BP Profit More Than Doubles as New Boss Speeds Up Break-Up

BP (LON: BP.), the London-listed oil and gas major, said second-quarter underlying replacement cost profit more than doubled to $5.7bn, beating analyst forecasts, as new chief executive Meg O’Neill used the results to press ahead with a break-up of the group.

BP shares traded at 558.4p in early London trade today, up 1.14% from yesterday’s close of 552.1p, having climbed as high as 561.8p. That leaves the stock well above its 52-week low of 384.37p but still short of its 602.49p high.

BP said the profit beat reflected stronger refining margins and higher oil and gas realisations, the prices it actually achieved for output, amid volatile Middle East-driven markets. The board raised the dividend 4% to 8.66 cents per ordinary share. O’Neill, four months into the role, used the statement to confirm BP is pressing ahead with disposals, including a sale process for its US biogas business Archaea Energy, alongside the completed sale of its Gelsenkirchen refinery, an agreed sale of its Austria retail business, and last week’s move to market its North Sea operations.

The $5.7bn figure compares with $2.35bn a year earlier and beat a company-polled analyst consensus of $5.11bn, while net debt fell to $22.25bn from $26.04bn a year ago. O’Neill said: “This is my first full quarter at bp… Financially, we delivered a strong quarter, with an underlying replacement cost profit of $5.7 billion ($2.5 billion higher than last quarter) and an operating cash flow of $10.9 billion, after a working capital build of $1.0 billion.” Even so, she was candid about the group’s recent record, saying BP has “not delivered consistently” and has “written off too much value”.

O’Neill’s five priorities, covering the balance sheet, portfolio simplification, capital discipline, operational performance and accountability, frame the profit beat as a starting point rather than evidence that the turnaround is complete.