On March 31, 2014 KTK (MICEX: KBTK), one of the leading producers and exporters of thermal coal in Russia announces the creation of motivation fund for management and plans for an SPO.
The Human Resources and Remuneration Committee on behalf of the Board of Directors conducted an analysis of option programs used in Russia and abroad. As a result of this work has been developed option program for long-term motivation of Company’s management. In Q1 2014, key executives received shares of the Company bought through the stock exchange, and signed a special agreement, including a moratorium on the sale of securities within three years.
Option program corresponds to the accepted international standards, aimed at long-term motivation of management on the achievement of key performance indicators including profits and market capitalization set by Board of Directors of the Company. It provides committee with the opportunity to track the development of each manager.
- commented Independent Director, Member of the Board of Directors of KTK Yuriy Fridman.
Igor Prokudin, controlling shareholder and CEO of KTK decided to conduct an SPO in the next three years. More than 15.6% of Company’s shares owned by management will be offered to investors, half of the share capital will be in a free-float. Opportunity to sell shares in this transaction will be provided to existing minority shareholders. Stock exchange for secondary placement will be determined based on the conditions of capital markets.
4 years passed since the IPO, and we can summarize and make an analysis of the Company’s efficiency. I am proud to note that all the commitments made during the IPO, the Company fulfilled. Dynamics of development of the Company shows a significant improvement in the key performance indicators. We increased production, have significantly improved the quality of coal by launching 2 washing plants, gradually increasing coal reserves by developing new open-pit mines, modernized mining equipment. Because of falling prices for thermal coal in the global markets since the second half of 2012 Company’s net income and market capitalization decreased. Now we have a situation when Company is significantly undervalued by the market. One of the measures to improve the Company's capitalization and liquidity of shares is to conduct a secondary public offering. Dynamics of the Company’s development contributes to this. Therefore, immediately upon the occurrence of a favorable market situation, we will start the preparation and implementation of measures for secondary placement. I think that for many of our existing minority shareholders it will be a good occasion to fix the profit and invite all stakeholders to participate in this important for the KTK event.
— said Igor Prokudin.
Contacts for analysts and investors in Moscow:
Vasily Rumyantsev
Head of Moscow office, IRO
+7 (495) 787-68-05
vkr@oaoktk.ru
Contacts for media in Kemerovo:
Elena Sarycheva
Head of public affairs department
+7 (3842) 36-47-62
es@oaoktk.ru
Company at a glance:
KTK is one of the leading producers1 and exporters of thermal coal in Russia. Production assets of the Company include three current and two projected opent-pit mines in Kemerovo region, two washing plants and own rail infrostructure located in the Company’s industrial cluster. The Company operates a retail network in 4 regions of Siberia, supplying over 400,000 households and over 1,000 of public and commercial boilers. The Company employs over 4,400 people. Shares of KTK are traded on MICEX, the free float is 34.39%.
News and announcements (Russian only): www.facebook.com/oaoktk
Presentations: www.slideshare.net/oaoktk
Video: www.youtube.com/oaoktkru
Financial highlights under IFRS:
| RUB mln
| 2012 | 2011 | 2010 |
| Cost of sales | 18 982 | 19 404 | 11 457 |
| Production cash costs per tonne, RUB | 690 | 653 | 509 |
| EBITDA | 3 479 | 3 911 | 2 134 |
| EBITDA margin | 15% | 16% | 15% |
| EBITDA per tonne, RUB | 399 | 448 | 304 |
| Net profit | 1 810 | 2 018 | 823 |
| Net profit margin | 8% | 8% | 6% |
| Net debt | 4 681 | 2 663 | 1 754 |
| Net debt / EBITDA | 1,35 | 0,68 | 0,82 |
Additional information about the Company and investor calendar: www.oaoktk.ru/en/investors
1 №6 by thermal coal production in Russia. Metal Expert, January 2014
