Putin Asks Rosneft CEO to Consider Dividends at 50% of Net Profit at Meeting

Russian President Vladimir Putin asked the Rosneft company to consider paying half of its net profit in dividends to the state rather than the 35 percent approved by the company's board.

MOSCOW (Sputnik) — Putin, at a meeting with Rosneft CEO Igor Sechin, said he "would ask you to return (at the general meeting of shareholders) to issues of a fiscal nature, namely, to pay dividends of 50 percent of net profit."

Russia's largest oil company will hold the annual shareholders's meeting on June 22 in Sochi. Rosneft's majority shareholder is the state-owned Rosneftegaz, which owns the majority stake in the company. Company's board of directors recommended the annual meeting to approve allocation of 63.377 billion rubles ($1 billion) for 2016 dividends, corresponding to 5.98 rubles per share or 35 percent of the company's IFRS net profit.

Later, Rosneft Press Secretary Mikhail Leontyev said the company would fulfill Putin's request.

Following Putin's words, Rosneft stock on the Moscow Exchange was up 1.61 percent by end of the trading day to 316 rubles ($5.3) per share, a five-week high.

"I would like to ask you to discuss [at the annual meeting] issues related to advanced technologies, digital technologies, modern production and, most importantly, the volatile situation on the world market. You are one of the participants in this process of alignment of positions of our largest companies, the government of Russia and, accordingly, we form our position with partners in the international oil market in this way," Putin added.

He said that Rosneft was involved in the development of these solutions, as the company knows what is happening in the world market.