Based on the company's dividend policy, Norilsk Nickel must pay 60% of EBITDA as dividends. For the first half of the year, they earned $ 1.74 billion. When calculating, we got about 390 rubles per share.

But today the board of directors decided a little differently:

“Recommend to the Extraordinary General Meeting of Shareholders to decide on the payment of dividends on ordinary registered shares of the Company based on the results of the first half of 2017 in the amount of 224.20 rubles per ordinary share. Propose to the Extraordinary General Meeting of Shareholders to set October 19, 2017 as the date on which the persons entitled to receive dividends are determined.

As a result, the expectations of many investors were NOT justified. We'll get "everything" 224 rubles. I think there's too much hysteria here. The difference between what they pay and what they must necessarily compensate for either additional dividends for 9 months, or add to the annual ones. The company needs the money now so as not to exceed the maximum net debt to EBITDA ratio of 1.8. Now this ratio is already 1.5 - and this is close to starting to reduce the size of dividends.

Management will do everything necessary to ensure that we receive the maximum possible payments. Now the main thing is not to hysteria and calmly wait for the surcharge.

The Norilsk Nickel Group of Companies is the world's largest producer and supplier of rare and valuable metals. In 2017, Norilsk Nickel allocates RUB 70.6 billion to pay income to shareholders. at the end of 2016 at the rate of 446.1 rubles. per share. Payments began on 06/23/2017.

PJSC MMC Norilsk Nickel is the world industrial leader in the production of rare and precious metals. The main share of production is occupied by nickel, palladium, as well as gold, platinum and silver. In terms of profitable attractiveness for shareholders, the metallurgical giant consistently holds a leading position among global corporations.

The history of the oldest mining and processing enterprise in this video:

How much will Norilsk Nickel pay dividends for 2016?

The Norilsk Nickel Group of Companies regularly pays not only annual dividends, but also interim income based on the results of work for six months and nine months. In accordance with the Dividend Policy Regulations, the amount of annual dividends cannot be less than 30% of the consolidated net profit of the group.

On June 09, 2017, the General Meeting of Shareholders of PJSC MMC Norilsk Nickel was held. Taking into account the recommendations of the board of directors, the meeting decided to announce the payment of dividend income on the company's ordinary shares.

Table 1. Terms and amount of payments

By the way, taking into account the payment of interim income on shares in 2016 based on the results of 9 months, the total amount of dividends per share amounted to 890.4 rubles.

How to receive dividends?

Cash (dividend income) can be received in the following order:

  • To owners whose rights to shares are reflected in the register of shareholders of the company, payments are made through post offices or by bank transfer to settlement accounts indicated in the questionnaires of registered persons available to the registrar.
  • If the rights to own shares are fixed with the nominal shareholder, the funds are paid through the nominal holder with whom the owner of the shares has concluded a corresponding agreement.

If, for any reason, a shareholder has not received the funds due to him, the right to claim for payment is retained for three years from the moment the dividends are declared.

For your information: the registrar and registrar of PJSC MMC Norilsk Nickel is JSC Independent Registration Company. Shareholders are advised to notify the registrar in a timely manner of changes in details and personal data.

How to become a shareholder of Norilsk Nickel?

  • Where to buy shares: PJSC Moscow Exchange MICEX-RTS.
  • Security code: GMKN .
  • How to buy: open a brokerage account with a broker (FINAM, BCS broker, ATON, Uralsib).

Dividend history of PJSC MMC Norilsk Nickel


Table 2. Dynamics of dividends on ordinary shares of PJSC MMC Norilsk Nickel (2012-2016)

Period Amount per 1 ordinary share (RUB) Total amount of dividends (billion rubles)
2016 446,1 70,6
2016 (9 months) 444,3 70,3
2015 230,1 36,4
2015 (9 months) 321,9 50,9
2015 (6 months) 305,0 48,3
2014 670,0 106,0
2014 (9 months) 762,3 120,6
2013 248,5 39,3
2013 (9 months) 220,7 34,9
2012 400,8 63,4

The Russian company MMC Norilsk Nickel produces nickel, palladium, copper and other non-ferrous metals. Norilsk Nickel is a public company, you can become a shareholder of the company together with Oleg Deripaska and Vladimir Potanin.

On March 6, Norilsk Nickel published its financial results for 2017. I took reporting in dollars, because Norilsk Nickel receives most of the money from foreign buyers, almost all money and loans are in foreign currency.

Sergei Shabolkin

private investor

Shareholder conflict

Norilsk Nickel has two major shareholders, Deripaska's Rusal and Potanin's Interros, both of which own Norilsk Nickel through subsidiaries. The guys have been in conflict since 2008 because of a different vision: Rusal wants more dividends, Interros wants to invest in the company.

Everything was so complicated that I had to call Abramovich: he bought part of the shares under the contract until 2017. The year is 2018: Potanin's Interros sent a letter to Abramovich's company with a proposal to buy back shares, but Deripaska's Rusal filed a lawsuit in a London court - the letter has no legal force.

But buying back Abramovich's shares isn't the only problem. Under the agreement, in the event of a continuation of the conflict, shareholders can buy back a block of shares from each other. Here is the key problem: the entire share will be bought out - according to Vedomosti, Rusal needs at least $14 billion, Interros needs at least $10 billion. This is a lot.

What will happen next is unknown, a hearing on the buyback of shares from Abramovich's company is scheduled for May 14-17. So far, both companies can buy back 2% of the shares from Abramovich's company. They want to do this: first they will close the sale, and then they will check it in the London court.

Revenue, sales and commodity prices

Norilsk Nickel earned $9.1 billion in 2017 - 10.7% more than in 2016. At the same time, sales fell in almost all metals sold - only rising prices for raw materials saved it.

The majority of the company's revenue comes from nickel, copper and palladium. The management explains the fall: the company reduced the production of nickel from third parties and carried out the modernization of part of the production - produced less, sold less. Because of this, Norilsk Nickel sold off nickel reserves for 2016.

Profit dropped

To evaluate the company's performance, calculate the operating margin - an indicator of profitability from core activities. Formula: operating income / revenue. More is better.

Operating margin of Norilsk Nickel

Operating profit

Revenue

Operating margin

Revenue increased, and with it, operating expenses. It got better, but not by much.

Debts and dividends


Let's unravel investor charades: Norilsk Nickel's dividend payout depends on the Net Debt/EBITDA multiplier. Less value - more dividends will be paid. Net debt is the sum of all loans and borrowings less the company's cash, and EBITDA is profit before taxes, interest payments to creditors and depreciation.

In 2017, Norilsk Nickel took on loans, there was less money due to dividend payments, and EBITDA grew by 2.4%. As a result, the Net debt / EBITDA multiplier increased from 1.2 to 2.1 over the year - the value falls into the zone of floating calculation of the dividend payout ratio.

But for the final dividends for 2017, an adjusted indicator was calculated - it amounted to 1.88. This means that Norilsk Nickel shareholders will receive slightly more dividends than in the standard calculation. The final dividends will be paid in April-May 2018, so stay tuned for company news.

Management promises to reduce the Net Debt / EBITDA ratio to 1.5 in 2018 - potentially we are waiting for the maximum dividend payout.

Market potential for electric vehicles

The management of Norilsk Nickel in the presentation paid special attention to the growing market of electric vehicles. The company produces copper and nickel, and the company estimates that the electric motor and battery of an electric car need these metals.

It looks nice, but while the electric car market is the story of the future, you should not flatter yourself. It might be worth looking at companies that make cobalt - it's used in lithium-ion batteries (like Tesla's) and its price has doubled in the last year.

Counting multipliers





Page 2 of the Norilsk Nickel press release for 2017

I took the market capitalization from Investfunds.ru for March 6th. Capitalization is indicated in rubles, the company's reporting is in dollars. I converted the capitalization into dollars, taking the dollar to ruble exchange rate on March 6 from the website of the Bank of Russia - 57.1 rubles. We still need the data from the press release. Transferring data to a table.

Results of Norilsk Nickel

Index

mln $

Operating profit

Impairment loss

Net profit

Interest paid

Cash and cash equivalents

Short-term credits and loans

Long-term credits and loans

Depreciation

Capitalization

P/E - the ratio of market capitalization to earnings. Shows how many years the company will pay for itself. If the result is from 0 to 5, then the company is probably undervalued.

P/S - the ratio of market capitalization to revenue. Less than 2 - good, less than 1 - perhaps the company is undervalued. Calculation formula: capitalization / revenue.

P / BV - the ratio of market capitalization to the capital of the company. Helps to understand how much money an investor will have in case of bankruptcy. If the indicator is greater than one, there will not be enough for everyone.

EV - the value of the company, taking into account all sources of financing - from investors and creditors. Reduced by cash, because at the expense of them you can reduce debt.

EBITDA - shows how much a company earns in net money, excluding taxes, interest on loans and depreciation. Norilsk Nickel considers EBITDA as follows: operating profit + loss from revaluation of non-financial assets + depreciation.

Your privacy is important to us. Your personal information entered in the consultation form is used solely to provide advice in accordance with your needs.

Your information will not be shared or sold to third parties.

What data is collected on the site

When requesting a consultation on our website, you send your Name, contact phone number, email address and the number of shares through the consultation form.

Your data is not transferred to third parties under any circumstances, except in cases related to the fulfillment of the requirements of the legislation of the Russian Federation.

You can send a request to delete your data to [email protected]

The site uses cookies and data about the actions of site visitors (including ip-address). With the help of this data, information is collected about the actions of visitors on the site in order to improve its content and functionality and, as a result, improve the convenience of using the site for visitors.

You can change your browser settings at any time so that the browser blocks all cookies or notifies you when cookies are being sent.

How is this data protected?

We use administrative, managerial and technical security measures to protect your personal information. We adhere to international control standards for dealing with personal information, which include certain controls to protect information.

Thus, 35.3% of semi-annual EBITDA can be used for payments. Since 2013, Norilsk Nickel has paid half of EBITDA as dividends. In the spring of 2016, after the fall in copper and nickel prices at the end of 2015, the company approved a new dividend policy. Now payments depend on the debt load, but must be at least $1 billion. The company gives shareholders 60% of EBITDA if the ratio of net debt to EBITDA is less than 1.8. If the indicator is equal to or higher than 2.2, then the amount of dividends paid can be reduced to 30% of EBITDA. The payout ratio is calculated based on the debt burden as of December 31 of each year. Norilsk Nickel specified that dividends would be divided into interim and final payments. Interim payments will be about 30% of the total dividend.

For 2016, dividends were $2.36 billion, or 60.5% of EBITDA.

"Norilsk Nickel"

Mining and metallurgical company
The main owners are Interros (30.4%), UC Rusal (27.8%), Crispian Investments Ltd. (5.7%).
Capitalization - $ 24.6 billion.
Revenue (IFRS, 1H 2017) – $4.2 billion,
Net profit - $915 million.

In the first half of the year, Norilsk Nickel's EBITDA fell 3% yoy to $1.7 billion due to the strengthening of the ruble and a one-time increase in social spending, the company said in a press release to its financial results report for the first half of the year. The ratio of net debt to EBITDA, according to the company as of June 30, was 1.5. By the end of 2017, Norilsk Nickel's debt burden may exceed 1.8 EBITDA if the price of metals and the ruble exchange rate remain at the level of August 1, according to the company's presentation. On August 1, according to Thomson Reuters, nickel cost $10,290 per 1 ton, copper - $6345, palladium - $892, platinum - $943.7. The dollar exchange rate, according to the Central Bank of Russia, was 60.06 rubles. “The share of EBITDA paid out as dividends decreases when the 1.8 threshold is reached. However, the final decision on the amount of dividends remains with the shareholders of the company,” Norilsk Nickel quoted Senior Vice President Sergey Malyshev in a press release following the results of the first half of the year.

Now everything depends on metal prices, experts are sure. “So far, nickel prices have not yet grown sufficiently, but the dynamics of recent weeks for the company is extremely positive,” says ACRA analyst Maxim Khudalov. Nickel, copper, platinum and palladium rose 9.0% to 37.48% in August, according to Thomson Reuters. The dollar costs 59.13 rubles. at the rate of the Central Bank. “The question is how long prices will hold at these levels,” adds Andrey Lobazov, an analyst at Aton. “If not for long, then the consensus forecast for Norilsk Nickel's 2017 EBITDA of $3.9 billion does not look conservative, and the ratio of net debt to EBITDA at the end of the year may be 1.95,” he explains.