An aggressive turnaround helped Petroleo Brasileiro SA post a record operating profit in the first quarter and move ahead of schedule in reducing a debt burden that is the largest of any major oil firm.
Petrobras, as the state-controlled company is known, reported net income of 4.449 billion reais ($1.42 billion), well above a consensus estimate of 3.773 billion reais, while improving cash flow and debt metrics. Petrobras lost a net 1.246 billion reais in the first quarter of 2016.
Moves to increase output in some offshore fields, sell non-essential assets and keep expenses in check yielded the firm’s best operating profit ever. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) rose 19 percent to 25.254 billion reais, beating the consensus forecast by 1.38 billion reais.
Chief Executive Pedro Parente said the strong result was driven by recurring factors such as cost controls, putting Petrobras ahead of a timetable to reduce net debt to 2.5 times annual EBITDA by the end of next year, from a ratio of 3.2 at the end of March.