Brazil’s Petrobras Releases Third Quarter of 2014 Results

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – After twice postponing the release of the third quarter financial results for 2014, Brazilian oil giant Petrobras released the report early Wednesday (January 28th) morning. The results show a net profit of R$3.084 billion.

These results represent a 38 percent decline from the second quarter of 2014 and a retraction of 9.9 percent in relation to the third quarter of 2013.

According to Agencia Brasil the document was approved by the state-owned oil giant’s administration council after a meeting which lasted more than seven hours. The balance results, however, were not audited by its independent auditor (Price Waterhouse Coopers) and does not register the losses expected due to the corruption scandal known as Operação Lava Jato (Carwash Operation).

The report, signed by Petrobras’ President Graça Foster, explains that due to the allegations of bribes and money laundering the company’s financial balance was delayed.

Graça Foster also states that the quantification of these illicit values is unviable since the payments were made by foreign suppliers, but she did note that “as for the forecast of the company’s cash flow and liquidity it is important to state that Petrobras’ cash position and its operational generation capacity will not be affected by the adjustments due to Operação Lava Jato.”

According to the company the net profit was due to the greater production of petroleum and natural liquid gas which grew by six percent during the third quarter of 2014, at an average of 118,000 barrels/day.

The release also informs that with the report the company complied with the objective of meeting contract obligations, stating that “with this [report] the state-owned company complies with its commitment to inform the market and act with transparency in relation to the recent events regarding the Operação Lava Jato (Carwash Operation).”