Gazprom posted a net loss of 629 billion rubles last year, its first loss in 20 years

Russian gas giant Gazprom plunged to a net loss of 629 billion rubles (161 billion Kč) last year. In 2022, it had still posted a net profit of 1.2 trillion rubles. Reuters reported this today, citing a company statement. The result was negatively affected, among other things, by a more than halving of gas sales to Europe. Analysts polled by Interfax had estimated that the company would post a profit of 447 billion rubles. It is the company’s first loss in more than 20 years.

Russian gas exports to Europe, once its main export market, have slumped sharply because of the political fallout from the conflict in Ukraine. Gazprom has a monopoly on gas exports and has become the most prominent victim of Western sanctions. The company has also embarked on a large-scale program to supply natural gas to local households.

Gazprom said today, according to Reuters, that it suffered a net loss from sales of 364 billion rubles in 2023. In 2022, it posted a profit of 1.9 trillion rubles.

The company’s total revenue fell to 8.5 trillion rubles last year from 11.7 trillion rubles in 2022.

According to Reuters calculations, Gazprom’s natural gas deliveries to Europe plunged by 55.6 percent to 28.3 billion cubic meters in 2023. Gazprom has not published its own export statistics since the beginning of 2023.

„Full-year EBITDA of 7.2 billion dollars (168 billion Kč) was the worst in the past 22 years, since the company reported 7.6 billion dollars in 2002,“ said Ronald Smith, an analyst at Moscow-based brokerage BCS Global Markets.

The results point to Gazprom’s dramatic decline. Since the collapse of the Soviet Union, it had been one of Russia’s most powerful companies, often used as leverage in disputes with neighbors such as Ukraine and Moldova. According to Reuters analysis, last year’s loss was Gazprom’s first annual loss since the turn of the 1990s and the beginning of the new millennium, when Vladimir Putin ally Alexei Miller took over the company in 2001.

The company, now based in St Petersburg, suffered heavy losses in the late 1990s after borrowing in foreign currencies. That debt later ballooned in ruble terms as a result of the 1998 financial crisis.

vjn mka