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BP shares slip after third-quarter earnings miss estimates

Published Oct 31, 2023 20:36
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Investing.com -- London-listed shares in BP (LON:BP) fell on Tuesday after the oil major reported lower-than-anticipated third-quarter earnings due in large part to weakness at its gas trading unit.

The British group posted $3.3 billion in underlying replacement cost profit, the company's main measure of income, below market estimates of $4B.

Interim Chief Executive Murray Auchincloss said the miss stemmed from a downturn in price volatility because of high gas storage levels in the U.S. and Europe, which weighed on trading activity at BP's gas division.

BP was hit as well by a $540 million write down on its wind power projects off the coast of New York. Authorities had previously rejected a request to renegotiate the terms of a related power purchase agreement, which BP had wanted to amend in order to reflect "inflationary pressures and permitting delays."

However, BP's income for the three months ended on September 30 was still an improvement from the $2.6B in profit it booked in the previous quarter, thanks to a jump in oil and gas production and strong refining margins.

In BP's first set of results since the surprise departure of former boss Bernard Looney in September for failing to disclose the details of past relationships with colleagues, Auchincloss noted that the business remains "committed" to a share buyback program that will see it aim to repurchase an additional $1.5B of stock. BP also backed plans to use 60% of its 2023 surplus cash flow to fund buybacks.

BP shares slip after third-quarter earnings miss estimates
 

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