BP’s Q2 earnings beat forecasts despite lower profits compared to last year

BP (NYSE:BP) reported on Tuesday second-quarter profits that surpassed analyst estimates, even as year-on-year earnings declined amid ongoing volatility in global oil and gas markets.

The company’s underlying replacement cost (RC) profit rose to $2.4 billion for the quarter, improving from $1.4 billion in the first quarter, driven by better performance across its key segments.

This result was down from $2.76 billion recorded in Q2 2024 but still exceeded the market consensus of $1.81 billion, according to data compiled by LSEG.

Operating cash flow reached $6.3 billion, a substantial increase from $2.8 billion in Q1, despite including a $1.1 billion payment related to a Gulf of Mexico legal settlement.

BP’s oil production division posted underlying RC profits of $2.3 billion, lower than last year’s due to weaker realized prices and higher depreciation expenses.

Production increased by 2.5% year-over-year to 1.52 million barrels of oil equivalent per day, while realized liquids prices fell to $59.74 per barrel from $73.05 a year prior.

The gas and low carbon energy segment delivered stable underlying RC profit of $1.5 billion year-on-year, as reduced output was offset by improved margins. Reported production dropped 13% following asset sales in Egypt and Trinidad.

Underlying RC profit in the customers and products segment rose to $1.5 billion from $1.1 billion a year ago, bolstered by stronger trading and midstream operations offsetting weaker refining margins. Refining availability remained strong at 96.4%.

“We are delivering our plan with operational reliability above 96%,” CEO Murray Auchincloss said. “We remain focused on safe, reliable operations, disciplined capital spending, and enhancing performance.”

He added that BP is reviewing its business portfolio to “maximize shareholder value.”

Capital spending for the quarter totaled $3.4 billion. Net debt declined to $26 billion from $27 billion in Q1, supported by $1.4 billion in proceeds from asset disposals.

The company also raised its dividend by 4% to 8.32 cents per share and unveiled a new $750 million share buyback program.

BP stock price

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