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Petrobras (New York Stock Exchange:PBR) will pay a record annual dividend by 2022, rewarding investors who stuck with the company despite concerns about political intervention under Brazil’s new leftist president.
In its first dividend to be paid under new CEO Jean Paul Prates, the state-controlled company revealed that its board approved 35.8 billion reais (~$6.9 billion) in fourth-quarter dividends, or 2,745 reais per share, which is largely in line with its existing shareholder remuneration policy.
However, the board also suggested setting aside 6.5 billion reais of dividends in a reserve, which would reduce the dividend payout to 29.3 billion reais; the proposal requires shareholder approval.
Petrobras (PBR) paid huge dividends throughout 2022, totaling 215.8 billion reais ($41.67 billion) for the full year, a policy that has been criticized by President Luiz Inácio Lula da Silva and his Workers’ Party. as excessive.
The company also reported fourth-quarter net income of 43.3 billion reais, up from the third quarter and the same quarter a year earlier, thanks to higher oil prices during the period.
Investors worry that under the new CEO selected by Lula, Petrobras (PBR) will start subsidizing fuel and spend on underperforming businesses; sales of company assets are now suspended for 90 days.