Sanctions-Hit Alrosa to cut shareholder dividend

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08 Jun 22 by John Jeffay

(IDEX Online) – Sanctions-hit Alrosa is not expected to pay any dividends to shareholders in the second half of last year, citing the need to “maintain the sustainability of its operations.”

The miner, a third party held by the Russian government, today announced that its supervisory board recommended the move.

In the first half of 2021, Alrosa paid just over $1 billion (64.7 billion rubles) to shareholders, or more than 70% of the company’s net profit for the year.

United StatesAnd the EU imposed a ban on imports of rough diamonds from Russia after the invasion of Ukraine.

The United States then added Alrosa to its Specially Designated Nationals (SDN) list, excluding him from its banking system aand prohibiting it from doing business with US citizens.

Alrosa made no direct mention of sanctions in a statement. He said: “Given the current situation, and given the interim dividend payments in 2021 which represented 70% of the 2021 net income (exceeding the required threshold of 50%), the board of directors decided not to recommend H2 dividends, as the company considers that t is essential to maintain the sustainability of its operations and meet its social needs. as the company remains the largest employer in the region and the lives and well-being of its employees depend on the company’s ability to manage its mining activities safely and sustainably, without compromising any aspect of the sustainability of its operations . »

Shareholders must vote on the recommendation of the supervisory board at the general meeting on June 30.

The photo shows Mirny, where Alrosa is based


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