Ferrexpo declares DPS of USc 6.6

The board of Ukraine’s largest iron ore pellet
exporter Ferrexpo (FXPO LN) has declared a USD 0.033 per share final special
dividend and a USD 0.033 per share final ordinary dividend, according to an
Apr. 21 company release.

The final special dividend will be paid on May 17, and
the record date for this dividend will be May 1, the release said.

If the final ordinary dividend is approved by
Ferrexpo’s shareholders at their May 28 AGM, this dividend will be paid on July
2 to those on register on June 5.

Recall, previously Ferrexpo declared an interim special dividend of USD 0.066 per share
and interim ordinary dividend of USD 0.066 per share.

The total amount of Ferrexpo’s dividends declared for
2019, USD 0.198 per share, is 14% below USD 0.231 per share declared for 2018.

Steve Lucas, Ferrexpo’s chairman, said that during the
last month, Ferrexpo continued to find demand for its products primarily by
redirecting sales to Asia, and that the company’s costs have fallen, according
to the release.

Dmytro Khoroshun: It is
likely that Ferrexpo will decrease yoy the amount of dividends declared in
2020, possibly to as low as USD 0.066 per share for the entire year.

The main reason to expect a substantial decrease in
dividends is the PXF principal payouts, USD 33 mln per quarter, which commenced
in 1Q20. We also see risks of a decline in iron ore prices because of the
decrease in steel demand worldwide due to the coronavirus pandemic, which might
result in a yoy drop in cash from operations. Nevertheless, Ferrexpo will spend
less cash on CapEx, as it plans to invest only USD 120-150 mln in 2020, which
is USD 100-130 mln lower than in 2019.