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Rosneft plans to pay first interim dividends in late 2017

April 24, 2017, 19:16 UTC+3 MOSCOW

In accordance with the dividend policy of the company, dividend payments will be made twice a year

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MOSCOW, April 24. /TASS/. Rosneft plans to pay first interim dividends at the end of 2017 in accordance with the new dividend policy that was approved during the privatization of a 19.5% stake in Rosneft, an official with the company told TASS.

"In accordance with the dividend policy of the company, dividend payments will be made twice a year." At the end of 2017, Rosneft plans to pay the first interim dividends, thus increasing the total amount of dividends this year, "the company said.

The management believes that such a dividend policy will positively affect the investment attractiveness of the company, contribute to growth of the shares’ value and of the shareholders' income.

Earlier it was reported that the board of directors recommended to shareholders of the company to approve spending 35% of net profit under international financial reporting standards (IFRS) on dividends.

By the end of 2016, the net profit of Rosneft under IFRS fell by 49% year-on-year to 181 billion rubles ($3.2 bln) due to unfavorable market situation.

Government’s directive on dividends

Officials with the company note that Rosneft has the "highest target minimum level of payments among Russian oil and gas companies."

Rosneft’s spokesman Mikhail Leontiev told TASS that the decision on payments of dividends for 2016 is fully in line with the government's directive and the company's new dividend policy.

"The company has never received any other directives and draft directives, they did not exist. The ceiling at 35% of profit is the highest among state-owned companies, at least in our sector. Gazprom Neft has just announced dividend payments at 25% of the company’s profit. For some reason it never occurred to anyone to say that they managed to some exceptional conditions from the government," Leontyev said.

He said that media reports claiming that Rosneft received preferences for dividend payments were "strange."

"The position of the Ministry of Finance is that state companies must pay 50% of their profits as dividends. That the Ministry of Finance's natural policy on maximum fiscal exemptions, but what does this have to do with the government's decision (on Rosneft’s directive)," Leontyev added.

Earlier, Rosneft CEO Igor Sechin did not rule out that the company may pay interim dividends in 2017, as part of the new dividend policy.

When preparing a 19.5% stake in Rosneft for privatization last year the board of directors changed Rosneft's dividend policy in order to increase the company's investment attractiveness. It increased dividends to 35% of IFRS profit with payments twice a year.

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