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PetroReconcavo Invests US$ 60 Million in UPGN Miranga, Strong Cash Generation Boosts Dividends of R$ 379 Million and Profit of R$ 159 Million in Q3 2024.
PetroReconcavo reported a net profit of R$ 159 million in the third quarter of 2024, representing a 17% increase compared to the previous quarter. Recently, the company revealed its intention to inject approximately US$ 60 million into the development of a new UPGN Miranga in Bahia, standing out as a strategic investment to strengthen its operations in the country. With this initiative, PetroReconcavo demonstrates its commitment to leverage local infrastructure and expand its production capacity.
Furthermore, the company excels in its robust cash generation capacity, which resulted in the distribution of dividends of R$ 379 million to its shareholders during this period. With two decades of experience in the sector, PetroReconcavo remains dedicated to optimizing its portfolio and exploring new growth horizons. This strategy not only benefits its investors but also contributes to regional economic development, consolidating its presence in the energy market.
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Financial Results for Q3 2024
Today, PetroReconcavo released its financial and operational figures for the third quarter of 2024. The company reported a net profit of R$ 159 million for this quarter, symbolizing a 17% growth compared to Q2 2024 and a 9% increase compared to the same period last year. Net revenue reached R$ 850 million, marking a 3% growth over the previous quarter and a 14% increase year-over-year.
The reported EBITDA was R$ 439 million, reflecting a 2% decrease compared to Q2 2024 and a 16% drop compared to Q3 2023. Thanks to the strong cash generation observed during this period, PetroReconcavo will distribute dividends of R$ 379 million, equivalent to a dividend yield of approximately 7.5%. These dividends (R$ 1.29 per share) will be paid on November 26, 2024.
Stability and Investments
The quarter ended with a leverage of 0.52x Net Debt/EBITDA for the last 12 months, indicating a healthy financial balance and allowing PetroReconcavo to maintain a local Corporate Rating of AA, according to the assessment by Moody’s, which demonstrates a stable outlook. The average daily production was 26,400 barrels of oil equivalent (BOED), remaining stable compared to the previous quarter.
In October, PetroReconcavo’s consolidated production reached 26,800 BOED, a 1% month-on-month increase, mainly due to a 3.3% rise in oil production in the Bahia Asset and a 2.2% increase in gas production in the Potiguar Asset. ‘These results validate our strategy focused on sustainable growth and reaffirm our commitment to shareholders’, stated Rafael Procaci da Cunha, Vice President of Finance and IR of the company.
Economic Strengthening
The beginning of October also marked the second issuance of debentures by the company, valued at R$ 650 million, with the purpose of early repayment of a previous debt, achieving better cost and term conditions. This reinforces PetroReconcavo’s economic base and optimizes financial conditions.
Advances in Midstream
PetroReconcavo revealed a historic investment of approximately US$ 60 million in the construction of a new UPGN, the Natural Gas Processing Unit (UPGN) Miranga, in Bahia, representing an important advancement in the midstream segment. This new UPGN, expected to begin operations in 2027, will initially have the capacity to process 950,000 m³/day with potential to increase to 1.5 million m³/day. The company also announced the signing of three Memorandums of Understanding with Ultracargo, Terminais Marítimos do Brasil S.A., part of the Dislub Equador group, and Companhia de Desenvolvimento do Complexo Industrial e Portuário do Pecém – CIPP, along with an agreement with Shell Western Supply and Trading Limited and Shell Trading Brasil.
Strategic Partnerships
These agreements aim to define cooperation guidelines for the development of projects focused on the logistics of flow, storage, and commercialization of petrol from PetroReconcavo, strengthening its role as an independent oil and gas producer.
History and Perspectives
Founded 24 years ago, PetroReconcavo has established itself as one of the leading independent oil and natural gas producers in Brazil, while also specializing in the management, development, and revitalization of onshore fields. The company has developed a verticalized structure, using its own equipment and labor for essential field services, such as workover rigs, drilling, and well stimulation units.
Since 2022, PetroReconcavo has been standing out in the natural gas market, independently and innovatively supplying its entire production after signing the first processing and flow contracts for gas in the Northeast. The company operates 55 oil and gas concessions in the Potiguar, Recôncavo, and Sergipe-Alagoas basins and holds eight exploratory blocks, in addition to participation in concessions operated by third parties.
Commitment to Diversity
In September 2024, the company was added to IDIVERSA B3, a performance index for B3 companies focused on diversity and inclusion, underscoring its commitment to these values in its operations. PetroReconcavo remains firmly listed on the Novo Mercado of B3 with the ticker RECV3, committing to generate continuous value in the Brazilian onshore sector.
Source: Press Release PETRORECONCAVO
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