24. Equity
(a) Share capital
| Number of shares unless otherwise stated | Ordinary shares | Preferred shares of class „А1” | Preferred shares of class „А2” |
|---|---|---|---|
| Shares on issue at 31 December 2011, RUB 25 par value | 12,447,708 | — | — |
| Shares authorised for additional issue at 31 December 2011, RUB 25 par value | 100,000,000 | — | — |
| Shares on issue at 31 December 2010, RUB 25 par value | 10,647,708 | 1,764,001 | 35,999 |
| Shares authorised for additional issue at 31 December 2010, RUB 25 par value | 100,000,000 | 30,000,000 | — |
The historical amount of the share capital of RUB 311 million has been adjusted for the effect of hyperinflation to comply with IAS 29 „Financial Reporting in Hyperinflationary economies”.
In February 2006 the Company issued 1,764,001 preferred shares of class „A1” and 35,999 preferred shares of class „A2”, both with a par value of 25 Russian Rubles. The issue price was 140 and 200 Russian Rubles per share for the shares of class „A1” and „A2”, respectively. The total proceeds from the share issue were RUB 254 million.
During the year the preferred shares were converted into the same number of ordinary shares.
In December 2011 the extraordinary meeting of the shareholders decided to split each ordinary share with the par value of 25 RUB into 10 ordinary shares with the par value of 2.5 RUB. The share split was completed in March 2012. As a result, the Company’s issued share capital is comprised of 124,477,080 shares having par value of 2.5 RUB each. The Company’s authorized share capital for additional issue is comprised of 1,000,000,000 shares having par value of 2.5 RUB each.
(b) Dividend policy
The Company expects to distribute cash dividends in the future and expects the amount of such dividends to be between 20 and 40 per cent. of the Group’s consolidated profit attributable to OJSC"PhosAgro" shareholders calculated in accordance with IFRS.
Whether the Company will pay dividends and the timing and exact amount of such dividends will be subject to the approval of the recommendation made by the Board of Directors at the General Shareholders’ Meeting and will depend on a variety of factors, including the Company’s earnings, cash requirements, financial condition and other factors deemed relevant by the Board of Directors in making their recommendation to the General Shareholders’ Meeting.
(с) Dividends
In accordance with Russian legislation the ParentCompany’s distributable reserves are limited to the balance of accumulated retained earnings as recorded in the ParentCompany’s statutory financial statements prepared in accordance with Russian Accounting Principles. As at 31 December 2011 the ParentCompany had cumulative retained earnings of RUB 16,705 million (31 December 2010: RUB 27,179 million).
In January 2011 dividends in the amount of RUB 205.35 for each issued outstanding preferred share of class „A1” were approved in the General shareholders’ meeting. The total amount of approved dividend is RUB 362 million.
In April 2011 the Board of Directors proposed a dividend in the amount of RUB 2,097 for one ordinary share and RUB 2,080.5 for one preferred share of class „A1” and RUB 52.9 for one preferred share of class „A2”. The total proposed dividend is RUB 26,000 million. This decision was approved by the shareholders’ meeting in May 2011.
In April 2011 the Board of Directors proposed payment of an interim dividend for the first quarter of 2011 in the amount of RUB 310.35 for one ordinary share, RUB 308.25 for one preferred share of the class „A1” and RUB 50.2 for one preferred share of class „A2”. The total amount of proposed dividend is RUB 3,850 million. This decision was approved by the shareholders’ meeting in May 2011.
The dividend accrued on treasury shares during 2011 amounted to RUB 252 million.
In October 2011 the Board of Directors proposed an interim dividend for the nine months ended 30 September 2011 in the amount of RUB 250 for one ordinary share. The total amount was RUB 3,112 million (including tax on dividends of RUB 198 million). This decision was approved by the shareholders’ meeting in December 2011.
During the six-month period ended 30 June 2011, the Group conducted a legal restructuring of the shareholding in one of its subsidiaries. The restructuring resulted in a series of sales-purchase transactions which was recognised as part of the result of acquisition and disposal of non-controlling interest in subidiaries in the statement of changes in equity in the amount of RUB 142 million.
(d) Treasury shares
During 2010 the Group purchased 180,492 preferred treasury shares of class „A1” representing 10.23% of such shares for the consideration of RUB 75 million. In 2010 the Group sold 90,320 of these shares for a consideration of RUB 324 million with the result recognised in share premium in the statement of changes in equity. In 2011 the Group sold the remaining 90,172 preferred treasury shares of class „A1” representing 5.11% of such shares for a consideration of RUB 640 million recognising a share premium of RUB 603 million.
(e) Special right of the Russian Federation for participation in governance of OJSC „Apatit”-„Golden share”
OJSC „Apatit”, a Group subsidiary belongs to a category of entities, where the government of the Russian Federation retained special voting rights after the entity’s privatisation. These rights include a right to appoint one Federal representative to the Company’s Board of directors and to the audit committee, right to call for extraordinary shareholder’s meeting and a „veto” voting right in the shareholder’s meeting in respect of certain issues as defined by the Federal Law on the „Privatisation of the Federal and Municipal property” and specified in the charter of OJSC „Apatit”. The „veto” voting right can be exercised in respect of the following issues:
- Making changes to the entity’s charter;
- Reorganisation of the entity;
- Liquidation of the entity;
- Amendment of the entity’s share capital;
- Approval of „significant transactions” and „transactions with interest”, as defined in the Russian Law on „Join stock companies”.
Additionally, the Government of the Russian Federation holds 26% of the ordinary voting shares (20% of all issued shares of OJSC „Apatit”).
Notes to the Consolidated Financial Statements