The Gazprom logo is displayed on a screen during the St. Petersburg International Gas Forum in St. Petersburg, Russia, September 15, 2022.
Anton Vaganov | Reuters
Kremlin-owned gas giant Gazprom said on Thursday its net loss would plummet to 629 billion rubles ($69 billion) in 2023 as gas trade with Europe, once its main sales market, shrank. billion), this was the first annual loss in more than 20 years.
The results underscore the dramatic decline of Gazprom, which has been one of Russia’s most powerful companies since the collapse of the Soviet Union and has often been used as leverage in disputes with neighbors such as Ukraine and Moldova.
Analysts had expected a net profit of 447 billion rubles, according to the Interfax news agency.
According to a Reuters analysis, this is the first time Gazprom has lost power since the late 1990s/early 2000s, when Alexei Miller, an ally of President Putin, took over the company in 2001. Annual loss occurred for the first time.
Gazprom’s net profit in 2022 will be 1.2 trillion rubles, but it will lose money in 2023.
The company, now headquartered in St. Petersburg, suffered severe losses in the late 1990s as the 1998 financial crisis caused foreign currency debt to balloon (in rubles).
Shares in Gazprom were down about 3.3% in Moscow as of 1307 GMT.
Russia’s gas exports to Europe, once its main export market, have fallen sharply due to the political fallout from the conflict in Ukraine, while Gazprom, which has a monopoly on pipeline gas overseas, has become the most obvious victim of Western sanctions.
Gazprom is also involved in an extensive program to provide natural gas to local households.
The company said on Thursday that it would post a net sales loss of 364 billion rubles in 2023, compared with a profit of 1.9 trillion rubles in 2022.
Its total revenue fell to 8.5 trillion rubles last year from 11.7 trillion rubles in 2022.
Core profit, known as earnings before interest, taxes, depreciation and amortization (EBITDA), fell to 618.38 billion rubles last year from 2.79 trillion rubles in 2022, according to Reuters calculations.
“Full-year EBITDA of $7.2 billion was the worst in 22 years since the company reported $7.6 billion in 2002,” said Ronald Smith of Moscow-based brokerage BCS Global Markets.
Reuters calculates that Gazprom’s natural gas supply to Europe will plummet by 55.6% to 28.3 billion cubic meters (bcm) in 2023.
Gazprom has not published its own export statistics since the beginning of 2023.
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