In 12 months of 2011, The Joint Stock Company “Latvijas Gāze” (hereinafter – LG) sold to the consumers 1, 56 billion m3 of natural gas. In comparison with the respective period of 2010, natural gas sales decreased by 13%.
The decrease of natural gas sales stemmed from the relatively high air temperatures in the 4th quarter of 2011, as well as the investments of heat supply companies in the use of renewable energy sources and partial replacement of fossil fuels with woodchip. For several years already, the natural gas purchase prices set for Latvia have reached the level of the natural gas market of European countries, and in 2011 they were only influenced by changes in oil product quotations at the stock exchange, currency rates and gas supply flows.
The gas injection season at the Inčukalns Underground Gas Storage Facility began on April 26, 2011 and was completed on October 18, 2011, reaching the active gas volume of 2.3 billion nm3 at the end of the injection season.
In 2011, the Company sold natural gas and provided services to customers for LVL 353 million (EUR 503 million), which does not significantly differ from the net turnover of 2010.
The changes in the structure of net turnover resulted from changes in the natural gas sales volume and the natural gas sale price, as well as the increased efficiency of usage of the Inčukalns Underground Gas Storage Facility.
During 2011, the natural gas sale end-user tariffs for the natural gas consumers also changed due to tax changes, because as of July 1, 2011 the reduced VAT rate for natural gas supplied to households was revoked, while natural gas used as fuel was applied an excise tax of 12 LVL/thsd. nm3 (17.1 EUR/thous.nm3).
The Company completed the year 2011 with a net profit of LVL 25.7 million (EUR 36.6 million), which is LVL 0.1 million (EUR 0.1 million) or 0.4% below that of 2010 – LVL 25.8 million (EUR 36.7 million). The net profitability of business activity was 7.3% in 2011 and 2010.
In 2011, the Company invested LVL 17 million (EUR 24 million) in the modernization of the gas supply system and the creation of new fixed assets. 29% of the total investment was spent on the modernization of gas transmission pipeline system, 39% – on the improvement of operation safety and the modernization of equipment at the Inčukalns UGS, and 25% – on the expansion of distribution networks and the renewal of fixed assets. The total number of gas-enabled objects at the end of the year reached 442.6 thousand.

Vinsents Makaris
Phone + (371) 67 369 144
E-mail: IR@lg.lv