Ukrnafta shrinks net profit by almost 80% in Q1

Ukraine's largest oil producer, Ukrnafta, in January-March 2019 (Q1) shrank its net profit by 76.5% year-over-year (y-o-y), to UAH 296 million ($11.3 million).

"In Q1 2019, three out of five state-run oil and condensate auctions failed due to the absence of buyers and, consequently, this affected the financial results: the significant part of crude oil was not sold," the company said in its quarterly report.

Over the period under review, Ukrnafta also reduced its net income by 19%, to UAH 6.7 billion ($256.6 million).

Dynamics of weighted average selling price of oil and condensate, as well as that of gas was also negative y-o-y.

Moreover, the company paid UAH 3.8 bln ($145.5 million) in taxes in Q1, which was 9.7% up y-o-y.

Read alsoUkrnafta boosts oil output by 5% in 2018

"Though the issue of the outstanding tax debt that limits Ukrnafta's investment capacities is still not solved, the company bears its tax liabilities in full while repaying the tax debt," the report said.

In the three months of 2019, Ukrnafta increased oil and condensate production up to 4.17 ktonnes per day, which was 6.4% up y-o-y. In turn, average daily gas production grew by 10.5% to 3.22 million cubic meters.

As UNIAN reported earlier, Ukrnafta in 2018 boosted its net profit by 63 times from 2017 up to UAH 6.438 billion ($245.6 million).

UNIAN memo. Ukrnafta is the largest state-owned oil and gas company in Ukraine. It accounts for about 70% of oil and condensate production, and 11% of gas extraction in the country. Ukrnafta is one of the key players in the retail market for petroleum products in Ukraine: the company owns more than 560 fuel filling stations throughout the country.