Petroleo Brasileiro (NYSE: PBR) is scheduled to release its financial results for fourth quarter 2009 after the market close on Friday, February 26, 2010. Analysts, on average, expect the company to report earnings of 90 cents per share on revenue of $48.83 billion Brazilian reais. For the fourth quarter of the previous fiscal, the company reported earnings of 74 cents per share on revenue of $63.26 billion Brazilian reais.
Petroleo Brasileiro S.A, is Brazil's national oil company, engages in the exploration, exploitation, and production of oil and gas, and energy in Brazil and internationally. The company operates in four segments: Exploration and Production, Supply, Gas and Energy, and Distribution. The Brazilian government owns approximately 32% of Petrobras common stock. The integrated energy company operates in 27 countries in the Americas, Africa, Asia and Europe.
It has one of the world's largest proven oil reserves and is among the top ten companies in the world in terms of oil and gas production, as well as total refining capacity. In September, CEO, Jose Sergio Gabrielli said that Petrobras' proven reserves could more than double to around 35 billion barrels in the next two to three years. Petrobras plans to invest about $170 billion in the next five years to boost crude output by 53 percent.
Last year, the company's proven reserves rose 9% to 12.14 billion barrels of oil equivalent, according to criteria used by the US Securities and Exchange Commission. Petrobras appropriated 1.824 billion barrels of oil equivalent of proved reserves and produced 872 million boe, which resulted in an increase of 952 million boe in relation to reservations for 2008. According to the SEC criteria, the rate of reserves replacement in 2009 was 209%.
In November, the Brazilian oil giant reported third quarter net income of R$7.3 billion or R$0.83 per share, in line with previous quarter earnings of R$7.7 billion or R$0.88 per share. The earnings per ADR for the quarter were R$1.66 compared to R$1.76 in the prior quarter. Operating cash flow, measured by EBITDA, was R$17.5 billion in the quarter. The oil and gas production for the quarter increased by 4% over prior year.
Early this month, the company said that its international output slipped to 147,700 barrels per day in January, compared to 150,300 in December, as a result of maintenance in wells of the Akpo field in Nigeria meant to boost production. Crude output in Brazil in January slipped 0.7 percent to 1.973 million barrels per day compared to December output of 1.987 million. "As a consequence of preventative maintenance in three platforms in the Campos Basin, total production from fields in the country fell 1 percent below the volume extracted in December 2009," the company said, referring to combined oil and gas production.
Average output in Brazil in 2009 was 1.970 million bpd, while total production including foreign operations was 2.111 million bpd.
Its exports of oil and oil products in 2009 reached an average 705,000 barrels per day, up 4.8 percent from 2008. Exports of oil alone rose 8.9 percent to 478,000 barrels per day. The increase in exports contributed to a trade surplus of 156,000 barrels per day, the equivalent of $2.87 billion, compared with a deficit of $927 million in 2008.
Brazil's Congress is currently discussing legislation that would make Petrobras the sole operator of new projects in the vast offshore subsalt province with a minimum 30 percent stake in those operations. According to media reports, Petrobras is considering raising billions in stock sale and is likely to swap shares for about $25 billion worth of oil rights from the federal government. The company is also likely to raise up to $50 billion in cash from investors. The deadline for the sale, which involves 12 banks including Banco do Brasil, is June, with the state approvals required by April.
Early in 2009, Petrobras started pumping out 30,000 barrels of oil a day from Brazil's Tupi field, a very deep offshore field off of the Rio de Janeiro coast. When fully operational, by 2010, the field will net 100,000 barrels per day. Tupi, discovered in November 2007,is estimated to contain 5 billion to 8 billion barrels of crude and is being seen as the largest find in the Americas since Mexico's Cantarell. Though expensive to tap, the vast size of the country's oil reserves is expected to offset the steep costs of development. The company's offshore oil discoveries remain economically viable with oil at $45 a barrel or higher.
Recently, Brazil's state-oil company said that it maintained its estimate for recoverable oil reserves in its Tupi field off Sao Paulo state's coast at 5 billion to 8 billion barrels.
In terms of stock performance, Petrobras shares have gained nearly 56% over the past year. On Thursday, shares of the company fell 80 cents or 1.92% to $40.78.
Disclosure: Author doesn't own any of the stocks discussed here.
Key Ratios :
- P/E Ratio: 13.070
- PEG Ratio: 1.200
Earnings Performance :
- EPS Growth in Last Quarter: 0.00 %
- EPS Growth in Last Year: -34.25 %
- Sales Growth in Last Quarter: -9.24 %
- Sales Growth in Last Year: -19.58 %
Dividend Data :
- Ex-Dividend Date: 12/24/2009
- Annual Dividend: $0.36
- Current Dividend Yield: $0.84
- Dividend Paid (3 months): $0.38
Earnings Estimates
- Current Estimates: $0.90
- Number of Estimates: 5
- High Estimate: $0.95
- Low Estimate: $0.83
- Last Year EPS: $0.74
- Percentage Growth: 22.00 %
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