AFTER NINE MONTHS Profit of "Transgaz" down 24%

"Transgaz" Mediaş (symbol: TGN) has reported a net profit of 215.2 million lei, after the first nine months of the current year, down 24.19% YOY, according to a report sent to the Bucharest Stock Exchange.

Total revenues fell approximately 5.78 million lei, from 1,025,845,152 lei on September 30, 2011, to 1,020,066,906 lei on September 30, 2012.

The revenues were influenced by factors such as the smaller volume of natural gas transported, compared to September 30, 2011, and its fall from 93,433,034 MWh to 90,286,780 MWh.

Operating revenues fell 13.5 million lei, from 985.2 million lei at the end of Q3 2011, to 971.7 million lei during the similar period of 2012, whereas financial revenues increased 7.7 million lei, to 48.3 million lei in the first three quarters of the current year, from 40.5 million lei in the similar period of last year.

Total expenses increased 63.4 million lei, from 686.03 million lei after the first nine months of 2011, to 749.4 million lei during the similar period of the current year. Operating expenses increased by 70.7 million lei YOY, to 728.1 million lei, whereas financial expenses fell by 7.32 million lei during the reviewed period.

Gross profit fell 20.37%, from 339.8 million lei in the first nine months of 2011, to 270.6 million lei at the end of Q3 2012.

Shareholders' equity was 3,131,293,062 on September 30, 2012, down 131.5 million lei, compared to the beginning of the year.

On one hand, non-current assets fell 54.5 million lei in the first nine months, and current assets increased 3.2 million lei.

Short term and long-term debts of "Transgaz" both shrank at the end of Q3 2012. Short term debts fell to 256.4 million lei, and long term debts fell to 57.6 million lei.

The secondary public offer of "Transgaz" was postponed by the president and the prime minister, who agreed that the current time was not right for that kind of operations, and that it was necessary to wait for the appointment of the private managers which would increase the value of the company.

Victor Ponta reminded that the sale of a stake in "Transgaz" was agreed with the IMF, but in December or most likely in the beginning of next year, in the first week of January, the negotiations with the IMF will begin for the signing of a new letter of intent and a new stand-by agreement.

• Simion Tihon: "The delays erode the confidence of investors in the listing of the state owned companies"

Simion Tihon, broker at Prime Transaction considers that the factor which made a difference between the success of Transelectrica and the failure of the state to sell 10% of Petrom was the difficult economic context. In his opinion, the delays do nothing but erode the investors' confidence that they will see further listings of stakes in state owned companies.

As for the drop in the profit of "Transgaz", in his opinion, this was caused by the increase of expenses with the amortization of fixed assets and the growth of staff expenses. Simion Tihon said that the increase of the latter was caused by the booking of the results from the reevaluation of the plots of land and the constructions which belong to the company, as well as by the increase of the wages and the employees' share of the profit.

"The expectations for the last quarter are optimistic", said Simion Tihon, due to a seasonality of the financial results of "Transgaz".

"Transgaz" Mediaş, the operator of the national gas transport network, has a share capital of 117,738,440 lei, divided into 11,773,844 shares, with a face value of 10 lei/share.

The company has been listed on the Bucharest Stock Exchange since 2008, and its majority shareholder is the Ministry of the Economy, which owns 73.50% of the shares, followed by the Proprietatea Fund, which holds 14.98%.