Gazprom Made a Loss at the End of the Year for the First Time in 25 Years
Gazprom in 2023 received a net loss under IFRS in the amount of 629 billion rubles. A year earlier, the group’s profit amounted to 1.2 trillion rubles.
At the end of 2023, Gazprom went to a loss, which amounted to 629 billion rubles. against profit of 1.23 trillion rubles. a year earlier, follows from the company’s report on international standards (IFRS), published on May 2.
The last time the company made an annual loss under IFRS was in 1999, according to its materials. Then it amounted to 79.3 billion rubles.
Gazprom’s revenue decreased by 27% compared to 2022 and amounted to 8.542 trillion rubles. At the same time, the revenue of the gas business fell by 43%, to 4.41 trillion rubles, the oil business increased by 4%, to 3.52 trillion rubles, and the electricity business increased by almost 9%, to 606 billion rubles.
At the end of last year, deputy chairman of the company’s board Famil Sadigov said that Gazprom expected “confident financial results” for 2023. It was expected that the group’s total EBITDA would be about 2.2 trillion rubles, and the investment program – almost 2 trillion rubles.
He also noted that “despite the decline in prices and gas export volumes compared to the previous year, in 2023 Gazprom will receive more than 4 trillion rubles. revenues from gas sales and 3.4 trillion rubles. income from other types of activities.” According to the deputy chairman, such results should have been ensured, among other things, by growing gas supplies to China.
Gazprom did not give exact figures for total gas exports in 2023, but separately announced data for China. According to the company, 22.7 billion cubic meters were supplied to the Chinese market via the Power of Siberia. m, which is one and a half times more than the level of 2022 and 700 million cubic meters. m above Gazprom’s contractual obligations.
At the same time, Gazprom’s adjusted EBITDA decreased by half last year, to RUB 1.76 trillion. At the same time, the report shows that the company’s debt burden has increased. Thus, at the end of 2023, the ratio of net debt to adjusted EBITDA was 2.96, and at the end of 2022 – 1.07. According to Gazprom’s dividend policy, if the level of debt burden at the end of the year exceeds 2.5, the board of directors may decide to reduce the size of dividends.
The report also indicates that Gazprom expects the total volume of investment development, according to the group’s investment program in 2024, to be at the level of 2.57 trillion rubles. The same figure for 2023 was initially planned at 3.06 trillion rubles.
According to BCS World of Investments analysts, Gazprom’s results for 2023 “turned out to be significantly worse than expected.” In particular, revenue for the second half of the year amounted to 4.43 trillion rubles. turned out to be 2% worse than the forecast, but the company’s loss for the same period turned out to be 3.99 times higher than the forecast and amounted to 925 billion rubles. (a loss of 232 billion rubles was expected).
“Significant losses in the second half of 2023 in both EBITDA and net income were much worse than our expectations and consensus. At the end of 2023, EBITDA is at its lowest since 2002. We consider the release to be a clearly negative event for the paper – dividend prospects for 2023 are questionable even with a minimum payout ratio of 50%,” Ronald Smith, senior analyst at BCS World of Investments, commented to RBC.
Shares of the gas holding fell by 4.2% after the release of the report.
