The annual general meeting of the PJSC TATNEFT n.a. V.D. Shashin shareholders was held on June 17.
In compliance with measures to ensure the non-proliferation of the coronavirus infection and in accordance with federal law the meeting was held in the form of absentee voting.
The published joint address of R.N. Minnikhanov, President of the Republic of Tatarstan, Chairman of the Board of Directors of PJSC TATNEFT, and N.U. Maganov, Director General of PJSC TATNEFT, was presented to shareholders, investors and partners in the Company's Annual Report on the Company's website.
Also, there was a video message from N.U. Maganov, the Company's Director General, and top managers of the Company, to the shareholders posted on the Company's website at link.
As of the end of 2019, TATNEFT demonstrated successful results, a consistently high level of profitability and a low level of debt burden. The adjusted EBITDA value increased by 4.3% and amounted to RUB 328.4 billion. The return on capital employed (ROACE) amounted to 24.8%. The Company is included in the Top 10 of the rating '100 most expensive in terms of capitalization public Russian companies' and the Top 10 of the world leaders in the oil and gas industry in terms of increasing the shareholder value (BCG Rating).
The value of consolidated assets increased by 3.1 percent in the reporting year and amounted to RUB 1,238.6 billion. The Exploration/Production and Refining/Sales of Petroleum and Oil Products segments were the growth drivers.
The TATNEFT Group's total crude oil production amounted to in the 29.8 million tonnes in the reporting year with an average daily production amounting to 581.5 thousand barrels. TATNEFT maintains one of the highest oil recovery rates in the industry at 44%. The Company increased the total volume of oil refining by 15.5% compared to the previous year through the development of the Company's own capacities at the TANECO Complex. The volume of oil products manufactured in 2019 amounted to 10.3 million tonnes in 2019, while the yielding of gas products accounted for 1.2 million tonnes.
The structure and quality characteristics of the petroleum product basket are improving. Starting February of the last year, in addition to the production of AI-92, AI-95, AI-98 gasoline grades, the Company has been producing and selling the ecological class Euro-5 premium AI-100 gasoline and diesel fuel corresponding to class EURO-6. High-quality products of the TANECO fuel line have become the hallmark of the TATNEFT filling stations chain.
The Company improves the value chain on an ongoing basis, increases the margin of the business through effective arrangement of business processes, and strict control of the level of the costs and returns on existing assets. The greater focus is fixated to strengthening the technological basis, digital solutions, the transition to innovative forms of management and the organization of business processes.
Being one of the largest taxpayers at the Republic, TATNEFT provides revenues to the federal and regional budgets, contributing to the stable socio-economic development of the Company's activity territories. At the same time, the Company annually allocates more than RUB 20 billion for the development of healthcare, science, education, the cultural environment, preservation of the spiritual heritage, and support for sports within the framework of targeted corporate programs.
The corporate objectives of the Company in the field of sustainable development are coordinated with the UN Global Compact Agenda, which TATNEFT became a party to in 2019. When making business decisions, the objectives of the socio-economic growth, expanding innovative opportunities and improving the quality of life in the territories of the Company's activity are taken into account. The targeting of the Company's initiatives and the transparency of decisions taken are enhanced through the open dialogue with stakeholders, including local communities.
The TATNEFT Group provides for about 60 thousand job positions at 105 enterprises in the Russian Federation and outside. Currently, to improve the effectiveness of the personnel policy, there is the HR strategy of the TATNEFT Group being formed, which, inter alia, includes among the main tasks increasing staff competencies, improving the motivation system, and creating a personnel reserve.
An important aspect of the Company's activity is its commitment to fundamental principles in the area of Human Rights, including the right to a safe environment. TATNEFT's policy in the area of industrial safety, labor protection and the environment is based on a risk-based approach, taking into account international best practices. The Company allocated RUB 12.3 billion in 2019 for projects ensuring environmental safety and environmental protection And the investments in this area are increasing on a continuous basis.
High environmental characteristics of the TATNEFT Group enterprises' products, energy efficiency indicators of production processes and a model of rational consumption of resources contribute to the continuous reduction of specific greenhouse gas emissions into the atmosphere.
Compensation measures are also important in the fight against climate change. Starting in 2000, TATNEFT has been implementing a greening program, under which there were about 11 million seedlings of trees and shrubs planted in order to create a favorable environment. The plans for 2020 provide for planting more than 3.8 million seedlings.
2020 was a turbulent challenge for everyone due to the spread of the Covid-19 pandemic. This problem has become an extreme test for sustainability and, most importantly, for readiness for sustainable development of the society in general and business in particular. TATNEFT is doing everything possible to prevent the spread of the pandemic in the territory of the Company's activities, to protect its employees, customers, and the local population; provides support to health care institutions, as well as assistance to socially vulnerable residents of the region.
TATNEFT assesses all current the macroeconomic and industry risks, adjusts its actions to move forward and will continue implementing strategic plans for further growth of the Company's shareholder value and sustainable development of the Company.
Results of the Shareholders Meeting
The shareholders' meeting approved the Company's annual report for 2019, annual financial statements, as well as the profit distribution for the financial year
The shareholders also made a decision on the dividends' payment. In accordance with the decisions of the general meetings of shareholders for the 6 and 9 months of 2019, the Company has already paid dividends in the amount of 6447% of their nominal value to the owners of preference and ordinary shares (64 rubles 47 kopecks per share).
There will be no additional dividends paid for 2019 to the holders of ordinary shares. Holders of preference shares at the end of 2019 will receive dividends in the amount of 100% of the par value (1 RUB per preference share), excluding previously paid dividends for the 6 and 9 months of 2019.
The date for determining the persons entitled to receive dividends according to the results of 2019 is set on June 30, 2020. The dividend payment period is determined in accordance with applicable law.
The Board of Directors has been formed. The following persons were elected to the Company's Board of Directors: Nail Ulfatovich Maganov, Director of PJSC TATNEFT; Laszlo Gerecs, Independent Director, Managing Director of G Petroconsulting Ltd; Yuri L'vovich Levin, Independent Director, Managing Partner of BVM Capital Partners Ltd; Rene Steiner, Independent Director, Head of Private Investment Programs of FIDES Business Partner AG; Fanil Anvarovich Agliullin, Minister of Land and Property Relations of the Republic of Tatarstan; Radik Raufovich Gaizatullin, Minister of Finance of the Republic of Tatarstan; Larisa Yuryevna Glukhova, Head of the State Legal Department of the President of the Republic of Tatarstan; Rafail Saitovich Nurmukhametov, used to hold the position of the Head of NGDU 'Leninogorskneft', Veteran of Labor; Rinat Kasimovich Sabirov, Assistant to President of the Republic of Tatarstan; Valery Yurievich Sorokin, General Director of PJSC 'Svyazinvestneftekhim'; Nurislam Zinatulovich Syubaev, Deputy Director General for Strategic Development of PJSC TATNEFT; Shafagat Fakhrazovich Takhautdinov, Assistant to President of the Republic of Tatarstan on the Oil Industry Issues and Advisor to Chairman of the Board of Directors of PJSC TATNEFT; Rustam Khamisovich Khalimov, First Deputy Director General of PJSC TATNEFT on Crude Oil Exploration and Production; Rais Salikhovich Khisamov, Deputy Director General - Chief Geologist of PJSC TATNEFT.
Rustam Nurgaliyevich Minnikhanov, President of the Republic of Tatarstan, was appointed as the State representative to the PJSC TATNEFT's Board of Directors.
The Audit Commission has been formed in the following composition: Kseniya Gennadyevna Borzunova, the Economics Department Head of the Ministry of Land and Property Relations of the Republic of Tatarstan; Azat Damirovich Galeyev, Head of Investment Projects Expertise Office, Investment Management Department of PJSC TATNEFT; Guzal Rafisovna Gilfanova, Deputy Head of the Auditing Office of PJSC TATNEFT; Salavat Galiaskarovich Zalyayev, Senior Legal Adviser of the PJSC TATNEFT's Corporate Legal Department; Venera Gibadullovna Kuzmina, used to work as an economist at the NIS of JSC TATNEFT, Veteran of Labor; Liliya Rafayelovna Rakhimzyanova, Head of Crude Oil Production and Oil Refining Office of the Ministry of Trade and Industry of the Republic of Tatarstan; Nazilya Rafisovna Farkhutdinova, Deputy Director or Finance and Economics; of OOO 'TagraS-RemServis'; Ravil Anasovich Sharifullin, Head of the Control and Audit Office of PJSC TATNEFT.
Sariya Kashibulhakovna Yusupova, Office Deputy Head of the Ministry of Finance of the Republic of Tatarstan, was appointed to the Audit Commission as Representative of the State.
CJSC 'PricewaterhouseCoopers/Audit' was approved as Auditor of PJSC TATNEFT for one year's period to perform a mandatory audit of the PJSC TATNEFT's annual financial statements prepared in accordance with the Russian Accounting Rules.
Forward-looking statements: The present materials contain certain statements about future events and expectations that are forward-looking in nature. Any statement in these materials that is not a statement of a historical fact is a forward-looking statement that involves known and unknown risks, uncertainties and other factors, which may cause actual results, performance or achievements expressed or implied by such forward-looking statements to differ. PJSC TATNEFT shall not assume any obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements.
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