Royal Dutch Shell Plc  .com Rotating Header Image 2ND UPDATE: BP Manages Small Profit Rise Despite Disruptions

July 24, 2007: 07:15 AM EST

LONDON (Dow Jones) — BP on Tuesday reported a surprise rise in second-quarter profit, as the British oil giant said gains from the sale of assets offset disruptions at a U.S. refinery.

BP (BP) said its quarterly profit rose 1.5% to $7.38 billion, or 38.18 cents a share, with revenue virtually flat at $73.08 billion.

Adjusted for the impact of energy price changes on inventories as well as $741 million in one-off gains, and its profit decline of 13% to $5.35 billion wasn’t as bad as the $5 billion in profit that analysts had forecast.

Mark Iannotti, a Merrill Lynch analyst, said the better-than-expected profit was on the back of a lower-than-expected tax charge of 36%.

BP lifted its dividend to 64.95 cents per U.S.-listed share, up from 58.95 cents.

Shares of BP slipped 0.7% in late morning London trading. For the year BP’s stock has underperformed rivals including Royal Dutch Shell (RDSA) , which reports results on Thursday.

The results were the first unveiled by Tony Hayward, who replaced John Browne as chief executive after the latter disclosed he had lied under oath about a relationship with a boyfriend.

Hayward, the former exploration and production chief, has been faced with difficulties largely around the refining and marketing business.

BP has been heavily criticized both by a committee led by former Secretary of State James Baker as well as the U.S. Chemical Safety and Hazard Investigation Board for the safety at its refineries. An explosion in 2005 in Texas City, Tex. left 15 dead and hundreds injured.

In the second quarter, refining and marketing profit improved due to the sale of its Coryton refinery and a U.S. pipeline system. But refinery throughput declined 7% to 2.12 million barrels a day, as the 410,000 barrel-a-day refinery in Whiting, Ind. has been running at a reduced rate.

The company last week said it would invest $3 billion in the facility. BP said on Tuesday it will be able to get Whiting to resume sour crude processing in the fourth quarter and back to full capacity in the first half of 2008. There has also been unscheduled downtime in refineries in Toledo and Carson.

At its largest arm, exploration and production, profit dropped 12% to $6.89 billion, as production fell 5% to 3.8 million barrels of oil a day.

It still sees annual production between 3.8 million and 3.9 million barrels of oil a day.

BP also said lower oil and gas prices and rising costs also hurt E&P profit.

Hayward told journalists that the company isn’t in merger talks with Shell and doesn’t have any plans to do so, rebutting an oft-heard market rumor.
  (END) Dow Jones Newswires
  07-24-07 0715ET
  Copyright (c) 2007 Dow Jones & Company, Inc. and its sister non-profit websites,,,,,, and are owned by John Donovan. There is also a Wikipedia feature.

0 Comments on “ 2ND UPDATE: BP Manages Small Profit Rise Despite Disruptions”

Leave a Comment

%d bloggers like this: