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Losses at OGX have more than trebled in the second quarter from a year ago, adding to concerns over the fledgling oil company of Brazilian billionaire Eike Batista.
The Rio de Janeiro-based company said its net loss had swelled to R$399m ($197m) from R$122m in the same quarter last year, blaming the declines on a sharp plunge in the Brazilian real against the dollar and losses from dry wells.
Investors have become increasingly disillusioned with OGX this year, especially after the oil start-up slashed production forecasts in June far beyond analysts’ expectations.
A near-70 per cent plunge in OGX’s share price since this year’s peak in February has also prompted investors to sell out of the rest of Mr Batista’s start-up empire, wiping billions off his net worth.
According to Forbes, Mr Batista, who has often bragged about becoming the world’s wealthiest man, may not even now be the richest person in Brazil.
After declines in the shares of his logistics company, LLX, Mr Batista last month announced he would delist the company, raising further questions about his plans for the rest of the group.
OGX also posted a loss for the first half of the year of R$543m, compared with R$151m in the first six months of 2011.
However, the company attributed the declines primarily to a net foreign exchange loss of R$339m in the first half, as opposed to revenues of R$9m last year, and tried to reassure investors by pointing to OGX’s strong cash position at the end of the second quarter of R$5.9bn.
Battered by a weaker domestic and global economic outlook, Brazil’s real depreciated about 11 per cent against the dollar over the second quarter, triggering financial losses across many of the country’s biggest companies with large amounts of debt abroad.
Earlier this month Brazil’s state-controlled oil company Petrobras posted its first quarterly loss in 13 years while mining company Vale last month recorded a near-60 per cent drop in net income, both blaming their declines on the real’s depreciation.