VSMPO-Avisma boosts dividends 34%

Shareholders of VSMPO-Avisma Corporation have authorized a dividend payout for FY06 equaling $1.95 (Rub 50.83) per share, which is a 34% increase on FY05. The total dividend payout amounts to around $22.5 mln, or 10%, of FY06 RAS net income, which totaled $225 mln.

Earlier, the company approved a new dividend policy, under which, as of the current year, payouts will equal 10% of RAS net income. The dividend yield is about 0.65%.Analytics believe that in 2007 and over the next 3—4 years, investors would be unwise to reckon on a high dividend yield.

Virtually all of VSMPO-Avisma’s net income will be allocated to implementing its extensive investment program, which calls for not only expanding existing production facilities, but also intensifying the refining of titanium products and producing new types of alloys. In order to fulfill its contracts the company has to overcome its present shortage of ilmenite concentrate and also buy new equipment capable of processing titanium forgings used in aircraft construction.