This excerpt taken from the PBR 6-K filed Mar 7, 2008.
Net income for the 4Q-2007 totaled R$ 5,053 million, 9% down on the R$ 5,528 million declared in the 3Q-2007, due to the factors listed below:
R$ 742 million reduction in gross profit:
(1) Expenditures on cabotage, terminals and pipelines.
Growth of R$ 579 million in operating expenses:
General and administrative expenses (R$ 275 million), reflected in higher expenses from personnel in Brazil (R$ 102 million) as a result of the collective bargaining agreement, and from third-party services (R$ 121 million), especially those
related to IT and consulting;
These effects were offset by the reduction in expenses from the Pension and Health Plan (R$ 705 million), due to the recognition, in the 3Q-2007, of the commitments associated with the Petros Plan (R$ 697 million).
A positive impact of R$ 228 million on the net financial result, as a result of:
An increase in financial expenses (R$ 273 million) from the monetary restatement of recoverable taxes (R$ 161 million) and revenue from investments in marketable securities (R$ 59 million);
These effects were partially offset by higher financial expenses (R$ 199 million) due to losses from hedge operations linked to commercial activities related to PifCo, Pasadena and PAI (R$ 169 million).