Average revenue estimate of R$163.7bn represents 34.6% increase over 2021
Analysts expect that state-owned company will maintain good cash generation in the quarter — Foto: Geraldo Falcão/Agência Petrobras
Oil prices and the exchange rate are expected to have a prominent role in the third-quarter earnings report Petrobras is set to release after the market closes on Thursday. Analysts also cite the greater use of refineries and falling imports of liquefied natural gas as important factors. The average of forecasts of three banks compiled by Valor suggests a net income of R$163.7 billion, which would mean a 34.6% year-over-year growth.
The analysts’ expectation is that the state-owned company will maintain good cash generation in the quarter and announce new dividend payments on Thursday. The projections of BTG Pactual, Goldman Sachs, and Itaú BBA for revenue vary between R$153.3 billion and R$177.89 billion.
On average, the three banks estimate an EBITDA of R$95.2 billion, which would represent a 15% increase over the third quarter of 2021.
“Despite reductions in oil prices and maintenance shutdowns at major refineries in the quarter, we expect Petrobras to announce solid results, with the high refinery utilization rate and increased sales compared to the previous quarter,” Itaú BBA analysts wrote in a report.
Petrobras is expected to report profits in the quarter. In the case of Itaú BBA, the state-owned company is seen as posting gains of R$41.84 billion. Goldman Sachs estimates that the company will earn R$45.56 billion, while BTG Pactual foresees gains of R$53.57 billion.
In dollars, UBS forecasts the company will post a $8 billion profit, while XP is a little more optimistic and estimates $8.2 billion. It is important to emphasize, however, that the profit may still suffer non-recurring effects, which are harder for banks to estimate.
As a comparison, in the third quarter of last year, the company posted a net profit of R$31.14 billion, while in the second quarter of 2022, the net profit was R$54.3 billion.
From July to September this year, the price of oil remained high in the international market, but lower than in the previous quarter, when there was greater impact from the war in Ukraine. According to Itaú BBA calculations, the Brent, the main international oil reference, had an average price of $98 per barrel in the third quarter.
The banks estimate that the state-owned company will pay more than $6 billion in dividends referring to the quarter’s results. Goldman Sachs points out that Petrobras can distribute up to $12 billion in dividends by the end of the year, without reducing the cash position to less than $9 billion.
According to the data released on Monday, Petrobras had an average production of 2.64 million barrels of oil equivalent per day (boe/day) in the third quarter, down 6.6% year-over-year. In relation to the immediately previous quarter, the drop was 0.3%.
One factor expected to contribute for the state-owned company to see better financial results in the annual comparison is the increase in rainfall. In 2021, Brazil faced a historic drought that affected hydroelectric generation and led the company to increase LNG imports to supply thermoelectric plants. This year, the scenario was reversed and LNG imports fell. Thus, according to XP, the gas and energy sector is expected to report good margins in the third quarter of 2022.
The release of Petrobras’s results on Thursday will be followed on Friday by two conference calls, one in English and another in Portuguese, and a press conference, in which the company’s executives will comment on the numbers.
XP stated, in a report, that investors will be alert to comments regarding signs of cost inflation in operations and updates on the sale of company assets, as well as possible talk about upcoming moves on dividends.
*By Gabriela Ruddy — Rio de Janeiro
Source: Valor International