MMK's Board of Directors recommended dividends for the fourth quarter of 2021 at 114% of FCF

The board of directors of Magnitogorsk Iron and Steel Works (MMK) recommended paying dividends for the fourth quarter of 2021 at the level of 114% of free cash flow (FCF), which corresponds to 0.945 rubles per ordinary share.

The information became known from the report on the financial results of the MMK group for the fourth quarter and 12 months of 2021, published on Tuesday, February 2.

According to the current dividend policy, dividends are paid quarterly if the financial position is stable. If “Net Debt/EBITDA” according to IFRS is below 1.0x, at least 100% of FCF goes to dividends. If the mentioned ratio is above 1.0x, at least 50% of FCF goes to dividends.

Let us recall that for the 3rd quarter of 2021, MMK’s board of directors recommended dividends in the amount of 2.391 rubles per ordinary share, which corresponded to 100% of FCF.

Currently, MMK's dividend yield based on all dividends paid over the last 12 months is 11.59% (12-month dividend yield). The indicative dividend yield (based on the last annualized dividend) is also 11.59%, taking into account the current price at the time of writing (RUB 53,085).

Dividend policy

Provided that the net debt/EBITDA ratio calculated on the consolidated financial statements is below 1.0x, the amount of funds allocated for the payment of dividends will generally be at least 100% of free cash flow calculated on the basis of the consolidated financial statements. financial statements of PJSC MMK prepared in accordance with international financial reporting standards; If the net debt/EBITDA ratio exceeds 1.0x, the amount of funds allocated for the payment of dividends, as a rule, will be at least 50% of free cash flow, calculated on the basis of the consolidated financial statements of PJSC MMK, compiled in accordance with international financial reporting standards.

useful links

Shares on the Moscow ExchangeDisclosure of informationOfficial website

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

Home → Dividends→ MMK JSC shares - forecast, payment history

A table with the full history of MMK's dividends, indicating the amount of payment, the date of closing the register and the forecast:

*Note 1: The Moscow Exchange operates on the T+2 trading system. This means that settlements for buying and selling shares occur within 2 business days. Therefore, to be included in the register of shareholders and receive dividends, you must be a shareholder 2 days before the cutoff.

*Note 2: Exact payout date varies by broker and issuer. The predicted earliest date for the receipt of dividends to the brokerage account for MMK: June 30, 2021.

Total dividends of MMK JSC shares by year and changes in their size compared to the previous year:

The amount of dividends paid by MMK JSC for the entire period is 31,159 rubles.

Average amount for 3 years: 4.58 rubles, for 5 years: 4.46 rubles.

DSI indicator: 0.86.

You can buy shares of MMK JSC with minimal commissions from stock brokers: Finam and BCS. Free deposits and withdrawals. Online registration.

Dividend policy:

At least 100% free cash flow if “Net Debt/EBITDA 1.0x.”

There is also compensation if CAPEX exceeds the standard value of 0.7 billion US dollars.

The dividend policy is effective from 2021.

Brief information about the issuer PJSC Magnitogorsk Iron and Steel Works

Other companies from the Metals and Mining sector

Calendar with upcoming and past dividend payments

View full calendar for 2021 »

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View the full company rating for 2021 »

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Exchange rate dynamics for all time

Price on the London Stock Exchange

If you look at the chart, you can see that MMK shares are growing steadily. Large drops are visible only at the height of the crisis in 2008, as well as in 2014 after the aggravation of the political situation and international sanctions. But while other companies sank greatly,

The Magnitogorsk plant not only reached pre-crisis levels, but also increased its income. In addition, after the 2021 reorganization, dividends increased by more than 200% and are paid stably. This makes MMK shares attractive for long positions and long-term investment.

How and when to buy MMK shares for dividends

MMK shares are traded on the Moscow Exchange under the ticker MAGN. Because of this name, newcomers sometimes confuse MMK and Magnit - but it has the ticker MGNT. Be careful not to get confused!

MMK shares are sold in lots. One lot contains 100 shares. Consequently, the minimum purchase price at current quotes is 4,665 rubles.

By purchasing this number of shares, you will receive 148.8 rubles per lot (or 1,488 rubles per share) as dividends.

At the same time, you are required to pay a tax of 13% on dividends. Consequently, you will receive 1.2945 rubles per share (or 129.45 rubles per lot) into your account. Take this point into account. Dividends are usually retained by the company itself, so it will not be possible to return them through an IIS.

The closure of the register for dividends is scheduled for June 20, therefore, taking into account the T+2 trading mode, they must be purchased before June 18.

MMK shares can be purchased through any Russian broker operating from the Moscow Exchange. For example, Tinkoff or one of these brokers. Please note that when purchasing shares you will pay a broker's commission.

And here’s another interesting article: Bashneft dividends in 2021: amount, timing, purchase procedure

Trending stocks

Is it worth taking MMK shares?

MMK's dividend history is, of course, very attractive. Especially for the future. But will management be able to continue to maintain the same rate of production and profit? This is unknown.

However, in general, the indicators are very good - profits and revenues are growing, the debt burden remains extremely low. MMK occupies almost 20% of the Russian steel production market, and sends another 15% for export, and its share is constantly growing. The additional influx of funds ensures an increase in demand for steel and, accordingly, prices for finished products.

In terms of multiples, everything is also attractive - unlike its direct competitors, MMK looks undervalued, so there is growth potential. And the new dividend policy can also serve as a good factor for growth. But, as always, I leave the decision on whether to buy MMK shares or not to you. Good luck, and may the money be with you!

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MARKETS TODAY: Oil up; MMK dividends; COBR; Rosstat

(Bloomberg) -- Oil prices climbed amid signs of a stronger recovery in demand and the dollar falling for a seventh straight session. Emerging market stocks are trading higher ahead of corporate reports. The ruble is strengthening, recouping yesterday’s losses against the backdrop of the situation with Alexei Navalny, who continues his hunger strike.

The Bank of Russia will offer three issues of coupon bonds. Rosstat will publish a portion of economic data. The Board of Directors of PJSC MMK will consider dividends for the first quarter. PJSC VTB Bank and PJSC Rostelecom will hold Investor Day. Morning review of the business press.

Markets at 08:49 Moscow time:

• MSCI Emerging Markets Index +0.4% to 1354.55
• MSCI EM Currency Index +0.3% to 1719.56
• Bloomberg Dollar Index -0.1% to 1,128.13
• S&P 500 futures +0.2% to 4165
• Brent oil +1% to $67.7/barrel, WTI +0.9% to $64
• Spot gold price -0.1% to $1770.6/oz
• US 10-year Treasury yield +1 bps. up to 1.62%
• Moscow Exchange Index at closing -0.7% to 3574.08, RTS -1.4% to 1476.58
• RTS index futures +0.6% to 145520
• Ruble to dollar +0.3% to 76.1525

World events:

OPEC+ may limit itself to a monitoring meeting on April 28

EU: The deployment of Russian troops near the Ukrainian border is the largest in history

The build-up of Russian troops near the Ukrainian border is more extensive than in 14: USA

The CDU Committee supported Laschet's candidacy for German Chancellor

Stabilization of UST yields will support EM assets: BlackRock

Heads of prime brokerage Credit Suisse will leave the bank after Archegos

Today:

• 10:20 Moscow time - Indonesian Central Bank rate, forecast - unchanged at 3.50%
• 15:50 Moscow time - speech by member of the ECB Governing Council Pablo Hernandez de Cos at a discussion on financial regulation
• Apple Inc. will introduce a range of products including the new iPad Pro, AirTags and the new iMac desktop computer

Events in Russia:

Psaki promises consequences for Russia if Navalny dies

M.video will take place for the first time in 15 years before the Central Bank meeting on the rate

Bonds of Russian issuers: COBR auctions, M.video book, OFZ announcement

The Russian Federation will not limit the share of foreigners in video services: Kommersant

Today:

• 10:00 Moscow time - Deputy Minister of Transport Alexander Poshivay will speak at a press conference on the digitalization of the Arctic
• 14:00 Moscow time - VTB Capital Investments will hold a conference with PJSC Tatneft
• 16:00 Moscow time — VTB Investor Day
• 19:00 Moscow time - Rosstat will publish the following data: Unemployment for March, forecast 5.6%
• Retail sales for March, forecast -1.9% y/y
• Real wages for February, forecast -0.2% y/y

©2021 Bloomberg LP

Stock dynamics

MMK shares as of 11:45 Moscow time rose in price by 0.06% to 53.085 rubles. On December 28, MMK shares reached an absolute maximum of 59.09 rubles. Since then, a correction has been observed, during which last Friday (January 29) the quotes tested the strength of the support represented by the 50-day moving average. From the December 28 high to the January 29 low, the stock fell 13.9%. On Monday, quotes bounced up from the 50-day MA, which had not been broken the day before, hinting at a resumption of the bullish trend observed since October. From the point of view of technical analysis, the closing of any trading day is above 56 rubles.

The situation on the steel market in Russia

Demand for metal products in the Russian Federation in the first quarter decreased by 3.5% year-on-year under the influence of reduced demand from the pipe industry amid the completion of large projects in the oil and gas industry, MMK notes in its presentation. Demand for steel products in the first quarter was mainly supported by demand from the automotive industry and a significant flow of orders from the construction industry.

World steel prices continued to rise due to a lack of supply in key regions, the group noted.