Yahoo Finance Petrobras' (PBR) Layoff Program Ends; 11,704 Take the Offer
Brazil's troubled state-run energy giant, Petroleo Brasileiro S.A. or Petrobras PBR announced that its voluntary layoff program, which came to an end on Aug 31, has been accepted by 11,704 employees.
In Apr 2016, the Rio de Janeiro-based oil producer had launched this program to lay off 21% of its staff or around 12,000 workers between 2016 and 2020. This voluntary retrenchment program was in line with the company’s plan to cut costs, reduce its debt level and strengthen its balance sheet.
Petrobras expects this program to cost around 4 billion reais ($1.23 billion) and generate savings up to 33 billion reais through 2020. The company has already set aside an amount of 1.2 billion reais in the second quarter to provide for the expenses.
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With the help of this initiative, the company intends to trim its workforce, enhance productivity and generate value for the company. The company has been implementing management training programs to assure continuity and safety at operations as it cuts staff.
Petrobras, with around $123.92 billion in long-term liabilities, is the most indebted energy company in the world. The company engages in the exploration, development, and production of crude oil, natural gas, and natural gas liquids. Additionally, the company sells crude oil and oil products produced at natural gas processing plants in domestic and foreign markets. It is also involved in the refining, logistics, transport, and trading of crude oil and oil products. Moreover, the firm exports ethanol and invests in petrochemical companies.
Recently, the company inked a Memorandum of Understanding (MoU) with Norwegian oil giant, Statoil ASA STO in order to strengthen their relationship in Brazil.The purpose of the MoU is to assess joint participation in the future tenders for exploration areas and to enhance upstream cooperation in producing fields in the Santos and Campos offshore basins.
Petrobras currently carries a Zacks Rank #3 (Hold). Some better-ranked players from the energy sector are Devon Energy Corporation DVN and NGL Energy Partners LP NGL. Both these stocks sport a Zacks Rank #1 (Strong Buy).
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