Transneft is ready to pay 50% of its profit by IFRS as dividends for 2017, if such a decision is made by the government, but this payment will be hard on the Company, Nikolay Tokarev, the President of Transneft told RIA Novosti.
“If 50% is required, we’ll proceed from this figure, but this will require strenuous efforts from us,” said Mr. Tokarev.
“We’ll stem from whatever is approved at the meeting of the Board of Directors and then it will be up to the government. Our dividend policy presumes 25%, but now this matter is being scrutinised by the government and we’ll obey any decision that will be made,” the Company’s Head emphasized.
The Russian planners drafting the budget for 2018–2020 proceeded from the assumption that state companies would pay 50% of their net profit by IFRS as dividends which were calculated as budget revenues. This was the basic assumption made by the Ministry of Finance in previous years as well, but in fact exceptions were made for a number of companies. Arkady Dvorkovich, Deputy Prime Minister of the Russian Federation, said in April that he believed it impossible for Gazprom, Transneft and a number of other state companies to pay 50% of their net profit by IFRS as dividends.
In 2017, Transneft paid out dividends amounting to about RUB 58 billion: RUB 30.6 billion based on the results of 2016 (100% of the profit by RFAS and 13% of the profit by IFRS) plus RUB 27.6 billion of interim dividends for the first half of 2017 (100% of the profit by RFAS and 24% of the profit by IFRS). In January Maksim Grishanin, First Vice-President of Transneft, mentioned that the Company is oriented towards the payment of dividends in 2018 at the level of the previous year.