Petroleos Mexicanos (PEMEX) Q1 2025 earnings summary

Executive summary

• New regulatory and governance frameworks were established, including a single board with independent members and updated internal regulations, while federal government contributions supported debt amortization and improved liquidity.

• Institutional strategy focused on stabilizing operations, cost reduction, and productivity, with a medium-term plan for 2025-2027 and a 2025-2030 work plan targeting sustainable hydrocarbon production and increased petrochemical output.

• Mixed development schemes with private participation advanced to offset field declines and reach oil production targets, with guidelines for these schemes approved.

• Downstream improvements included increased distillate yields, reduced heavy fuel oil output, and higher refinery reliability, with the Olmeca and Deer Park refineries ramping up operations and delivering cash surpluses.

• Net zero indebtedness policy reaffirmed, with stricter budget control, vertical integration progress, and tax regime simplification enhancing efficiency and transparency.

Financial highlights

• Total revenues from sales and services reached MXN 396 billion in Q1 2025, with operating profit of MXN 64 billion and net loss of MXN 43.3 billion due to financial costs and FX losses.

• EBITDA rose to MXN 124.4 billion, up MXN 32 billion year-over-year, with EBITDA margin increasing to 31.4%.

• Cost of sales decreased by 13% year-over-year, gross profit was MXN 109 billion, and operating profit was MXN 63.6 billion.

• CapEx for Q1 was MXN 72.1 billion, with 96% allocated to exploration and extraction, and 56.7% of the annual CapEx budget exercised by March.

• Payments to suppliers increased, reducing supplier debt by 20% since end-2024.

Outlook and guidance

• Zero net indebtedness targeted for 2025, with no plans to increase debt balance beyond $97.6 billion at 2024 year-end, and a focus on debt maturity management.

• Mixed contracts with private partners expected to supplement CapEx and support production and investment needs.

• Continued focus on cost reduction, productivity, and sustainability initiatives, including energy transition projects and emissions reduction.

• Crude oil hedging covers 38% of 2025 exposure, with gasoline crack spread hedges providing additional protection.

• Management aims to reduce financial debt by year-end 2025.