The third quarter of 2020 ended with a financial loss for Petrobras. The company announced losses of R$ 1.546 billion between July and September. This is  the third quarter followed of recorded losses for the oil company. For the first quarter of 2020 the company recorded losses of R$ 48.5 billion,  between April and June recorded losses of R$ 2.7 billion. In the third quarter of 2019, the company had posted a profit of R $ 9.087 billion.

Petrobras said that despite the loss in the third quarter, it achieved gains with higher volumes of sales of oil and oil products and higher prices for the Brent barrel. However, this positive aspect was not sufficient to remedy the effects of financial expenses during the period, influenced by premiums paid on the repurchase of securities.

The state-owned company declared that the third quarter had sales revenues that totaled R$ 70.7 billion during the interval, an increase of 39% in comparison with the previous quarter. According to the company, the period was marked by the recovery of demand for oil products in Brazil (18% growth in sales volume). Other factors also justified the higher revenues, such as increased market share, the maintenance of the high level of exports and the 48% increase in Brent prices in Reais.

“Despite the restrictions imposed by the pandemic and the uncertain environment, our operational and financial performance has improved significantly as demonstrated by the increase in oil and natural gas production and the utilization factor of our refineries and the strong cash generation,” wrote the president of oil company, Roberto Castello Branco.

The executive also pointed out that free cash flow in the first nine months of the year reached US$ 16.4 billion, while free cash flow for shareholders was US$ 6.8 billion. “The strong performance allowed us to reduce our gross debt from US$ 87.1 billion, on December 30, 2019, to US$ 79.6 billion, on September 30, 2020,” added the president. Castello Branco said that this debt amount is below the target of maintaining debt at the same level of 2019, due to the challenging scenario of 2020.

Read full report: Petrobras 3Q20 Results

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