By Christian Moess Laursen
LONDON (Dow Jones)–British energy company BP increased its third-quarter profit thanks to higher realized refining margins, a strong oil trading result and higher oil and gas production. However, market expectations were missed. The group announced another share buyback worth $1.5 billion.
In the three months ended September, the group posted adjusted profit at replacement cost – a measure comparable to the net income of U.S. oil companies – of $3.29 billion, up from $2.59 billion in the previous quarter. However, the profit was below the company’s analyst consensus of $4.01 billion.
The energy company, which is listed on the FTSE 100, wants to use part of the cash flow surplus of $3.11 billion for a further share buyback with a volume of $1.5 billion. This buyback should be completed by the time the final quarter figures are presented. The dividend payout was increased from 6.006 cents in the previous year to 7.27 cents.
Most of the trading result came from profits in the oil production and operations segment, which totaled $3.14 billion before interest and taxes in the quarter, up from $2.78 billion in the second quarter. Higher realized refining margins, a strong oil trading result and higher oil and gas production also contributed to the gains, although they were not enough to repeat last year’s result of $8.15 billion. At that time, high natural gas prices in Europe brought record profits to energy companies worldwide.
“This was a solid quarter supported by a strong operational performance, demonstrating our continued focus on delivery,” said interim chief executive Murray Auchincloss.
BP’s net profit rose to $4.89 billion from $1.79 billion in the quarter.
For the fourth quarter, BP expects oil, gas and low-carbon energy production to be largely unchanged compared to the previous quarter and refining margins to be significantly lower.
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(END) Dow Jones Newswires
October 31, 2023 03:49 ET (07:49 GMT)
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