Page 14 - FSUOGM Week 16 2021

FSUOGM NEWS IN BRIEF FSUOGM

Based on the approved current dividend company's shares are yet to reflect this. improvements in the company’s corporate
policy Gazprom could still pay at least 40% governance," Sova commented, while
of 2020 adjusted net income this year and at affirming a Buy call on Gazprom's shares.
least 50% of 2021 adjusted net income next Gazprom confirms early "The implied annual yield amounts to
year. 5.4%, which is above our expectation as
But "by proposing what is likely a 50% switch to 50% dividend the payout ratio has been increased ahead
payout on 2020, Gazprom’s management of schedule," Sberbank CIB commented
board has handily exceeded even the most The board of Russian natural gas giant on April 15, noting that Gazprom shares
optimistic of analyst expectations," BCS Gazprom recommended a RUB12.55 remain one of top picks in the sector,
Global Markets commented on April 14, per share dividend for 2020, making expecting the dividend per share to double
while affirming a Buy call on Gazprom's a RUB297bn ($4bn) total payout and next year to RUB26 (11% yield) on the back
shares. corresponding to 50% of the adjusted IFRS of stronger earnings while assuming the
BCS GM estimates that RUB12.5 net income for 2020. same 50% payout ratio.
(USc16.0) per share payout would make a As reported by bne IntelliNews, this As reported by bne IntelliNews, despite
"respectable 5.6% dividend yield on what week unconfirmed reports suggested that the losses sustained in 2020, the market
was a very difficult year". Gazprom could switch to a 50% payout anticipated the company to stick to the
"If the dividend recommendation is one year earlier than the dividend strategy current dividend plan despite the strain
confirmed we would consider this as a implies, with the surprise dividend news on finances. Gazprom has previously
further positive step and would represent positively being received by the analysts. reiterated its dividend policy, but now could
reassurance that the management sees a reportedly surprise the market with a higher
strong global gas market outlook," Sberbank The dividend confirmed is 33% ahead payout.
CIB analysts wrote. of consensus, which was anticipating a
BCS GM analysts remind that a higher dividend of RUB9.04/share, Sova Capital
than expected dividend payout is one of the commented. The highest dividend ever paid
three catalysts they have anticipated from by Gazprom was RUB16.61/share in 2018, Customs: Russia’s oil
Gazprom. followed by the dividend of RUB15.24/
The other two potential catalysts are share the company paid out in 2019, Sova export revenue rises 7% to
upward revisions of earnings and dividend reminds.
expectations for 2021 due to the improved Gazprom decided to increase its $6.6bn in Feb
outlook on the European gas market, as well dividend due to the strong operating results
as the physical completion of Line A (early of 1Q21 and the positive dynamics on the Russia’s oil export revenue rose by 6.5% on
fall) and Line B (early summer) of Nord oil and gas markets seen at the end of 2020. the month to U.S. $6.585bn in February, the
Stream 2 pipeline to Germany, lowering The company plans to reduce its Net Debt/ Federal Customs Service said in a report on
event risk around Gazprom's shares. EBITDA to below 2.0x, and it sees free cash Tuesday.
In December 2020 BCS Global Markets flow (FCF) as covering the 2021 dividend In physical terms, oil exports went up by
"enthusiastically confirmed" a Buy call on payments in full. 0.7% on the month and 11.8% on the year
Gazprom. The analysts noted that exports The company sees its decision to pay out to 16.906mn tonnes.
are recovering faster than expected after 50% of corrected IFRS net income instead Oil products exports increased by 8.1%
a tough year, with European exports seen of 40% as a sign that shareholder payouts on the month to 11.414mn tonnes and
returning to normal by 2023. are one of its key financial priorities, revenue went down 2.5% to $4.343bn in
VTB Capital (VTBC) in December Gazprom commented. February.
2020 also upgraded the investment case on "For the next round of catalysts, we think In January–February, oil exports fell
Gazprom, arguing that the entire gas futures the approval of a management incentive 17.6% on the year to 33.935mn tonnes, with
price curve is moving up and that the programme could be on the cards, as well as revenue falling 30.1% to $12.743bn. Oil

P14 www. NEWSBASE .com Week 16 21•April•2021