Shareholders Hike Mosenergo Dividend

Shareholders in Mosenergo on Friday approved an increased dividend for 2000 after the company slashed losses, and a top official said management was eyeing a share issue to fund development plans.

A meeting of shareholders in the utility, which heats and powers Moscow and the surrounding region, on Friday approved a 0.007667 ruble dividend per ordinary share for 2000, a company spokeswoman said.

In 1999, the utility paid a 0.003-ruble dividend per ordinary share, which has a nominal value of 1 ruble. Mosenergo has no preferred shares.

The company posted a net loss per share of $0.0001 under U.S. generally accepted accounting principals in 2000 compared with a $0.0776 loss in 1999, Mosenergo said in statement.

Mosenergo's net loss for the year came to $3 million compared with $2 billion in 1999.

Alfa Bank analyst Natalya Sazhina said the results were neutral. "They will not rattle the market. What is good is that there was an operating profit — of course there would be with such tariffs," she said.

Mosenergo posted an operation profit of $129 million last year after a $1.95 million operating loss in 1999.

Mosenergo general director Alexander Remezov told the shareholders meeting that in the middle of 2000 electricity tariff increases came to 35 percent over 1999, while heating tariffs were hiked 39 percent.

NIKoil analyst Andrei Abramov agreed results were neutral, but pointed to better cash flows as a good sign, including an increase of almost $30 million in cash on the company's books.

Mosenergo's deputy general director, Vladislav Nazin, said the company was now eyeing ways to attract investment and that management was considering raising money through a share issue.

But he said such a move would largely depend on the position of its major shareholder, national power utility Unified Energy Systems.

"Today we are electing a board of directors. It will be up to the board to decide, but management is interested in a new emission," Nazin said.

Nazin declined to say how big an issue the management was interested in, and added that raising Mosenergo's share capital was not on the agenda for the shareholders meeting.

Remezov had said earlier this week that Mosenergo could pursue a share or Eurobond issue around the end of 2001. He also said investment plans did not exclude the possibility of a ruble debt issue.

Mosenergo shares jumped almost 5 percent and posted the highest gains among the most liquid shares following the shareholders meeting, Interfax reported. The utility's shares went up 4.8 percent to $0.0375/$0.0377 on the Russian Trading System.