Russian daily RBC reports that Russian Railways decided to pay out 95% of its profits as dividends. The figure is not impressive, – a mere 302 million rubles, or USD 4.7 million, – but the company never paid more than 25% of its profits to the shareholders in the past. Correction: to the shareholder, as the Russian Government is the sole owner of the company. It is also in dire need of funds to patch the rising budget deficit, which explains the generous attitude of its daughter company.
2007 was a record year for the Russian Railways, as the company generated a net income of USD 3.44 billion. The Government was in no need of funds at that time and the company paid out only 1% of its profits as dividends. The tide has turned since, and the company was forced to pay dividends even when it suffered a net loss in 2014. However, it is unclear who is the ultimate beneficiary in this relationship, as Russian federal and local authorities subsidized the company with USD 864 million in 2015.