BP to resume share buybacks

BP has provided a trading update for the City  Photo: Jonathan Brady/PA Wire
BP has provided a trading update for the City Photo: Jonathan Brady/PA Wire
0
Have your say

BP said it will resume share buybacks after reporting a doubling in third-quarter profit in a sign the oil company is confident about a turnaround.

BP said it was able to balance its cashflow in the first nine months of the year, excluding large payments for the settlement of the 2010 Deepwater Horizon spill, at $49 a barrel as years of costs cuts pay off.

The profit growth was driven by a recovery in earnings from oil and gas production after BP started six major projects so far this year.

BP said it will start buying back shares in the fourth quarter in order to offset the dilutive effect of the scrip dividend programme, when investors can receive dividend payouts with cash and shares.

BP reported third-quarter underlying replacement cost profit, the company’s definition of net income, of $1.87 billion, exceeding analysts’ forecasts of $1.58 billion.

That doubled a profit of $933 million a year earlier and $684 million in the second quarter of 2017, when the company took a large writedown on exploration.

“Given the momentum we see across our businesses and our confidence in the outlook for the group’s finances, we will be recommencing a share buyback programme this quarter,” Chief financial officer Brian Gilvary said.