BP Posts Record Half-Year Profits Amid Global Energy Boom

Strategic Insights -

BP, the UK's largest company, recorded a surge in half-year profits to £5.6 billion ($8.45 billion), fueled by a 164% increase in group second-quarter profits. The oil giant's chief executive, Sir John Browne, attributes the success to the company's "well tried formula of ever lower costs and ever tougher performance targets." The profits are the highest ever recorded by a UK company, with BP on track to become the first UK group to top £10 billion in annual profits if oil prices remain stable.

Key Takeaways:

  • BP's half-year profits reached £5.6 billion ($8.45 billion), the highest ever recorded by a UK company.
  • The quarterly dividend is 3.352p (5 cents).
  • BP is lifting annual investment to £9 billion to pursue "top-line" revenue growth.
  • The company is targeting new oil and gas fields in the Gulf of Mexico, Trinidad, and Angola.
  • Even the North Sea, which has been a long-standing region for BP, is experiencing a renaissance.
  • New frontiers for BP include Iran, China, and Russia, where it is exploring new projects and partnerships.
  • Despite trebled profits, the company's shares have fallen 14p to 593p and are below last year's level.

Statistics:

  • £215 million per week
  • £30 million per day
  • Replacement cost profits pre-exceptionals almost trebled to $3.6 billion ($5.5 billion)
  • 164% surge in group second-quarter profits
  • 20% discount to the market
  • 61.5p per litre of petrol sold, with taxes taking 61.5p and BP making 1p
  • £9 billion annual investment
  • 30 years of operations in the North Sea

Sources:

  • BP press release, no date provided
  • Investec Henderson Crosthwaite report, no date provided