Petrobras poised to change dividend policy

In a securities filing to the U.S. Securities and Exchange Commission, Brazilian oil giant Petrobras admitted that its dividend payment policy is “subject to change.”

“If we decide on a strategic plan that requires a greater volume of investments, or amend our strategic plan to  do so, the amount allocated to the distribution of dividends may be reduced,” the Brazilian state-controlled company said.

The Workers’ Party of President Luiz Inácio Lula da Silva has opposed massive dividend payments, saying the money should be used to finance more investment. Earlier this month, Petrobras CEO Jean Paul Prates, who is a member of the party, echoed those views, saying shareholder compensation should be balanced with investment in “good projects.”

In 2022, the company paid its largest-ever dividend after obliterating forecasts and posting a consolidated net income of USD 36.62 billion, up 84 percent from the previous year. A study by consulting firm Janus Henderson showed that Petrobras paid the second-highest dividends in the world in 2022.

Despite the massive results, Petrobras was among the major oil companies that invested the least last year (USD 9.8 billion) — roughly half of what ExxonMobil invested in the same period.

Additionally, the company said its board “may seek to revise [its] commitment” to sell eight of its 13 refineries, signed with antitrust regulators in 2019. The government has asked Petrobras to halt the sale of assets, sparking a backlash from angry minority shareholders. 

Brazil’s securities regulator received a complaint that the move would be detrimental to shareholders. 

By midday Friday, Petrobras shares were down by more than 1 percent.

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