Gazprom Registers 41% Profit Decrease in Q1

Gazprom registered a 35.1% decrease in profit before profit tax in the first quarter of the year on higher finance expenses, which jumped from 51,292 millions of RUB in Q1 2013 to 203,087 millions of RUB in Q1 2014.

Net sales (net of customs duties) grew 13% to 484,379 millions of RUB with respect to the same period in 2013. Indeed, the company did register a slight increase in volumes and a more consistent jump of average price (including customs duties) from 11,862.8 RUB/mcm in Q1 2013 to 13,087.3 in Q1 2014. 

Nonetheless, the profits slid on increased expenses. In particular, 2014 profit for the period totalled RUB 223,007 million which is RUB 157,658 million (41%) lower compared to the three months ended March 31, 2013.

‘Operating expenses increased by RUB 139,697 million, or 15%, to RUB 1,089,749 million in the three months ended March 31, 2014 compared to the three months ended March 31, 2013.The major factor leading to an increase in operating expenses was accrual of provision for doubtful trade accounts receivable in the amount of RUB 71,298 million in the three months ended March 31, 2014, which was mainly related to doubtful trade accounts receivable of NAK Naftogaz Ukraine,’ reads a note released by the company on Thursday.