• Natural Gas News

    Gazprom reports record quarterly profit for Q3


Gazprom expects even stronger results in the fourth quarter.

by: NGW

Posted in:

Natural Gas & LNG News, Europe, Top Stories, Premium, Corporate, Financials, Contracts and tenders, News By Country, Russia

Gazprom reports record quarterly profit for Q3

Net profit at Russia's national gas supplier Gazprom surged to an all-time record of 581.8bn rubles ($7.75bn) in the third quarter on the back of soaring European gas prices, the company said on November 29.

The result compares with a net loss of 251.3bn rubles a year earlier. Net income for the first nine months of the year came to 1.55 trillion rubles, versus a loss of 218.4bn rubles in the corresponding period of 2020.

In a statement posted on its Telegram channel, Gazprom said it expected to post even higher income in the fourth quarter. Europe has entered the winter heating season with unprecedentedly high prices and unusually low levels of storage, following a sharp rebound in gas demand following the pandemic and global supply constraints. 

EBITDA in the third quarter came in at 809bn rubles, an absolute record and 2.4 times more than Gazprom generated in the same period of 2020. Its core earnings have grown for six quarters in a row, and the company said this trend was expected to continue in the fourth quarter.

Free cash flow totalled 83bn rubles in the third quarter and 682bn rubles for the first nine months of the year, representing another record. Gazprom also said it had maintained a "liquidity cushion" of 1.5 trillion rubles, which is more than double its short-term commitments.

Gazprom's net debt to EBITDA ratio was 1.2 at the end of the third quarter, and the company expects this to fall further to around 1.0 by the end of the year.

The company sold its gas in Europe and other countries outside the former Soviet Union for 17,839 rubles ($238)/'000 m3 in January through September, compared with 9,165 rubles a year ago. Besides higher gas hub prices, the growth was also the result of a recovery in oil prices, which affected pricing in Gazprom's oil-indexed contracts with customers.

"It is obvious that in Q4 the price of our supplies to Europe will be significantly higher, which will have a positive effect on the results of the whole year," Gazprom spokesman Famil Sadigov said in a statement.

Revenues also climbed thanks to an increase in sales volumes to 175.7bn m3 from 154.4bn m3 a year earlier.