MOSCOW (MRC) -- State-led oil company Petrobras reported Q2 2016 profit fell by nearly a third from a year earlier, missing analysts' expectations as oil prices fell, it took charges for layoffs and the impairment of a refinery, reported Hydrocarbonprocessing.
Petrobras said net income fell 30% to USD118 million in the three months ended June 30.
Last year's profit was one of the most anemic quarterly results in the company's recent history. The second-quarter 2016 profit comes after a USD395 M loss in the first quarter of this year.
The average profit estimate of eight analysts surveyed by Reuters was USD570 M. Estimates, though, ranged from a USD1.75 B real profit to a USD395 M real loss, as analysts struggled again with a lack of clear Petrobras guidance.
While total debt has eased 2% since the end of 2015, at USD124 billion it is still the largest in the oil industry.
The USD380 M cost of a voluntary dismissal program and USD350 M impairment charges for the Comperj refinery, whose construction was halted last year after eating up USD13.5 billion of investment, kept costs high even as revenue fell.
As a result, operating profit fell 25% to USD2.27 B. If a scaled back Comperj opens as now planned in 2023, it will be more than a decade late and nearly triple its original USD5.2 B budget.
Earnings before interest, taxes, depreciation and amortization, or EBITDA, a measure of a company's ability to generate cash from operations, was little changed rising 2.8% to USD6.4B, in line with analysts estimates.
As MRC wrote previously, since January 2016, Petrobras has been seeking to sell its 5.8 billion Brazilian real (USD1.4 billion) stake in petrochemical producer Braskem SA. Petroleo Brasileiro SA (Petrobras) hired Brazilian bank Banco Bradesco SA as a financial adviser and started to pitch the sale to foreign investors. Petrobras owns a 36 percent stake in Braskem, Latin America's largest petrochemical producer. The sale would help Petrobras meet its target of selling USD15.1 billion worth of assets in 2015-16, a key part of its plan to cut debt as oil prices plunge to 12-year lows.
Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
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