Outgoing BP boss Bob Dudley beat expectations in his final set of results as chief executive, allowing him to give shareholders an increased dividend as a parting gift.
The oil giant’s underlying replacement cost (RC) profit, its most watched measure that is a proxy for net profit, reached 2.6 billion US dollars (£2 billion) for the fourth quarter.
It is a major fall from 3.5 billion dollars (£2.7 billion) in the same period last year, yet still beat brokers’ forecasts of 2.1 billion dollars (£1.6 billion).
On a reported basis, RC swung to a loss of four million dollars (£3.1 million) for the three months. However losses narrowed from 351 million dollars (£271 million) in the quarter before.
Full year 2019 results: BP is performing well, with safe & reliable operations, continued strategic progress & strong cash delivery. $10bn underlying replacement cost profit, $28.2bn underlying operating cash flow.* $BP— BP (@BP_plc) February 4, 2020
Underlying full-year RC profit was nearly 10 billion dollars (£7.7 billion), a reduction from 12.7 billion (£9.8 billion) a year earlier.
On a reported basis, the full-year RC profit fell by 65% to 3.5 billion dollars (£2.7 billion).
It means the company weathered a drop in the price of oil better than many of its rivals, with production rising 3% to compensate slightly.
As a result Mr Dudley was able to increase his shareholders’ dividend by 2.4% to 10.5 cents (8.1p) per share, which will be paid at the end of March.
The finalised figure in sterling will be published in mid-March.
“BP is performing well, with safe and reliable operations, continued strategic progress and strong cash delivery,” Mr Dudley said.
“This all supports our commitment to growing distributions to shareholders over the long term and the dividend rise we announced today.”
Analysts were gloomy ahead of the full-year results, after a poor set of performances from BP’s rivals.
Shell’s shares fell last week after it revealed how badly hit it had been by the drop in oil and gas prices.
The news came on Mr Dudley’s last day in charge of the business.
The American, who steered the oil major through its response to the Deepwater Horizon spill, will hand over to Irishman Bernard Looney on Wednesday.
Mr Dudley said: “After almost 10 years, this is now my last quarter as CEO.
“In that time, we have achieved a huge amount together and I am proud to be handing over a safer and stronger BP to Bernard and his team.
“I am confident that, under their leadership, BP will continue to successfully navigate the rapidly-changing energy landscape.”
Faced with Deepwater Horizon, Mr Dudley’s time in charge has been defined by the environmental problems that result when things go wrong for oil companies. However, his successor is likely to face a more holistic challenge to BP’s environmental impact.
The business is already being challenged by climate change activists, who have targeted its sponsorship of art institutions, and its alleged lobbying.
In June, protesters from Extinction Rebellion targeted the Royal Opera House during a BP-sponsored screening of Romeo and Juliet.
Shares rose 16.8p, or 3.7%, 469.5p as markets opened on Tuesday morning.