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The future for synthetics lies in that it has become possible to grow a stone you want and make what you want out of it

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In anticipation of ALROSA shareholders meeting: Results of 2018 and prospects for 2019

17 june 2019

What dividends per share the ALROSA’s shareholders will get based on the results of 2018

At the end of June 2019, a General Meeting of Shareholders will be held, where the results of 2018 will be summed up and the ALROSA’s shares dividends for 2018 will be decided on. Taking into account the interim dividends paid for the first half of the last year in amount of ₽43.7 bn, or ₽5.93 per share, the money will be allocated for dividend payments based on the H2 2018 results. The Supervisory Board of ALROSA recommended the General Meeting of Shareholders to allocate 100% of the free cash flow for the dividend payments, which makes ₽30.3 bn, or ₽4.11 per share.

Totally, ₽73.9 bn, or ₽10.04 per share, can be allocated for dividend payments, which will be the record sum ever paid by ALROSA Company.

Thus, the Republic of Sakha (Yakutia) will receive their dividends in the sum of ₽7,575 mn and 8 districts of the diamond province will get ₽2,425 mn. Totally, Yakutia will receive ₽10 bn to their budget from ALROSA Company.

It is proposed to set July 15, 2019 as the dividend record date.

Dividends per one ALROSA’s share in 2009-2018

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Prospects for 2019

Comparative data on the rough and polished diamond sales by ALROSA Group in January-April 2019, to the respective period of 2018

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2019 started with a steep decline in the ALROSA Group diamond product sales. The drop in rough diamond sales over 4 months was 34.1%, while that in the whole diamond product was 34.2%. Even sharper decline was seen in the polished diamond sales over the January-April period – by 41.6%, but taking into consideration that the share of the polished diamonds in the total goods sales is small (about 2%), this does not have a significant effect on the ALROSA’s economic performance.

For the whole 2019 year, taking into account the seasonal decrease in the rough diamond sales in summer, ALROSA Group can get into difficulties and tax remissions to the budgets will decrease, and based on the H1 results, hardly any dividends will be paid. So, the Republic of Sakha (Yakutia) should start preparing for the significant budget cut right now.

Yury Danilov, Ph. D., Lead Research Fellow at Subsoil Use Innovative Economics Laboratory of the North-Eastern Federal University