Management Committee approves revised draft version of Gazprom’s Dividend Policy


The Management Committee has approved the revised draft version of Gazprom’s Dividend Policy and resolved to submit the document to the Company’s Board of Directors for consideration.

The draft document was elaborated with due regard for the current status of Gazprom’s business, namely, participation in the equity capital of major oil and power generation public companies. The draft Dividend Policy is aimed at enhancing transparency and predictability of dividend payments to shareholders. Both the draft document and the current Dividend Policy are governed by the basic principle of maintaining the balance between the short-term (making profit) and long-term (corporate development) shareholder interests.

In accordance with the revised draft version of the Dividend Policy, the dividend calculation envisages that the net income may be adjusted by the amount of Gazprom’s investment revaluation. This enables the Company to allocate the income secured by the real cash flow to the dividend and investment payments.

The draft document also contains a provision on the dividend payment amounts (from 17.5 to 35 per cent of net income).

The revised draft version of the Dividend Policy doesn’t require taking into account the amount of Gazprom’s market capitalization when calculating the dividends. The dividend level is a reflection of the Company’s operating results over the past year, while market capitalization – expectations of the investment community regarding the future financial performance.

“The shareholder interests underlie all the decisions taken in Gazprom. The amended dividend policy will make the divided calculation principles more comprehensible. An increase in the maximum possible level of dividend payments from 30 to 35 per cent will allow a shareholder to enhance its participation in Gazprom’s profits.

The revised draft version of the Dividend Policy will improve the ratio between the Company’s investments and the shareholders’ profit. This will instill confidence in the shareholders that may count on a pretty good profit in the future,” said Alexey Miller.


The current Dividend Policy of Gazprom was approved by the Board of Directors in April 2001. The document sets out the procedure for distributing net profit gained over a  reporting period.

Part of the net profit is channeled to forming the reserve fund (in accordance with the Company’s Articles of Association – in the amount of 7.3 per cent of the Company’s chartered capital). Distribution of net income for the reserve fund shaping is terminated when it gains the size specified in the Articles of Association.

Part of the income (no less than 2 per cent of the market capitalization and no more than 10 per cent of the net income) is used to pay dividends.

50 to 75 per cent of the net profit is retained for technical retrofitting, new technologies mastering, R&D, current assets replenishment and other similar purposes.

The remaining part is split in equal parts to pay dividends and to form the reserve for corporate and social development.

The decision on the annual dividend distribution, as well as the amount and method is adopted by  the Shareholders Meeting on the Board of Directors recommendation. The annual dividend payments should not exceed the amount recommended by the Board of Directors.

The dividends based on the Company’s 2009 operating results (approved by the Company’s annual General Shareholders Meeting in June 2010) were calculated on Gazprom’s 2009 net profit less the net profit received from revaluation of financial investments (largely – the shareholding in Gazprom neft owned by Gazprom) and unsecured by the real cash flow.

According to regulatory accounting documents, financial investments comprise, in particular, state and municipal securities, securities of other companies, contributions to  the charter (share) capitals of other companies (including subsidiary and associated entities).

If it is possible to define the current market value of financial investments according to the established procedure (i.e. when securities are quoted on a stock exchange), they are reflected in the accounting reports as of the end of the fiscal year at  the current market value by adjusting its evaluation (revaluation) as at the preceding reporting date. The value change versus the previous year has an impact on the net income amount, but is not secured by the real cash flow.

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