Brazil’s Petrobras smashes profit estimates amid divestments, Ukraine War
2022.07.29 03:38
FILE PHOTO: A general view of the tanks of Brazil’s state-run Petrobras oil company following the announcement of updated fuel prices at at the Brazilian oil company Petrobras in Brasilia, Brazil June 17, 2022. REUTERS/Ueslei Marcelino
By Gram Slattery
RIO DE JANEIRO (Reuters) -Brazil’s Petrobras smashed second quarter profit and margin estimates, boosted by divestments and higher margins in its fuel and natural gas businesses, the company said on Thursday.
In a securities filing, Petroleo Brasileiro SA, as the state-run oil firm is formally known, reported a net income of 54.33 billion reais ($10.5 billion). That represented a 26.8% increase from the same period last year, and was well above the Refinitiv consensus estimate of 38 billion reais.
Earnings before interest, taxes, depreciation and amortization, or EBITDA, adjusted for certain non-recurring factors, came in at 98.26 billion reais, up 58.6% in annual terms and well above the Refinitiv estimate of 83.2 billion reais.
In comments accompanying the figures, Petrobras attributed its results to strong Brent prices, as well as improved margins in its natural gas and fuels business, which includes gasoline, diesel and various other petroleum derivatives.
The effective divestment of part of its Atapu and Sepia offshore fields to two Chinese state-run oil firms helped boost profits, while the global hunt for alternative sources of oil due to the war in Ukraine also favored the company.
Petrobras said the war significantly affected its export markets, as Asian buyers received Russian crude that European and North American buyers forwent.
The percentage of Petrobras exports purchased by China, for instance, fell from 38% to 15%, the company said, while exports to Europe increased significantly.
($1 = 5.18 reais)
