In today’s issue: After four down years, Petrobras finally profits again.
After four down years, Petrobras finally profits again
Petrobras, Brazil’s state-run oil and gas company, has posted positive yearly results for the first time since 2013. The BRL 25.7bn profit was made possible mainly due to a reduction of Petrobras’ debt and benefited from a 31% increase in the average Brent crude price. Over 2018’s last quarter, however, profits stayed at BRL 2.1bn—way below the projected BRL 7.8bn.
Over the past few years, Petrobras has been strangled by Operation Car Wash—a probe that unveiled deeply-rooted corruption schemes within its ranks. The company was forced to settle deals in class action suits, filed by investors who claimed they lost money due to the scandals. In 2018, the company agreed to pay U.S. investors USD 2.9bn—the largest amount ever paid by a non-American entity.
CEO Roberto Castello Branco, however, still believes Petrobras is “way below” where it should be. He intends on continuing divestments and cost-cutting measures. As this newsletter informed yesterday, Petrobras will launch a voluntary redundancy program—it will also shut down offices in São Paulo, New York City, Africa, Iran, and Japan.
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