Petrobras: Gross Debt for 2020 Is $87 Billion

Due to the impacts from the new coronavirus and the shock in oil prices, Petrobras announced yesterday, April 28, that it will close 2020 with a gross debt of US$ 87 billion, the same level as the closing of 2019. Petrobras Announces Binding Phase for the Sale of Biodiesel Factories

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The target set by Petrobras’ Board of Directors approved the revision of the top indebtedness metric in the Strategic Plan 2020-2024, replacing the net debt/EBITDA indicator with the gross debt indicator.

“The approved target for gross debt in 2020 is US$ 87 billion, the same closing level as in 2019, due to the adversity in the current global scenario, as a result of the impacts from the COVID-19 pandemic (coronavirus) and the shock in oil prices”, the state-owned company reported.

The indication of gross debt as a top metric reduces the impact of Brent price volatility and more directly reflects the company’s indebtedness and more precisely the company’s management actions such as: cost reduction, investment portfolio review, and adjustments in working capital.

It is worth noting that the company continues to pursue a reduction of gross debt to US$ 60 billion. This amount is in line with the new dividend policy already announced, which foresees an increase in remuneration to shareholders when gross debt reaches this level or is lower.

Petrobras ensures that the safety metric has not been changed, and that the target of recordable accident rate per million man-hours (TAR) below 1.0 remains, with an ambition of zero fatalities.