Aeroflot will pay dividends only after achieving sustainable profits

Aeroflot will pay dividends only after achieving sustainable profits

Director of Investor Relations and Capital Markets at Aeroflot (MOEX: AFLT) Andrey Napolnov said that the company will return to discussing the payment of dividends after reaching a stable net profit. Otherwise, he said, payments will lead to a worsening credit profile.

“Initially, we must return to organic profit, without revaluations, without one-time effects – that is, to profit from which dividends can be paid when this does not damage the company. After all, is it in a shareholder’s interest to pay dividends for the sake of dividends when it would worsen the company’s credit profile or undermine its financial stability?” – Mr. Napolnov said at the SberCIB webinar (quote from “Interfax”).

He recalled that Aeroflot’s policy involves paying dividends in the amount of 25% of net profit under IFRS for the previous year. In previous years, as Andrey Napolnov clarified, the company paid 50% of the profit.

Earlier, February 12, Aeroflot published results of financial statements according to RAS. Net profit for 2023 amounted to 50.4 billion rubles. compared to a net loss of RUB 40.3 billion. in the previous year. The company said in a statement that it had “steadily improved financial results, driven by improved operating performance and increased passenger traffic.”

In October 2023, Kommersant wrote that by the end of the year the company would be able to continue to restore revenue due to the expansion of the international geography of flights and rising ticket prices. The problem, as analysts said, could be debt refinancing given the rise in the key rate.

Read more in the publication “Kommersant” “‘Aeroflot’ didn’t reach profit”.

Petr Buzlaev

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