• 5 minutes Drone attacks cause fire at two Saudi Aramco facilities, blaze now under control
  • 8 minutes China Faces Economic Collapse
  • 12 minutes Oil Production Growth In U.S. Grinds To A Halt
  • 14 minutes Iran in the world market
  • 17 minutes Ethanol, the Perfect Home Remedy for A Saudi Oil Fever
  • 4 mins Experts review drone damage . Say Saudis need to do a lot of explaining.
  • 7 hours USA Wants Iran War -- Shooty Shooty More
  • 12 hours Collateral Damage: Saudi Disruption Leaves Canada's Biggest Refinery Vulnerable
  • 12 hours Yawn... Parliament Poised to Force Brexit Delay Until Jan. 31
  • 33 mins Saudis Confirm a Cruise Missile from Iranian Origin
  • 8 hours The Spy Money: U.S. Wants To Seize All Money Edward Snowden Makes From New Book
  • 54 mins Aramco Production
  • 14 hours Wonders of US Shale: US Shale Benefits: The U.S. leads global petroleum and natural gas production with record growth in 2018
  • 5 hours Trump Will Win In 2020 And Beyond..?
  • 1 day USA : Attack came from 'Iranian soil'. Pompeo to release 'evidence'.
  • 6 hours The Belt & Road Initiative: A Wolf in Sheep's Clothing?

BP Launches Share Buyback As Q3 Profit Beats Estimates

BP

BP (NYSE:BP) is starting a share buyback program as it doubled its third-quarter profit, in a sign that the UK oil supermajor is now more optimistic of its business and cost structure.

BP reported on Tuesday an underlying replacement cost profit—its preferred measure for net income—of US$1.865 billion, up from US$933 million for the same period in 2016, as oil and gas production increased by 14 percent on the year, and downstream underlying quarterly earnings hit their highest in five years. Analysts had expected BP to report an underlying Q3 profit of US$1.58 billion.

BP’s total oil and gas production in Q3 averaged 3.6 million barrels of oil equivalent per day, up by 14 percent from Q3 2016.

In the downstream, underlying replacement cost profit before interest and tax jumped to US$2.338 billion from US$1.413 billion in Q2, and from US$1.431 billion in Q3 2016.

In the upstream, underlying profit before interest and tax surged to US$1.562 billion from US$710 million in Q2, and from a loss of US$224 million in Q3 2016.

Between January and September, BP’s underlying operating cash flow exceeded organic capital expenditure plus full dividend, which was equal to organic cash balance including full dividend at Brent oil price of $49 a barrel.

Encouraged by these signs, BP restarted its share buyback program to offset the dilution coming from its scrip dividends—the plan under which investors can choose to be paid in shares instead of in cash, which BP and other oil majors resorted to with the oil price crash.

Related: 3 Potential OPEC Deal Killers

“We have made strong progress this year in adjusting to the lower oil price environment and have now brought our finances, including the full dividend, back into organic balance at an oil price just below $50 a barrel. Given the momentum we see across our businesses and our confidence in the outlook for the group’s finances, we will be recommencing a share buyback programme this quarter. We intend to offset the ongoing dilution from the scrip dividend over time,” chief financial officer Brian Gilvary said.

The buyback plan sent BP’s shares rallying in London, and 2.85 percent higher in pre-market trade in New York at 8:17 a.m. EDT.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play