https://www.forbes.com/sites/dereksaul/2022/06/30/shares-of-russias-largest-public-company-gazprom-tank-30/
Topline
Shares of majority state-owned Russian oil and gas giant Gazprom, which is the country’s largest public company, tanked in trading on Thursday after the company declined to pay out dividends for the first time since 1998 in a sign of the widening impact of sanctions on the Russian economy.
Gazprom advertising boards are pictured in Germany in February.
Key Facts
Gazprom shareholders voted not to pay dividends because under the “current situation it is not advisable to pay dividends based on the 2021 results,” the company’s deputy chief executive Famil Sadygov said, according to Reuters, in a nod to worsening economic conditions in Russia as it is cut off from much of the global economy in response to its invasion of Ukraine.
That decision is a reversal of the board’s recommendation last month to issue a dividend of 52.53 rubles (96 cents) per share.
Shares of Gazprom fell 29.8% to 208.9 rubles ($3.82) on Thursday, and the Moscow stock exchange briefly halted trading of the stock.
The drop sent the company’s market capitalization tumbling to 7.046 trillion rubles ($129 billion), though the company is still the largest in Russia by market cap.
Key Background
Gazprom placed 49th in Forbes’ list of the 2,000 largest public companies in the world released last month, which factored in companies’ assets, market value, profits and sales. Surging oil and gas prices led to Gazprom recording its highest ever profit of 2.09 trillion roubles ($38.3 billion) in 2021, but a partial ban on the export of Russian energy products to the European Union and other countries have dampened the company’s outlook. State-owned Russian bank Sberbank, which is the third-largest public company in the country according to Forbes, said in May it wouldn’t pay dividends.
Contra
The ruble rose 3.4% to 53.8 against the dollar Thursday, continuing the Russian currency’s surprising rally to its highest level since 2015. The ruble collapsed earlier this year, falling to an all-time low of 150 against the dollar on March 7.
Further Reading
These Are Russia’s Biggest Public Companies: Forbes Global 2000 (Forbes)
