Dividends on Lenta shares in 2021 - size and register closure date

Good afternoon

This article will discuss corporate policy regarding the approach to dividend payment. I will talk about the previously chosen strategy, the latest news and plans for the future after the change of controlling shareholder.

About what kind of profitability investors can presumably focus on and how likely the issuer’s transition to regular payments is.

In addition to this, I will tell you when you should buy shares in order to receive dividend payments into your account, and how to choose the right broker.

Well, now let’s start: “Lenta dividends 2021.”

Dividend policy

There is no established official dividend policy.
Previously, the issuer announced a strategy of reinvesting all cash flow for financing related to the further development of the retailer's activities.

However, in 2021, as part of the distribution of funds between shareholders, the company carried out a share buyback. And at the beginning of 2019, Lenta management talked about a possible transition to paying dividends from 2021.

In mid-2021, Lenta came under the control of Severgroup, whose main shareholder is Alexey Mordashov. After which, representatives of the issuer announced that a new development strategy would be adopted, which would be presented to the investment community approximately at the beginning of 2021.

All company dividends for the last 10 years (with a breakdown of ordinary and preferred)

The founders of Yandex (A. Volozh, V. Sigalovich) own 17.64% of the securities. The American fund Tiger Global owns 20.5%, UFG – 5.13%. Sberbank of Russia is the owner of the “golden share” (veto right to sell a quarter of the volume of securities). Among the major shareholders is the investment fund Baring Vostok Capital Partners (BVCP) - 22.6% of the shares.

The company has 2 types of shares:

• type A – with one vote;
• type B – from 10.

There are no preferred shares with guaranteed dividends and no voting rights.

Owners and large holders control 61.2% of the votes. For all this time, Yandex has never paid dividends, directing net income to the development of the company.

When will dividends be paid in 2021?

It will most likely not pay dividends in 2021.

When making dividend payments, investors should focus on the closing date of the shareholder register. But we should not forget that the Moscow Exchange operates in the “T + 2” mode (trading day + 2 working days).

This means that if the closing date of the register is set for August 12, 2021, then in order to receive dividends you must be a shareholder of the company as of the close of trading on August 10, 2019.

You can also use dividend calendars posted on various investment platforms such as Smart LAB, BCS Express, etc.

Should we expect dividends from Yandex in the coming years?

One of the largest representatives of the Russian IT industry, Yandex, first entered the public market in 2011, and already in 2014, the company’s shares became available to investors on the Moscow Exchange. During this period, the company has never pleased investors with dividend payments and has no similar plans for the future. Why does Yandex avoid paying dividends, since in the Russian market this factor is very significant for investors? And what does this company policy mean for Yandex shareholders?

Let's start with the hardware. Shareholders, as owners of the company, are entitled to a corresponding share of profits and a share of net assets. Accordingly, income from owning shares can be received in two forms:

1) part of the profit withdrawn from the company in the form of dividends and coming to the personal disposal of shareholders

2) growth of the company’s net assets due to reinvestment of profits into equity capital

Which of these methods is more profitable? From a financial point of view, the one that allows you to place the profits at a higher yield is more profitable.

If the company's expected return on equity (ROE) is lower than the return that can be obtained in other assets, then it is more profitable for the shareholder to take the profit in the form of dividends and place it in more profitable instruments.

But if a company has the opportunity to reinvest profits at a higher percentage than can be obtained on the market with comparable risk, then it is more profitable for its owners to leave money in the company, because it will subsequently bring higher income.

Let's now see how the situation is in Yandex.

If we do not take into account the one-time effect in profit from the sale of Yandex.Market, then the ROE indicator, calculated as the ratio of profit over the last 12 months to the average equity capital, is at a fairly modest level, while demonstrating clear positive dynamics since the beginning of 2021. However, it is important to take into account not only the results of past periods, but also forecasts for the near future. What's more important here is forward ROE.

The company's revenue growth rate of about 40% has virtually no analogues on the Russian public market. The company owes this dynamics to new promising projects, the largest of which is Yandex.Taxi.

These projects are in the stage of operational growth and are still unprofitable. However, as margin targets are achieved, they can generate significant earnings growth and lead to a significant return on equity above industry averages.

In particular, the Yandex.Taxi business, which is growing at a triple-digit rate, is consistently demonstrating a reduction in losses at the operational level. With each quarter, the segment's EBITDA is getting closer to entering positive territory.

At the same time, the company's main business, search advertising, is also growing rapidly. Based on the results of the first quarter of 2021, the company increased the share of its search segment in the Russian market by 0.5 percentage points. up to 57% and the share of presence on Android up to 51.2% versus 49.5% in the previous quarter. Revenue growth rates in this segment remain above 20%.

Thus, forward earnings figures allow shareholders to expect a high return on their investment for the foreseeable future. Similar expectations can be observed, including in the market quotes of Yandex shares, which are traded at high multiples of P/E LTM = 38x and EV/EBITDA LTM ​​= 16x, typical for fast growing companies.

As a result, for Yandex, as a classic growth story, the withdrawal of profits as dividends at this stage of development will be rather a negative factor, indicating a significant reduction in the company's growth potential. In our opinion, such a scenario should not be expected in the near future; at least, such a step seems inappropriate from the point of view of effective management of the company.

At the same time, the long-term view on the company's shares remains positive. We expect sustainable growth in financial performance, which should have a positive impact on Yandex stock prices.

BCS Broker

Stock return

It will most likely not pay dividends in 2021.

If we assume that the issuer would distribute 50% of the net profit of 2021, then the yield to current quotes would be: 12/220 = 5.45% excluding taxes or 4.74% including personal income tax.

What dividends will be paid in 2019?

2014–2016 were difficult for Yandex:

• launch of several projects (for example, “Taxi”, “Market”, “Weather”, “Food”, etc.);
• change of search algorithms;
• increase in technical capacity;
• loss of the Ukrainian market.

And only in 2021 did the company get out of the crisis hole. Net income amounted to RUB 45,861,000.

Stock prices on the stock exchange went up. Almost half of all shares are in free float. Investors expected the IT company to announce the payment of dividends at the end of the 1st quarter of 2019. The topic was actively discussed at the beginning of the year. But the miracle did not happen. There is no need to talk about any payment schedule.

How to buy shares and receive dividends

Lenta shares are traded on the London Stock Exchange. Despite this, they can also be purchased on the Moscow Exchange through depositary receipts, under the ticker LNTADR. They provide investors with completely similar rights as the issuer’s securities themselves.

They should be purchased through a Russian licensed broker.

Best brokers

Reliable Russian brokers

Here you can find a list of the best Russian brokerage firms.

Warning about Forex and BO

Expert opinion

Vladimir Silchenko

Private investor, stock market expert and author of the Capitalist blog

Ask a Question

Forex is an over-the-counter foreign exchange market. There is no way to acquire ownership of stock market assets through securities or receipts.

Binary options are gambling platforms designed to place bets on price movements of financial assets over a specific period of time in the future. Such offices have nothing to do with stock markets and are analogues of online casinos.

Moscow Exchange