Korea Gas Corp. (KOGAS) posted a 9% year-on-year increase in first-quarter operating profit, while unpaid receivables from residential city gas sales stood at about 13.37 trillion won, down roughly 500 billion won from the previous quarter.
KOGAS disclosed on the 13th that its consolidated operating profit for the first quarter came to a provisional 910 billion won, up 9.1%, or 76.1 billion won, from the same period last year.
Revenue fell 7.3%, or 930.5 billion won, to 11.8022 trillion won, while net profit rose 49.3%, or 181.1 billion won, to 548.3 billion won.
KOGAS attributed the operating profit gain to a 29 billion won decline from a year earlier in proceeds from a steel pipe bid-rigging lawsuit victory and overseas dividends, both of which are used to fund gas rate reductions. A 16.9 billion won increase in operating profit at subsidiaries also contributed to the improved results.
Revenue declined because, although sales volumes of gas — combining city gas and power generation use — rose, unit selling prices fell.
Unpaid receivables from residential city gas sales edged lower. First-quarter residential gas receivables totaled 13.3717 trillion won, down 493.2 billion won from 13.8649 trillion won at the end of the previous quarter.
Even when the price of liquefied natural gas (LNG) it purchases rises, KOGAS cannot freely raise residential rates. Supply costs that KOGAS has been unable to reflect in rates are precisely what make up these receivables. A review committee that determines KOGAS's wholesale prices is scheduled to convene in late May, but analysts say a price hike will be difficult with local elections looming in June.
