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By Ron Bousso
LONDON, Oct 30 (Reuters) - BP has yet to decide whether to
boost its dividend by the end of the year, it said on Wednesday,
after its shares fell sharply on the previous day on fears it
would defer a decision to 2020.
BP reported a 40% drop in third-quarter profits on Tuesday
due to lower oil and gas prices, though its underlying
performance and cashflow was strong.
Its shares, however, sank 3.8% after Chief Financial Officer
Brian Gilvary indicated in an analyst call that the company
could delay a decision on boosting dividends to next year.
"We'll certainly discuss it at 4Q, but it's more likely it
will be beyond that," Gilvary said.
Investors have been piling pressure on oil companies to
increase returns as they successfully slashed costs after years
of weak performance in the wake of the 2014 industry downturn.
BP shares were up 1% at 1110 GMT.
On Wednesday, BP issued an unusual statement saying no
decision has been made yet.
"In response to certain commentary following BP's 3Q 2019
results issued on 29 October 2019, BP wishes to confirm that no
decision has yet been made with respect to the 4Q 2019 or any
future dividend."
In a sign of confidence, BP eliminated a scrip dividend for
the quarter which allows investors to get shares instead of
cash, a measure used during the industry downturn.
Jefferies analyst Jason Gammel said he had expected the
London-based company to increase its dividend by a "modest" 2.4%
in the fourth quarter of 2019.
"A 3.8% drop in share price on a stock now yielding 6.5%
strikes us as harsh. The company has taken other steps to
increasing shareholder returns," Gammel said in a note.
(Reporting by Ron Bousso, editing by Louise Heavens)
