Romanian gas pipeline operator Transgaz expects 2009 net profit to rise 10-12 per cent, helped by cost cuts, currency weakness and an expected rise in demand later in the year.
Transgaz’s 2008 net profit rose 6.5 per cent to 239 million lei ($80 million). Its 2009 target had not been announced before.
Chief executive Ioan Rusu also told Reuters in an interview that gas transit in the first half was down almost 25 per cent to about 6 billion cubic metres, 15 per cent lower than in the company’s 2009 budget.
But a 5 per cent cut in gas tariffs from July 1 will increase industrial demand for natural gas and boost revenues, he said.
“We have a profit target which is 10-12 per cent bigger than last year’s and I expect to reach it ... currency depreciation is definitely a factor, and we are also under a cost reduction programme.”
Earnings started to feel the pinch of the global crisis in the fourth quarter, as many manufacturers mothballed production because of lower demand. But this has been offset by the leu weakening against the dollar.
Rusu said Transgaz losses from grid maintenance and upgrades were cut back this year.