MOSCOW, Oct 22 (PRIME) -- Russian oil pipeline monopoly Transneft plans to spend up to 20 billion rubles, or 8% of the company’s market capitalization, on a 3-year buyback program for preferred shares, according to a presentation demonstrated on Monday.
“The market buyback program (in the framework of fulfillment of a board of directors’ order) will be fulfilled due to a significant underappreciation of the securities and will envisage a later use of the purchased securities in an option program for the key employees of the company,” Transneft said.
Transneft also said that it plans the same of higher growth of annual dividends in absolute terms in the medium term. The requirements of the state as a key shareholder were listed as one of the priorities in fulfillment of the dividend program.
Capital expenditures will be additionally reduced by up to 120 billion rubles in 2018–2023. “In the conditions of a limited growth of revenue and earnings before interest, taxes, depreciation and amortization (EBITDA) this is the main factor of growth of free cash flow.”
(65.8140 rubles – U.S. $1)
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