August 03, 2018 –
Consolidated interim financial information audited by independent auditors in accordance with international accounting standards (IFRS). Net Income R$ 17,033 million
Production 2,669 thousand boed
Adjusted EBITDA R$ 55,835 million
Petrobras reported a net income of R$ 17,033 million in 1H-2018, with growth of 257% and the best semi-annual result since 2011, determined by :
. Brent’s share price increase, which resulted in higher margins in oil exports and sales of derivatives in Brazil, associated with the depreciation of the real;
. Reduction of interest expenses due to the decrease in indebtedness;
. Lower general and administrative expenses and equipment idleness; and
. On the other hand, higher oil prices led to higher government participation expenses.
Operating income and cash inflows of US $ 4,914 million from divestments led to amortization and prepayment of debt, resulting in a significant drop of 16% in which totaled US $ 91,712 million and 13% of net indebtedness, which reached US $ 73,662 million.
Free Cash Flow * remained positive for the thirteenth consecutive quarter, reaching R $ 29,366 million in 1H-2018, 29% higher than the first half of the previous year, mainly due to the higher operational generation, combined with the lower realization of the investments in the period.
Following the Remuneration Policy to Shareholders and taking into account the profit obtained in the quarter and the financial deleveraging target, the anticipation of Interest on Own Capital, in the amount of R $ 0.05 per share, also for preferred and common shares, providing the same amounts already distributed in 1Q-2018, of R $ 652.2 million. As a result, the prepayments of JCP totaled R $ 1,304.4 million in the first half.
Metrics – Net Debt / Adjusted EBITDA
Adjusted EBITDA * increased 26% compared to 1H-2017 to R $ 55,835 million, due to the increase in domestic sales and oil export sales, both driven by the increase in Brent and the depreciation of the real. Adjusted EBITDA margin was 35%.
The net debt to LTM Adjusted EBITDA * ratio decreased to 3.23 in June 2018, compared to 3.67 in December 2017. Leverage * decreased from 51% to 50% in this period.
Excluding the provision for the Class Action agreement, the company would present the net debt / LTM Adjusted EBITDA ratio of 2.86, converging towards the 2.5 target by the end of 2018.
Petrobras’ total production of oil and natural gas in 1H-2018 was 2,669 thousand barrels of oil equivalent per day (boed), of which 2,572 thousand boed in Brazil, 4% less than 1H-2017, mainly reflecting divestments in fields of Lapa and Roncador.
The first production system in the Cessão Onerosa area, in the Búzios field, with P-74, and a new production system in the Campos Basin, in the field of Tartaruga Verde, started operating. In addition, it is worth mentioning the expansion of the exploratory portfolio, for the acquisition of areas of great potential, in the rounds of ANP bids.
Compared to 1H-2017 the production of derivatives in Brazil fell 3%, while domestic sales decreased 6%, totaling 1,759 thousand barrels per day (bpd) and 1,823 thousand bpd, respectively, due to the reduction in sales of naphtha to Braskem and the loss of market share of gasoline for ethanol. Compared to 1Q-2018, there was an increase in the market share of diesel and gasoline, resulting in an increase in sales volume, especially diesel, which grew 15%.
The company maintained its position as a net exporter, with a balance of 372 thousand bpd in 1H-2018 (vs. 401 thousand bpd in 1H-2017).
* See definitions of Free Cash Flow, Adjusted EBITDA, LTM Adjusted EBITDA, Adjusted EBITDA Margin, Leverage and Net Indebtedness in the Glossary and respective reconciliations in the Liquidity and Capital Resources sections, Reconciliation of Adjusted EBITDA, LTM Adjusted EBITDA and Indebtedness Liquid.
Attached Financial Statements and Press Interview