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Gazprom net profit down due to higher costs

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Russian gas giant Gazprom on Monday said net profits in the second quarter plunged 17 per cent due to higher operating costs which offset a hike in revenues.

[MOSCOW] Russian gas giant Gazprom on Monday said net profits in the second quarter plunged 17 per cent due to higher operating costs which offset a hike in revenues.

The state-run behemoth posted a net profit of 245 billion rubles (S$5.2 billion) between April and June, which exceeded forecasts by analysts interviewed by Russia's Interfax news agency.

Gazprom saw its running costs jump by 16 per cent and was hit by changes in currency exchange rates.

However, the company was helped by a higher-than-expected turnover of 1.327 billion rubles.

Exports to Europe - its biggest market - rose 19 per cent despite efforts by the European Union to obtain gas from other sources.

Gazprom lost markets at home and ceased sales to Ukraine due to tensions between Kiev and Moscow. But sales rose eight per cent over the first quarter to 1.755 billion rubles, the company said.

AFP