Gazprom’s debt burden forces dividend freeze despite $17.3 billion profit
Alexei Miller, chairman of Gazprom’s management board. (Photo: REUTERS/Maxim Shemetov/Pool)
Gazprom’s board of directors has recommended that
shareholders approve no dividend payments for 2025, meaning Russia’s
state-controlled gas monopoly is unlikely to send dividend revenue to state
coffers, Interfax
reported.
Gazprom published its 2025 financial statements under international
standards in April. Analysts agreed that the company should not be expected to
pay dividends for 2025, the report says.
The agency cited experts who said dividends remain off the
table for Gazprom despite its profit, because debt repayment remains the
priority.
“With total debt of 6.7 trillion rubles, or about $94.6
billion at the current exchange rate, and a net debt-to-EBITDA ratio of 2.07x,
the company will direct liquidity toward scheduled debt repayments,” PSB, one
of Russia’s largest banks, said.
Another financial institution calculated that Gazprom’s free
cash flow, including interest adjustments, is turning negative.
Financial company BCS concluded that Gazprom “essentially
has no money to pay dividends — something indirectly confirmed by management’s
complete silence on the matter.”
Gazprom has not paid dividends to shareholders in recent
years.
Gazprom’s annual shareholder meeting, with remote
participation, will be held on June 26. Its agenda does not include electing a
new board of directors, because the board was elected in 2025 for a three-year
term, through June 2028.
The state controls more than 50% of the gas monopoly: 38.37%
directly, 10.97% through state-owned Rosneftegaz and 0.89% through state-owned
Rosgazifikatsiya.
Gazprom previously reported net profit of 1.31 trillion
rubles, or $17.3 billion, for 2025.
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