MOSCOW (Reuters) - Russian gas group Gazprom on Wednesday reported a fall in 2019 net profit to 1.2 trillion roubles ($16.3 billion) from 1.46 trillion roubles in 2018 as revenues declined.
The company’s results in were hit by declining demand for Gazprom’s gas in 2019 in Europe, its main market. The company has faced a sharp fall in natural gas demand this year due to the economic fallout from the global spread of the novel coronavirus.
Russia’s customs agency said that Gazprom’s revenues from gas exports in January - February fell 51% year-on-year to $5 billion.
Gazprom expects European gas demand to start recovering from the third quarter, Renaissance Capital wrote earlier this month after a call with the Russian gas group.
The company’s management is due to update investors later on Wednesday in a conference call.
Gazprom also said its 2019 sales declined to 7.7 trillion roubles last year from 8.2 trillion roubles in 2018.
It said investments for the Gazprom group, which includes oil division Gazprom Neft and power assets, were set at 1.6 trillion roubles for 2020 against more than 2 trillion roubles for 2019.
In December, the company started pipeline gas deliveries to China, a milestone for Russia’s plans to diversify commodities supplies away from Europe.
Gazprom said it had supplied China with 300 million cubic metres of gas in 2019 following the launch of Power of Siberia pipeline. Gazprom plans to increase exports to China to 5 billion cubic metres (bcm) this year and reach a planned supply of 38 bcm by 2025.
Reporting by Vladimir Soldatkin; Editing by Toby Chopra and Jane Merriman