Petrobras 2Q24 Performance Summary
Business Context and Reporting Period
This Form 6-K summarizes the financial performance of Petróleo Brasileiro S.A. – Petrobras for the second quarter ended June 30, 2024. The report highlights robust cash generation despite significant non-recurring accounting charges related to a tax transaction settlement and exchange rate fluctuations. The company maintained its shareholder remuneration policy and investment plans.
Key Financial Metrics
| Metric | 2Q24 (R$ Million) | 1Q24 (R$ Million) | 2Q23 (R$ Million) |
|---|---|---|---|
| Sales Revenues | 122,258 | 117,721 | 113,840 |
| Adjusted EBITDA | 49,740 | 60,044 | 56,690 |
| Recurring Adjusted EBITDA | 62,332 | 61,523 | 59,101 |
| Net Income (Loss) to Shareholders | (2,605) | 23,700 | 28,782 |
| Recurring Net Income | 15,728 | 23,873 | 29,402 |
| Free Cash Flow | 31,881 | 32,428 | 33,315 |
| Net Debt (US$ Million) | 46,160 | 43,646 | 42,177 |
| Financial Debt (US$ Million) | 26,321 | 27,738 | 29,228 |
Material Changes vs. Prior Period
- Net Loss vs. Profit: Reported a net loss of R$ 2.6 billion, a sharp decline from the R$ 23.7 billion profit in 1Q24. This was primarily driven by non-recurring items totaling R$ 23.0 billion, including R$ 11.6 billion in financial expenses and R$ 4.3 billion in tax expenses related to the adherence to a Tax Transaction, and R$ 6.9 billion in actuarial losses for the health care plan.
- Recurring Performance: Excluding non-recurring items and exchange rate effects, recurring net income was R$ 15.7 billion, down 34% from 1Q24 due to lower margins on diesel and gasoline and increased import costs.
- Financial Result: The financial result was a loss of R$ 36.4 billion, heavily impacted by the depreciation of the Brazilian Real (BRL) against the US Dollar (USD) and charges related to the Tax Transaction.
- Revenue Growth: Sales revenues increased 3.9% quarter-over-quarter, driven by an 11% increase in export revenues due to higher Brent prices and volumes.
- Debt Levels: Financial debt reached US$ 26.3 billion, the lowest level since 3Q08. Net debt increased 5.8% quarter-over-quarter to US$ 46.2 billion.
Guidance, Outlook, and Risks
- Capex Guidance: The 2024 Capex projection was revised to a range of US$ 13.5 billion to US$ 14.5 billion, representing a 7% to 15% increase over 2023 levels. 1H24 Capex totaled US$ 6.4 billion.
- Dividends: The company approved dividends and interest on equity totaling R$ 13.6 billion, to be paid in November and December 2024.
- Tax Transaction: Adherence to the Tax Transaction settled disputes worth R$ 45 billion, ending significant legal uncertainty. While it created a large non-cash accounting charge, management views it as positive for cash flow stability.
- Risks: Key risks include exchange rate volatility (BRL/USD), fluctuations in oil and gas prices, and regulatory changes. The filing notes that forward-looking statements involve uncertainties and are not guarantees.
Investor Verification Checklist
- Non-Recurring Items: Verify the specific accounting treatment and cash impact of the R$ 23 billion in non-recurring charges, particularly the Tax Transaction and actuarial revisions.
- Recurring Margins: Analyze the trend in recurring Adjusted EBITDA (R$ 62.3 billion) versus reported Adjusted EBITDA to assess core operational performance.
- Debt Structure: Confirm the weighted average maturity of debt (11.76 years) and the leverage ratio (Net Debt/LTM Adjusted EBITDA of 0.95x).
- Capex Execution: Monitor the execution of the revised 2024 Capex plan, specifically investments in pre-salt projects (Mero, Búzios) and the Marlim Revitalization.
- Dividend Policy: Confirm the payout of the approved R$ 13.6 billion dividend and interest on equity in late 2024.