Polymetal shares fall as struggling miner cuts dividend

Thursday, September 22, 2022 6:36 PM

Polymetal shares fell 11.5% today after the British-Russian precious metals mining company announced it was scrapping the dividend for the year 2021 due to lower cash flow and lack of new sales channels.

He also suggested canceling the 2022 interim dividends “to allow the Group to strengthen its cash position and increase its resilience in a very volatile environment”.

Future dividends will depend on Polymetal’s ability to release the 22% blocked shares currently stored by Russia’s National Settlement Depository (NSD), which was hit by EU sanctions earlier this year.

Polymetal has offered an exchange offer to shareholders affected by the NSD sanction bite, in which certificated shares are issued on a one-for-one basis.

However, the offer is subject to shareholder approval at a general meeting on October 12 in London.

Since Russian President Vladimir Putin sent troops to Ukraine in February, Western sanctions have not directly targeted the mining company, which is 24% owned by Russian entrepreneur Alexander Nesis.

Polymetal nevertheless faces a liquidity crisis and, out of necessity, turns to the Central Bank of Russia, which means that it receives rubles rather than US dollars.

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