ALROSA Talks Contracts with Clients; Dividends Again To Be 50% of (Much Higher) Profit

Mining and Exploration
21/04/2017 13:45

Sergey Ivanov, the President of ALROSA, participated in the extraordinary business meeting with the company’s long-term clients dedicated to the new contract period, the company writes in a press release. Participants of the meeting from more than 70 Russian and foreign companies had a chance to discuss with ALROSA’s management diamond market trends, the existing market environment, plans for the near future, and the company’s sales structure. A new 3-year contract period 2018-2020 is to start next year. The list of applicants for long-term agreements will be formed with due account for clients’ relevant applications, completeness of submitted data and based on the analysis of results of trade cooperation between ALROSA and applicants in the period 2015-September 2017.

The assortment and volume of goods under a 3-year agreement will be formed on an annual basis. The core aim of these innovations is to take account of our customers’ assortment preferences. “The heart of ALROSA’s sales policy – sale of the major part of rough diamonds through the system of long-term agreements – will not change. We also intend to preserve all the best practices in our sales system”, emphasized Sergey Ivanov in his speech. “You may rest assured that our sales policy will be improved with due account of our customers’ opinions and market views”, he added.

Meanwhile, according to Prime Business News Agency, Russia's finance minister and chairman of ALROSA’s supervisory board Anton Siluanov told reporters on Wednesday that ALROSA again intends to pay 50% of its net profit calculated under International Financial Reporting Standards (IFRS) in dividends for 2016, and those profits are much higher than the year before. “We will offer 50% of the IFRS net profit,” he said. Previously, the company paid 2.09 rubles ($0.04) per share, or a total of 15.392 billion rubles ($274 million) in dividends for 2015, which accounted for 50% of its IFRS net profit for the year. In 2016, the net profit of ALROSA jumped more than fourfold on the year to 133.471 billion rubles (2.37 billion). The government owns 33% in ALROSA, the Yakutia republic 25% plus one share, the districts of the republic hold 8% and the rest is in free float.