Low consumption of chemical plants hurts Transgaz profit

National gas transmission company Transgaz Mediaş (TNG), saw its net profit decline by 2.4% between July and September of this year, to 18.8 million RON (4.4 million euros), after it had increased by 56% in the first half of the year.
Transgaz revenues were slightly up in the third quarter, by 2.6%, to 225.2 million RON (52.9 million euros) amid a rise in tariffs, which compensated for the around 6% decline in the consumption transmitted of gas. The decline could deepen in the last quarter, after the Economy Ministry decided not to extend the incentive granted to chemical plants to use gas only from domestic production, which caused these plants to threaten to suspend production.
"Results were in line with our expectations of a significant slowdown in the growth rate in the third quarter against the first six months of the year because of the lower volumes transmitted. National gas consumption was cut year-on-year, by 11% in July and by 10% in August. The decline largely came from chemical plants, which account for around one third of national consumption, and which consumed 36% and 23% less gas in July and August respectively than in the corresponding period of last year," says Roxana Ungureanu, BCR Erste analyst.