Energy company BP has reported $0.1 billion in underlying replacement cost profit, surpassing analysts’ expectations of $347 million loss in Q3.
Energy company BP Plc (LON:BP) has exceeded analysts’ expectations as it reported profits for the third-quarter (Q3). The earnings result, which was released on October 27th, showed that the company is beginning to rebound from recent losses.
Before now, analysts at Refinitiv had predicted that BP would report a loss of $347 million for Q3. However, the energy giant reported gains in Q3 over the loss of $6.7 billion in Q2.
BP Q3 Earnings Results
According to the quarterly results titled “performing while transforming,” BP gained $0.1 billion in underlying replacement cost profit. The company also earned $5.3 billion in underlying operating cash flow, excluding post-tax Gulf of Mexico oil spill payments.
The recent gains can be tied to the recovering prices of oil and gas. Apart from the price rebound, BP noted that the company also benefited from increased energy demand. In addition, the result revealed that BP is on track to hit its target for organic capital expenditure. Targeting about $12 billion, BP has gathered $9.1 billion over the past three quarters in 2020.
Also, the energy company has announced a dividend of 5.25 cents per share for the third quarter. The earnings report also showed that year-on-year cash costs are down by 11%, and net debt is down $1.5 billion to $40.4 billion. BP is currently aiming to hit $35 billion in net debt.
BP CEO Bernard Looney commented on the A3 earnings result:
“Having set out our new strategy in detail, our priority is execution and, despite a challenging environment, we are doing just that – performing while transforming.”
Notably, BP recently added new major projects. Since mid-year, the company has included Atlantis Phase 3 and Khazzan Phase 2 (Ghazeer) in Oman into production. Apart from the additional major projects, BP has also announced recent achievements and plans for further expansion. BP has revealed plans for a “network of ultra-fast chargers in Germany.”
Also, UK’s biggest name in electric vehicle charging, BP Chargemaster, has been awarded a contract worth £21 million by Police Scotland. The company would be supplying more than 1,000 charging points across 265 locations.
Furthermore, BP and Microsoft Corporation (NASDAQ: MSFT) have collaborated to “develop new technology innovations and digital solutions to help meet their sustainable aims.” As the two companies work together, BP will supply renewable energy to Microsoft.
At the time of the partnership, the CEO of BP Chargemaster Matteo de Renzi said that the energy giant aims to become a net-zero company by 2050.
EVP of customers & products at BP Emma Delany also expressed her satisfaction with the company’s recent recoveries. “We have strong businesses today. They have the scale and they are growing. They are delivering cash and strong returns. And we see more growth to come. In the next decade, we aim to nearly double our earnings,” added she.