We posted a recurring net income of R$10 billion in the third quarter of 2019.

Our net income in 3Q19 reached R$ 9.1 billion - equivalent to R$ 0.70 per share - against R$ 18.9 billion in 2Q19. The lower result compared to the previous quarter was due to the sale of TAG in 2Q19 and income tax expenses in 3Q19 due to the write-off of deferred tax assets abroad, partially offset by the gain on the sale of BR Distribuidora shares in 3Q19. In 9M19, net income was R$ 32 billion, compared to R$ 23.7 billion in the same period last year.

Highlights of 3Q19 results:

• The Company’s recurring net income and adjusted EBITDA were R$ 10.0 billion and R$ 35.1 billion, respectively, excluding the effects of special items.
• Considering the special items, net income reached R$ 9.1 billion, mainly reflecting the increase in oil and gas production and the capital gain from the sale of BR Distribuidora.
• Adjusted EBITDA was R$ 32.6 billion, stable compared to 2Q19 despite the drop in Brent prices, as a result of solid operating performance, with higher margins on diesel and LPG, higher export volumes  and of oil and diesel sales in the domestic market.
• In 3Q19, the adjusted net debt / LTM EBITDA ratio dropped to 2.58x versus 2.69x in 2Q19, applying the effects of IFRS 16 throughout the whole LTM EBITDA period. Once these effects are eliminated, the ratio would have been 1.96x in 3Q19.
• The Board of Directors approved the anticipated distribution of shareholders’ compensation in the form of interest on capital (IOC) in the amount of R$ 2.6 billion, equivalent to R$ 0.20 per common and preferred share.

Learn more at our Investor Relations website.