Turboatom Approves 35% Dividend Payout

Turboatom (TATM: U/R) shareholders approved the company’s 2006 financial results at their AGM yesterday: net income of USD 4.4 mln (+11% yoy) and sales of USD 52.0 mln (-3.2% yoy). Shareholders approved a 35% dividend payout of USD 1.5 mln (dividend per share of USD 0.0036 and yield of 0.5%). Dividends will be paid out from August 29 to September 29. Acting CEO Viktor Subotin was confirmed CEO of Turboatom. The company’s supervisory board was enlarged from 6 to 7 (five from the state, one related to Gryhoryshyn, and one from Megabank). A new statue was also passed, which among other things diversified its business into products for the military, and added a position responsible for corporate governance. Subotin said that Turboatom has signed contracts for orders through 2015 and he expects sales in 2007 of over USD 79 mln. Inna Perepelytsya: Before the start of the shareholder meeting, a lawyer from Konstantin Gryhoryshyn–related Swarog Asset Management (holder of a 14.6% stake in Turboatom) said that courts forbid the official registration of Turboatom shareholders. We believe that Gryhoryshyn will try to challenge the legitimacy of the AGM in court, and that the dispute will only be settled in the fall after the formation of a new government.