Gasum Group H1 2023 – Volumes continued to improve as confidence is returning to the market

January–June 2023 (H1 2022):

• The Group’s revenue decreased by 41.5 percent to EUR 745.1 (1,274.2) million due to lower gas prices and volumes.
• Operating profit (EBIT) was EUR –26.4 (+56.3) million at loss. Adjusted operating profit (EBIT) was EUR -20.2 (5.6) million
• Balance sheet total came to EUR 1,485.9 (2,244.0) million
• Equity ratio was 34.0 (20.9) percent
• Sales volumes decreased by 37 percent compared to H1 2022 mainly due to lower natural gas volumes and were 6.2 (9.2) TWh.

Gasum Group CEO Mika Wiljanen comments on the second quarter and the first half of 2023:

“Volumes developed well during the second quarter in all businesses – liquefied natural gas (LNG) and liquefied biogas (LBG) volumes have picked up significantly. Confidence is returning to the market as prices are stabilizing. The good progress driven by affordable prices, which started during Q1, continued in Q2. Even more customers have been switching back to gas from more polluting alternatives, which were taken into use during the sky-high gas prices of 2022.

The Group’s revenue for the first half of 2023 was EUR 745.1 million, operating profit was EUR –26.4 million and adjusted operating profit was EUR –20.2 million. While volumes and sales developed positively during the first half of the year, Gasum’s result was burdened by costs that resulted from adverse impacts of the market turmoil and adjusting operations to the changed energy landscape in 2022. The costs are an outcome of the need to reorganize the entire supply chain for pipeline-delivered natural gas as natural gas flow from Russia ended in May 2022.

In May 2023 Gasum ended the long-term pipeline natural gas supply contract it had with Russian Gazprom Export. Gas supplies had at that point been discontinued for a year. Gasum began arbitration proceedings after Gazprom demanded for payment in rubles instead of euros in the spring of 2022. The parties were not able to come to a settlement after the arbitration proceedings which resulted in Gasum ending the agreement.

The implementation of Gasum’s new strategy, launched in Q4 of 2022, proceeded with determination throughout the first half of 2023. Construction work on our next large 120 GWh biogas plant in Götene, Sweden proceeded as planned and investment decisions on expansions and improvements of three existing plants in Finland and Sweden were made in the second quarter. Completion of the improvement and expansion projects at the existing plants by the summer of 2024 will increase Gasum’s biogas output by 60 GWh annually.

In June Gasum and the Cruise Division of global shipping company MSC Group signed a long-term agreement for the supply of LNG to MSC’s new flagship MSC Euribia, as well as a Letter of Intent with the goal of cooperating on the supply of synthetic liquefied methane, or e-LNG, made with renewable energy. MSC Cruises also purchased over 400 tons of liquefied biogas (LBG) from Gasum for the world’s first net zero greenhouse gas emissions cruise from Saint-Nazaire in France to Copenhagen.

Gasum is also providing LBG to cruise ferry operator Viking Line in an innovative initiative to allow passengers to reduce the carbon footprint from travel by up to 90 percent by buying biogas in proportion to the amount of fuel used for their journey. This is an initiative that Gasum is very happy to be a part of.

In the power business we made a ten-year power purchase agreement (PPA) providing wind power to Volvo Finland and Volvo Construction Equipment. Gasum experts will also take over the balancing of power purchasing and consumption so that Volvo can concentrate on their core business while reducing their carbon footprint at the same time.

In addition, we started constructing Europe’s northernmost gas filling station in Finnish Lapland as well as opened two new stations in Norway, one of which is an innovative green energy station with the possibility of also charging electric vehicles in addition to fueling biogas.

I feel very positive about the developments in sales volumes and amount of activity and interest in the market and would like to thank the excellent staff at Gasum for their hard work on implementing our new strategy during the first half of the year.”

Read the whole review on our website