PhosAgro ready to pay windfall tax in 2023, puts it at under 7 bln rubles

MOSCOW. June 8 (Interfax) - PhosAgro plans to pay the new windfall tax at the end of this year and estimates the tax will be less than 7 billion rubles, the Russian fertilizer producer's deputy CEO for finance and international projects, Alexander Sharabaiko said on Finam Investments on Wednesday.

"Our estimate [for the amount of the windfall tax], as I've already said, is less than 7 billion rubles. We're paying in the fourth quarter of this year. [That's] if all revisions and all announced calculation formulas are certain," Sharabaiko said.

He said the new one-off tax will reduce the company's free cash flow, which is the base for calculating dividends, but PhosAgro does not plan to make any changes to its dividend policy.

"On the contrary, we plan to adhere to it. We do not plan to renounce dividends, we plan to continue the practice of quarterly payouts," Sharabaiko said.

PhosAgro shareholders voted at their annual meeting in late March to approve dividends for 2022 in the amount of 465 rubles per share. The company paid out a total of 60.2 billion rubles in final dividends.

The tax base for the windfall tax will be past windfall profits, determined as the amount by which the arithmetic average profit for 2021 and 2022 exceeded profit for 2018 and 2019. Profit will be calculated as the sum of tax bases for corporate profit tax taking into account carry forward of past losses and not including a number of tax bases, such as income from dividends, securities transactions and sale of equity stakes or shares, and the financial results of the Central Bank within the context of the law "On the Bank of Russia."

For companies involved in investment protection and promotion agreements, the tax base from activities related to the implementation of the investment project covered by this agreement will not be included in the calculation of profit.

If the law on the tax is passed, it will go into effect on January 1, 2024, but not less than a month after its official publication.

Tinkoff Investment analysts said in April that companies most sensitive to the windfall tax (anticipated tax as a share of 2022 profit) include PhosAgro, Rusagro , steelmakers, banks, developer PIK and power company RusHydro .