BP 2Q Earnings Beat Expectations -- Earnings Review

By Oliver Griffin

BP PLC (BP.LN) reported results for the second quarter on Tuesday. Here is how the results came in:

UNDERLYING REPLACEMENT COST PROFIT: BP reported second-quarter underlying replacement cost profit--a figure that is similar to the net profit figure U.S. oil companies use, but strips out one-off items--of $2.81 billion. This is roughly flat on the $2.82 billion reported in the year-earlier period and beat analyst expectations. A company-compiled consensus of 20 brokers had forecast underlying replacement cost profit for the quarter at $2.46 billion.

SALES: The oil company reported sales and operating revenue of $72.67 billion for the second quarter, representing a 3.7% fall from $75.44 billion in the year earlier period. A consensus estimate of three broker forecasts compiled by FactSet saw BP's second-quarter sales and operating revenue at $71.50 billion. Total revenue for the second quarter came in at $73.75 billion.

WHAT WE WATCHED:

-PRODUCTION: Second-quarter reported production came in at 3.8 million barrels of oil equivalent a day, up 4% on the year-earlier period. Excluding contributions from Rosneft Oil Co. (ROSN.MZ), in which BP holds a 19.7% stake, production for the quarter came in at 2.64 million barrels of oil equivalent a day, roughly flat on the first quarter of 2019, when the company reported production of 2.66 million barrels a day.

-NET DEBT: Net debt rose over the quarter to $46.5 billion. In a note, Citi analysts said they believe progress in disposals is being hampered by low U.S. gas prices. The analysts said operating cash flow is outfacing rising debt and added that the second-quarter should be peak angst for investors on the leverage issue.

-U.S. NATURAL GAS: Henry Hub gas prices fell to $2.64 per million British thermal units, from $2.80 in the year-earlier period and $3.15 in the first quarter of 2019.

Shares at 1053 GMT were up 3% at 543 pence each.

Write to Oliver Griffin at [e-mail]; @OliGGriffin

(END) Dow Jones Newswires

July 30, 2019 08:00 ET (12:00 GMT)

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