Petrobras reports $470m net loss in Q2 2024, below expectations

Brazilian state oil giant Petrobras on Thursday (August 8) posted a net loss of 2.6 billion reais ($470 million) for the second quarter (Q2) of 2024. It is the first time the oil giant has reported a loss net from T3. 2020.

The company also announced lower-than-expected results and a reduction in investment estimates.

The Q2 results show a significant decrease compared to the corresponding period in 2023, where net profit reached 28.7 billion reais. The loss also represents a 111% drop from Q1 2024, when Petrobras posted a net profit of 23.7 billion reais.

The company’s board of directors approved the payment of interim and interim dividends and equity interest totaling 13.57 billion reais, equivalent to 1.05320017 reais per outstanding ordinary and preferred share.

In Q2 2024, there was a loss of $344 million due to non-recurring items, mainly the consequences of the implementation of the tax transaction and losses resulting from the 2023 employment contract.

Fernando Melgarejo, Chief Financial Officer and Investor Relations, said: “Petrobras maintained robust cash generation in the second quarter of 2024, which allowed it to make $3 billion in investments, comply with our remuneration policy shareholders and to pay dividends”.

In Q2 2024, Petrobras posted adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of $9.6 billion, down 20.6% from $12.1 billion in the previous quarter. This decrease was primarily attributed to reduced diesel and gasoline margins, higher imports and one-time expenses.

However, the company said higher export earnings, largely driven by the strengthening of Brent, somewhat mitigated these adverse effects.

“The main events were the variation of the exchange rate for the period – an effect between the companies in the Petrobras System that has no cash or even equity effect – and the impact of joining the tax transaction – a decision considered positive by the market because it ended the disputes of billions of dollars that brought great uncertainty to the company’s cash flow. Without these events, net income for Q2 2024 would have reached $5.4 billion and EBITDA would have been $12 billion, in line with the previous quarter,” Melgarejo added.

In the first half of 2024, total capital expenditure (capex) amounted to USD 6.4 billion, 12.5% ​​higher than in the first half of 2023. The estimated capital for 2024 was revised by 13, 5 billion – 14.5 billion USD. This level of investment will not affect oil and gas production and represents a 7–15% increase over total capital in 2023.

The company said revenue from the sale of petroleum products within the country fell 2% compared to Q1 2024. This decline was mainly due to lower prices, although it was somewhat offset by an increase in the amount of products sold, especially diesel . The increase in sales was driven by seasonal demand and a boost in economic activity.

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“Petrobras reports $470M net loss in Q2 2024, below expectations” was originally created and published by Offshore Technology, a brand owned by GlobalData.

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