Restoration of pre-accident production volumes is delayed

OJSC Raspadskaya, which has already changed its production plans twice this year, has presented a new work schedule for 2012. The company expects to produce 10.5 million tons of coal, which is 18% lower than previously announced forecasts. The time frame for restoring pre-accident production volumes has also been shifted. But now Raspadskaya shareholders have the opportunity to earn more from dividends.

Last Friday, Raspadskaya revealed its adjusted production plan for 2011 and 2012. By the end of this year, the company plans to produce 6.4 million tons of coal, in 2012 - 10.5 million tons, its CEO Gennady Kozovoy said at a telephone conference. This is respectively 25% and 18% lower than the forecasts that Raspadskaya made in February as part of the production development program for 2011-2015.

Raspadskaya has been trying to restore production since May 2010, when an explosion occurred at its largest mine, killing 91 people. According to the plan, by the end of the year the company was going to introduce five new longwalls in the emergency mine, but in fact only two turned out, one of which was worked out in the first half of the year. Mr. Kozovoy explained the delay behind the schedule by the fact that it takes more time to coordinate the commissioning of new sections for workings than originally expected. Raspadskaya expects to reach its pre-accident production volume (13-15 million tons of coal per year) “in three years,” said Gennady Kozovoy. Previously, we were talking about 2012-2013.

Raspadskaya has already adjusted its plan for 2011. In October it was said about 6.8 million tons, by December the forecast decreased by 6%. Investors now want to hear shorter forecasts from the company, with a horizon of one quarter, in order to quickly respond to changes in longer plans, notes Boris Krasnozhenov from Renaissance Capital.

But the appetites of the main shareholders of Raspadskaya are growing (40% each for the management and Evraz Group of Roman Abramovich and Alexander Abramov). After a series of unsuccessful attempts to sell their shares, the owners concentrated on withdrawing funds from the company, notes Oleg Petropavlovsky from BCS. First, Raspadskaya shareholders approved the payment of dividends for the first half of the year in the amount of $135 million with a net profit of $99 million, and in mid-October the company announced a buy back up to 10% of its own shares for $382 million, 60% more than the market price of the package at that time. On Friday it became known that the company's board of directors had changed its dividend policy: now payments will be at least a quarter of net profit, and not up to 25%, as before.

However, Raspadskaya shareholders are still thinking about selling it. Evraz said that it would return to this issue in 2012-2013, Gennady Kozovoy said that he would wait for an offer of $9 per share (on Friday the paper cost $3.2 per share).

Roman Asankin

Raspadskaya is behind schedule