Solid first half; strong operations, strong cash flow.
- Underlying replacement cost (RC) profit for the second quarter was US$0.7 billion.
- Second-quarter operating cash flow, excluding Gulf of Mexico oil spill payments*, was US$6.9 billion. Including these payments, operating cash flow* for the quarter was US$4.9 billion.
- Dividend unchanged at 10 cents per share.
- Second-quarter Upstream production was 10% higher than in the same period in 2016; first-half production was 6% higher.
- Upstream major projects on track; two new projects sanctioned in quarter; significant gas discoveries in Senegal and Trinidad announced; US$753 million exploration write-off, predominantly in Angola.
- In Downstream, first-half fuels marketing earnings around 20% higher than in the first half of 2016.
BP’s profit for the second quarter and half year was US$144 million and US$1593 million respectively, compared with a loss of US$1419 million and a loss of US$2002 million for the same periods in 2016.
The second-quarter replacement cost (RC) profit was US$553 million, compared with a loss of US$2247 million for the same period in 2016. After adjusting for a net charge for non-operating items of US$215 million and net favourable fair value accounting effects of US$84 million (both on a post-tax basis), underlying RC profit for the second quarter was US$684 million, compared with US$720 million for the same period in 2016.
For the half year, RC profit was US$1965 million, compared with a loss of US$2732 million a year ago. After adjusting for a net charge for non-operating items of US$520 million and net favourable fair value accounting effects of US$291 million (both on a post-tax basis), underlying RC profit for the half year was US$2194 million, compared with US$1252 million for the same period in 2016.
Bob Dudley – Group chief executive:
“We continue to position BP for the new oil price environment, with a continued tight focus on costs, efficiency and discipline in capital spending. We delivered strong operational performance in the first half of 2017 and have considerable strategic momentum coming into the rest of the year and 2018, with rising production from our new Upstream projects and marketing growth in the Downstream.”
Brian Gilvary – Chief financial officer:
“Cash flow was strong in the first half – organic cash flow exceeded organic capital expenditure* and dividends paid. While net debt* rose primarily due to Gulf of Mexico payments, we expect this will improve over the second half as these payments decline and divestment proceeds come in towards the end of the year.”
Read the article online at: https://www.oilfieldtechnology.com/special-reports/01082017/bp-q2-and-half-year-2017-results/