/ world today news/ The refusal of Gazprom shareholders to pay dividends for the best financial year 2021 in its history caused a storm not only on the stock markets, but also among the population. After all, Gazprom is one of the largest Russian companies, and the state is the main recipient of these dividends. Why, then, for the first time in 23 years, the state did not approve the payment of hundreds of billions of rubles to itself by the gas monopolist?
Gazprom shares during trading on June 30 immediately fell by 32% to 202 rubles – just a few minutes after the company announced that it had decided not to pay dividends to its shareholders for 2021. Before this news, the shares of ” Gazprom” cost over 310 rubles.
The depth of the fall raises questions, as shares in the same Sberbank, which today also announced no dividend for 2021, fell by just 5.72%. In addition, TGK-14, Rosset, GAZ and Vysochaishi also refused to pay dividends on Thursday.
However, “Black” Thursday was only for “Gazprom”, which ended up crashing the entire Russian market. The index of the Moscow Stock Exchange after the session fell by 7.30% to 2204.85 points, RTS to the dollar fell by 4.81% to 1345.01 points. It should be noted that the ruble, combined with the drop in oil prices, did not notice these problems at all – it returned to strengthening again. The unique situation with the ruble, which lives separately from the rest of the economic world, requires non-standard solutions from the authorities.
Why did Thursday become “black” only for “Gazprom”? The shareholders’ decision at the annual meeting came as a complete surprise to investors. First, only a month ago the board of directors of Gazprom itself said it planned to pay dividends, and the change in decision turned out to be sudden.
“In Russian corporate governance practice, there are extremely rare cases where shareholders have not approved dividends recommended by the board of directors, especially since Gazprom’s dividends were supposed to be record highs,” said Natalia Milchakova, lead analyst at Freedom Finance. . And this rare event happened.
Second, the refusal to pay dividends is unique to the company, as Gazprom has paid dividends regularly for 23 years in a row. At the same time, 2021 was the best year for him from a financial point of view. It received a record high net profit of more than 2.16 trillion rubles, while the debt burden remained low. Therefore, the payment of dividends would not undermine the financial position of the company.
The case with “Sberbank” is a little simpler. “Initially, no one expected dividends from Sberbank, even on preferred shares. Because back in March, the Bank of Russia recommended that all Russian banks under restrictions refuse to pay dividends for 2021. Therefore, the decision of Sberbank shareholders meets the expectations of investors, unlike the situation with Gazprom, explains Milchakova.
“Finally, the market reacted with such a sharp fall in Gazprom shares, as many perceived the refusal to pay dividends as an acknowledgment of the company’s instability, although this is completely false,” said Artem Deev, head of the analytical department of AMarkets.
“The reasons for this decision are quite understandable: the company needs large funds to maintain exports at the required level, which requires new major infrastructure projects. Gas pipelines are necessary to supply gas to China because there is only one route – the “Power of Siberia”. In order to take a significant share of the liquefied natural gas market, it is necessary to develop projects from which foreign partners previously withdrew,” explains Deev.
On the other hand, Gazprom suffered losses on investments in Nord Stream 2, which is now frozen and it is not known if it will ever work. In addition, there were problems with the maintenance of the technical equipment needed to pump gas through Nord Stream-1. And if Germany does not solve the problem of Canadian sanctions, there are risks of stopping this gas pipeline as well, with the subsequent consequences of reducing gas exports to Europe.
In addition, Gazprom has temporarily increased the mineral extraction tax, due to which the company will have to pay an additional 416 billion rubles to the budget.
At the same time, according to Milchakova, in the form of dividends, the state can receive 200 billion more than Gazprom – 624.6 billion rubles. But instead, the state as the main shareholder (owning 50.2% of the shares) lost this money.
But he can still get “his” in a slightly shortened version and in another way – by increasing taxes. It turns out that the state allowed Gazprom to keep about 200 billion rubles at its own expense, plus another 622 billion rubles at the expense of other shareholders who lost dividends. The total amount of dividends should have been 1.244 trillion rubles. Of these, Gazprom managed to keep more than 800 billion rubles.
Gazprom is not the first and will not be the last company to refuse to pay dividends in the face of a difficult situation with sanctions. But Gazprom attracts increased attention from citizens, as it is one of the largest companies in the country, and its performance (including on the stock exchange) becomes a marker of global changes in the local economy. In the same way, for example, people could react to Rosneft’s decisions, says Deev.
According to him, the company’s management made an unpopular but strategically correct decision. The fall in the company’s stock is not so scary anymore. “But in the future, the availability of a financial cushion will allow Gazprom to maintain the pace of development and supplies abroad. The company will use the money to ensure that after some time its results will also remain high, which is in the interest of the state, the population and the shareholders,” concludes the expert.
Translation: V. Sergeev
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