BP PLC on Tuesday lowered its share buyback after first quarter profit fell short of market expectations.
In response, shares in the London-based oil major fell 3.7% at 348.45 pence in London on Tuesday. Shares in BP have fallen 33% in the last 12 months.
Underlying replacement cost profit nearly halved to $1.38 billion in the first quarter of 2025, falling from $2.72 billion a year prior, and missing the $1.53 billion company-compiled consensus.
Pretax profit plunged 32% to $3.13 billion in the quarter from $4.63 billion a year prior. Total revenue declined 4.2% to $47.88 billion from $49.96 billion.
Profit has been hit by a sharp fall in oil prices and refining margins compared to a year ago.
Operating cash flow declined to $2.83 billion from $5.01 billion a year prior.
Net debt increased to $26.97 billion from $24.02 billion, primarily driven by lower operating cash flow. In the last quarter alone, net debt rose from $23.00 billion.
BP declared a dividend of 8.00 US cents, unchanged from the prior quarter, but up 10% from 7.27 cents a year ago.
In addition, it announced a £750 million share buyback, at the low-end of the previously guided range of £750 million to $1 billion and a marked easing from prior quarters.
BP said the $1.75 billion share buyback programme announced with the fourth quarter results was completed on April 25.
BP said it expects total shareholder distributions of 30% to 40% of operating cash flow, over time.
The company expects capital expenditure of around $14.5 billion in 2025 and has a capital frame of around $13 to $15 billion for 2026 and 2027.
In February, BP announced an operational reset, moving away from its green energy strategy.
Chief Executive Officer Murray Auchincloss said the firm has has already made ‘significant progress’.
‘So far this year we have started up three major projects, made six exploration discoveries and have progressed our divestment programme - all while delivering strong operational performance,’ he said.
Auchincloss said BP will continue to ‘monitor market volatility and changes and remain focused on moving at pace.’
‘I’m confident that our plans to strengthen the balance sheet, reduce costs, and improve cash flow and returns will grow long-term shareholder value and strengthen the resilience of BP,’ he added.
Looking ahead, BP expects second quarter reported upstream production to be broadly flat compared with the first-quarter 2025.
In its customers business, BP expects seasonally higher volumes compared to the first quarter.
In products, BP expects a significantly higher level of planned refinery turnaround activity compared to the first quarter.
BP expects divestment and other proceeds to be around $3 to $4 billion in 2025, weighted towards the second half.
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