Petrobras Records net Profit of R$18.9 Billion in the Second Quarter

RIO DE JANEIRO, BRAZIL – Petrobras reported that it recorded net profits of R$18.9 billion (US$4.73 billion) in the second quarter of this year, a historical record. A note published by the state-owned company states that the result represents an increase of 368 percent over the net profits for the first quarter of the year (R$4 billion) and 87 percent over the second quarter of 2018 (R$10.1 billion).

The main reason for the profit was the completion of the sale of ninety percent of Petrobras’ stake in Transportadora Associada de Gás S.A. (TAG), for R$33.5 billion, of which R$2 billion were used to settle the carrier’s debt with the BNDES.

The increase in the international oil price and the appreciation of the dollar against the real have also contributed to this result.

The adjusted EBITDA — Earnings Before Interest, Taxes, Depreciation, and Amortization — stood at R$32.7 billion in the quarter, an increase of nineteen percent over the first quarter. This result was influenced by higher oil prices, higher diesel sales volumes, and increased margins for gasoline, naphtha, and natural gas.

Net Debt

Free cash flow was positive for the 17th consecutive quarter, totaling R$11.3 billion. The net debt, on the other hand, continued its downward trend at US$83.7 billion in the second quarter of this year, a reduction of twelve percent over the previous quarter.

Investments totaled US$2.6 billion, of which 82 percent in exploration and production activities. “We achieved a good financial result in the second quarter, benefiting mainly from the sale of TAG, with net profits reaching a historical record of R$19 billion. We will pursue our path to generate value, focusing on assets with a higher return, such as pre-salt, and relentless search for cost reduction,” said the president of Petrobras, Roberto Castello Branco, in a note.

According to Petrobras, the company’s oil and natural gas production totaled 2.63 million barrels of oil equivalent per day in the second quarter, an increase of 3.8 percent over the first quarter of this year. In the pre-salt fields alone, production grew 12.7 percent, with 1.17 million barrels of oil per day.