Petrobras Scores Q2 Net Profit Loss Due to Tax Transactions, Labor Agreements

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Petrobras (NYSE:PBR) (Rio de Janeiro, Brazil) has maintained solid investments across operations, though it had negative profits in the second quarter due to non-recurring item payments.

The company reported a net profit loss attributable to its shareholders of US$344 million (2.6 billion Brazilian real) for the second quarter. This, however, was the result of non-recurring item payments related to tax transactions and labor agreements.

"The net result for the quarter should be analyzed in light of events that impacted the accounting result but had no relevant impact on the company's cash flow. 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 -- 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 2Q24 would have reached US$5.4 billion and EBITDA would have been US$12 billion, in line with the previous quarter," said Chief Financial Officer Fernando Melgarejo.

Despite this, the company will pay dividends to its shareholders of 1.05 Brazilian reals (US$0.19), totaling 13.6 billion Brazilian reals (US$2.45 billion). The company will use 6.4 billion reals (US$1.17 billion) from its remuneration reserve, which was created to ensure resources for dividend payments.

For Q2, Petrobras' capital expenditures reached US$3.4 billion (18.6 billion reals), about 11.5% more than in Q1. This was mainly destined to large pre-salt projects such as the Marlim revitalization and the construction of floating production, storage and offloading (FPSO) vessels for the Buzios oil field in the Santos basin.

Meanwhile, the company also invested US$450 million in refining, transportation, and marketing, with emphasis on the scheduled stoppage of Paulinha's (REPLAN) hydrotreating unit (HDT).

Currently, the Brazilian company has 12 main projects, including FPSOs and platforms in the Mero and Buzios fields, that are expected to come online between this year and 2030, totaling about US$46.5 billion in investments. Petrobras continues to plan for further production expansions in the next years.

Industrial Info is tracking 275 capital Petrobras project reports, worth US$88.2 billion. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for a list of detailed project reports.

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