Brazilian state-run oil giant Petrobras on Thursday (8 August) recorded a net loss of 2.6bn reais ($470m) for the second quarter (Q2) of 2024. It is the first time the oil giant has reported a net loss since Q3 2020.
The company also announced lower-than-expected results and a reduction in investment estimates.
The Q2 results show a significant decrease compared with the corresponding period in 2023, where net profit reached 28.7bn reais. The loss also represents a 111% drop from Q1 2024 when Petrobras achieved a net profit of 23.7bn reais.
The company’s board has approved the payment of interim and intermediate dividends and equity interest totalling 13.57bn reais, equivalent to 1.05320017 reais per outstanding common and preferred share.
In Q2 2024, a loss of $344m was incurred due to non-recurring items, notably the consequences of implementing the tax transaction and the losses stemming from the 2023 labour agreement.
Fernando Melgarejo, chief financial and investor relations officer, said: “Petrobras maintained robust cash generation in the second quarter of 2024, which allowed it to make $3bn in investments, comply with our shareholder remuneration policy and pay dividends.”
In Q2 2024, Petrobras recorded an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $9.6bn, marking a 20.6% decrease from $12.1bn the previous quarter. This decline was primarily attributed to reduced margins on diesel and gasoline, higher imports and one-time expenses.
However, the company said that increased export earnings, largely driven by the strengthening of Brent, somewhat mitigated these adverse effects.
“The main events were the exchange rate variation for the period – an effect between companies in the Petrobras System that has no cash effect or even equity effect – and the impact of adhering to the tax transaction – a decision deemed positive by the market because it ended billion-dollar disputes that brought great uncertainty to the company's cash flow. Without these events, net income for Q2 2024 would have reached $5.4bn, and EBITDA would have been $12bn, in line with the previous quarter,” Melgarejo added.
In the first half (H1) of 2024, total capital expenditure (capex) amounted to $6.4bn, 12.5% higher than in H1 2023. The projected capex for 2024 has been revised $13.5bn–14.5bn. This level of investment will not impact oil and gas production and represents an increase of 7–15% compared with the total capex in 2023.
The company said that revenues from the sale of oil products within the country decreased by 2% compared with Q1 2024. This decline was mainly due to lower prices, although it was somewhat offset by an increase in the quantity of products sold, especially diesel. The increase in sales was driven by seasonal demand and a boost in economic activity.
