BP PLC (LSE:BP.) has posted record annual profits, an increased dividend and a further hefty share buy-back as it raised earnings targets out to 2030.
“Performing while transforming” was how chief executive, Bernard Looney described the results which were accompanied with an update on its strategic vision.
But it wasn’t all good news with fourth-quarter underlying replacement cost profits of US$4.8bn below City expectations of US$5bn, and down from US$8.2bn in the third quarter.
Nevertheless, annual profits reached US$27.6bn in 2022, more than double 2021’s US$12.8bn, lifted by a surge in energy prices which followed Russia's invasion of Ukraine.
The fourth quarter dividend was up 10% at 6.6 US cents when compared to last year and the oil giant launched a further US$2.75bn share buy-back.
Compared to the third quarter, the result was impacted by a below-average gas marketing and trading result after the exceptional result in the third quarter, lower oil and gas realizations, a higher level of refinery turnaround and maintenance activity, plus lower marketing margins and seasonally lower volumes, BP said.
The FTSE 100-listed oil giant set new targets for EBITDA of US$46bn to US$49bn in 2025 and is aiming for US$51bn to US$56bn in 2030 (assuming a US$70/barrel oil price environment), up from previous forecasts of around US$38bn in 2025 and US$39-US46bn in 2030 at $60/barrel.
BP made a number of investment pledges announcing plans to invest up to US$8bn more into transition growth engines by 2030 focusing on higher-return bioenergy, and convenience & EV charging, hydrogen and renewables and power.
Up to $8bn more will be pumped into oil and gas by 2030 “targeting short-cycle fast-payback opportunities with lower additional operational emissions,” it said.
But the overall capex range remained little changed at US$14bn to US$18bn compared to a previous band of US$14bn to US$16bn.
In the results statement, Looney commented: "We will increase our focus on the transition growth engines able to deliver nearer-term solutions - like EV chargers and sustainable aviation fuels - that can help people and businesses decarbonise sooner.
“We are growing our investment into our transition and, at the same time, growing investment into today's energy system. In doing so - we see tremendous opportunity to create value. And it's what governments and customers are asking of companies like us."