
Sovkomflot has announced a buyback to fund management's long-term incentive programme. The overall amount will not exceed RUB 550mn, 2% of the current free-float (0.3% of mcap). No other details have been disclosed. Despite the size being not significant, we believe this development is positive, as i) it aligns management's interests with those of investors, and ii) buybacks are usually supportive for sentiment.
T Plus is considering a potential IPO, the timing of which remains uncertain, Interfax reported on 9 December, citing CEO Andrey Vagner. According to Mr. Vagner, the company could pay out RUB 6-8bn in dividends annually over the next few years. The company’s capex should peak in
79 RUSSIA Country Report January 2022 www.intellinews.com