Austrian oil and gas group OMV reported a slight decrease in results for the second quarter on Wednesday, attributed to lower gas prices and legislative changes in its key Romanian market.
Financial Results
The company achieved a profit of approximately 378 million euros for the period from April to July, compared to 380 million euros in the same period last year, according to a statement released on Wednesday.
Turnover also declined (-4%) to 8.6 billion euros, “mainly due to a decrease in gas prices.”
Impact of Romanian Legislation and Diversification Efforts
Margins in the energy division were affected by “legislative changes in Romania, which came into effect in April 2024,” OMV explained.
However, other activities, particularly chemicals, helped the group mitigate the losses, thanks to “favorable inventory changes” and the positive contribution of joint ventures from its subsidiary Borealis, a major player in fertilizer production.
The group’s operating profit excluding special items and inventory effects (CCS), closely watched by analysts, increased by 4% to 1.2 billion euros.
CEO’s Perspective and Strategic Direction
CEO Alfred Stern praised the “solid results and financial foundation capable of supporting the historic transformation” of the company, which is seeking to reduce the share of polluting fossil fuels in its revenue.
For example, OMV recently completed the acquisition of photovoltaic projects in Romania.
Addressing Gas Supply Concerns
In parallel, the group is continuing to diversify its gas supply sources, as it faces criticism for its contractual ties with Russian giant Gazprom until 2040.
The Austrian government has just established a commission to investigate a possible withdrawal from these contracts, with the aim of reducing dependence on Russian gas, which still accounts for 90% of the Alpine country’s imports more than two years after the start of the invasion of Ukraine.
Company Structure and Workforce Reduction
Integrated from production to distribution and 31.5% owned by the Austrian state, OMV has reduced its workforce over the past year to approximately 21,100 employees worldwide. In 2010, it employed 37,700 people.