OGZPY PJSC Gazprom (PK)

MOSCOW—Russian state gas giant PAO Gazprom said net profit for the second quarter was up 29% from the same period last year as a higher ruble price made up for lower sale volumes in its most-lucrative European market.

Gazprom said net profit stood at 294 billion rubles ($4.6 billion), while revenue was down 4% from the previous year at 1.27 trillion rubles.

The lower sales volumes reflect the increased competition that Gazprom is facing from rivals in Russia and in Europe.

Total gas production was down 9% in the first six months of the year at 221.3 billion cubic meters, Gazprom said.

Sale volumes to Europe slid 7% in the first half of the year, but revenues grew 7% to 947 billion rubles as the weaker Russian currency meant the ruble price was 21% higher than for the same period last year, the company said.

Sales volumes and revenue in Russia and former Soviet republics both fell.

The increased competition led the Russian Economy Ministry in July to forecast that Gazprom's output could fall to an all-time low of 414 billion cubic meters this year, from 444 billion cubic meters last year. Analysts say this could be pessimistic as European customers are ramping up purchases in the second half of the year to build up stores ahead of winter.

Gazprom released its results late Monday in Moscow, only three weeks after it published its first-quarter earnings well after other Russian listed companies.

Write to James Marson at james.marson@wsj.com

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(END) Dow Jones Newswires

August 31, 2015 15:15 ET (19:15 GMT)

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