Clique para editar o título mestre RESULTS Clique para editar o texto ANNOUNCEMENT mestre 1Q17 Clique para editar o texto mestre Conference Call / Webcast May, 12th 2017
Disclaimer FORWARD-LOOKING STATEMENTS: DISCLAIMER We undertake no obligation to publicly update or revise any forward-looking The presentation may contain forward-looking statements about future events statements, whether as a result of new information or future events or for any other within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are not based reason. Figures for 2017 on are estimates or targets. on historical facts and are not assurances of future results. Such forward-looking All forward-looking statements are expressly qualified in their entirety by this statements merely reflect the Company’s current views and estimates of future cautionary statement, and you should not place reliance on any forward-looking economic circumstances, industry conditions, company performance and financial statement contained in this presentation. results. Such terms as "anticipate", "believe", "expect", "forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are used to In addition, this presentation also contains certain financial measures that are not recognized under Brazilian GAAP or IFRS. These measures do not have standardized identify such forward-looking statements. Readers are cautioned that these statements are only projections and may differ materially from actual future results meanings and may not be comparable to similarly-titled measures provided by other or events. Readers are referred to the documents filed by the Company with the companies. We are providing these measures because we use them as a measure of company performance; they should not be considered in isolation or as a substitute SEC, specifically the Company’s most recent Annual Report on Form 20-F, which identify important risk factors that could cause actual results to differ from those for other financial measures that have been disclosed in accordance with Brazilian contained in the forward-looking statements, including, among other things, risks GAAP or IFRS. relating to general economic and business conditions, including crude oil and other commodity prices, refining margins and prevailing exchange rates, uncertainties NON-SEC COMPLIANT OIL AND GAS RESERVES: inherent in making estimates of our oil and gas reserves including recently discovered oil and gas reserves, international and Brazilian political, economic and CAUTIONARY STATEMENT FOR US INVESTORS social developments, receipt of governmental approvals and licenses and our ability We present certain data in this presentation, such as oil and gas resources, that we to obtain financing. are not permitted to present in documents filed with the United States Securities and Exchange Commission (SEC) under new Subpart 1200 to Regulation S-K because such terms do not qualify as proved, probable or possible reserves under Rule 4- 10(a) of Regulation S-X. 2
1Q17 Highlights Safety � 26% decrease of TRI (Total Recordable Injury Frequency Rate) relative to 1Q16, reaching 1.24 � Net income of R$ 4.45 Billion, reversing the 1Q16 loss Constant � Operating income of R$ 14.27 Billion, 75% higher than 1Q16 improvement of � 19% increase of adjusted EBITDA relative to 1Q16, reaching a historic record of R$ 25.25 Billion. economic and EBITDA margin of 37%, the highest since 2009 financial results � Free cash flow of R$ 13.37 Billion, positive for 8 quarters in a row and 5.6 times 1Q16 figures. � 5% decrease in gross debt in reais and 3% in US dollars compared to 12/31/16 Acceleration of deleverage � Increase of average debt duration to 7.61 years from 7.46 years on 4Q16 due to liability management process � Reduction in Net Debt/adjusted EBITDA to 3.24 from 3.54 and in leverage to 54% from 55% 3
1Q17 Highlights � Total production of 2,805 kboed, 7% above 1Q16 � Average oil production in Brazil of 2,182 kbpd, 10% higher than 1Q16 � Oil products sales in Brazil of 1,951 kbpd, a decrease of 5% relative to 1Q16 Operating performance � Petrobras has maintained a net exporting position given the 72% increase in exports and 40% decrease in imports, relative to 1Q16 � Oil exports at higher prices due to the increase in Brent and the appreciation of the Brazilian crude oil streams � Reductions compared to 1Q16: Progress in � 18% in manageable operating costs Efficiency � 27% in SG&A � 17% decrease in headcount 4
OPERATIONAL HIGHLIGHTS — Clique para editar o título mestre Clique para editar o texto mestre Clique para editar o texto mestre
Production growth of 7% compared to 1Q16 With a noteworthy 10% increase in Brazil Oil and Gas Production Pre-salt oil production operated (kboed/d) by Petrobras (million bpd) +7% 2,805 1.24 2,616 122 In January 4 th , 2017 we reached the record of 181 1.34 Million 501 barrels of oil produced per day 455 2,182 1,980 3T08 1Q08 2Q08 4T08 3Q08 1T09 4Q08 2T09 1Q09 3T09 2Q09 4T09 3Q09 1T10 4Q09 2T10 1Q10 3T10 2Q10 4T10 3Q10 1T11 4Q10 2T11 1Q11 3T11 2Q11 4T11 3Q11 1T12 4Q11 2T12 1Q12 2Q12 3T12 3Q12 4T12 4Q12 1T13 1Q13 2T13 2Q13 3T13 3Q13 4T13 4Q13 1T14 1Q14 2T14 2Q14 3T14 3Q14 4T14 4Q14 1T15 1Q15 2T15 2Q15 3T15 3Q15 4T15 4Q15 1T16 1Q16 2T16 2Q16 3T16 3Q16 4T16 4Q16 1Q17 1T17 1Q16 1Q17 Oil + Gas Abroad Gas Brazil Oil Brazil 6
3 new systems and 1 EWT* expected to start operation P-66 is on location to start production CIDADE DE CAMPOS P-66 LIBRA PIONEER P-67 DOS GOYTACAZES Tartaruga Verde e Libra EWT Lula North Mestiça Crossing the Atlantic COOEC Shipyard Brasfels Shipyard Lula South – On Location * Extended Well Test 7
Lower oil products output aligned with lower sales volumes Demand influenced by the slowdown in the domestic economy Participation of domestic oil in Oil products output refineries’ throughput -8% 0% +7% +1% 1,958 1,810 1,811 683 Others 645 672 95 451 % 94 kbbl/day 89 454 Gasoline 452 824 Diesel 711 688 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 Sales Volume* Diesel, gasoline and jet fuel yield -5% -2% 2,056 2,001 1,951 694 Others 741 710 70 70 69 564 % kbbl/day Gasoline 553 539 798 Diesel 707 702 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 8 * Includes Downstream and BR Distribuidora sales
Exports of 779 kbpd of oil and oil products in 1Q17, a net balance of 489 kbpd Imports Exports Net Balance kbbl/day Oil Products 779 Oil 170 634 489 155 486 453 329 146 305 287 290 609 516 479 410 197 236 307 199 108 93 69 -27 -81 -141 -33 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 9
Natural Gas Supply and Demand Higher domestic supply of natural gas and lower thermoelectric demand Natural Gas Supply Natural Gas Demand -9% -5% -9% -5% 81 81 77 77 73 73 1 10 MMm³/day MMm³/day 2 34 25 19 35 35 31 30 25 22 52 Non-Thermoelectric 50 39 LNG Thermoelectric Bolivia Downstream/Fertilizers 15 16 15 Domestic System Gas 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 10
RESULTS — 11
Constant increase of Brent prices and appreciation of the real since 1Q16 Brent +59% +9% (US$/bbl) 62 54 54 50 49 46 46 44 34 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 155 190 178 168 132 160 149 163 169 R$/bbl FX Rate -19% -5% (R$/US$) 3,90 3,84 3,54 3,51 3,25 3,30 3,15 3,07 2,87 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 3.21 3.10 3.97 3.90 3.56 3.21 3.25 3.26 3.17 End of Period 12
Improvement in results throughout the last quarters Gross Income Operating Income R$ Billion +13% +4% +75% +21% 23.8 14.3 22.8 21.0 11.8 8.1 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 Net Financial Results Net Income +77% -5.3 4.4 -7.8 -8.7 2.5 -1.2 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 13
EBITDA growth, with an unprecedented result +19% +2% Adjusted EBITDA (R$ Billion) Highest quarterly 25.3 24.8 22.3 EBITDA ever 21.2 21.1 20.5 20.0 18.9 16.7 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 +7 p.p. +2 p.p. Adjusted EBITDA Margin (%) Highest EBITDA 37 35 32 30 margin 28 29 25 22 20 (since 2009) 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 14
Free cash flow for eight quarters in a row Operating Cash Flow R$ Billion Free Cash Flow +34% -2% +461% +12% 23.7 23.2 17.3 1Q16 4Q16 1Q17 13.4 Investments 1 12.0 -34% -16% 2.4 14.9 11.8 9.9 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 1. Cash Basis 15
Reduction in manageable operating costs Reduced costs level will not persist in the upcoming quarters, mainly due to the sale of NTS Manageable Operating Costs Workforce -18% -16% -17% -5% 22.4 78,406 21.9 68,829 65,220 18.3 R$ Billion 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 Sales Expenses General and Administrative Expenses -36% -22% -13% -22% 3.8 2.9 2.7 3.1 2.3 2.4 R$ Billion R$ Billion 1Q16 4Q16 1Q17 1Q16 4Q16 1Q17 16
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