BP beats third-quarter forecasts with record $8.46 billion profit
BP•BP reported third-quarter underlying replacement cost profit of $8.46 billion, topping analysts’ $7.33 billion forecast and rising from $2.2 billion a year earlier. Net debt fell to $13.9 billion, a year ahead of its target, and BP said it would use surplus cash to settle remaining Deepwater Horizon liabilities.
1. Record quarterly profit
BP reported third-quarter underlying replacement cost profit of $8.46 billion, its highest quarterly result under the current measure, compared with analysts’ $7.33 billion forecast and $2.2 billion a year earlier. Operating cash flow was $14.8 billion, while net debt fell to $13.9 billion, meeting BP’s target a year early.
2. Cash and liabilities
BP said it would use some surplus cash to settle its remaining Deepwater Horizon liabilities. Related payables and provisions stood at $5.94 billion, while the company said it had previously set aside $69 billion relating to the 2010 spill.
3. Business performance
All three business units beat expectations. Customer and products reported pretax profit of $6.95 billion, above the $6.3 billion analyst estimate; BP’s refining indicator margin rose to $46.7 per barrel from $29.6 in the second quarter and $15.8 a year earlier. BP recorded $4 billion of impairments, largely linked to transition businesses, and said it will hold a strategy update on December 15.
