OGZD.L Regulatory News (OGZD)

15 Feb 2008 07:00

Oao Gazprom15 February 2008 press release 15 February 2008 Moscow Gazprom reports its consolidated interim financial results under international financial reporting standards (IFRS) for the first nine months of 2007. On 15 February 2008 OAO Gazprom issued its unaudited consolidated interimcondensed financial information prepared in accordance with InternationalAccounting Standard 34 "Interim Financial Reporting" (IAS 34) for the first ninemonths of 2007. Changes in the accounting treatment of NPF Gazfund significantly impacted theconsolidated financial information of OAO Gazprom for the nine months ended 30September 2007. In connection with the latest developments in the legislationregulating investment of pension reserves, the Group took a decision toterminate consolidation of NPF Gazfund as a subsidiary in the consolidatedfinancial statements starting from the first quarter of 2007. As a result of thechange in the accounting treatment, investment assets of the fund are recordedby the Group as pension plan assets in accordance with IAS 19 'EmployeeBenefits'. Primarily the change has impacted the following items: short-termfinancial assets, other non-current assets, provisions for liabilities andcharges, minority interest and treasury shares. Subsidiaries of OAO Gazpromwhere NPF Gazfund holds an interest (such as OAO Gazprombank, OAO Sibur Holdingand their subsidiaries) continue to be consolidated by the Group. The aggregate effect of NPF Gazfund deconsolidation results in recognition ofincome of RR 44,692 million in the line "Deconsolidation of NPF Gazfund" in theconsolidated interim condensed statement of income and the increase in equity ofRR 111,015 million in the line "Deconsolidation of NPF Gazfund". The table below presents the unaudited consolidated interim condensed statementof income for the nine months ended 30 September 2007 and 2006. All amounts arepresented in millions of Russian Roubles, unless otherwise stated. Nine months ended 30 September 2007 2006 Sales (net of excise tax, VAT and customs duties) 1,660,069 1 581 328Operating expenses (1,163,243) (1 012 913)Operating profit 496,826 568,415 Deconsolidation of NPF Gazfund 44,692 -Finance income 115,001 82,320Finance expenses (87,021) (51,576)Share of net income of associated undertakings and jointly controlled entities 22,489 19,869 Gain on disposal of available-for-sale financial assets 19,586 3,531Profit before profit tax 611,573 622,559 Current profit tax expense (150,366) (156,684)Deferred profit tax expense (6,717) (5,610)Profit tax (157,083) (162,294)Profit for the period 454,490 460,265 Profit for the period attributable to:Equity holders of OAO Gazprom 426,268 442,296Minority interest 28,222 17,969 454,490 460,265 Sales (net of excise tax, VAT and customs duties) increased by RR 78,741 millionor 5%, to RR 1,660,069 million in the nine months ended 30 September 2007compared to the nine months ended 30 September 2006. More detailed informationon our sales for the nine months ended 30 September 2007 and 2006 is presentedin the table below. in millions of RR (unless otherwise stated) Nine months ended 30 SeptemberSales of gas 2007 2006 Far Abroad Net sales (net of excise tax and customs duties) 596,347 604,231Volumes in bcm 117.1 118.8Average price, RR/mcm (including excise tax and customs duties) 6,683.6 6,995.4 FSU Net sales (net of excise tax, VAT and customs duties) 190,374 157,283Volumes in bcm 72.0 75.5Average price, RR/mcm (including excise tax, customs duties and net of VAT) 2,842.3 2,441.7 Russia Net sales (net of excise tax and VAT) 275,677 246,822Volumes in bcm 211.5 219.6Average price, RR/mcm (including excise tax and net of VAT) 1,303.5 1,128.0Total sales of gas Net sales (net of excise tax, VAT and customs duties) 1,062,398 1,008,336Volumes in bcm 400.6 413.9 Net sales of refined products (net of excise tax, VAT and customs duties) 351,954 333,216Net sales of crude oil and gas condensate (net of excise tax, VAT and customs duties) 117,956 141,049 Gas transportation sales (net of VAT) 30,560 25,141Other revenues (net of VAT) 97,201 73,586Total sales (net of excise tax, VAT and customs duties) 1,660,069 1,581,328 Net sales of gas increased by RR 54,062 million, or 5%, to RR 1,062,398 millionin the nine months ended 30 September 2007 compared to the nine months, ended 30September 2006. This increase was primarily due to higher FSU and domesticprices for gas. Net sales of natural gas to the Far Abroad decreased by RR 7,884 million, or 1%,to RR 596,347 million in the nine months ended 30 September 2007 compared to thenine months ended 30 September 2006. This is explained primarily by the factthat the volume of gas sales decreased by 1% or 1.7 bcm. Net sales of natural gas to FSU countries increased by RR 33,091 million, or21%, to RR 190,374 million in the nine months ended 30 September 2007 comparedto the nine months ended 30 September 2006. It is explained by 27% increase inaverage realized prices (net of excise tax, VAT and customs duties) which waspartially offset by the fact that the volume of gas sales decreased by 5% or 3.5bcm. Net sales of natural gas in the domestic market increased by RR 28,855 million,or 12%, to RR 275,677 million in the nine months ended 30 September 2007compared to the nine months ended 30 September 2006. It is explained primarilyby 15% rise of domestic price for gas established by the Federal TariffsService, which was partially offset by a 4% or 8.1 bcm reduction in the volumeof sold gas. In the nine months ended 30 September 2007 net sales of crude oil and gascondensate decreased by RR 23,093 million, or 16% compared to the nine monthsended 30 September 2006. The decrease in the sales of crude oil and gascondensate is due to Gazprom Neft's activities: in the nine months ended 30September 2007 net sales of crude oil decreased by RR 22,994 million, or 18%, toRR 103,159 million compared to the same period of 2006. The decrease was causedby the fact, that more oil was used to produce refined products. Operating expenses increased by RR 150,330 million, or 15%, to RR 1,163,243million in the nine months ended 30 September 2007 compared to the nine monthsended 30 September 2006. The main component which accounted for the major part (or 55%) of the increasein operating expenses was purchased oil and gas. This increase is primarilyrelated to the increase of prices for gas purchased in Middle Asia, mainly forfurther reselling. Other items of operating expenses (except for purchased oiland gas) increased by 8% in the nine months ended 30 September 2007 compared tothe nine months ended 30 September 2006. Profit attributable to equity holders of OAO Gazprom decreased by RR 16,028million or 4% to RR 426,268 million in the nine months ended 30 September 2007compared to the nine months ended 30 September 2006. In the first six months of 2007 the Group acquired 50% plus 1 share of SakhalinEnergy Investment Company Ltd. for RR 192,330 million (USD 7,450 million) andincreased shareholding in OAO Mosenergo to controlling interest. Thesetransactions had no material effect on the consolidated statement of income forthe nine months ended 30 September 2007. Our net debt balance (defined as the sum of short-term borrowings, currentportion of long-term borrowings, short-term promissory notes payable, long-termborrowings, long-term promissory notes payable and restructured tax liabilities,net of cash and cash equivalents and balances of cash and cash equivalentsrestricted as to withdrawal under the terms of certain borrowings and othercontractual obligations) decreased by RR 224,379 million, or 28%, from RR807,814 million as of 31 December 2006 to RR 583,435 million as of 30 September2007. This decrease can be explained by a significant increase of our cash andcash equivalents in bank accounts primarily due to temporary placement of fundsin OAO Gazprombank from third parties. More detailed information on the IFRS consolidated interim condensed financialinformation for the nine months ended 30 September 2007 can be found on OAOGazprom web site (www.gazprom.ru). INFORMATION DIVISION www.gazprom.com _____________________________________________________________________________________ Contacts for Press Investor Relations +7 (495) 719-10-77 +7 (495) 719-10-97 +7 (495) 719-49-37 +7 (495) 719-10-36 +7 (495) 719-47-36 +7 (495) 719-10-27 +7 (495) 719-28-01 pr@gazprom.ru ir@gazprom.ru This information is provided by RNS The company news service from the London Stock Exchange