Russia's Gazprom skips dividend for first time since 1998

Gazprom will not pay a dividend in 2022.

Russian gas giant Gazprom announced today that it will not pay a dividend to shareholders for the first time since 1998.

On Thursday, June 30, it was announced that Gazprom shareholders voted against paying a dividend for 2021. This ends a long series of annual dividend payments by Gazprom.

This May Gazprom's board was recommending a dividend of 52.53 rubles per share on its 2021 results. At the time this resulted in a total payout amount of 1.244 trillion rubles ($20.10 billion), or 50% of adjusted group net income. 

Gazprom had one of the very best dividend track records in Russia with a 12.55 rubles dividend paid last year and a dividend that has been consistently paid since 1998. That is now coming to an end. Investors are not happy and today put the Gazprom share in Moscow 25% lower at a price of 223 rubles. Gazprom's share price loss is 35% this year and the company still has a market cap of $140 billion, despite the war in Ukraine and all the sanctions Western countries have imposed on Russia.

"The shareholders decided that in the current situation it is not advisable to pay dividends based on the 2021 results," -  Gazprom CEO Famil Sadygov

Last year Gazprom paid a dividend of  12.55 rubles per share and the proposed dividend of 52.53 rubles for 2021 would have been the highest dividend paid by the Russian company on record, yielding 18% at today's stock price of 224 rubles. Gazprom 

Other companies suspending or cutting the dividend recently are Belgian retailer Colruyt and French retirement homes operator Orpea.

Gazprom PAO is a Russia-based operator of gas pipeline systems. Gazprom's activities include exploration and production of gas; transportation of gas; sales of gas within the Russian Federation and abroad; gas storage; production of crude oil and gas condensate; processing of oil, gas condensate and other hydrocarbons, and sales of refined products, and electric and heat energy generation and sales. Gazprom had been paying a dividend to shareholders every year since at least 1998. The dividend was suspended in 2022.