Why Brazilian Oil Giant Petrobras Shares Are Diving Today

Petroleo Brasileiro S.A. PBR shares are trading lower after the company reported fourth-quarter financial results.

Sales of $27.11 billion (-10.2% Y/Y) beat the consensus of $26.94 billion.

Oil products revenue fell 14.7% Y/Y to $16.1 billion. Total domestic market revenues declined 13.9% Y/Y to $19.6 billion, while foreign market revenues were up 1.4% Y/Y to $7.5 billion.

In the quarter, despite lower sales volumes in the domestic market on the seasonality of diesel, revenues were up Q/Q thanks to higher average prices of oil products. Also, an increase in the export volumes, mainly oil, contributed to the growth.

In the quarter, Petrobras reported an oil and natural gas production of 2.935Mboed, up 10.9% Y/Y.

In 2023, the total oil and natural gas production of 2.782 MMboed, up 3.7% Y/Y, led mainly by the start-up of FPSOs Almirante Barroso, Anna Nery, and Anita Garibaldi, and the full ramp-up of P-71 and FPSO Guanabara.

Adjusted EBITDA declined 3.1% Y/Y to $13.5 billion. Earnings per ADS of $0.96 missed the consensus of $1.11.

Adjusted EBITDA was down 1% Q/Q, owing to higher abandonment expenses. 

In the fourth-quarter, capex totaled $3.6 billion, up 5% Q/Q, mainly due to higher investments in scheduled refining stoppages. 

As of December 31, 2023, net debt reached $44.7 billion, and cash and cash equivalents totaled $12.7 billion.

Price Action: PBR shares are down 11.86% at $14.72 on the last check Friday.

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