Today PJSC Gazprom issued its audited consolidated financial statements prepared in accordance with International Financial Reporting Standards for the year ended December 31, 2019.

The table below presents the consolidated statement of comprehensive income prepared in accordance with IFRS for the years ended December 31, 2019 and December 31, 2018. All amounts are presented in millions of the Russian Rubles.

  Year ended December 31,
 

2019

2018

Sales

7,659,623

8,224,177

Net (loss) gain from trading activity

(24,957)

18,015

Operating expenses

(6,387,071)

(6,181,191)

Impairment loss on financial assets

(127,738)

(130,971)

Operating profit

1,119,857

1,930,030

Finance income

654,916

503,091

Finance expense

(354,835)

(813,042)

Share of profit of associates and joint ventures

207,127

232,483

Profit before profit tax

1,627,065

1,852,562

Current profit tax expense

(327,618)

(278,233)

Deferred profit tax expense

(29,930)

(45,333)

Profit tax

(357,548)

(323,566)

Profit for the year

1,269,517

1,528,996

Other comprehensive income (loss):

Items that will not be reclassified to profit or loss:

Gain arising from changes in fair value of financial assets measured at fair value through other comprehensive income, net of tax

22,631

148,963

Remeasurement of provision for post-employment benefits

 (186,066)

 19,854

Total other comprehensive (loss) income that will not be reclassified to profit or loss

(163,435)

168,817

Items that may be reclassified subsequently to profit or loss:

Share of other comprehensive (loss) income of associates and joint ventures

(4,276)

13,923

Translation differences

(182,165)

222,221

Gain from hedging operations, net of tax

13,321

10,082

Total other comprehensive (loss) income that may be reclassified subsequently to profit or loss

(173,120)

246,226

Total other comprehensive (loss) income for the year, net of tax

(336,555)

415,043

Comprehensive income for the year

932,962

1,944,039

Profit for the year attributable to:

Owners of PJSC Gazprom

1,202,887

1,456,270

Non-controlling interest

66,630

72,726

1,269,517

1,528,996

Comprehensive income for the year attributable to:

Owners of PJSC Gazprom

877,328

1,858,486

Non-controlling interest

55,634

85,553

932,962

1,944,039

Sales (net of excise tax, VAT and customs duties) decreased by RUB 564,554 million, or 7%, to RUB 7,659,623 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. The decrease in sales was mainly due to a decrease in sales of gas to Europe and other countries.

More detailed information concerning the main items of the sales structure for the years ended December 31, 2019 and December 31, 2018 is presented below.

in RUB million (unless indicated otherwise)

Year ended December 31,

 

2019

2018

Sales of gas

   

Europe and other countries

   

Net sales (net of excise tax and customs duties)

2,490,372

2,951,215

Volumes in bcm

232.4

243.3

Average price, RUB per mcm (including excise tax and customs duties)

13,613.0

15,499.5

Former Soviet Union countries

Net sales (net of customs duties)

356,102

348,625

Volumes in bcm

38.7

38.1

Average price, RUB per mcm (including customs duties)

10,175.9

10,225.9

Russian Federation

Net sales (net of VAT)

970,913

954,493

Volumes in bcm

235.8

239.7

Average price, RUB per mcm (net of VAT)

4,118.2

3,981.3

Total gas sales

Retroactive gas price adjustments

(16,657)

49,338

Net sales (net of excise tax, VAT and customs duties)

3,800,730

4,303,671

Volumes in bcm

506.9

521.1

Net sales of refined products (net of excise tax, VAT and customs duties)

2,111,181

2,179,772

Net sales of crude oil and gas condensate (net of VAT and customs duties)

752,790

734,953

Electric and heat energy net sales (net of VAT)

518,373

522,095

Gas transportation net sales (net of VAT)

215,335

225,673

Other sales (net of VAT)

261,214

258,013

Total sales (net of excise tax, VAT and customs duties)

7,659,623

8,224,177

Net sales of gas decreased by RUB 502,941 million, or 12%, to RUB 3,800,730 million for the year ended December 31, 2019 compared to the year ended December 31, 2018, that was mainly due to a decrease in average prices and volumes of gas sold in the segment Europe and other countries.

Net sales of gas to Europe and other countries decreased by RUB 460,843 million, or 16%, to
RUB 2,490,372 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. The change was mainly due to the decrease in average prices (including excise tax and customs duties) denominated in the Russian Ruble by 12% and the decrease in volumes of gas sold by 4 %, or 10.9 bcm. At the same time average prices denominated in US Dollar decreased by 15%.

Net sales of gas to Former Soviet Union countries increased by RUB 7,477 million, or 2%, to RUB 356,102 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. The change was mainly due to the increase in volumes of gas sold by 2%, or 0.6 bcm.

Net sales of gas in the Russian Federation increased by RUB 16,420 million, or 2%, to RUB 970,913 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. This change was explained by the increase in average prices by 3% that was partially compensated by the 2 % decrease in volumes of gas sold, or 3.9 bcm.

Operating expenses increased by RUB 205,880 million, or 3%, to RUB 6,387,071 million for the year ended December 31, 2019 compared to the year ended December 31, 2018.

The change in operating expenses is primarily caused by an increase in the item “Staff costs” by RUB 148,896 million, or 25%, for the year ended December 31, 2019 compared to the year ended December 31, 2018. The increase was mainly due to the recognition of income from change in provision for post-employment benefits for the year ended December 31, 2018 caused by the increase in a retirement age according to the legislation of the Russian Federation.

The item “Foreign exchange differences on operating items” increased by RUB 106,316 million for the year ended December 31, 2019 compared to the year ended December 31 ,2018 due to the revaluation of accounts receivable from foreign customers and loans issued, which was mainly caused by the depreciation of the US Dollar and the Euro against the Russian Ruble by 11 % and 13 %, respectively, for the year ended December 31, 2019 compared to the appreciation of the US Dollar and the Euro against the Russian Ruble by 21 % and 15 %, respectively, for the year ended December 31, 2018.

The item “Depreciation” increased by RUB 67,236 million for the year ended December 31, 2019 compared to the year ended December 31,2018, that was mainly due to charging of depreciation of
right-of-use assets caused by the application of IFRS 16 Leases since January 1, 2019.

The balance of foreign exchange differences reflected within the item “Net finance income (expense)” produced the gain in the amount of RUB 285,581 million for the year ended December 31, 2019 compared to the loss of RUB 332,225 million for the year ended December 31, 2018. There were the depreciation of US Dollar and Euro against the Russian Ruble by 11 % and 13 %, respectively, for the reporting year compared to the appreciation of US Dollar and Euro against the Russian Ruble by 21 % and 15 %, respectively, for the prior year.

Profit attributable to the owners of PJSC Gazprom for the year ended December 31, 2019 amounted to RUB 1,202,887 million which is by RUB 253,383 million, or 17 %, less than for the year ended
December 31, 2018.

Net debt balance (defined as the sum of short-term borrowings, current portion of long-term borrowings, short-term promissory notes payable, long-term borrowings, long-term promissory notes payable, net of cash and cash equivalents) increased by RUB 153,444 million, or 5%, from RUB 3,014,403 million as of December 31, 2018 to RUB 3,167,847 million as of December 31, 2019. This change was mainly due to a decrease in cash and cash equivalents balances.

More detailed information on the IFRS consolidated financial statements for the year ended December 31, 2019 can be found here.

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