"Gazprom" with Record Profits

Russian state-backed energy company Gazprom is ready to pay the Kremlin 2.5 billion rubles after posting record profits.

The company reported a net profit of 2.5 billion rubles for the first six months of this year. Oil and gas prices rose during that period, pushed up by supply concerns following Russia's invasion of Ukraine.

The Kremlin owns 49.3 percent of Gazprom and will participate in the payout of 1.21 billion rubles after the board offered investors a payout of 51.03 rubles per ordinary share. The decision will be presented to shareholders at an extraordinary general meeting on September 30.

The dividend represents a setback in Western efforts to stifle the Russian economy through sanctions. The UK and Europe have also taken steps to phase out imports of Russian oil and gas to prevent Western funding of Vladimir Putin's regime. Instead, however, Russia increased oil exports to Asia, and gas prices rose in response to cuts in Gazprom supplies to Europe.

Gazprom Deputy CEO Famil Sadigov said: "Despite the pressure of sanctions and an adverse external environment, Gazprom Group reported record revenue and net profit under IFRS in the first half of 2022, while reducing net debt and leverage to a minimum."

The payout follows a decision in June to cancel Gazprom's annual dividend for the first time since 1998. The decision sent the company's stock down nearly 30% in one day.

The dividend decision comes as energy companies and politicians face a nervous wait to find out whether Russia will restart gas supplies via the Nord Stream 1 pipeline to Europe.

Russia said it had shut down gas supplies to the Baltic Sea pipeline from 5 a.m. Wednesday for three days to carry out repairs.

In recent months,...