LUKOIL's Board of Directors has proposed dividends of 541 rubles per share for 2024, despite a significant decrease in the company's net profit.
As LUKOIL prepares to reward its shareholders, analysts and investors alike are watching closely.
The Board of Directors of LUKOIL recently recommended dividends for the fiscal year 2024 amounting to 541 rubles per share, equating to a yield of around 7.5%. This decision comes as the market grapples with the impact of fluctuating oil prices and tightening regulations.
Shareholders will have a final say on the dividend proposal during an annual general meeting scheduled for May 15, 2025, where they will also review the annual report and financial statements of the company. As of June 3, 2025, the eligibility for the dividend payout will be based on the shareholders registered by the cutoff date, with the last date to purchase shares qualifying for dividends being June 2, 2025.
Despite the looming financial uncertainties, LUKOIL's ability to maintain its dividend payments has garnered mixed reactions. The company's net profit fell by 26.6% year-on-year to 851.546 billion rubles, a clear reflection of the challenges posed by market competition and operational costs. Yet, revenue did show an 8.7% increase, touching 8621.56 billion rubles, indicating some resilience amid adversity.
Capitalizing on its free cash flow policy, LUKOIL aims to distribute 100% of its free cash flow to shareholders. Previously, the company paid out interim dividends of 514 rubles per share based on its nine-month results in 2024, bringing the total expected dividend for the year to an encouraging 1055 rubles per share.
Analysts have offered insights regarding LUKOIL's financial performance. "LUKOIL presented generally good financial results for fiscal 2024, but it saw a decline in net profit tied to several adverse factors such as a lower margin for refining and the need to comply with OPEC+ quotas," said a financial expert from Veles Capital. The expert went on to note that LUKOIL had to reassess deferred tax liabilities due to an increase in rates to 25% beginning in 2025. Nevertheless, these changes are not expected to affect dividend distributions, as LUKOIL's policy is rooted in adjusted cash flow metrics.
The company presented a notable EBITDA of 1785.26 billion rubles, a decrease of nearly 10% from the previous year. Despite the profit drop, LUKOIL remains committed to rewarding its investors adequately, thus maintaining investor confidence and interest.
As of currently available data, shares of LUKOIL are trading at 7255 rubles, experiencing a slight dip of 0.5%. This performance reflects a broader trend where the stocks have shown fluctuations amid overall market conditions. Nevertheless, many analysts remain optimistic about LUKOIL's long-term prospects, reiterating their positive outlook on the oil giant's shares.
According to the analysis by Alpha Investment, LUKOIL’s dividend policy is attractive to many investors looking for stable returns. Moreover, analysts predict that LUKOIL may achieve a total dividend payout between 1064 and 1084 rubles per share based on adjusted cash flows.
Such expectations underscore the company’s reputed strategy to focus on operational efficiency while navigating an increasingly competitive landscape. Investors have been advised to keep an eye on market news, especially leading up to the annual meeting where some pivotal decisions will be confirmed.
Therefore, as LUKOIL approaches this critical juncture, it continues to lure the attention of investors, aiming to balance profitability and effective capital management amidst shifting market dynamics.
The combination of stock price performance, dividend allocations, and a strategic focus on maximizing shareholder value will undoubtedly play a significant role in shaping LUKOIL's financial narrative in the coming fiscal year.
In summary, LUKOIL is gearing up for a noteworthy year with the intent of providing its shareholders with substantial dividends while managing the impacts of a challenging economic environment.
As the date for decisions approaches, investors and stakeholders are keenly waiting to see how LUKOIL will uphold its commitment to delivering shareholder value against the backdrop of fluctuating profits and operational adjustments.
With continued focus on maintaining robust financial health and investor trust, LUKOIL aims to steer through market challenges effectively.
