Petroreconcavo (RECV3) Q3 2025 earnings summary

Executive summary

• Net revenue for Q3 2025 was R$786 million, down 2% sequentially, with year-to-date revenue at R$2.5 billion, up 1% YoY; EBITDA for Q3 was R$350 million (-6% QoQ), and net income was R$122 million, down 49% from Q2 but up 45% YTD to R$588 million.

• Average production for Q3 was 26,400 boe/day, down 3% from Q2, but YTD average was up 2–3% YoY.

• Major operational advances included completion of water injection in the Chié/Tiê field, the first horizontal well, and a deep well campaign.

• Acquisition of 50% of midstream natural gas assets in Rio Grande do Norte was completed, with staged payments and joint operation agreements.

• Strategic logistics and commercial partnerships were established, including new oil handling contracts and expanded routes.

Financial highlights

• Net revenue for Q3 2025 was R$786 million, down 2% sequentially; EBITDA was R$350 million (44.5% margin), and net income was R$122 million, down 49% from Q2.

• Year-to-date net revenue was R$2.5 billion (+1% YoY), EBITDA R$1.1 billion (-7% YoY), and net profit R$588 million (+45% YoY).

• Net debt at period end was R$1.5 billion, with leverage at 1.00x EBITDA (LTM).

• Free cash flow for Q3 was R$38 million, excluding midstream asset acquisition; capex for Q3 was R$569 million, mainly for reserves and midstream assets.

• R$500 million in new debentures issued in July, extending average debt maturity and reinforcing cash for investments.

Outlook and guidance

• Capex for reserve development is expected to decrease by ~15% in Q4, with a more conservative investment approach and focus on operational efficiency in 2026.

• Water injection and reservoir repressurization in the Tiê/Chié field are expected to stabilize and potentially increase production.

• Enhanced hedging strategies implemented, with significant portions of oil and gas production hedged for 2026.

• Operational flexibility and capital allocation are being adjusted in response to macroeconomic and Brent price trends.