BP profit rises to $5 bln as share buyback slows

 BP (BP.L) made a $5 billion profit in the first quarter of 2023, up from the previous three months on the back of strong oil and gas trading as the company pared back a share buyback programme.

BP's profit, which beat forecasts, follows strong results from rivals including Exxon Mobil (XOM.N) and Chevron last week as they continue to benefit from energy prices that remain strong despite some softening since the start of the year.

BP said its first-quarter underlying replacement cost profit, the company's definition of net income, reached $4.96 billion, up from $4.8 billion in the fourth quarter of 2022 and beating expectations of $4.3 billion in a company-provided survey of analysts.

However, it was a drop from the $6.25 billion recorded in the first quarter of 2022.

The profit reflects "an exceptional gas marketing and trading result, a lower level of refinery turnaround activity and a very strong oil trading result", BP said, noting the partial offset from lower oil and gas prices and refining margins.

The company said it will repurchase a further $1.75 billion of shares over the next three months, exceeding its goal of using 60% of surplus cash for the purpose. That is, however, below the $2.75 billion bought in the previous three months.

BP's share price was down around 4% in early trading at 513.3 pence compared with a drop of around 1% for an index of European oil companies (.SXEP).

Its dividend remained unchanged at 6.61 cents per share after a 10% increase in February. BP had previously halved its payout in the wake of the pandemic.

The London-based company said it expects oil and European gas prices to remain strong in the second quarter even as refining profit margins are expected to weaken due to lower diesel prices.

BP shares have outperformed in the sector so far this year, up 10% compared to a 6% rise for Exxon and a 3% gain for Shell.

Benchmark Brent crude oil prices averaged $81 per barrel in the first three months of the year, down 16% from a year earlier and 7% from the fourth-quarter.

BP's profit hit a record $28 billion in 2022 on soaring energy prices and market volatility which benefited its large trading business.

The company had said in February it would repurchase $2.75 billion worth of shares over the next three months after buying $11.7 billion in 2022.

Related Posts
Commnets
or

For faster login or register use your social account.

Connect with Facebook