BP (LON:BP) have seen their share price tick up as they announce earnings that beat analyst expectations for a second quarter running. The British oil producer’s underlying replacement cost profit for the third quarter, a measure they use to assess the strength of the core business, was $1.9 billion, up from both $684 million in the previous quarter and $933 million last year.
By this measure, BP’s earnings per share (EPS) was $0.57 compared to $0.30 in the year previous. This represented a considerable beat of analysts expectations of $0.48.
The company also announced that they will recommence a share buyback programme in the fourth quarter, in order to offset the dilutive effect of scrip dividends. They were fairly non-committal with the details of the buyback programme, saying it would reflect the ongoing judgement of various factors used to adjudge the health of the core business.
Group chief executive, Bob Dudley, said of the results that the firm “are steadily building a track record of delivering on our plans and growing across our businesses. This quarter, three new Upstream projects and the highest Downstream earnings in five years, underpinned by reliable operations and disciplined spending, have generated healthy earnings and cash flow. There is still room for further improvement and we will keep striving to increase sustainable free cash flow and distributions to shareholders.”
The three new upstream projects for the most recent quarter are the Persephone project in Australia, the Juniper project in Trinidad, and the first phase of the Khazzan tight gas development in Oman. Six of the seven major projects BP expects to start production in 2017 are now online. The seventh, Zohr in Egypt, is on track to start up before the end of the year. Due to this the energy firm expect fourth quarter production to outstrip that in the third.
BP also managed to curtail costs of the oil spill in the Gulf of Mexico, down to $0.6 million, a significant decrease on the costs in the first two quarters of the year. Payments over the first nine months of 2017 were $4.9 billion and full year payments are expected to be roughly $5.5 billion.
BP also confirmed that dividend would remain unchanged at 10c per share. This is expected to be paid on 21 December 2017, and the corresponding sterling amount will be announced on 11 December.
BP share price has risen by 2.27% to 513p at the time of writing.