“The victory in the arbitration against Gazprom was a major factor behind the group’s profit in 2017 — Naftogaz posted the highest net profit in its 20-year history: UAH 39.4 billion compared to UAH 17.8 billion in 2016. If not for a positive outcome in the transit case, the group would have suffered a net loss of UAH 7.4 billion,” reads the report.
Revenues from sales in 2017 increased by 18%, or UAH 34.714 billion, up to UAH 227.478 billion, while gross profit decreased by 0.9%, or UAH 0.629 billion, up to UAH 70.331 billion.
At the same time, the company noted the low marginality of the gas sales segment to the population, which in 2016-2017 reached only 3%, as intermediaries (regional supply companies) accumulated more than $1 billion in debts over the past two years.
“Gas production and sales to regional gas supply companies for resale to households under the public service obligations is an important element of the group’s operations. Opaque intermediaries between Naftogaz and households remain the major problem of this line of business,” reads the report.
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