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Gazprom Quarterly Profit Falls 24% on Lower Sales, Refund

Sept. 6 (Bloomberg) -- OAO Gazprom, the world’s biggest natural-gas producer, said first-quarter profit slumped 24 percent on lower export sales and refunds to European customers.

Net income fell to 357.8 billion rubles ($11 billion) from 468 billion rubles a year earlier, the Moscow-based company said today in an e-mailed statement. That missed the 373 billion-ruble average estimate of 12 analysts surveyed by Bloomberg. Revenue slid 7 percent to 1.22 trillion rubles. The state-controlled gas export monopoly took a charge of 78.5 billion rubles for retroactive gas-price adjustments.

Customers in Europe, Gazprom’s biggest market by revenue, have sought changes to their purchasing deals with Gazprom after the 2008 recession cut demand, dragging spot prices below long-term contract levels. Gazprom ties its contracts to prices for crude and refined-oil products with a time lag of as much as nine months.

“The retroactive payments are expected to continue into future statements,” Alexander Burgansky, an oil and gas analyst at Otkritie Capital, said by e-mail.

Sales to Europe fell 3 percent and 30 percent to former Soviet republics as volumes dropped, according to the statement.

Gazprom shares were little changed at 155.32 rubles on Moscow’s Micex exchange as of 11:30 a.m.

To contact the reporter on this story: Stephen Bierman in Moscow at sbierman1@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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