Petrobras Earnings: Reduced Capital-Expenditure Guidance With Unchanged Production Outlook Welcome

No-moat Petrobras reported recurring adjusted EBITDA of BRL 62.3 billion, up from BRL 59.1 billion a year prior. Reported negative net income was the result of one-time items such as a tax settlement, which had no cash impact. Higher upstream earnings from higher prices and volumes offset lower contribution from refining and marketing and gas and low carbon energies. Production during the quarter increased to 2.70 million barrels of oil equivalent per day from 2.64 mmboe/d a year ago. Production through the first half of the year of 2.74/mmboed, with 81% from presalt, is in keeping with the 2.8 (+/4%) mmboed from the strategic plan.