Tags: EU | Britain | Earns | BP

BP Posts $4.3 Billion Profit But Misses Estimates

Tuesday, 02 Feb 2010 07:36 AM

BP PLC, Europe's second-largest oil company, on Tuesday reported a net profit of $4.3 billion for the fourth quarter, up from a year-ago loss but falling short of analysts' estimates due to weak earnings on refining.

The company had made a loss of $3.3 billion in the fourth quarter of 2008 but a profit of $5.3 billion in the third quarter of 2009.

The fourth-quarter profit was also about 5 percent below analysts' consensus forecast, according to Evolution Securities, and BP shares dropped 4.5 percent to 568 pence in early trading on the London Stock Exchange.

Replacement cost profit, a key oil industry measure, was $3.45 billion compared to $2.6 billion in the fourth quarter of 2008, but down from $4.98 billion in the third quarter.

BP declared a dividend of 14 cents per share, unchanged from the third quarter or from a year ago.

"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.

However, he said, "the company is in good shape. It continues to explore new opportunities, has costs under relative control and, from an investment perspective, the dividend income is an additional bonus."

Fourth-quarter results reflected a weaker refining and marketing environment. BP said its refining indicator margin, a broad measure of profitability, dropped from $5.20 a barrel in the last quarter of 2008 to $1.49 a barrel in the recent period.

Rising crude prices and reduced volatility squeezed marketing margins, only partly offset by stronger operational performance and lower costs, BP said, adding that it expected refining margins to remain weak this year. Production is expected to be slightly lower in 2010, the company added.

For the full year, BP said its net profit was $16.6 billion, down from $21.2 billion in 2008. Replacement cost profit for the year was down 45 percent to $13.96 billion.

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BP PLC, Europe's second-largest oil company, on Tuesday reported a net profit of $4.3 billion for the fourth quarter, up from a year-ago loss but falling short of analysts' estimates due to weak earnings on refining.The company had made a loss of $3.3 billion in the fourth...
EU,Britain,Earns,BP
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2010-36-02
Tuesday, 02 Feb 2010 07:36 AM
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