Petrom’s profit up 34% despite consumption decline

Petrom, the only petroleum and gas producer in Romania, controlled by Austrian petroleum group OMV managed to end 2009 with a 1.36 billion RON (326 million-euros) profit, 34% higher compared with 2008, mainly because of hedging.

Financial hedging instruments alone enabled Petrom to gain 524 million RON (125 million euros), that is 40% of the net profit. Despite the profit rise, Petrom will propose its shareholders not to collect their 2009 dividends, after having done the same thing in 2008.

The business, however, was down to 12.8 billion RON (about 3 billion euros), as the company’s fuel sales, including exports, went down by 7%, with petrol and diesel being 3% and 14% cheaper than in 2008, anyway. At the same time, the gas sales of the company fell 9%.

“We are seeing a year with greater challenges, at least as far as the fuel and gas business is concerned,” said Mariana Gheorghe, chief executive officer of the company.