6-K 1 pbraitrifrs2q14rs_6k.htm ITR IFRS 2Q14 (R$) pbraitrifrs2q14rs_6k.htm - Generated by SEC Publisher for SEC Filing

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM 6-K

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934

For the month of August, 2014

Commission File Number 1-15106



PETRÓLEO BRASILEIRO S.A. - PETROBRAS
(Exact name of registrant as specified in its charter)



Brazilian Petroleum Corporation - PETROBRAS
(Translation of Registrant's name into English)



Avenida República do Chile, 65
20031-912 - Rio de Janeiro, RJ
Federative Republic of Brazil
(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. 

Form 20-F ___X___ Form 40-F _______

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes _______ No___X____

 


 
 

 

 

Petróleo Brasileiro S.A. – Petrobras

Quarterly Information - ITR

At June 30, 2014 and report on review of

Quarterly Information

 

(A free translation of the original in Portuguese)

 

 


 
 

Petróleo Brasileiro S.A. – Petrobras

Index

 

 

Report of Independent Registered Public Accounting Firm 3
Company Data / Share Capital Composition 5
Company Data / Cash Dividends 6
Individual Interim Accounting Information / Statement of Financial Position - Assets 7
Individual Interim Accounting Information / Statement of Financial Position - Liabilities 8
Individual Interim Accounting Information / Statement of Income 9
Individual Interim Accounting Information / Statement of Comprehensive Income 10
Individual Interim Accounting Information / Statement of Cash Flows – Indirect Method 11
Individual Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2014 to 06/30/2014 12
Individual Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2013 to 06/30/2013 13
Individual Interim Accounting Information / Statement of Added Value 14
Consolidated Interim Accounting Information / Statement of Financial Position - Assets 15
Consolidated Interim Accounting Information / Statement of Financial Position - Liabilities 16
Consolidated Interim Accounting Information / Statement of Income 17
Consolidated Interim Accounting Information / Statement of Comprehensive Income 18
Consolidated Interim Accounting Information / Statement of Cash Flows – Indirect Method 19
Consolidated Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2014 to 06/30/2014 20
Consolidated Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2013 to 06/30/2013 21
Consolidated Interim Accounting Information / Statement of Added Value 22
Notes to the financial statements 23
1. The Company and its operations 23
2. Basis of preparation of interim financial information 23
3. Basis of consolidation 23
4. Accounting policies 24
5. Cash and cash equivalents 24
6. Marketable securities 24
7. Trade and other receivables 25
8. Inventories 26
9. Disposal of assets and legal mergers 26
10. Investments 28
11. Property, plant and equipment 30
12. Intangible assets 31
13. Exploration for and evaluation of oil and gas reserves 32
14. Trade payables 33
15. Finance debt 34
16. Leases 37
17. Related parties 37
18. Provision for decommissioning costs 42
19. Taxes 43
20. Employee benefits (Post-Employment) 46
21. Shareholders’ equity 48
22. Sales revenues 49
23. Other operating expenses, net 49
24. Expenses by nature 50
25. Net finance income (expense) 50
26. Supplemental information on statement of cash flows 51
27. Segment information 52
28. Provisions for legal proceedings, contingent liabilities and contingent assets 56
29. Collateral in connection with concession agreements for petroleum exploration 60
30. Risk management 60
31. Fair value of financial assets and liabilities 64
32. Subsequent events 64
33. Correlation between the notes disclosed in the complete annual financial statements as of December 31, 2013 and the interim statements as of June 30, 2014  66

  


 
 

 

Report of Independent Registered Public Accounting Firm

 

 

(A free translation of the original in Portuguese)

 

 

 

Report on review of quarterly information

 

 

To the Board of Directors and Shareholders

Petróleo Brasileiro S.A. - Petrobras

 

 

 

 

Introduction

 

We have reviewed the accompanying parent company and consolidated interim accounting information of Petróleo Brasileiro S.A - Petrobras, included in the Quarterly Information Form for the quarter ended June 30, 2014, comprising the balance sheet as at that date and the statements of income, comprehensive income, changes in equity and cash flows for the six months then ended, and a summary of significant accounting policies and other explanatory information.

 

Management is responsible for the preparation of the parent company interim accounting information in accordance with the accounting standard CPC 21 (R1), Interim Financial Reporting, of the Brazilian Accounting Pronouncements Committee (CPC), and of the consolidated interim accounting information in accordance with CPC 21 (R1) and International Accounting Standard IAS 34 - Interim Financial Reporting issued by the International Accounting Standards Board (IASB), as well as the presentation of this information in accordance with the standards issued by the Brazilian Securities Commission (CVM), applicable to the preparation of the Quarterly Information.  Our responsibility is to express a conclusion on this interim accounting information based on our review.

 

Scope of review

 

We conducted our review in accordance with Brazilian and International Standards on Reviews of Interim Financial Information (NBC TR 2410 – Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 – Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively).  A review of interim information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.  A review is substantially less in scope than an audit conducted in accordance with Brazilian and International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit.  Accordingly, we do not express an audit opinion.

 

 

 

 


 
 

 

Conclusion on the parent

company interim information

 

Based on our review, nothing has come to our attention that causes us to believe that the accompanying parent company interim accounting information included in the quarterly information referred to above has not been prepared, in all material respects, in accordance with CPC 21 (R1) applicable to the preparation of the Quarterly Information, and presented in accordance with the standards issued by the CVM.

 

Conclusion on the consolidated

interim information

 

Based on our review, nothing has come to our attent­ion that causes us to believe that the accompanying consolidated interim accounting information included in the quarterly information referred to above has not been prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34 applicable to the preparation of the Quarterly Information, and presented in accordance with the standards issued by the CVM.

 

Other matters

 

Statements of value added

 

We have also reviewed the parent company and consolidated statements of value added for the six-month period ended June 30, 2014.  These statements are the responsibility of the Company’s management, and are required to be presented in accordance with standards issued by the CVM applicable to the preparation of Quarterly Information and are considered supplementary information under IFRS, which do not require the presentation of the statement of value added.  These statements have been submitted to the same review procedures described above and, based on our review, nothing has come to our attention that causes us to believe that they have not been prepared, in all material respects, in a manner consistent with the parent company and consolidated interim accounting information taken as a whole.

 

 

 

Rio de Janeiro, August 8, 2014

 

 

 

/s/ PricewaterhouseCoopers                                                                     

Auditores Independentes                                                                   

CRC 2SP000160/O-5 "F" RJ

 

 

 

/s/ Marcos Donizete Panassol

Contador CRC 1SP155975/O-8 "S" RJ

 

 


 
 

Petróleo Brasileiro S.A. – Petrobras

Company Data / Share Capital Composition

 

 

Number of Shares

(Thousand)

Current Quarter

 

06/30/2014

 

 

From Paid-in Capital

 

Common

7,442,454

Preferred

5,602,043

Total

13,044,497

 

 

Treasury Shares

 

Common

0

Preferred

0

Total

0

 

 

 

 

5 


 
 

Petróleo Brasileiro S.A. – Petrobras

Company Data / Cash Dividends

 

 

Event

Approval

Date

Type

Payment

Begin

Type of Shares

Class of shares

Dividends Per Share

(Reais/Share)

 

 

 

 

 

 

 

 

 

 

Board of Directors Meeting

02/25/2014

Interest on Shareholders' equity

04/25/2014

Preferred

 

0.96720

Board of Directors Meeting

02/25/2014

Interest on Shareholders' equity

04/25/2014

Common

 

0.52170

 

                   

 

 

 

6 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Financial Position - Assets

(R$ Thousand)

 

 

 

Current Quarter

Previous Fiscal Year

Account Code

Account Description

June 30, 2014

December 31, 2013

1

Total Assets

656,420,000

633,173,000

1.01

Current Assets

84,581,000

87,480,000

1.01.01

Cash and Cash Equivalents

6,945,000

7,917,000

1.01.02

Marketable securities

17,603,000

22,752,000

1.01.03

Trade Receivables, Net

19,115,000

16,301,000

1.01.04

Inventories

30,272,000

27,476,000

1.01.06

Recoverable Income Taxes

5,850,000

9,281,000

1.01.06.01

Current Recoverable Income Taxes

5,850,000

9,281,000

1.01.06.01.01

Current Income Tax and Social Contribution

992,000

1,468,000

1.01.06.01.02

Other Recoverable Taxes

4,858,000

7,813,000

1.01.08

Other Current Assets

4,796,000

3,753,000

1.01.08.01

Assets classified as held for sale

733,000

781,000

1.01.08.03

Others

4,063,000

2,972,000

1.01.08.03.01

Advances to Suppliers

1,402,000

1,407,000

1.01.08.03.02

Others

2,661,000

1,565,000

1.02

Non-Current Assets

571,839,000

545,693,000

1.02.01

Long-Term Receivables

25,562,000

26,330,000

1.02.01.01

Marketable securities measured at Fair Value

22,000

31,000

1.02.01.02

Marketable securities measured at Amortized Cost

234,000

226,000

1.02.01.03

Trade Receivables, Net

3,801,000

4,453,000

1.02.01.06

Deferred income Taxes

9,777,000

10,899,000

1.02.01.06.02

Deferred Taxes and contributions

9,777,000

10,899,000

1.02.01.09

Other Non-Current Assets

11,728,000

10,721,000

1.02.01.09.03

Advances to Suppliers

1,772,000

2,172,000

1.02.01.09.04

Judicial Deposits

5,301,000

4,826,000

1.02.01.09.05

Other Long-Term Assets

4,655,000

3,723,000

1.02.02

Investments

83,200,000

83,497,000

1.02.03

Property, Plant and Equipment

429,839,000

402,567,000

1.02.04

Intangible Assets

33,210,000

33,289,000

1.02.05

Deferred charges

28,000

10,000

 

 

 

7 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Financial Position - Liabilities

(R$ Thousand)

 

 

 

Current Quarter

Previous Fiscal Year

Account Code

Account Description

June 30, 2014

December 31, 2013

2

Total Liabilities

656,420,000

633,173,000

2.01

Current Liabilities

84,139,000

102,049,000

2.01.01

Payroll, profit sharing and related charges

4,958,000

4,127,000

2.01.02

Trade Payables

28,972,000

25,961,000

2.01.04

Current debt and Finance Lease Obligations

36,453,000

48,411,000

2.01.04.01

Current debt

35,013,000

46,627,000

2.01.04.03

Finance Lease Obligations

1,440,000

1,784,000

2.01.05

Other Liabilities

11,911,000

21,730,000

2.01.05.02

Others

11,911,000

21,730,000

2.01.05.02.01

Dividends and interest on capital payable

9,301,000

2.01.05.02.04

Other taxes

9,182,000

9,734,000

2.01.05.02.05

Other accounts payable

2,729,000

2,695,000

2.01.06

Provisions

1,845,000

1,820,000

2.01.06.02

Other Provisions

1,845,000

1,820,000

2.01.06.02.04

Pension and Medical Benefits

1,845,000

1,820,000

2.02

Non-Current Liabilities

211,430,000

182,984,000

2.02.01

Non-current debt and Finance Lease Obligations

135,208,000

111,696,000

2.02.01.01

Non-current debt

130,443,000

105,737,000

2.02.01.03

Finance Lease Obligations

4,765,000

5,959,000

2.02.03

Deferred Income Taxes

29,314,000

24,259,000

2.02.03.01

Deferred Income Tax and Social Contribution

29,314,000

24,259,000

2.02.04

Provisions

46,908,000

47,029,000

2.02.04.01

Provisions for legal proceedings (tax, labor, civil and pension)

2,726,000

2,280,000

2.02.04.02

Other Provisions

44,182,000

44,749,000

2.02.04.02.04

Pension and Medical Benefits

27,150,000

26,077,000

2.02.04.02.05

Provision for decommissioning costs

14,937,000

15,320,000

2.02.04.02.06

Other Provisions

2,095,000

3,352,000

2.03

Shareholders' Equity

360,851,000

348,140,000

2.03.01

Share Capital

205,432,000

205,411,000

2.03.02

Capital Reserves

967,000

1,048,000

2.03.04

Profit Reserves

148,904,000

148,925,000

2.03.05

Retained earnings

10,308,000

2.03.06

Accumulated other comprehensive income

(4,760,000)

(7,244,000)

 

 

 

 

8 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Income

(R$ thousand)

 

Account Code

Account Description

Current Quarter 04/01/2014 to 06/30/2014

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Same Quarter of the Previous Year 04/01/2013 to 06/30/2013

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

3.01

Sales Revenues

66,015,000

129,665,000

57,706,000

114,630,000

3.02

Cost of Sales

(51,372,000)

(101,707,000)

(43,778,000)

(87,634,000)

3.03

Gross Profit

14,643,000

27,958,000

13,928,000

26,996,000

3.04

Operating Expenses / Income

(8,108,000)

(15,553,000)

(4,875,000)

(9,508,000)

3.04.01

Selling Expenses

(3,374,000)

(6,641,000)

(3,157,000)

(6,203,000)

3.04.02

General and Administrative Expenses

(1,765,000)

(3,552,000)

(1,823,000)

(3,505,000)

3.04.05

Other Operating Expenses

(5,051,000)

(11,568,000)

(3,496,000)

(7,353,000)

3.04.05.01

Other Taxes

(209,000)

(408,000)

(89,000)

(175,000)

3.04.05.02

Research and Development Expenses

(592,000)

(1,181,000)

(583,000)

(1,228,000)

3.04.05.03

Exploration Costs

(1,656,000)

(3,132,000)

(1,146,000)

(2,383,000)

3.04.05.04

Profit sharing

(252,000)

(533,000)

(313,000)

(690,000)

3.04.05.05

Other operating expenses, net

(2,342,000)

(6,314,000)

(1,365,000)

(2,877,000)

3.04.06

Share of profit / gains on interest in equity-accounted investments

2,082,000

6,208,000

3,601,000

7,553,000

3.05

Net income before financial results, profit sharing and income taxes

6,535,000

12,405,000

9,053,000

17,488,000

3.06

Finance income (expenses), net

157,000

612,000

(1,723,000)

(521,000)

3.06.01

Finance Income

1,271,000

2,549,000

670,000

1,419,000

3.06.01.01

Finance Income

844,000

1,621,000

670,000

1,419,000

3.06.01.02

Foreign Exchange and Inflation Indexation Charges, Net

427,000

928,000

3.06.02

Finance Expenses

(1,114,000)

(1,937,000)

(2,393,000)

(1,940,000)

3.06.02.01

Finance Expenses

(1,114,000)

(1,937,000)

(426,000)

(759,000)

3.06.02.02

Foreign Exchange and Inflation Indexation Charges, Net

(1,967,000)

(1,181,000)

3.07

Net Income Before Income Taxes

6,692,000

13,017,000

7,330,000

16,967,000

3.08

Income Tax and Social Contribution

(1,752,000)

(2,714,000)

(1,164,000)

(3,171,000)

3.08.02

Deferred

(1,752,000)

(2,714,000)

(1,164,000)

(3,171,000)

3.09

Net Income from Continuing Operations

4,940,000

10,303,000

6,166,000

13,796,000

3.11

Income / Loss for the Period

4,940,000

10,303,000

6,166,000

13,796,000

3.99

Basic Income per Share (Reais / Share)

 

 

 

 

3.99.01

Basic Income per Share

 

 

 

 

3.99.01.01

Common

0.38000

0.79000

0.47000

1.06000

3.99.01.02

Preferred

0.38000

0.79000

0.47000

1.06000

3.99.02

Diluted Income per Share

 

 

 

 

3.99.02.01

Common

0.38000

0.79000

0.47000

1.06000

3.99.02.02

Preferred

0.38000

0.79000

0.47000

1.06000

 

 

 

 

9 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Comprehensive Income

(R$ thousand)

 

Account Code

Account Description

Current Quarter 04/01/2014 to 06/30/2014

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Same Quarter of the Previous Year 04/01/2013 to 06/30/2013

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

4.01

Net Income for the Period

4,940,000

10,303,000

6,166,000

13,796,000

4.02

Other Comprehensive Income

1,236,000

2,489,000

(3,410,000)

(3,806,000)

4.02.07

Unrealized Gains / (Losses) on Cash Flow Hedge - Recognized in Shareholders' Equity

2,768,000

6,488,000

(7,268,000)

(7,268,000)

4.02.08

Unrealized Gains / (Losses) on Cash Flow Hedge - Reclassified to Profit or Loss

274,000

697,000

4.02.09

Deferred Income Tax and Social Contribution on Cash Flow Hedge

(941,000)

(2,206,000)

1,999,000

1,999,000

4.02.10

Share of Other Comprehensive Income of Equity-accounted Investments

(865,000)

(2,490,000)

1,859,000

1,463,000

4.03

Total Comprehensive Income for the Period

6,176,000

12,792,000

2,756,000

9,990,000

 

 

 

10 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Cash Flows – Indirect Method

(R$ Thousand)

 

Account Code

Account Description

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

6.01

Net cash provided by operating activities

10,101,000

23,197,000

6.01.01

Cash provided by operating activities

23,284,000

23,399,000

6.01.01.01

Net Income for the Period

10,303,000

13,796,000

6.01.01.03

Pension and medical benefits (actuarial expense)

1,953,000

2,523,000

6.01.01.04

Share of Profit of Equity-accounted Investments

(6,208,000)

(7,553,000)

6.01.01.05

Depreciation, Depletion and Amortization

10,992,000

9,784,000

6.01.01.06

Impairment charges on property, plant and equipment and other assets

317,000

130,000

6.01.01.07

Exploration expenditures written off

2,427,000

1,223,000

6.01.01.08

(Gains) / losses on disposal / write-offs of non-current assets, E&P areas returned and cancelled projects

69,000

64,000

6.01.01.09

Foreign Exchange variation, indexation and finance charges

717,000

261,000

6.01.01.10

Deferred income taxes, net

2,714,000

3,171,000

6.01.02

Decrease / (Increase) in assets / Increase/(Decrease) in liabilities

(13,183,000)

(202,000)

6.01.02.01

Trade and Other Receivables

(2,846,000)

2,825,000

6.01.02.02

Inventories

(3,107,000)

(854,000)

6.01.02.03

Other Assets

(3,406,000)

(713,000)

6.01.02.04

Trade Payables

(2,618,000)

380,000

6.01.02.05

Taxes payable

(1,922,000)

(1,883,000)

6.01.02.06

Pension and Medical Benefits

(854,000)

(738,000)

6.01.02.07

Other Liabilities

1,570,000

781,000

6.02

Net cash provided by (used in) investing activities

(19,840,000)

(50,395,000)

6.02.01

Capital expenditures

(31,100,000)

(29,923,000)

6.02.02

Investments in investees

(2,335,000)

(8,708,000)

6.02.03

Proceeds from disposal of assets (divestment)

893,000

6.02.04

Investments in marketable securities

6,080,000

(13,658,000)

6.02.05

Dividends Received

2,412,000

1,894,000

6.02.06

Cash and Cash Equivalents of Consolidated Companies previously accounted for by the equity method

4,210,000

6.03

Net cash provided by financing activities

8,767,000

37,159,000

6.03.02

Proceeds from long-term financing

42,514,000

84,905,000

6.03.03

Repayment of Principal

(22,563,000)

(43,363,000)

6.03.04

Repayment of Interest

(2,453,000)

(1,512,000)

6.03.05

Dividends paid

(8,731,000)

(2,871,000)

6.05

Net increase/ (decrease) in cash and cash equivalents

(972,000)

9,961,000

6.05.01

Cash and cash equivalents at the beginning of the year

7,917,000

17,393,000

6.05.02

Cash and cash equivalents at the end of the period

6,945,000

27,354,000

 

 

11 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2014 to 06/30/2014

(R$ thousand)

 

Account Code

Account Description

Share Capital

Capital Reserves, Granted Options and Treasury Shares

Profit Reserves

Retained Earnings (Losses)

Accumulated Other Comprehensive Income

Shareholders' Equity

5.01

Balance at the beginning of the period

205,411,000

1,048,000

148,925,000

(7,244,000)

348,140,000

5.03

Adjusted Opening Balance

205,411,000

1,048,000

148,925,000

(7,244,000)

348,140,000

5.04

Transactions with owners

21,000

(81,000)

(21,000)

5,000

(5,000)

(81,000)

5.04.01

Capital Increases

21,000

(21,000)

5.04.08

Change in Interest in Subsidiaries

(81,000)

(81,000)

5.04.09

Realization of the Deemed Cost

5,000

(5,000)

5.05

Total of Comprehensive Income

10,303,000

2,489,000

12,792,000

5.05.01

Net Income for the Period

10,303,000

10,303,000

5.05.02

Other Comprehensive Income

2,489,000

2,489,000

5.07

Balance at the end of the period

205,432,000

967,000

148,904,000

10,308,000

(4,760,000)

360,851,000

 

 

 

 

 

12 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2013 to 06/30/2013

(R$ thousand)

 

Account Code

Account Description

Share Capital

Capital Reserves, Granted Options and Treasury Shares

Profit Reserves

Retained Earnings (Losses)

Accumulated Other Comprehensive Income

Shareholders' Equity

5.01

Balance at the beginning of the period

205,392,000

939,000

134,980,000

2,129,000

343,440,000

5.02

Prior period adjustments

(154,000)

(14,505,000)

(14,659,000)

5.03

Adjusted Opening Balance

205,392,000

939,000

134,980,000

(154,000)

(12,376,000)

328,781,000

5.04

Transactions with owners

19,000

50,000

(19,000)

5,000

(5,000)

50,000

5.04.01

Capital Increases

19,000

(19,000)

5.04.08

Change in Interest in Subsidiaries

50,000

50,000

5.04.09

Realization of the Deemed Cost

5,000

(5,000)

5.05

Total of Comprehensive Income

13,796,000

(3,806,000)

9,990,000

5.05.01

Net Income for the Period

13,796,000

13,796,000

5.05.02

Other Comprehensive Income

(3,806,000)

(3,806,000)

5.07

Balance at the end of the period

205,411,000

989,000

134,961,000

13,647,000

(16,187,000)

338,821,000

 

13 


 
 

Petróleo Brasileiro S.A. – Petrobras

Individual Interim Accounting Information / Statement of Added Value

(R$ Thousand)

 

Account Code

Account Description

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

7.01

Sales Revenues

199,990,000

179,177,000

7.01.01

Sales of Goods and Services

161,832,000

145,122,000

7.01.02

Other Revenues

4,043,000

2,965,000

7.01.03

Revenues Related to the Construction of Assets to be Used in Own Operations

34,301,000

31,086,000

7.01.04

Allowance / Reversal for Impairment of Trade Receivables

(186,000)

4,000

7.02

Inputs Acquired from Third Parties

(111,597,000)

(95,728,000)

7.02.01

Cost of Sales

(57,917,000)

(46,453,000)

7.02.02

Materials, Power, Third-Party Services and Other Operating Expenses

(40,692,000)

(38,528,000)

7.02.03

Impairment charges / reversals of Assets

(317,000)

(130,000)

7.02.04

Others

(12,671,000)

(10,617,000)

7.03

Gross Added Value

88,393,000

83,449,000

7.04

Retentions

(10,992,000)

(9,784,000)

7.04.01

Depreciation, Amortization and Depletion

(10,992,000)

(9,784,000)

7.05

Net Added Value Produced

77,401,000

73,665,000

7.06

Transferred Added Value

8,254,000

10,470,000

7.06.01

Share of Profit of Equity-accounted Investments

6,208,000

7,553,000

7.06.02

Finance Income

1,652,000

2,554,000

7.06.03

Others

394,000

363,000

7.07

Total Added Value to be Distributed

85,655,000

84,135,000

7.08

Distribution of Added Value

85,655,000

84,135,000

7.08.01

Employee compensation

13,196,000

10,423,000

7.08.01.01

Salaries

9,825,000

6,678,000

7.08.01.02

Fringe Benefits

2,839,000

3,271,000

7.08.01.03

Unemployment benefits (FGTS)

532,000

474,000

7.08.02

Taxes and contributions

40,669,000

39,292,000

7.08.02.01

Federal

27,012,000

26,509,000

7.08.02.02

State

13,543,000

12,726,000

7.08.02.03

Municipal

114,000

57,000

7.08.03

Return on third-party capital

21,487,000

20,624,000

7.08.03.01

Interest

5,038,000

5,765,000

7.08.03.02

Rental expenses

16,449,000

14,859,000

7.08.04

Return on Shareholders' Equity

10,303,000

13,796,000

7.08.04.03

Retained Earnings (losses) for The Period

10,303,000

13,796,000

 

 

 

14 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Financial Position - Assets

(R$ Thousand)

 

 

 

Current Quarter

Previous Fiscal Year

Account Code

Account Description

06/30/2014

12/31/2013

1

Total Assets

800.370.000

752.967.000

1.01

Current Assets

144.270.000

123.351.000

1.01.01

Cash and Cash Equivalents

58.140.000

37.172.000

1.01.02

Marketable securities

8.236.000

9.101.000

1.01.03

Trade and Other Receivables

23.412.000

22.652.000

1.01.04

Inventories

37.408.000

33.324.000

1.01.06

Recoverable Income Taxes

8.344.000

11.646.000

1.01.06.01

Current Recoverable Income Taxes

8.344.000

11.646.000

1.01.06.01.01

Current Income Tax and Social Contribution

1.973.000

2.484.000

1.01.06.01.02

Other Recoverable Taxes

6.371.000

9.162.000

1.01.08

Other Current Assets

8.730.000

9.456.000

1.01.08.01

Assets classified as held for sale

4.223.000

5.638.000

1.01.08.03

Others

4.507.000

3.818.000

1.01.08.03.01

Advances to Suppliers

1.556.000

1.600.000

1.01.08.03.02

Others

2.951.000

2.218.000

1.02

Non-Current Assets

656.100.000

629.616.000

1.02.01

Long-Term Receivables

45.138.000

44.000.000

1.02.01.01

Marketable securitiess measured at Fair Value

22.000

31.000

1.02.01.02

Marketable securities measured at Amortized Cost

277.000

276.000

1.02.01.03

Trade and Other Receivables

12.660.000

10.616.000

1.02.01.06

Deferred Income Taxes

13.827.000

15.250.000

1.02.01.06.01

Deferred Income Tax and Social Contribution

2.377.000

2.647.000

1.02.01.06.02

Deferred Taxes and Contributions

11.450.000

12.603.000

1.02.01.09

Other Non-Current Assets

18.352.000

17.827.000

1.02.01.09.03

Advances to Suppliers

6.992.000

7.566.000

1.02.01.09.04

Judicial deposits

6.395.000

5.866.000

1.02.01.09.05

Other Long-Term Assets

4.965.000

4.395.000

1.02.02

Investments

15.669.000

15.615.000

1.02.03

Property, Plant and Equipment

559.335.000

533.880.000

1.02.04

Intangible Assets

35.958.000

36.121.000

 

 

 

 

15 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Financial Position - Liabilities

(R$ Thousand)

 

 

 

Current Quarter

Previous Fiscal Year

Account Code

Account Description

06/30/2014

12/31/2013

2

Total Liabilities

800.370.000

752.967.000

2.01

Current Liabilities

75.256.000

82.525.000

2.01.01

Payroll, profit sharing and related charges

5.709.000

4.806.000

2.01.02

Trade Payables

27.551.000

27.922.000

2.01.03

Taxes

838.000

659.000

2.01.03.01

Federal Taxes

838.000

659.000

2.01.03.01.01

Income Tax and Social Contribution Payable

838.000

659.000

2.01.04

Current debt and Finance Lease Obligations

23.535.000

18.782.000

2.01.04.01

Current debt

23.495.000

18.744.000

2.01.04.03

Finance Lease Obligations

40.000

38.000

2.01.05

Other Liabilities

15.126.000

25.930.000

2.01.05.02

Others

15.126.000

25.930.000

2.01.05.02.01

Dividends and interest on capital payable

9.301.000

2.01.05.02.04

Other Taxes

10.221.000

10.938.000

2.01.05.02.05

Other accounts payable

4.905.000

5.691.000

2.01.06

Provisions

1.909.000

1.912.000

2.01.06.02

Other Provisions

1.909.000

1.912.000

2.01.06.02.04

Pension and Medical Benefits

1.909.000

1.912.000

2.01.07

Liabilities associated with non-current Assets Held For Sale and Discontinued

588.000

2.514.000

2.01.07.01

Liabilities associated with Non-current Assets Held For Sale

588.000

2.514.000

2.02

Non-Current Liabilities

362.874.000

321.108.000

2.02.01

Non-current debt and Finance Lease Obligations

284.177.000

249.038.000

2.02.01.01

Non-Current debt

284.001.000

248.867.000

2.02.01.03

Finance Lease Obligations

176.000

171.000

2.02.03

Deferred Income Taxes

28.054.000

23.206.000

2.02.03.01

Deferred Income Tax and Social Contribution

28.054.000

23.206.000

2.02.04

Provisions

50.643.000

48.864.000

2.02.04.01

Provisions for legal proceedings (tax, labor, civil and pension)

3.327.000

2.918.000

2.02.04.02

Other Provisions

47.316.000

45.946.000

2.02.04.02.04

Pension and Medical Benefits

28.864.000

27.541.000

2.02.04.02.05

Provision for decommissioning costs

16.176.000

16.709.000

2.02.04.02.06

Other Provisions

2.276.000

1.696.000

2.03

Consolidated Shareholders' Equity

362.240.000

349.334.000

2.03.01

Share Capital

205.432.000

205.411.000

2.03.02

Capital Reserves

656.000

737.000

2.03.04

Profit Reserves

149.015.000

149.036.000

2.03.05

Retained earnings

10.357.000

2.03.06

Accumulated other comprehensive income

(4.760.000)

(7.244.000)

2.03.09

Non-controlling Interests

1.540.000

1.394.000

 

 

 

16 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Income

(R$ Thousand)

 

Account Code

Account Description

Current Quarter 04/01/2014 to 06/30/2014

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Same Quarter of the Previous Year 04/01/2013 to 06/30/2013

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

3.01

Sales Revenues

82,298,000

163,843,000

73,626,000

146,162,000

3.02

Cost of Sales

(63,283,000)

(125,374,000)

(54,919,000)

(108,598,000)

3.03

Gross Profit

19,015,000

38,469,000

18,707,000

37,564,000

3.04

Operating Expenses / Income

(10,208,000)

(21,899,000)

(7,211,000)

(16,062,000)

3.04.01

Selling Expenses

(2,772,000)

(5,497,000)

(2,552,000)

(4,847,000)

3.04.02

General and Administrative Expenses

(2,580,000)

(5,140,000)

(2,590,000)

(5,060,000)

3.04.05

Other Operating Expenses

(5,127,000)

(12,055,000)

(2,459,000)

(6,701,000)

3.04.05.01

Other Taxes

(313,000)

(640,000)

(249,000)

(472,000)

3.04.05.02

Research and Development Expenses

(601,000)

(1,193,000)

(594,000)

(1,268,000)

3.04.05.03

Exploration Costs

(1,803,000)

(3,328,000)

(1,207,000)

(2,488,000)

3.04.05.04

Profit Sharing

(312,000)

(648,000)

(235,000)

(648,000)

3.04.05.05

Other Operating Expenses / Income, Net

(2,098,000)

(6,246,000)

(174,000)

(1,825,000)

3.04.06

Share of Profit in Equity-Accounted Investments

271,000

793,000

390,000

546,000

3.05

Net Income Before Financial Results and Income Taxes

8,807,000

16,570,000

11,496,000

21,502,000

3.06

Net Finance Income (Expense)

(940,000)

(1,114,000)

(3,551,000)

(2,161,000)

3.06.01

Finance Income

1,303,000

2,977,000

909,000

1,881,000

3.06.01.01

Finance Income

758,000

1,800,000

909,000

1,881,000

3.06.01.02

Foreign Exchange and Inflation Indexation Charges, Net

545,000

1,177,000

3.06.02

Finance Expenses

(2,243,000)

(4,091,000)

(4,460,000)

(4,042,000)

3.06.02.01

Finance Expenses

(2,243,000)

(4,091,000)

(1,280,000)

(2,479,000)

3.06.02.02

Foreign Exchange and Inflation Indexation Charges, Net

(3,180,000)

(1,563,000)

3.07

Net Income Before Income Taxes

7,867,000

15,456,000

7,945,000

19,341,000

3.08

Income Tax and Social Contribution

(2,676,000)

(4,479,000)

(2,266,000)

(5,827,000)

3.08.01

Current

(1,063,000)

(2,183,000)

(1,182,000)

(2,621,000)

3.08.02

Deferred

(1,613,000)

(2,296,000)

(1,084,000)

(3,206,000)

3.09

Net Income from Continuing Operations

5,191,000

10,977,000

5,679,000

13,514,000

3.11

Consolidated Net Income / Loss for the Period

5,191,000

10,977,000

5,679,000

13,514,000

3.11.01

Attributable to Shareholders of Petrobras

4,959,000

10,352,000

6,201,000

13,894,000

3.11.02

Attributable to Non-controlling Interests

232,000

625,000

(522,000)

(380,000)

3.99

Income per Share - (Reais / Share)

3.99.01

Basic Income per Share

3.99.01.01

Common

0.38000

0.79000

0.48000

1.07000

3.99.01.02

Preferred

0.38000

0.79000

0.48000

1.07000

3.99.02

Diluted Income per Share

3.99.02.01

Common

0.38000

0.79000

0.48000

1.07000

3.99.02.02

Preferred

0.38000

0.79000

0.48000

1.07000

 

 

 

17 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Comprehensive Income

(R$ Thousand)

  

Account Code

Account Description

Current Quarter 04/01/2014 to 06/30/2014

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Same Quarter of the Previous Year 04/01/2013 to 06/30/2013

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

4.01

Consolidated Net Income for the Period

5,192,000

10,977,000

5,679,000

13,514,000

4.02

Other Comprehensive Income

1,154,000

2,067,000

(3,273,000)

(3,751,000)

4.02.01

Actuarial gains / (losses) on defined benefit pension plans

(1,000)

(1,000)

(11,000)

(11,000)

4.02.03

Cumulative translation adjustments

(1,032,000)

(3,145,000)

2,343,000

1,887,000

4.02.05

Unrealized Gains / (Losses) on Available-for-Sale Securities - Transferred to Profit or Loss

(90,000)

4.02.06

Deferred income tax and social contribution on available-for-sale securities

31,000

4.02.07

Unrealized Gains / (Losses) on Cash Flow Hedge - Recognized in Shareholders' Equity

2,884,000

6,780,000

(8,019,000)

(7,975,000)

4.02.08

Unrealized Gains / (Losses) on Cash Flow Hedge - Reclassified to Profit or Loss

301,000

772,000

10,000

8,000

4.02.09

Deferred income tax and social contribution on Unrealized gains / (losses) on cash flow hedge

(1,082,000)

(2,565,000)

2,714,000

2,714,000

4.02.10

Share of other comprehensive income of equity-accounted investments

84,000

226,000

(310,000)

(315,000)

4.03

Total Comprehensive Income for the Period

6,346,000

13,044,000

2,406,000

9,763,000

4.03.01

Attributable to Shareholders of Petrobras

6,195,000

12,841,000

2,791,000

10,088,000

4.03.02

Attributable to Non-controlling Interests

151,000

203,000

(385,000)

(325,000)

 

 

 

18 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Cash Flows – Indirect Method

(R$ Thousand)

  

Account Code

Account Description

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

6.01

Net cash provided by operating activities

23,714,000

31,076,000

6.01.01

Cash provided by operating activities

35,173,000

34,981,000

6.01.01.01

Net Income for the Period

10,352,000

13,894,000

6.01.01.02

Non-controlling Interests

625,000

(380,000)

6.01.01.03

Pension and medical benefits (actuarial expense)

2,252,000

2,775,000

6.01.01.04

Share of Profit of Equity-accounted Investments

(793,000)

(546,000)

6.01.01.05

Depreciation, Depletion and Amortization

14,833,000

13,366,000

6.01.01.06

Impairment charges on property, plant and equipment and other assets

473,000

471,000

6.01.01.07

Exploration expenditures written off

2,552,000

1,231,000

6.01.01.08

(Gains) / losses on disposal / write-offs of non-current assets, E&P areas returned and cancelled projects

(313,000)

(1,400,000)

6.01.01.09

Foreign exchange variation, indexation and finance charges

2,896,000

2,364,000

6.01.01.10

Deferred Income Tax, Net

2,296,000

3,206,000

6.01.02

Decrease / (Increase) in assets / Increase/(Decrease) in liabilities

(11,459,000)

(3,905,000)

6.01.02.01

Trade and Other Receivables

(3,190,000)

777,000

6.01.02.02

Inventories

(4,760,000)

(1,637,000)

6.01.02.03

Other Assets

(2,236,000)

(339,000)

6.01.02.04

Trade Payables

157,000

(75,000)

6.01.02.05

Taxes payable

(2,006,000)

(2,493,000)

6.01.02.06

Pension and Medical Benefits

(901,000)

(787,000)

6.01.02.07

Other Liabilities

1,477,000

649,000

6.02

Net cash provided by (used in) investing activities

(37,117,000)

(38,664,000)

6.02.01

Capital Expenditrures

(39,830,000)

(41,610,000)

6.02.02

Investments in investees

(288,000)

(114,000)

6.02.03

Proceeds from disposal of assets (divestment)

1,054,000

3,192,000

6.02.04

Investments in marketable securities

1,306,000

(275,000)

6.02.05

Dividends Received

641,000

143,000

6.03

Net cash provided by financing activities

37,565,000

29,345,000

6.03.01

Non-controlling interests

1,000

(199,000)

6.03.02

Proceeds from long-term financing

64,026,000

61,150,000

6.03.03

Repayment of principal

(11,068,000)

(23,814,000)

6.03.04

Repayment of interest

(6,663,000)

(4,921,000)

6.03.05

Dividends paid

(8,731,000)

(2,871,000)

6.04

Effect of exchange rate changes on cash and cash equivalents

(3,194,000)

1,865,000

6.05

Net increase/ (decrease) in cash and cash equivalents

20,968,000

23,622,000

6.05.01

Cash and cash equivalents at the beginning of the year

37,172,000

27,628,000

6.05.02

Cash and cash equivalents at the end of the period

58,140,000

51,250,000

 

 

 

19 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2014 to 06/30/2014

(R$ Thousand)

  

Account Code

Account Description

Share Capital

Capital Reserves, Granted Options and Treasury Shares

Profit Reserves

Retained Earnings / Accumulated Losses

Other Comprehensive Income

Shareholders' Equity

Non-controlling interest

Shareholders' Equity Consolidated

5.01

Balance at the beginning of the period

205,411,000

737,000

149,036,000

(7,244,000)

347,940,000

1,394,000

349,334,000

5.03

Adjusted Opening Balance

205,411,000

737,000

149,036,000

(7,244,000)

347,940,000

1,394,000

349,334,000

5.04

Transactions with owners

21,000

(81,000)

(21,000)

5,000

(5,000)

(81,000)

(57,000)

(138,000)

5.04.01

Capital Increases

21,000

(21,000)

5.04.06

Dividends

(56,000)

(56,000)

5.04.08

Change in Interest in Subsidiaries

(81,000)

(81,000)

(1,000)

(82,000)

5.04.09

Realization of the Deemed Cost

5,000

(5,000)

5.05

Total of Comprehensive Income

10,352,000

2,489,000

12,841,000

203,000

13,044,000

5.05.01

Net Income for the Period

10,352,000

10,352,000

625,000

10,977,000

5.05.02

Other Comprehensive Income

2,489,000

2,489,000

(422,000)

2,067,000

5.07

Balance at the end of the period

205,432,000

656,000

149,015,000

10,357,000

(4,760,000)

360,700,000

1,540,000

362,240,000

 

 

 

 

20 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Changes in Shareholders’ Equity - 01/01/2013 to 06/30/2013

(R$ Thousand)

  

Account Code

Account Description

Share Capital

Capital Reserves, Granted Options and Treasury Shares

Profit Reserves

Retained Earnings / Accumulated Losses

Other Comprehensive Income

Shareholders' Equity

Non-controlling interest

Shareholders' Equity Consolidated

5.01

Balance at the beginning of the period

205,392,000

630,000

134,929,000

2,128,000

343,079,000

2,354,000

345,433,000

5.02

Prior period adjustments

(154,000)

(14,504,000)

(14,658,000)

(14,658,000)

5.03

Adjusted Opening Balance

205,392,000

630,000

134,929,000

(154,000)

(12,376,000)

328,421,000

2,354,000

330,775,000

5.04

Transactions with owners

19,000

48,000

(19,000)

5,000

(5,000)

48,000

(268,000)

(220,000)

5.04.01

Capital Increases

19,000

(19,000)

5.04.08

Change in Interest in Subsidiaries

48,000

48,000

(268,000)

(220,000)

5.04.09

Realization of the Deemed Cost

5,000

(5,000)

5.05

Total of Comprehensive Income

13,894,000

(3,806,000)

10,088,000

(325,000)

9,763,000

5.05.01

Net Income for the Period

13,894,000

13,894,000

(380,000)

13,514,000

5.05.02

Other Comprehensive Income

(3,806,000)

(3,806,000)

55,000

(3,751,000)

5.07

Balance at the end of the period

205,411,000

678,000

134,910,000

13,745,000

(16,187,000)

338,557,000

1,761,000

340,318,000

 

 

 

 

 

21 


 
 

Petróleo Brasileiro S.A. – Petrobras

Consolidated Interim Accounting Information / Statement of Added Value

(R$ Thousand)

  

Account Code

Account Description

Accumulated of the Current Year 01/01/2014 to 06/30/2014

Accumulated of the Previous Year 01/01/2013 to 06/30/2013

7.01

Sales Revenues

243,743,000

223,845,000

7.01.01

Sales of Goods and Services

198,256,000

178,477,000

7.01.02

Other Revenues

5,339,000

5,663,000

7.01.03

Revenues Related to the Construction of Assets to be Used in Own Operations

40,357,000

39,703,000

7.01.04

Allowance / Reversal for Impairment of Trade Receivables

(209,000)

2,000

7.02

Inputs Acquired from Third Parties

(134,185,000)

(117,154,000)

7.02.01

Cost of Sales

(75,222,000)

(59,529,000)

7.02.02

Materials, Power, Third-Party Services and Other Operating Expenses

(44,968,000)

(45,773,000)

7.02.03

Impairment charges / reversals of Assets

(473,000)

(471,000)

7.02.04

Others

(13,522,000)

(11,381,000)

7.03

Gross Added Value

109,558,000

106,691,000

7.04

Retentions

(14,833,000)

(13,366,000)

7.04.01

Depreciation, Amortization and Depletion

(14,833,000)

(13,366,000)

7.05

Net Added Value Produced

94,725,000

93,325,000

7.06

Transferred Added Value

2,735,000

2,431,000

7.06.01

Share of Profit of Equity-accounted Investments

793,000

546,000

7.06.02

Finance Income

1,800,000

1,881,000

7.06.03

Others

142,000

4,000

7.07

Total Added Value to be Distributed

97,460,000

95,756,000

7.08

Distribution of Added Value

97,460,000

95,756,000

7.08.01

Employee compensation

16,089,000

13,036,000

7.08.01.01

Salaries

11,940,000

8,743,000

7.08.01.02

Fringe Benefits

3,543,000

3,750,000

7.08.01.03

Unemployment benefits (FGTS)

606,000

543,000

7.08.02

Taxes and contributions

55,846,000

53,800,000

7.08.02.01

Federal

33,114,000

33,208,000

7.08.02.02

State

22,546,000

20,465,000

7.08.02.03

Municipal

186,000

127,000

7.08.03

Return on third-party capital

14,548,000

15,406,000

7.08.03.01

Interest

7,247,000

7,743,000

7.08.03.02

Rental expenses

7,301,000

7,663,000

7.08.04

Return on Shareholders' Equity

10,977,000

13,514,000

7.08.04.03

Retained Earnings (losses) for The Period

10,352,000

13,894,000

7.08.04.04

Non-controlling Interests

625,000

(380,000)

 

 

 

 

22 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(In millions of reais, except when indicate otherwise)

 

1.            The Company and its operations

Petróleo Brasileiro S.A. - Petrobras is dedicated, directly or through its subsidiaries (referred to jointly as “Petrobras” or “the Company”) to prospecting, drilling, refining, processing, trading and transporting crude oil from producing onshore and offshore oil fields and from shale or other rocks, as well as oil products, natural gas and other liquid hydrocarbons. In addition, Petrobras carries out energy related activities, such as research, development, production, transport, distribution and trading of all forms of energy, as well as any other correlated or similar activities. The Company’s head office is located in Rio de Janeiro – RJ, Brazil.

2.            Basis of preparation of interim financial information

The consolidated interim financial information is being presented in accordance with IAS 34 - Interim Financial Reporting, as issued by the International Accounting Standards Board (IASB) and also in accordance with the accounting practices adopted in Brazil for interim financial reporting (CPC 21 - R1).

The individual interim financial information has been prepared and is being presented in accordance with the accounting practices adopted in Brazil for interim financial reporting (CPC 21 - R1) and does not differ from the consolidated information, except for the maintenance of the noncurrent deferred charges account, as established in CPC 43 (R1) – First-time adoption of Brazilian Accounting Pronouncements. The reconciliation between the parent company’s and the consolidated shareholders’ equity and net income is presented in Note 3.1.

This interim financial information presents the significant changes which occurred in the period, avoiding repetition of certain notes to the financial statements previously reported, and presents the consolidated information, considering Management’s understanding that the consolidated information provides a more comprehensive view of the Company’s financial position and operational performance, along with some individual information of the parent company. Hence it should be read together with the Company’s annual financial statements for the year ended December 31, 2013, which include the full set of notes.

This interim financial information was authorized for issue by the Company’s Board of Directors in a meeting held on August 8, 2014.

2.1.       Accounting estimates

The preparation of the interim financial information requires the use of estimates and assumptions for certain assets, liabilities and other transactions. These estimates include: oil and gas reserves, pension and medical benefits liabilities, depreciation, depletion and amortization, decommissioning costs, provisions for legal proceedings, fair value of financial instruments, present value adjustments of trade receivables and payables from relevant transactions, and income tax and social contribution on net income (CSLL). Even though our management uses assumptions and judgments that are periodically reviewed, the actual results could differ from these estimates.

3.            Basis of consolidation

The consolidated interim financial information includes the quarterly information of Petrobras, its subsidiaries, joint operations and consolidated structured entities.

There were no significant changes in the consolidated entities in the six-month period ended June 30, 2014.

The main disposal of assets and legal mergers are set out in note 9.

23 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

3.1.       Reconciliation between shareholders’ equity and net income for the parent company and consolidated

 

Shareholders' equity

Net income

 

06.30.2014

12.31.2013

Jan-Jun 2014

Jan-Jun 2013

Consolidated - IFRS

362,240

349,334

10,977

13,514

Non-controlling Interests

(1,540)

(1,394)

(625)

380

Deferred Expenses, Net of Income Tax

151

200

(49)

(98)

Parent company - Brazilian Accounting Standards (CPC)

360,851

348,140

10,303

13,796

 

 

4.            Accounting policies

The same accounting policies and methods of computation were followed in these consolidated and individual interim financial statements as those followed in the preparation of the annual financial statements of the Company for the year ended December 31, 2013.

5.            Cash and cash equivalents

 

Consolidated

 

06.30.2014

12.31.2013

Cash at bank and in hand

1,309

2,227

Short-term financial investments

 

 

- In Brazil

 

 

Single-member funds (Interbank Deposit) and other short-term deposits

7,640

8,182

Other investment funds

89

125

 

7,729

8,307

- Abroad

49,102

26,638

Total short-term financial investments

56,831

34,945

Total cash and cash equivalents

58,140

37,172

 

 

 

6.            Marketable securities

 

Consolidated

 

06.30.2014

12.31.2013

Trading securities

8,223

9,085

Available-for-sale securities

29

39

Held-to-maturity securities

283

284

 

8,535

9,408

Current

8,236

9,101

Non-current

299

307

 

 

 

Trading securities refer mainly to investments in government bonds that have maturities of more than 90 days. These assets are classified as current assets due to the expectation of their realization in the short term.

 

24 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

7.            Trade and other receivables

7.1.       Trade and other receivables, net

 

Consolidated

 

06.30.2014

12.31.2013

Trade receivables

 

 

Third parties

22,647

23,067

Related parties (Note 17)

 

 

Investees

2,063

1,542

Receivables from the electricity sector

7,256

5,050

Petroleum and alcohol accounts - Federal Government

839

836

Other receivables

6,671

6,066

 

39,476

36,561

Provision for impairment of trade receivables

(3,404)

(3,293)

 

36,072

33,268

Current

23,412

22,652

Non-current

12,660

10,616

 

 

 

7.2.       Changes in the provision for impairment of trade receivables

 

Consolidated

 

06.30.2014

12.31.2013

Opening balance

3,293

2,967

Additions (*) (**)

288

470

Write-offs (*)

(177)

(144)

Closing balance

3,404

3,293

Current

2,061

1,873

Non-current

1,343

1,420

 

 

 

(*) Includes foreign exchange differences arising from the translation of the provision for impairment of trade receivables of companies abroad.

(**) Amounts recognized in profit or loss as selling expenses.

 

 

 

 

 

 

7.3.       Trade and other receivables overdue - Third parties

 

Consolidated

 

06.30.2014

12.31.2013

Up to 3 months

1,039

1,968

From 3 to 6 months

598

558

From 6 to 12 months

1,210

857

More than 12 months

4,688

3,974

 

7,535

7,357

 

 

 

As of June 30, 2014, the balance of trade and other receivables past due includes R$ 2,577 from Companhia de Gás do Amazonas - Cigás (R$ 1,597 as of December 31, 2013) related to natural gas sales in the state of Amazonas. Negotiation regarding payment of the receivables past due is underway.

25 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

8.            Inventories 

 

Consolidated

 

06.30.2014

12.31.2013

Crude Oil

16,951

13,702

Oil Products

11,863

11,679

Intermediate products

2,288

2,165

Natural Gas and LNG (*)

1,204

939

Biofuels

526

370

Fertilizers

46

60

 

32,878

28,915

Materials, supplies and others

4,670

4,532

 

37,548

33,447

Current

37,408

33,324

Non-current

140

123

 

 

 

(*) Liquid Natural Gas

 

 

 

Consolidated inventories are presented net of an R$ 86 allowance reducing inventories to net realizable value    (R$ 205 as of December 31, 2013), mainly due to the volatility of international prices of crude oil and oil products. The amounts recognized in profit or loss, as other operating expenses are set out in note 23.

A portion of the crude oil and/or oil products inventories have been pledged as security for the Terms of Financial Commitment (TFC) signed by Petrobras and Petros in the amount of R$ 7,415 (R$ 6,972 as of December 31, 2013), as set out in note 20.

9.            Disposal of assets and legal mergers

9.1.       Disposal of assets

Brasil PCH

On June 14, 2013, Petrobras entered into an agreement with Cemig Geração e Transmissão S.A. (which further assigned the sale and purchase contract to Chipley SP Participações) for the disposal of its entire equity interest in Brasil PCH S.A., equivalent to 49% of its voting stock, for a consideration of R$ 650, excluding contractual price adjustments.

On February 14, 2014, the remaining conditions precedent for this transaction were met and the disposal was concluded for a total amount of R$ 711, including contractual price adjustments. A gain of R$ 646 before taxes was recognized as other operating income (expenses).

Innova S.A.

On August 16, 2013, the Board of Directors of Petrobras approved the disposal of 100% of the share capital of Innova S.A. to Videolar S.A. and its controlling shareholder, at a consideration of R$ 870, subject to price adjustment before the transaction is concluded.

The transaction was approved in a Shareholders’ Extraordinary General Meeting held on September 30, 2013 and its conclusion is subject to certain conditions, including the approval by Conselho Administrativo de Defesa Econômica – CADE.

Due to the pending conditions precedent for conclusion of this transaction, the assets and associated liabilities involved in this transaction were classified as held for sale.

26 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

Petrobras Colombia Limited (PEC)

On September 13, 2013, the Board of Directors of Petrobras approved the disposal of 100% of the share capital of Petrobras Colombia Limited (PEC), a subsidiary of Petrobras International Braspetro B.V. (PIB BV), to Perenco Colombia Limited, for a consideration of U.S.$ 380 million, subject to price adjustment until the closing of the transaction

On April 30, 2014 the transaction was concluded, the respective assets and liabilities were transferred to Perenco and a US$ 101 million gain was recognized as other operating income. This gain is subject to price adjustment, as set out in the agreement.

Petrobras Energia Peru. S.A.

On November 13, 2013, the Board of Directors of Petrobras approved the disposal of 100% of Petrobras Energia Peru S.A. by Petrobras de Valores Internacional de España S.L. – PVIE and Petrobras International Braspetro B.V – PIB BV to China National Petroleum Corporation (CNPC) for U.S.$ 2,647 million, subject to price adjustment until the transaction is concluded.

The transaction is subject to certain conditions precedent, including approval by the Chinese and Peruvian governments, as well as compliance with the procedures under their "Joint Operating Agreement (JOA)", where applicable.

Due to the pending conditions precedent for the conclusion of this transaction, the assets and corresponding liabilities were classified as held for sale

UTE Norte Fluminense

On April 11, 2014 Petrobras disposed of its 10% interest in Usina Termelétrica Norte Fluminense (UTE - NF) to the Électricité de France (EDF) group for R$ 182, recognizing a R$ 83 gain as other operating income. There is no condition precedent regarding approval by Brazilian authorities.

9.2.       Assets classified as held for sale

Assets classified as held for sale and associated liabilities, classified under the Company’s current assets and current liabilities are comprised of the following items and business segments:

 

 

 

 

 

 

Consolidated

 

 

 

 

 

06.30.2014

12.31.2013

 

Exploration

and

Production

Refining,

Transport.

& Marketing

International

Others

Total

Total

Assets classified as held for sale

 

 

 

 

 

 

Property, plant and equipment

114

280

2,957

1

3,352

4,169

Trade receivables

210

57

267

318

Inventories

211

22

233

283

Investments

23

23

46

126

Cash and Cash Equivalents

4

81

85

283

Others

72

168

240

459

 

114

800

3,308

1

4,223

5,638

 

 

 

 

 

 

 

Liabilities on assets classified as held for sale

 

 

 

 

 

 

Trade Payables

(67)

(42)

(109)

(383)

Provision for decommissioning costs

(21)

(21)

(70)

Non-current debt

(44)

(44)

(1,434)

Others

(63)

(351)

(414)

(627)

 

(174)

(414)

(588)

(2,514)

 

 

 

27 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

9.3.       Legal mergers

On April 2, 2014, the Shareholders’ Extraordinary General Meeting of Petrobras approved the following mergers of subsidiaries into Petrobras, which did not increase share capital or required any additional paid in capital: Termoaçu S.A., Termoceará Ltda. e Companhia Locadora de Equipamentos Petrolíferos – CLEP.

The objective of these mergers is to simplify the corporate structure of the Company, reduce costs and capture synergies. These mergers did not affect the consolidated financial statements.

 

10.          Investments

10.1.   Investments in subsidiaries, joint ventures, joint operations and associates(Parent Company)

 

06.30.2014

12.31.2013

Subsidiaries:

 

 

Petrobras Netherlands B.V. - PNBV

30,923

29,631

Petrobras Distribuidora S.A. - BR

12,492

11,767

Transportadora Associada de Gás S.A. - TAG (*)

8,446

Petrobras Transporte S.A. - Transpetro

4,684

4,666

Companhia Integrada Têxtil de Pernambuco S.A. - Citepe

3,370

2,504

Petrobras Logística de Exploração e Produção S.A. - PB-LOG

3,334

3,351

Petrobras Internacional Braspetro - PIB BV

2,940

3,837

Petrobras Gás S.A. - Gaspetro (*)

2,676

10,633

Petrobras Biocombustível S.A. - PBIO

2,028

2,121

Companhia Petroquímica de Pernambuco S.A. - PetroquímicaSuape

1,451

1,499

Liquigás Distribuidora S.A. - Liquigás

878

859

Termomacaé Ltda

741

747

Araucária Nitrogenados S.A.

740

789

Breitener Energética S.A. - Breitener

493

475

5283 Participações Ltda

392

518

Termobahia S.A.

384

429

Petrobras Comerc. de Energia Ltda - PBEN

362

301

Arembepe S.A.

342

314

Companhia Locadora de Equipamentos Petrolíferos S.A. - CLEP (note 9.3)

1,530

Termoaçu S.A. (note 9.3)

666

Termoceará Ltda (note 9.3)

334

Other subsidiaries

799

871

Joint operations

192

218

Joint ventures

761

374

Associates

3,813

3,481

 

82,241

81,915

 

 

 

Goodwill

3,246

3,125

Unrealized profits - Parent company

(2,313)

(1,570)

Other investments

26

27

Total investments

83,200

83,497

 

 

 

(i) From the second quarter of 2014, TAG ceased to be a subsidiary of Gaspetro and became a direct subsidiary of Petrobras.

 

 

 

28 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

10.2.   Investments in joint ventures and associates (Consolidated)

06.30.2014

12.31.2013

Investments measured using equity method

 

 

Braskem S.A.

5,373

5,157

Petrobras Oil & Gas B.V - PO&G

3,779

3,999

State-controlled Natural Gas Distributors

1,300

1,248

Guarani S.A.

1,203

1,194

Petroritupano S.A.

433

464

Nova Fronteira Bioenergia S.A.

414

399

Petrowayu S.A.

405

433

Other petrochemical investees

206

196

UEG Araucária Ltda

187

138

Transierra S.A.

162

159

Petrokariña S.A.

145

155

Other associates

2,012

2,021

 

15,619

15,563

Other investees

50

52

 

15,669

15,615

 

 

 

 

 

 

10.3.   Investments in listed companies

 

Thousand-share lot

 

Quoted stock exchange prices (R$  per share)

Market value

Company

06.30.2014

12.31.2013

Type

06.30.2014

12.31.2013

06.30.2014

12.31.2013

Indirect subsidiary

 

 

 

 

 

 

 

Petrobras Argentina

1,356,792

1,356,792

Common

1.77

1.87

2,402

2,537

 

 

 

 

 

 

2,402

2,537

 

 

 

 

 

 

 

 

Associate

 

 

 

 

 

 

 

Braskem

212,427

212,427

Common

11.25

16.50

2,390

3,505

Braskem

75,793

75,793

Preferred A

14.09

21.00

1,068

1,592

 

 

 

 

 

 

3,458

5,097

 

 

 

The market value of these shares does not necessarily reflect the realizable value of a large block of shares.

Braskem S.A. - Investment in publicly traded associate:

Braskem’s shares are publicly traded on stock exchanges in Brazil and abroad. The quoted market value as of June 30, 2014, was R$ 3,458, based on the quoted values of both Petrobras’ share in common stock (47% of the outstanding shares), and preferred stock (22% of the outstanding shares). However, there is extremely limited trading of the common shares, since non-signatories of the shareholders’ agreement hold only approximately 3% of the common shares.

In addition, given the operational relationship between Petrobras and Braskem, the recoverable amount of the investment, for impairment testing purposes, was determined based on value in use, considering the Company’s share of the future cash flows projected for Braskem. As the recoverable amount was higher than the carrying amount, no impairment losses were recognized for this investment.

The main assumptions on which cash flow projections were based to determine Braskem‘s value in use are set out in note 14 to our audited consolidated financial statements for the year ended December 31, 2013.

29 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

11.        Property, plant and equipment

11.1.   By class of assets

 

Consolidated

Parent Company

 

Land, buildings and improvements

Equipment and other assets

Assets under construction (*)

Exploration and development costs (oil and gas producing properties)

Total

Total

Balance at January 1, 2013

16,684

166,972

166,878

68,182

418,716

279,824

Additions

148

3,870

78,156

1,408

83,582

62,974

Additions to / review of estimates of decommissioning costs

(1,431)

(1,431)

(1,958)

Capitalized borrowing costs

8,474

8,474

6,514

Business combinations

39

70

36

145

Write-offs              

(9)

(261)

(5,285)

(55)

(5,610)

(4,550)

Transfers (***)

2,605

51,603

(64,706)

58,516

48,018

80,642

Depreciation, amortization and depletion

(1,115)

(16,241)

(10,643)

(27,999)

(21,028)

Impairment - recognition (****)

(26)

(13)

(193)

(232)

(119)

Impairment - reversal (****)

112

165

277

268

Cumulative translation adjustment

79

5,682

3,300

879

9,940

Balance at December 31, 2013

18,431

211,781

186,840

116,828

533,880

402,567

Cost

25,134

312,427

186,840

180,654

705,055

531,928

Accumulated depreciation, amortization and depletion

(6,703)

(100,646)

(63,826)

(171,175)

(129,361)

Balance at December 31, 2013

18,431

211,781

186,840

116,828

533,880

402,567

Additions

15

1,741

35,605

373

37,734

30,548

Additions to / review of estimates of decommissioning costs

(45)

(45)

Capitalized borrowing costs

4,322

4,322

3,987

Write-offs              

(18)

(62)

(3,145)

(152)

(3,377)

(2,984)

Transfers

2,659

16,257

(24,560)

12,760

7,116

6,528

Depreciation, amortization and depletion

(658)

(8,698)

(5,246)

(14,602)

(10,807)

Cumulative translation adjustment

(89)

(3,664)

(1,152)

(788)

(5,693)

Balance at June 30, 2014

20,340

217,355

197,910

123,730

559,335

429,839

Cost

27,644

323,249

197,910

191,939

740,742

569,412

Accumulated depreciation, amortization and depletion

(7,304)

(105,894)

(68,209)

(181,407)

(139,573)

Balance at June 30, 2014

20,340

217,355

197,910

123,730

559,335

429,839

 

 

 

 

 

 

 

Weighted average of useful life in years

25

(25 to 40)

(except land)

20

(3 to 31)

(**)

 

Units of production method

 

 

 

 

 

 

 

 

 

(*) See note 27 for assets under construction by business area.

(**) Includes exploration and production assets depreciated based on the units of production method.

(***) Includes the amount of R$ 50,389, reclassified from Intangible Assets to Property, Plant and Equipment as a result of the declaration of commerciality of areas of the Assignment Agreement (Franco and Sul de Tupi).

(****) Impairment charges and reversals are recognized in profit or loss as other operating expenses.

 

 

 

As of June 30, 2014, consolidated and parent company property, plant and equipment includes assets under finance leases of R$ 194 and R$ 9,270, respectively (R$ 202 and R$ 10,738 at December 31, 2013).

 

30 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)

 

12.        Intangible assets

12.1.   By class of assets

 

Consolidated

Parent Company

 

 

Softwares

 

 

 

 

Rights and

concessions

Acquired

Developed

in-house

Goodwill from expectations of future profitability

Total

Total

Balance at January 1, 2013

78,702

386

1,178

941

81,207

77,349

Additions

6,665

72

278

7,015

6,862

Capitalized borrowing costs

26

26

26

Write-offs

(171)

(3)

(7)

(181)

(138)

Transfers (**)

(50,467)

(30)

(26)

(39)

(50,562)

(50,474)

Amortization

(82)

(99)

(287)

(468)

(336)

Impairment - reversal (***)

(1,139)

(1,139)

Cumulative translation adjustment

182

6

35

223

Balance at December 31, 2013

33,690

332

1,162

937

36,121

33,289

Cost

34,680

1,423

3,379

937

40,419

36,118

Accumulated amortization

(990)

(1,091)

(2,217)

(4,298)

(2,829)

Balance at December 31, 2013

33,690

332

1,162

937

36,121

33,289

Additions

178

44

115

337

277

Capitalized borrowing costs

10

10

10

Write-offs

(200)

(25)

(225)

(201)

Transfers

5

14

(3)

16

2

Amortization

(42)

(71)

(118)

(231)

(167)

Impairment - reversal (***)

15

15

Cumulative translation adjustment

(66)

(2)

(1)

(16)

(85)

Balance at June 30, 2014

33,580

317

1,140

921

35,958

33,210

Cost

34,556

1,494

3,472

921

40,443

36,236

Accumulated amortization

(976)

(1,177)

(2,332)

(4,485)

(3,026)

Balance at June 30, 2014

33,580

317

1,140

921

35,958

33,210

Estimated useful life - years

(*)

5

5

Indefinite

 

 

 

 

 

 

 

 

 

(*) See note 3.9 (Intangible assets) of the financial statements of December 31, 2013.

(**) Includes the amount of R$ 50,389, reclassified from Intangible Assets to Property, Plant and Equipment as a result of the declaration of commerciality of areas of the Assignment Agreement (Franco and Sul de Tupi).

(***) Impairment charges and reversals are recognized in profit or loss as other operating expenses.

 

 

12.2.   Concession for exploration of oil and natural gas - Assignment Agreement (“Cessão Onerosa”)

As of June 30, 2014, the Company’s intangible assets include R$ 24,419 (R$ 24,419 at December 31, 2013) related to the Assignment Agreement, net of amounts paid as signature bonuses for Franco (now Campo de Búzios) and Sul de Tupi (now Campo de Sul de Lula) which have been transferred to property, plant and equipment, as set out in note 13.1 to the Company’s financial statements for the period ended December 31, 2013.

Petrobras, the Federal Government (assignor) and the Agência Nacional de Petróleo, Gás Natural e  Biocombustíveis - ANP (regulator and inspector) entered into the Assignment Agreement in 2010, which grants the Company the right to carry out prospection and drilling activities for oil, natural gas and other liquid hydrocarbons located in blocks in the pre-salt area (Franco, Florim, Nordeste de Tupi, Entorno de Iara, Sul de Guará and Sul de Tupi), limited to the production of five billion barrels of oil equivalent in up to 40 (forty) years and renewable for a further 5 (five) years subject to certain conditions.

The agreement establishes that, immediately after the declaration of commerciality for each area, the review procedures, which must be based on independent technical appraisal reports, will commence. The review of the Assignment Agreement will be concluded after the date of the last declaration of commerciality.

31 


 
 

Petróleo Brasileiro S.A. – Petrobras

Notes to the financial statements

(Expressed in millions of reais, unless otherwise indicated)