Gazprom Neft on Wednesday posted a smaller fourth-quarter profit than analysts had expected, largely because of reasons unrelated to production. The oil arm of gas giant Gazprom earned a net income of $861 million, it said in a statement, shy of analyst estimates of $955 million in an earlier Bloomberg poll. Its shares slid 3.2 percent by the end of the day in Moscow, compared with the MICEX's broader oil and gas index, which declined by only 0.6 percent.
Gazprom Neft said in the statement, however, that its shares gained more value over 2009 than the average for integrated oil companies, rising by 161 percent to 163.64 rubles, compared with average growth of 118 percent. Chief financial officer Vadim Yakovlev said in an interview to Reuters that the company would recommend offering 20 percent of its 2009 adjusted profit of $2.77 billion for dividends.
The company's declining organic output should have dampened interest in the stock, said Alexei Kokin, an analyst at investment company Metropol. At one point toward the end of the year, though, investors thought Gazprom would issue a secondary public offering for the subsidiary's stock, which might have driven the price up, he said. “It caused certain enthusiasm,” Kokin said, adding that the purchase of London-listed oil producer Sibir Energy, which has stakes in such lucrative assets as the Moscow Refinery and another oil company, Salym Petroleum Development, may also have played a role in the stronger-than-average appreciation.
Gazprom Neft said the fourth-quarter profit, if cleared of losses and revenues from asset sales, came to $638 million, compared with a net loss of $543 million a year earlier, when oil prices reached critically low levels. The company's full-year profit, if adjusted for one-offs, decreased 41 percent to $2.8 billion, it said. As nonoperating losses in the fourth quarter, Gazprom Neft recorded the sale of assets in the remote Chukotka Peninsula and the difference between the book value and fair market value of Salym Petroleum Development.
Gazprom Neft gained the shares when it took over Sibir Energy, which holds 50 percent of Salym. Even so, Gazprom Neft said it gained paper profit in another aspect of the Sibir deal. The oil producer said the market value of the Moscow Refinery was higher than the refinery's book value. Gazprom Neft plans to invest $3.9 billion this year, mostly in exploration and production, which would be an increase of about 50 percent from last year, the company said in a presentation on its web site.