In the nine months of 2021, the net turnover of Latvijas Gāze Group has increased by 113 %

30.11.2021. | finance

The net turnover of the Group reached EUR 281.2 million in the nine months of 2021, which is 113 % more than in the corresponding period in 2020.

On 25 November 2021, a webinar of Latvijas Gāze took place, where Inga Āboliņa, Member of the Board and Chief Financial Officer, presented and explained the financial results of the first nine months of 2021.

At the end of the nine-month period of 2021, the net turnover of the Latvijas Gāze trade segment reached EUR 240.5 million, which is 144% more than in the corresponding period in 2020. The substantial increase in net turnover is mainly due to the higher sales prices influenced by the developments in the global natural gas market, as well as higher sales volumes. On 30 September 2021, the losses of the Group reached EUR 167.47 million, which is a significant decrease in profits compared to the corresponding period in 2020. The large losses are due to the overvaluation of negative derivatives in the profit and loss account, which is because the price of natural gas in the winter almost tripled from its already high level in the previous period.

“At present, all energy companies are suffering from the difficult market conditions and this time, in the case of natural gas trade, is a particularly challenging time given the high rise in prices. In October, the price of natural gas reached a peak and was almost six times higher than at the beginning of 2021. Now, the price has fallen, but it remains high. It has undeniably affected the financial results of the company,” explained I. Āboliņa.

During this period, Latvijas Gāze has sold 10,662 GWh of natural gas to customers in Latvia and abroad. Compared to the same period in 2020, sales have increased by 26%. Natural gas sold abroad accounted for 30 % of the total sales.

In the first nine months of 2021, the financial performance of the Group was primarily affected by the recognition of derivative financial instruments at their fair value, which is negative due to the rising natural gas prices on the market but will be compensated from trade transactions in the following periods. In October, part of the compensatory effect has been confirmed and, together with the observed fall in the price of natural gas, which has a positive impact on the market revaluation value of derivatives, it demonstrates profit of Latvijas Gāze of EUR 117 million in October, thus, drastically reducing losses from the beginning of the year.

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