Gas consumption in November 2011 up 25% yoy

The draught impacted strongly the production of hydro energy and gave a boost to gas power plants. On the other hand chemical producers' consumption came down by 15% yoy to 2.5 TWh. We see the news as positive for Transgaz, especially as October consumption was weak (down 7% yoy to 11.9 TWh). Assuming a 5% yoy growth in consumption in December as well, this should translate into a nice 4Q 2011 profit, which should partially counteract the budgeted and expected hike in maintenance works. Overall we see the FY 2011 profit some 10% lower yoy and some 15% higher than previously estimated. Assuming a pay-out ratio of 90% (as budgeted) the dividend yield would come above 10%. Trangaz share price rose by more than 15% in the last two months thus we will revise upwards our estimates but keep our 'hold' recommendation.