RE: Cash registers28 Feb 2022 18:06
BP is getting rid of its 19.75% stake in Russian energy firm Rosneft saying, ''The Rosneft holding is no longer aligned with bp's business and strategy''. The group will no longer recognise Rosneft's income, production and reserves.
Instead, the holding will be treated as a financial investment until it's been sold.
The decision will result in a material non-cash charge in the group's first quarter results. It will be the difference between Rosneft's value of around $14bn, as reported at the end of 2021, and the current market value of bp's stake. It will also include a charge for foreign exchange losses. As of 2021, these totalled around $11bn.
Management continues to expect cash profits (EBITDA) to increase at a compound annual growth rate of 7-9% through 2025, if oil prices remain above $50-60 per barrel.
Giving up Rosneft isn't expected to impact the group's dividend and buyback plans.
The shares were down 6.7% following the announcement.