Novatek to Double Interim Dividends

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Russian natural gas and LNG producer Novatek, whose shareholders include France’s TotalEnergies, plans to more than double a dividend payout for the first half of 2021, compared with last year’s interim dividends. The higher dividends reflect a sharp growth in earnings this year, after a drop in the first half of 2020, due to higher oil and gas prices as well as increased gas and gas condensate production (LNGI Jul.28'21). The company’s board of directors on Friday recommended paying 27.67 rubles (37¢) per share, or 267.7 rubles per global depositary receipt in dividends for January-June, up from 11.82 rubles/share paid for the first half of 2020, Novatek said in a statement. If approved by shareholders at an extraordinary general meeting, scheduled for Sep. 30 in the form of absentee voting, interim dividends will total 84.01 billion rubles, or $1.1 billion. That will represent 51% of the adjusted net profit of 164.73 billion rubles posted in the first half of 2021, in line with Novatek’s recently amended policy to pay no less than 50% of profit in dividends. Last year, interim dividends were 17% lower than in 2019, due to a sharp drop in earnings amid low prices on the oversupplied market additionally hit by the Covid-19 pandemic. But full-year dividends for 2020 ended up 10% higher on the year despite a lower profit, as shareholders opted to get 64% of adjusted profit in dividends for 2020, up from 40% for 2019 (LNGI Mar.19'21). Novatek’s key shareholders are its CEO Leonid Mikhelson with nearly 25%, Russian-Finnish businessman Gennady Timchenko, who is a close ally of Russian leader Vladimir Putin, with 23%, and Total with 19.4%.

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