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(Alliance News) - BP PLC on Tuesday announced it plans to expand its share buybacks to around USD4.0 billion per year, as it swung to a profit in the third quarter.
However, the profit was milder than in the second quarter.
BP continued "performing while transforming" in the third quarter of the year. It recorded USD57.81 billion in revenue during the quarter, up 52% from USD37.87 billion a year prior but 19% lower from USD67.87 billion in the second quarter.
It swung to a pretax profit of USD1.98 billion from a loss of USD495 million a year before. Third quarter profit was however significantly lower than GBP14.06 billion in the second quarter to June 30.
Post-tax, it narrowed its loss to USD1.98 billion from USD2.35 billion a year ago. This compares to a profit of USD9.54 billion in the second quarter.
BP also swung to a replacement cost profit of USD23 million from a loss of USD2.93 billion a year before. The profit is however dwarfed by a second quarter replacement cost profit of USD7.65 billion.
By its preferred measure, the oil major's third quarter profit jumped year-on-year, to an underlying replacement cost profit of USD8.15 billion from USD3.32 billion. This was lower than the USD8.45 billion profit in the second quarter.
BP announced a dividend of 6.006 US cents per share to be paid in December, up 10% from 5.46 US cents a year ago. It expects oil prices to remain elevated in the fourth quarter, due to OPEC+ cutting supply, however it expects global gas prices to be more volatile.
"BP expects industry refining margins to remain elevated in the fourth quarter due to sanctioning of Russian crude and product and energy prices are also expected to remain high," the company said.
BP increased its natural gas production to 5.0 million cubic feet of gas per day from 4.5 million a year ago and 4.7 million a quarter ago. Its average realised gas price rose to USD9.85 per thousand cubic feet from USD5.26 a year ago and USD8.42 a quarter ago.
BP sold hydrocarbons for an average realised price of USD60.80 per barrel in the third quarter, up 74% from USD34.91 a year ago and 9.0% higher than USD55.79 in the second quarter.
The firm sold liquids for an average realised price of USD88.03 per barrel, up 33% from USD66.39 but down 17% from USD105.50 in the second quarter.
Upstream production in the fourth quarter is likely to be slightly lower than in the third quarter, BP guided.
The company said it plans to executive another USD2.5 billion share buyback before the release of its fourth quarter results. It noted that it completed a USD3.5 billion share buyback programme announced with second quarter results last week Thursday.
Further, BP said it expects to be able to deliver share buybacks of USD4.0 billion every year and increase annual dividends per share of around 4% through 2025, based on its forecast with a price of around USD60 per barrel Brent.
For its third quarter, BP said the average oil marker price for Brent was at USD100.84 per barrel, up 37% from USD73.51 a year prior but down 11% from USD113.93 in the second quarter.
BP's cashflow rose to USD3.53 billion from USD933 million a year ago but was lower than USD6.59 billion a quarter ago.
BP shares were 0.5% lower at 477.40 pence each in London on Tuesday morning.
By Tom Budszus; tombudszus@alliancenews.com
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