Prio S.A. Unsponsored ADR

Prio sold 15.2 million barrels in Q2 2026, its highest quarterly sales volume ever, and average production was 172,000 barrels per day. Reported EBITDA was $847 million, or $878 million excluding nonrecurring items, and first-half 2026 EBITDA exceeded $1.730 billion. The company kept lifting cost at $8.9 per barrel, with average Brent at $94.6 and an equivalent FOB selling price of about $87.70, implying an average discount of around $6.90 per barrel. Net debt fell from $4.372 billion in Q1 to just over $4 billion, leverage dropped to 1.5x, and cash remained above $700 million, or $713 million on the call. For guidance, management said Q3 lifting cost should start around $7 and end up between $7 and $8 per barrel, full-year production should likely end above 200,000 barrels per day, net debt/EBITDA remains targeted at 1x by end-2027/next year under $60 oil assumptions, and share buybacks will continue and may accelerate in 2H as CapEx falls.

Roberto Monteiro described the quarter as “excellent,” emphasizing that the main drivers were both higher oil prices and, more importantly, stronger operations. He highlighted Wahoo’s steady 40,000 barrels per day, Peregrino’s successful A15 startup and A13/C24 drilling, and said these assets practically secure about 100,000 barrels per day at Peregrino through year-end. His tone was confident on execution and capital returns, repeatedly stressing continued buybacks, rising cash generation and a path to lower leverage.

Milton Rangel focused on the hard numbers: 15.2 million barrels sold, $847 million EBITDA, and $878 million adjusted EBITDA after excluding nonrecurring items. He explained that export taxes of $113.9 million, including $111 million tied to new export taxes, and a jump in royalties/special participation due to the Brent reference price moving from $60 in Q1 to $89 in Q2 were major cost line impacts. He also noted net debt moved down to just over $4 billion, CapEx was $285 million in the quarter, and the average cost of debt ticked up to 6.40% while remaining competitive.

Analysts pressed management on trading discounts, export taxes, Peregrino synergies, CapEx, Albacora Leste/Arapuca timing, Wahoo depletion and the dividend/remuneration policy. On trading, Roberto said the Q2 $6.90 discount reflected the company’s exposure to Dated Brent versus ICE Brent and stressed that Q3 could be closer to $8 to $9 per barrel depending on market and geopolitical moves. On export taxes, management said it is challenging the measure legally because Brazil needs exports and the tax does not match market realities. On capital allocation, Roberto said the company is not choosing between buybacks and projects; both continue, with buybacks resuming and CapEx likely falling as Wahoo, Peregrino gas import and early Frade work are largely behind them.