MEXICO CITY – Mexican state oil company Petroleos Mexicanos (Pemex) posted a net loss of $18.4 billion in 2019, nearly double its $9.6 billion loss the previous year, the company reported on Thursday.
In its latest earnings report, Pemex attributed the result to the higher cost of hedge derivative financial instruments, which rose to 18.5 billion pesos ($954.6 million) due to the appreciation of the US dollar relative to other currencies.
The company said that its total sales fell to $74.5 billion, down 16.5 percent from 2018, with domestic revenues down 17.5 percent to $42.9 billion and exports falling 15.3 percent to $31.1 billion.
Crude output amounted to 1.68 million barrels per day, a drop of 7.6 percent relative to 2018, the report said.
Natural gas production, meanwhile, fell 4 percent to 3.7 billion cubic feet per day.
After subtracting the cost of sales, Pemex’s gross income came in at $11.5 billion in 2019, a drop of 56.9 percent compared to the previous year.
The company’s operating income plunged 81 percent to $3.7 billion.
Pemex said its “income before duties, taxes and other,” equivalent to earnings before interest, tax, depreciation and amortization (EBITDA), plunged 95.1 percent relative to 2018 to $725 million.
Pemex’s total liabilities, including short- and long-term debt and employee benefits, rose to $206.2 billion, up 10 percent from 2018.
By contrast, the Mexican oil company said its total financial debt was down 4.8 percent compared to the close of 2018 to $105.2 billion.
In the fourth quarter of last year, the company’s net loss amounted to $9 billion, an increase of 7.9 percent compared to the net loss in the fourth quarter of 2018.
Revenue from sales and services income in the fourth quarter of 2019 amounted to $17 billion, down 21.6 percent from the same quarter of 2018.
These were Pemex’s first full-year results under current President Andres Manuel Lopez Obrador, who took office in 2018 with a vow to revive the heavily indebted state oil company and boost its production.
The leftist leader announced a series of extraordinary measures last year aimed at boosting Pemex’s finances, which combined with expected savings from efforts to combat fuel theft were forecast to provide a total financial benefit of 107 billion pesos ($5.5 billion) in 2019.
The company has been on a roller-coaster in recent years in terms of its bottom-line results.
In 2018, Pemex’s net loss was down 47.1 percent from the loss reported in 2017. That was an encouraging result after the company’s net loss in 2017 had risen 74.4 percent from 2016.
In 2016, Pemex’s net loss was down 58.5 percent from the $30.3 billion reported in 2015.
The company regularly posts hefty net losses because a large portion of its profits help fund the federal budget, although the Mexican government has said it will bring that profit-sharing duty down to 54 percent in 2021 from 65 percent last year.
A major goal of the tax relief is to reverse the steady drop in the company’s oil output over the past 16 years.