Prio (PRIO3) Q4 2024 earnings summary

Executive summary

• 2024 was marked by operational setbacks, including equipment failures and environmental licensing delays, but also major achievements such as the acquisition of a 40% stake in Peregrino Field and a favorable arbitration outcome for Wahoo, boosting reserves and production capacity.

• Annual production averaged 84,000 barrels per day, with Peregrino integration adding significant production and commercial synergies.

• The company maintained a strong cash position post-acquisition, executed substantial share buybacks, and expanded social and environmental initiatives.

• Strategic expansion into trading and gas commercialization, with continued focus on cost optimization and operational efficiency.

• Released the second Annual Sustainability Report and received a Fitch Ratings upgrade to AAA (bra).

Financial highlights

• 2024 revenue was US$2.4 billion, down 8% year-over-year, with adjusted EBITDA (ex-IFRS 16) at US$1.6 billion and net income (ex-IFRS 16) at US$1.7 billion, driven by a $900 million tax credit gain.

• Q4 revenue was US$536 million, with adjusted EBITDA of US$322 million and margins down due to Peregrino integration and lower Brent prices.

• Lifting cost in Q4 2024 was US$11.1/bbl, up 62% year-over-year, mainly due to lower production and Peregrino's higher cost structure.

• Cash position at year-end ranged from US$645 million to US$2,160 million, reflecting acquisition and working capital adjustments.

• Net income increased 60% to 231% year-over-year, reflecting tax credits and operational gains.

Outlook and guidance

• Wahoo drilling license obtained in February 2025, with drilling begun and first oil expected later in the year, potentially adding 40,000 bpd to production.

• 2025 priorities include securing the Wahoo installation license, improving Albacora Leste efficiency, and pursuing M&A opportunities.

• 1P reserves increased from 537 million to 688 million barrels, reflecting Peregrino and Wahoo developments.

• Continued focus on health, safety, cost efficiency, and operational reliability to support growth.