The net profit of Romanian natural gas producer Romgaz [BSE:SNG] dropped to a
preliminary 930.7 million lei ($281.9 million/206 million euro) in 2013 from 1.1
billion lei a year earlier, the company said on Thursday.
Romgaz posted a
gross profit of 1.3 billion lei last year, versus 1.4 billion lei a year before,
the company said in a statement.
"Overall, though we are disappointed by
the net result, we keep our positive view on Romgaz and maintain our Buy
recommendation and 39 lei TP [target price]," Raiffeisen Capital &
Investment (RCI) said in a note to investors.
Romgaz's turnover rose by
only 1.5% on the year to 3.9 billion lei as lower demand offset a 15% increase
in the prices of gas from domestic production, the company said.
Last
year, Romgaz produced 5.65 billion cubic metres of gas. At the end of September
it had a market share of 50.5% on the domestically-produced gas market,
according to the country's energy regulator.
"On the production side, we
see the stable production result as positive. Plus, the company announced a
reserve replacement ratio of 70%, coming from exploration and appraisal wells
and reservoir studies, which we find appealing," RCI said.
Romania raised
1.7 billion lei via the initial public offering of a 15% stake in Romgaz in
October last year. Following the sale, the country reduced its holding in the
company to 70%.
Blue chip Romgaz was trading 0.58% up at 33 lei by 1231
CET on the Bucharest bourse on Thursday.