Petrobras $PETR3 (-2,65 %)
$PETR4 (-1,91 %) the state-owned Brazilian oil company, reported a disappointing fourth quarter on Thursday with a net loss of 17 billion reais, compared to a profit of 31 billion reais in the previous year.
Reuters reports that the current downturn is primarily due to one-off events, the volatility of the Brent oil price and a more volatile diesel market in the future.
Despite the poor financial results, Petrobras expects to pay out 9.1 billion reais in ordinary dividends from cash reserves.
Petrobras reported net sales of 121.3 billion reais for the quarter, down 10% and below analysts' expectations of 127.8 billion reais.
This had an impact on Petrobras' earnings:
Petrobras reported a net loss for the quarter, in sharp contrast to the net profit of 31 billion reais recorded in the previous year.
The company attributed this decline primarily to exchange rate fluctuations, which affected the debt between the state-owned oil company and its international subsidiaries.
Despite the reported loss, Petrobras stated that these financial transactions had no impact on the company's cash flow.
Without these effects, the company would have made a net profit of 17.7 billion reais, which still represents a 53% decrease compared to the same period last year.
While these transactions had a negative impact on net income, they had a direct positive impact on the company's equity, said CFO Fernando Melgarejo in a statement.
Despite political pressure on the dividend policy at the beginning of President Luiz Inacio Lula da Silva's term, the company has remained a strong cash generator.
XP Inc. analyst Regis Cardoso highlighted free cash flow and the dividend as the biggest disappointments, pointing to higher-than-expected capital expenditures.
"It will take a few better quarters of solid cash flow generation to fix the disappointment," he wrote in a note to clients, adding that the issue is likely to spark further discussion.
Other metrics:
Petrobras spent $16.6 billion in 2024, up 31% from a year earlier and ahead of its own forecasts.
The company attributed the higher spending to accelerated payments to contractors in the massive Búzios offshore field to mitigate risks in the supply chain.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) came in at 41 billion reais, below the 61.9 billion reais expected by analysts.
The company achieved an adjusted EBITDA margin of 34%, while the ratio of net debt to adjusted EBITDA was 1.29, higher than the forecast ratio of 1.17.
Free cash flow for the quarter amounted to 21.70 billion reais and net debt reached 52.24 billion reais, exceeding the forecast of 47.98 billion reais.
