Motor Sich reports a 31% drop in its 2013 bottom line

Leading CIS aircraft engine producer Motor Sich (MSICH UK) reported a 31% drop in its net income to UAH 1.38 bln in 2013, according to its preliminary results published in an AGM announcement on Feb. 24. The company has yet to reveal other P&L indicators for the year. Motor Sich’s AGM is scheduled for March 27 and contains an item for 2013 profit distribution.

Alexander Paraschiy: The decline in the company’s bottom line was broadly expected given that Motor Sich reported a significant worsening in its profit in its interim results. With the 9M13 results on hand, we see that the key item that drove the bottom line downwards was an increase in unidentified “other operating costs.” We believe this trend continued in the fourth quarter. Yet we expect the profit decline will not affect the company’s dividend policy. Most likely, it will remain consistent and skimpy. We expect the company will again pay UAH 10/share in dividends, which would yield less than 0.5%.