MGYOY Mol Magyar Olay Es Gazipari Rt (PK)

(Adds details about company forecasts.)

By Margit Feher

BUDAPEST--Shareholders of oil and gas company MOL Nyrt. (MOL.BU), Hungary's largest company by revenue, approved at an annual meeting Thursday the board's proposal for the payment of a total of 55 billion forints ($201.2 million) in dividends on 2015 earnings.

That's up from last year, when MOL paid a total of HUF50 billion in dividends after its 2014 results.

MOL shareholders also approved the cancellation of shares amounting to 2% of the company's registered equity to improve the firm's capital structure and also to lower the registered equity by 2,090,381 shares to increase the shareholders' return. Shareholders will receive no compensation upon the share cancellation.

MOL Chairman and Chief Executive Zsolt Hernadi told the press after the shareholders' meeting that the company is confident it will meet its $500 million cost reduction target in its downstream operations by 2017.

Following major write-offs related to upstream assets that totaled $1.2 billion last year, MOL plans no further write-offs this year, Chief Financial Officer Jozsef Simola said.

The strong results the company forecasts for this year could provide the opportunity for the board to propose an increase in dividend payment next year on 2016, Mr. Simola added.

MOL targets earnings before interest, taxes, depreciation and amortization of about $2 billion for this year and sufficient cash flow to be able to continue to cover both internal investment needs and dividends to shareholders.

Write to Margit Feher at margit.feher@wsj.com; Twitter: @margitfeher

(END) Dow Jones Newswires

April 14, 2016 07:41 ET (11:41 GMT)

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