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Petroreconcavo (RECV3) investor relations material
Petroreconcavo Q2 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.
Executive summary
Second quarter 2025 faced challenging macroeconomic conditions, with a 10% drop in Brent prices and a 6% sequential revenue decline to BRL 806 million.
Production averaged 27.4 thousand boe/day, stable quarter-over-quarter and up 4% year-over-year.
Strategic investments included deep well completions, acquisition of 50% of Brava's gas assets, and a R$500 million debenture issuance.
Sustainability initiatives advanced, with the fourth ESG report released, a 32% GHG reduction, and increased social impact in the Northeastern region.
Financial highlights
EBITDA for 2Q25 was BRL 374 million, down 12% sequentially; net income rose 5% sequentially to BRL 238 million.
Net revenue dropped 6% sequentially, mainly due to lower Brent prices and currency impacts.
Net debt stood at BRL 1.28 billion, with a new debenture issuance of BRL 500 million at 5.66% annual cost.
Free cash flow was negative BRL 100 million in 2Q25, reflecting high CapEx and interest payments.
CapEx in 2Q25 totaled BRL 367 million, up 47% sequentially, mainly for reserve development and midstream investments.
Outlook and guidance
CapEx for the second semester is expected to be significantly lower, focusing on workovers and maintenance rather than new drilling.
Production growth target for the year was revised down from 10% to 4%, with focus on maintaining current levels.
New oil hedges set a floor of US$60/bbl and cap of US$70/bbl through 2026, covering about 50% of production.
Gas sales contracts feature fixed or Brent-linked pricing with floor clauses, enhancing revenue predictability.
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