BP Q1 2024 Earnings
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BP's Profit Falls 40% Refinery Issues Counteract Output Growth
BP disclosed a decline in underlying profits to $2.7 billion for the initial three months of 2024, a drop from $5 billion in the first quarter of the previous year. This decrease was attributed in part to declining gas prices and an unplanned outage at a major BP refinery in the US.
BP's profits for the current period were lower compared to the same period in 2023, when they amounted to nearly $5 billion. This decline mirrors the trend seen across many oil and gas industry peers, attributed to a significant drop in gas market prices year-on-year.
The British energy giant reported adjusted EBITDA of $10.3 billion.
Murray Auchincloss, who assumed the role of chief executive from Bernard Looney in January, stated that BP's "controllable" cash costs amounted to approximately $22.6 billion in 2023. He emphasized that savings would be implemented across all sectors of the company's operations.
He mentioned that BP's strategy would involve concentrating on its portfolio, accelerating digital transformation, and collaborating with suppliers to eliminate inefficiencies.
Auchincloss highlighted that BP had previously reduced cash costs by $3 billion between 2020 and 2022. However, since then, these costs have increased by approximately 8% compared to 2019 levels.
In terms of financial performance, the company reported an operating cash flow of $7.4 billion for the quarter, meeting expectations. Additionally, there was a noted increase in net debt to $24 billion from $20.9 billion at the end of the fourth quarter.
The company's debt climbed to $53 billion, leading to a rise in its debt-to-market capitalization ratio to 22% from 19.7% in the previous quarter.
Oil and gas production saw a 2.1% increase from the previous year, reaching 2.38 million barrels of oil equivalent per day, driven by the commencement of operations in Azerbaijan and the United States.
On May 7th BP's share was down by 0.2% slightly below the flatline in London.
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