Page 61 - RusRPTJune18

strengthening of the ruble, Sberbank CIB said on April 1, while noting that in 2017 net income was down 5% y/y due to a high base following a RUB41bn foreign currency gain in 2016. Sberbank also noted that Transneft started generating positive free cash flow (FCF) in 2017, with the full year FCF coming in at $300mn boosted by $700mn of positive FCF in the fourth quarter. "Although the positive FCF generation was an encouraging sign, the amount was still significantly below the $1.6bn the company should pay at a minimum based on the government's order to pay out at least 50% of IFRS net income," Sberbank analysts commented.
The board of Fortum Russia , the Russian subsidiary of the largest shareholder of Uniper (83% stakeholder in Russia's utility generation major Unipro ), made 2017 dividend recommendation with a total payout of RUB12.1bn ($193mn) on May 28. "The dividend per share (DPS) stands at RUB13.86, implying a total payment of RUB12.1bn and a payout of 100% of RAS net income," VTB Capital commented on May 29, adding that "this is the first time that dividends have been recommended since the company was privatised in 2007." VTB reminds that Fortum is one of the largest foreign investors into Russian utilities, both within the scope of the mandatory investment programme and on a voluntary basis, and has been modernising key out-dated equipment in its portfolio. Fortum is currently running the youngest generation fleet in Russia with an average age of 22 years old, making the company the largest investor into renewables energy.
Magnit’s BoD recommended dividends for the second half of 2017 of Rb135.5/s (Rb13.8bn in total), according to the company’s press release. The announced DPS implies a DY of 2.6%. The AGM will be held on 21 June, while the record date is set for 6 July. Taking into account the DPS for 1H17 of Rb115.5/s, the total dividend for 2017 will be roughly Rb251/s, which is about 10% below the dividend paid for
2016 (Rb278/s).
Russian gas giant Gazprom raised a €600mn ($708mn) loan from France's Credit Agricole CIB , the company said on May 18. The five-year loan has been added to Gazprom since its head Alexei Miller was added to a US sanctions blacklist in early April.
The Polyus BoD has recommended a R147.12 per share dividend for the second half of 2017 , subject to approval at the AGM on May 31. At a USD/RUB rate of 62, the dividend is equivalent to around $2.37 per share and $1.18 per GDR. The total payout should come to around RUB19.5bn, or $313mn. At the current share price, the dividend yield is around 4%. The record date is set for June 10. The total payout for 2017 will be around $550mn, in line with the company's dividend policy. To recap, for both 2017 and 2018, that entails paying out the higher of either 30% of EBITDA for the reporting year or $550mn.
Gazprom’s management recommended dividends of Rb8.04/sh for 2017.
The company’s management decided to keep dividends flat y/y, according to Interfax. Previously, the company promised that it would keep dividends at the same level as for 2016. Under the current dividend policy, RAS serves as the basis for dividend payments, but since RAS net income declined by more than 4x y/y in 2017, part of the payment will be made from retained earnings.
As Russian Finance Ministry continues the fight to make state-owned enterprises pay dividends it could allow natural gas behemoth Gazprom to pay 26% of IFRS net profit in dividends for 2017 or RUB190bn ($3bn), Vedomosti daily reported on May 14. This would make only a half of the 50% of IFRS net profit that the ministry continues to demand from SOE (state owned enterprises). However, the ministry is reportedly mulling a possible Mineral Extraction Tax (MET) increase that would allow it to collect an additional RUB100bn-170bn from Gazprom.
61 RUSSIA Country Report June 2018 www.intellinews.com