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cash flow on dividends for July–December 2016, the company said in a statement on Wednesday. “On the back of strong profitability and lower debt load, the company’s management decided to recommend that the board of directors pay dividends representing 60% of free cash flow for the second half of 2016,” the company said. “The management continues to adhere to the strategy of increasing return on equity, and plans to offer the board to amend dividend policy and increase the dividend payout ratio to at least 50% of free cash flow,” the company added. Currently, the board of directors has a threshold for dividend recommendations of no less than 30% of free cash flow. Previously, MMK paid 0.72 rubles per share, or a total of 8.046 billion rubles in January–June 2016 and 0.31 rubles per share, or a total of 3.464 billion rubles in final dividends for 2015. According to the company’s Web site, its shareholders are Mintha Holding Limited, beneficiary owned by Chairman of MMK Board of Directors Viktor Rashnikov, with an 87.26% stake; The Bank of New York Mellon, beneficiaries of which are owners of global depositary receipts of MMK, with 4.88%; and other shareholders with 7.86%.
Russian gold miner Nordgold will pay $19mn (€18mn) in dividends for October-December , at $0.0512 per share or GDR, Vedomosti reported on February 27. This amount will correspond to 30% of the company's preliminary unaudited profit of $63.2mn. Nordgold's total dividend payments for 2016 are to be $66.9mn, compared with $58.5mn a year before. Earlier this month, Nordgold said that it would delist from the London Stock Exchange in a bid to revamp its valuation.
8.3.3 ECM news
Russia’s iconic Detski Mir (Children’s World) closed the first major IPO in three years raising RUB21bn ($355mn) by floating a minority stake on Russia’s Moscow Exchange (Moex) on January 7. T he IPO implies the company, which specializes in toys and children’s goods, has a market capitalization of RUB62.8bn ($1bn) also making it the biggest IPO in Europe, Middle East and Africa (EMEA) region so far this year. The company is owned by Russian conglomerate AFK Sistema, but the Russia-China Investment Fund and other shareholders, including the management of Sistema and Detsky Mir, all participated in the offering as selling shareholders, the company said in a press release. “Sistema will retain a majority stake in Detsky Mir, and the others will also all retain a stake post-IPO. No shareholders are fully exiting,” the company said in a statement. Sistema owns the brand and the growing network of Detski Mir stores that have spread out over Russia. The company plans to more than double the number of branches in the chain; it opened 200 stores in the last two years and plans another 250 new stores in the next three years to bring the total to over 700. In the last two years revenues have increased by just under a third and profit per square meter has been rising steadily as management techniques improve. Indeed, the same story is being repeated in most branches of retail as Russia’s leading companies become ever more professional in the face to rising competition. Detski Mir’s rising revenue bucks the trend in Russia’s retail overall, where retail turnover finished last year contracting by 3.5%. Detski Mir’s strategy has been to focus on run of the mill children goods. In addition to the traditional toys, which account for 35% of revenues, the chain is the go-to place for school clothes, shoes and stationary as well as baby products from nappies to dummies. At the start of each term the stores are packed with families tooling up for the new semester and the store even has a line of smart jackets and frilly children dresses that are traditional for
81 RUSSIA Country Report February 2017 www.intellinews.com