BP full year profits take a hit but shares rise

BP commits to net zero by 2050

BP (LON:BP) shares rose on Tuesday despite the multinational oil and gas company revealing a hit to its underlying replacement cost profit for the full year.

Shares in the company were almost 5% higher during Tuesday morning trade.

The company said that underlying replacement cost profit for the full year amounted to $10.0 billion, down on the $12.7 billion figure recorded for the same period a year earlier.

Underlying replacement cost profit is BP’s definition of net income.

BP said that this result largely reflects “the impact of the weaker environment”.

Despite the decline, the company raised its dividend by 2.4% compared to the year prior.

Full year operating cash flow, excluding Gulf of Mexico oil spill payments, was recorded as $28.2 billion.

Meanwhile, the company reduced its net debt by $1.1 billion in the fourth quarter.

The company added that it completed its announced share buyback programme in January 2020.

“BP is performing well, with safe and reliable operations, continued strategic progress and strong cash delivery,” Bob Dudley, group Chief Executive, commented on the results.

“This all supports our commitment to growing distributions to shareholders over the long term and the dividend rise we announced today,” the Chief Executive said.

The Chief Executive also commented on his departure: “After almost ten years, this is now my last quarter as CEO. In that time, we have achieved a huge amount together and I am proud to be handing over a safer and stronger BP to Bernard and his team. I am confident that under their leadership, BP will continue to successfully navigate the rapidly-changing energy landscape.”

Earlier last year, the company also revealed a hit to its underlying replacement cost profit in its third quarter results, causing shares to drop.

However, its second quarter profits beat expectations.

Shares in BP plc (LON:BP) were up on Tuesday, trading at +4.61% as of 09:59 GMT.