Petrobras, Brazil's state-controlled oil giant, has reported significant financial downturns for 2024, with net profits plummeting to R$ 36.6 billion. This figure marks a staggering decline of 70.6% compared to the previous year, attributing the drop to various uncontrollable external factors and internal accounting adjustments.
The announcement of these results came on January 26, 2024, marking the first financial report under the leadership of CEO Magda Chambriard. The company had achieved its second highest profit ever in 2023, totalling R$ 124.6 billion, making this year’s results particularly stark.
Financial director Fernando Melgarejo stated, "The decrease was significantly affected by accounting items and external market dynamics," highlighting how fluctuations related to the company’s currency exchanges and other market conditions shaped the fiscal outcome. This included unfavorable variations with dealings between Petrobras and its subsidiaries abroad which complicated the financial picture.
Looking more closely at the numbers, Petrobras reported sales revenues of R$ 490.8 billion, down 4.1% from the prior year. This was complemented by reporting R$ 121.3 billion for the fourth quarter alone, which showed some upward movement at 9.7% year-on-year. Nevertheless, the financial documents showed EBITDA also faced challenges, closing at R$ 214.4 billion for the year—a decrease of 18.2% compared to 2023.
Adding to the complexity of the financial narrative, the fourth quarter of 2024 saw Petrobras post losses of R$ 17 billion, showcasing the extent of financial struggles during this period. Without the unique events affecting this quarter, the profit for this timeline would have showcased R$ 17.7 billion instead, showcasing how externalities struck the operation.
Interestingly, the company also shared positive aspects amid the challenges, noting its operational cash flow exceeded R$ 204 billion for the year, signaling strong core operations and cash generation capabilities. Notably, the company plans to distribute R$ 9.1 billion in dividends to shareholders, with total disbursements for the year amounting to R$ 75.8 billion, reinforcing its commitment to return value to investors even amid profit perturbations.
"The company's 2024 performance demonstrates our value creation capacity for our society and investors," reiterated CEO Chambriard, focusing on the contributions made not just to shareholders but also toward national priorities through significant tax payments totalling R$ 270 billion during the year.
The company cited external pressures like oil price volatility—specifically the Brent crude reductions and diesel price discrepancies—as additional factors impacting profitability. The difference between crude pricing and refined product returns dropped sharply, illustrating how broader market conditions affected earnings significantly.
Despite these hurdles, Petrobras remains resolute, stating they achieved all targets set forth within their strategic plan for 2024-2028+, including production reaching 2.7 million barrels of oil equivalent per day. Such achievements paint the picture of resilience within operations, as highlighted through discussions on the investments directed toward innovations and operational health amid ambitions for future growth.
Going forward, Petrobras is set to push through challenges, with plans for new projects, operational enhancements, and a significant focus on community and investor enrichment pathways. Conclusively, the financial results spotlight both the harsh realities of the market's influence and the company's purported strengths, presenting stakeholders with tangible insights for future planning and engagement.