BP posts earnings in Q4 below estimates
By Robert Barr |
February 3, 2010, Wednesday
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Print Edition
Print Edition
BP Plc, Europe's second-largest oil company, yesterday reported a net profit of US$4.3 billion for the fourth quarter, up from a year-ago loss but short of analysts' estimates, due to weak earnings on refining.
The company had made a loss of US$3.3 billion in the fourth quarter of 2008 but a profit of US$5.3 billion in the third quarter of 2009.
The fourth-quarter profit was about 5 percent below analysts' consensus forecast, according to Evolution Securities, and BP said it expected refining margins to remain weak and production to drop this year.
The stock slumped 4.5 percent to 568 pence (US$9.05) in London.
"The shares have fallen foul of high market expectations in early trade, and may also have been subject to some profit taking after a 20 percent rally in the last six months," said Richard Hunter, analyst at Hargreaves Lansdown Securities.
Replacement cost profit, a key oil industry measure, was US$3.45 billion compared to US$2.6 billion in the fourth quarter of 2008, but down from US$4.98 billion in the third quarter.
BP declared a dividend of 14 US cents per share, unchanged from the third quarter or from a year ago.
"The group has performed well against a weak operating background," said Tony Shephard, analyst at Charles Stanley & Co, who noted that BP had cut its cash costs by US$4 billion during the year "and further efficiencies are expected."
"While it is disappointing the results came in below consensus, the market had clearly got a bit ahead of itself," said Jonathan Jackson, analyst at Killik & Co.
Analysts said there would be more cues to BP's prospects at a strategy meeting in March.
For the full year, BP said its net profit was US$16.6 billion, down from US$21.2 billion in 2008. Replacement cost profit for the year was down 45 percent to US$13.96 billion.
The company had made a loss of US$3.3 billion in the fourth quarter of 2008 but a profit of US$5.3 billion in the third quarter of 2009.
The fourth-quarter profit was about 5 percent below analysts' consensus forecast, according to Evolution Securities, and BP said it expected refining margins to remain weak and production to drop this year.
The stock slumped 4.5 percent to 568 pence (US$9.05) in London.
"The shares have fallen foul of high market expectations in early trade, and may also have been subject to some profit taking after a 20 percent rally in the last six months," said Richard Hunter, analyst at Hargreaves Lansdown Securities.
Replacement cost profit, a key oil industry measure, was US$3.45 billion compared to US$2.6 billion in the fourth quarter of 2008, but down from US$4.98 billion in the third quarter.
BP declared a dividend of 14 US cents per share, unchanged from the third quarter or from a year ago.
"The group has performed well against a weak operating background," said Tony Shephard, analyst at Charles Stanley & Co, who noted that BP had cut its cash costs by US$4 billion during the year "and further efficiencies are expected."
"While it is disappointing the results came in below consensus, the market had clearly got a bit ahead of itself," said Jonathan Jackson, analyst at Killik & Co.
Analysts said there would be more cues to BP's prospects at a strategy meeting in March.
For the full year, BP said its net profit was US$16.6 billion, down from US$21.2 billion in 2008. Replacement cost profit for the year was down 45 percent to US$13.96 billion.
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