Petroreconcavo (RECV3) Q1 2026 earnings summary

Executive summary

• Q1 2026 was marked by global macroeconomic shifts, including rising geopolitical tensions and oil price volatility, resulting in cost and CapEx reductions and improved financial performance.

• Production averaged 24.4k BOE/day, down 3% sequentially and 11% year-over-year, mainly due to operational shutdowns and maintenance, especially in Bahia.

• Net revenue was BRL 684 million, down 3% sequentially and 20% year-over-year, impacted by lower production and currency effects.

• EBITDA reached BRL 310 million, up 5% sequentially but down 27% year-over-year, with margin improving to 45.3%.

• Net income was BRL 124 million, up 144% sequentially but 46% lower year-over-year, driven by currency effects and cost discipline.

Financial highlights

• Free cash flow: BRL 80 million generated in Q1 2026, a 492% increase from 4Q25.

• Net debt: BRL 1.4 billion; leverage at 1.04x net debt/EBITDA; net debt down 13% from year-end 2025.

• CapEx: BRL 197 million, down 26% sequentially and 21% year-over-year.

• Lifting cost per barrel: US$15.82, up 10% sequentially, impacted by lower production and exchange rates.

• EBITDA margin improved to 45.3% from 41.9% sequentially.

Outlook and guidance

• Strategy remains unchanged for 2026 despite oil price volatility; portfolio under review but no CapEx acceleration planned.

• Focus on production stability, operational safety, and long-term value creation through water injection and mature field management.

• Expectation to maintain flat production and disciplined CapEx for the year.

• Next natural gas price adjustment scheduled for May 2026, reflecting Brent prices from Jan–Mar 2026.

• Continued focus on cost discipline, liquidity, and balance sheet health.