Novatek, Russia’s largest private gas producer, reported a jump in profit for the third quarter and the nine months of 2019.
The company reported a net profit of 370 billion Russian rubles ($5.79 billion) for the third quarter of 2019, jumping up from 45.9 billion Russian rubles in the corresponding quarter last year.
Regarding the figures for the nine months of the year, Novatek reported a profit of 820.9 billion Russian rubles, which compares to 121 billion Russian rubles in the corresponding period last year.
“Our profit was significantly impacted by the recognition of a net gain on disposal of a 10 percent and a 30 percent participation interest in Arctic LNG 2 project in March and July 2019, respectively, taken together amounting to RR 675.0 billion. In addition, our profit was impacted by the recognition of non-cash foreign exchange effects on foreign currency-denominated loans of the group and its joint ventures in both reporting periods,” the statement reads.
Excluding the effect from the disposal of interests in subsidiaries and joint ventures, as well as foreign exchange differences, the profit totaled RR 48.5 billion in the third quarter of 2019 and RR 178.6 billion in the nine months of 2019. This represented a decrease of 25.9 percent and an increase of 7.1 percent, respectively, as compared to the corresponding periods in 2018.
In the third quarter of 2019, Novatek’s revenue amounted to RR 189.2 billion representing decreases of 13.8 percent as compared to the prior year corresponding period.
The decrease was primarily due to lower hydrocarbons sales prices on international markets in 2019, which were largely offset by an increase in the company’s natural gas sales volumes due to the production launch at the second and third LNG trains at Yamal LNG in July and November 2018, respectively.
In the nine months ended September 30, 2019, revenues increased to RR 641.8 billion or by 7.9 percent as compared to the corresponding period in 2018.
This was largely due to an increase in LNG sales volumes and Novazek’s domestic average natural gas sales price, which was offset by a decrease in hydrocarbons sales prices on international markets in 2019.