PETROBRAS: Profit Rises 56.5% In The 1Q18 And Beats Market Estimates

(RTTNews) - The Brazilian state-owned oil company Petrobras' net profit rose 56.5% in the first quarter from a year before, to R$ 6.961 billion (US$ 2.145 billion), beating market estimates of a R$ 5.047 billion gain.

Results reflect higher oil prices, which boosted the firm's export margin, larger profits with oil products and natural gas and asset sales. Lower expenses with equipments and general expenses also helped.

Petrobras' net revenue increased 8.9% in the first quarter, to R$ 74.461 billion, above market estimates of R$ 58.11 billion, while the company's earnings before interest, taxes, depreciation, and amortization (EBITDA) fell 1.6%, to R$ 25.669 billion, in adjusted terms, surpassing the R$ 25.254 billion market estimate.

The adjusted EBITDA excludes results in equity-accounted investments, impairment, cumulative foreign exchange adjustments reclassified to the income statement and results from disposal and write-offs of assets.

Petrobras' Refining, Transportation and Marketing area, the largest division of the oil company per revenue, posted a 24.7% fall in its net profit, to R$ 3.056 billion. Exploration and production activities' net profit was 77,5% higher in the first quarter, at R$ 11.536 billion.

During that period, Petrobras cut its investments by 13.8% from the first quarter of 2017, to R$ 9.947 billion, and reduced its free cash flow by 2.8%, to R$ 12.993 billion.

The company's net debt totaled R$ 270.712 billion by the end of the quarter, 3.6% less than at the end of 2017 and equivalent to 3.52 times Petrobras' adjusted EBITDA.

Excluding the provision for a class action settlement, the net leverage ratio would be at 3.07.