Petrobras, Brazil’s state-owned oil company, announced on Thursday a net loss of 2.6 billion reais (approximately $468.7 million) for the second quarter of 2024.
The company’s performance was primarily impacted by the settlement of a tax dispute with the government and the fluctuation in the exchange rate between the dollar and the real during the period, Petrobras stated in a press release.
In the first quarter, Petrobras had reported a net profit of 23.7 billion reais ($4.782 billion), representing a 34.9% decline compared to the same period in 2023.
First Results Under New Leadership
These financial results are the first to be released under the leadership of Magda Chambriard, who took over as Petrobras’ CEO in late May, succeeding Jean-Paul Prates.
“Operational results were solid and aligned with expectations. However, non-recurring events, such as the tax settlement with the Ministry of Finance and significant exchange rate volatility during the period—without affecting the company’s cash flow or equity—impacted our internal accounting, thereby affecting the quarterly results,” Chambriard noted in the statement.
Dividend Payments Approved
In a separate announcement, Petrobras’ board of directors approved the payment of 13.570 billion reais ($2.446 billion) in dividends and interest on equity to shareholders for the second quarter.
This amount equates to 1.05 reais ($0.19) per ordinary and preferred share.
The withholding of extraordinary dividends in March, related to the 2023 results, had previously upset market expectations and sparked controversy.
Controversy Over Withheld Dividends
Jean-Paul Prates, the 55-year-old former senator from the Workers’ Party (PT), a leftist party led by Lula, had to step down as CEO after his appointment shortly following Lula’s inauguration in January 2023.
Prates’ troubles began on March 7, when Petrobras’ board decided not to pay any extraordinary dividends to shareholders for the 2023 fiscal year, despite the oil giant posting its second-largest profit in history that year.
Petrobras’ stock price plummeted on the stock exchange, with analysts attributing the absence of dividends to perceived government interference in the company’s operations.
The situation stabilized in late April after shareholders approved the distribution of half of the dividends, amounting to approximately 22 billion reais (around $4.25 billion). The remaining funds were allocated to a reserve to ensure future dividend payments.
Historical Performance and Leadership Turnover
In 2023, Petrobras posted an annual net profit of $24.884 billion, down 32% from the previous year but still the second-largest in its history.
Throughout its 68-year history, Petrobras has seen a rapid turnover of leadership, with 39 CEOs—Chambriard being the 40th—and an average tenure of less than two years.