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Inter RAO Falls as Hopes for Dividend Payout Fade: Moscow Mover

Inter RAO UES extended declines to a second session as a full-year loss at the partially state- owned Russian power company dimmed prospects of a dividend.

The stock fell as much as 7.9 percent and was trading down 5.7 percent to 1.19 kopeks by 5:26 p.m. in Moscow, heading for the lowest level on a closing basis since May 2009. More than 12 billion shares traded, 1.7 times the three-month daily average. Inter RAO is the worst performer on Russia’s Micex index (INDEXCF) this year, having lost 52 percent.

Inter RAO posted a net loss of 22.8 billion rubles ($720 million) in 2012 based on international financial accounting standards, according to an April 15 statement. The loss makes it “complicated” for Inter RAO to pay dividends for 2012, Inter RAO’s Chief Financial Officer Dmitry Palunin said in Moscow on the same day. The company did not pay dividends for 2011, according to its website.

“The market is reacting to the weak financial results and to the risks associated with dividends,” Igor Goncharov, an analyst at BCS Financial Group, said by phone from Moscow. “Investors realize that the company won’t pay dividends this year.”

Inter RAO aims to pay shareholders 25 percent of its net income in 2014, Ilnar Mirsiyapov, Inter RAO’s head of strategy and investment, said in an interview last year. That’s the level set by new Russian government regulations for state-controlled companies last year.

Inter RAO’s 2012 net loss based on Russian accounting standards was 14.4 billion rubles, according to its website. The company’s dividend policy is based on earnings as defined by Russian accounting standards.

To contact the reporter on this story: Ksenia Galouchko in Moscow at kgalouchko1@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net

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