BP Posts RC Loss In Q2, Underlying RC Profit Beats View

(RTTNews) - British energy major BP Plc reported Tuesday a replacement cost or RC loss in its second quarter, compared to prior year's profit, hit by hefty charges and weak revenues. Underlying RC profit, however, beat market estimates, while revenues missed view.

Further, bp said it intends to execute a $1.75 billion share buyback prior to reporting the third quarter results, and also announced $3.5 billion share buyback for the second half of 2024. For the second quarter, bp has announced a dividend per ordinary share of 8 cents, a growth of 10 percent from last year.

In London, bp shares were trading at 458.50 pence, up 1.2 percent. In pre-market activity on the NYSE, the shares were trading at $35.32, up 1.03 percent.

Chief executive officer Murray Auchincloss said, "We are driving focus across the business and reducing costs, all while building momentum in our drive to 2025. Our recent go-ahead of the Kaskida development in the Gulf of Mexico business, and decision to take full ownership of bp Bunge Bioenergia while scaling back plans for new biofuels projects, demonstrate our commitment to delivering as a simpler, more focused and higher value company."

Looking ahead, bp expects third-quarter reported upstream production to be lower compared with second-quarter 2024, including in higher margin regions.

For fiscal 2024, bp continues to expect both reported and underlying upstream production to be slightly higher compared with 2023.

The company further said its net debt was reduced to $22.6 billion, compared to $23.7 billion last year and $24.0 billion at the end of the first quarter, largely driven by strong operating cash flow.

In its second quarter, bp's RC loss was $16 million, compared to profit of $2.34 billion last year.

Loss for the period attributable to bp shareholders was $129 million, compared to profit of $1.79 billion last year. Loss per ADS was $0.05, compared to profit of $0.60 per ADS a year earlier.

The latest results included adverse impact of adjusting items, net of tax, of $2.77 billion, including a net charge of $1.5 billion relating to asset impairments and associated onerous contract provisions. The prior year's charges were $248 million.

Underlying RC profit was $2.76 billion, compared to $2.59 billion last year. Underlying RC profit per ordinary share was 16.61 US cents, compared to 14.77 US cents a year ago.

Underlying RC profit per ADS was $1.00, compared to $0.89 last year.

Analysts on average expected the company to report earnings of $0.92 per share, according to figures compiled by Thomson Reuters. Analysts' estimates typically exclude special items.

Adjusted EBITDA edged down to $9.64 billion from last year's $9.77 billion.

Total revenues and other income dropped to $48.25 billion from last year's $49.48 billion, while the Street was looking for revenues of $52.92 billion for the quarter.

Sales and other operating revenues were $47.30 billion, down from $48.54 billion a year ago. Total hydrocarbons production dropped to 899 mboe/d from 903 mboe/d last year.

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