The largest digital services provider in Russia

Rostelecom’s board of directors approves a new dividend policy

Print version
Return to the list

Moscow, Russia – December 04, 2015 – Rostelecom PJSC (“the Company”) (MOEX: RTKM, RTKMP; OTCQX: ROSYY), Russia’s national telecommunications operator, today announces that its Board of Directors has approved a new dividend policy, whereby the Company pays dividends as a percentage of Free Cash Flow (FCF[1]).

The terms of the approved dividend policy are as follows:

  1. The FCF payout ratio is set at no less than 75% for ordinary and preferred shares;
  2. But, no less than RUB 45 billion cumulatively over 2016, 2017 and 2018 (i.e. upon results of 2015, 2016 and 2017);
  3. The Company is to increase the dividend amount payable per ordinary share in absolute ruble terms compared to the relevant preceding year.

The payable dividend amount shall not equate to less than the level recommended by Rosimuschestvo for companies with state ownership interest.

Sergei Kalugin, President of Rostelecom, commented: “The adoption of the new dividend policy, based on free cash flow, is a significant milestone for the Company, and it further strengthens Rostelecom’s investment case.

As Rostelecom nears the completion of the capital-intensive modernisation of its network infrastructure, which has seen the conversion of its last mile network to fibre optic and seen its transport network capacity expand, the Company’s Capex commitments will be lower starting from 2016, releasing more funds available for dividends.

Historically, Rostelecom’s shares offered significantly lower dividend yield compared to its publicly traded peers. However, the new policy will bring the yield to a comparable level, and further improve Rostelecom’s equity story.”

* * *

For more information please visit http://www.rostelecom.ru/en/ir or contact:

“Rostelecom Investor Relations / Rostelecom IR” application is now available to download for free from the Apple App Store and Google Play

[1] “Free Cash Flow” (hereinafter the “FCF”) shall mean the net cash from operating activities, (1) net of cash paid for purchase of property, plant and equipment and intangible assets, (2) plus proceeds from sale of property, plant and equipment and intangible assets. The FCF shall be determined according to the Cash Flow Statement of the Company consolidated financial statements pursuant to requirements of the International Financial Reporting Standards (hereinafter the “IFRS”);