BP 4Q and full-year 2009 results | press

Release date: 02 February 2010

Download the full version of our fourth quarter and full-year 2009 results using the link below.

Fourth quarter	Third quarter	Fourth quarter	$ million	Year
2008	2009	2009	$ million	2009	2008	%

(3,344)	5,336	4,295	Profit (loss) for the period^(a)	16,578	21,157
5,931	(355)	(848)	Inventory holding (gains) losses, net of tax	(2,623)	4,436

2,587	4,981	3,447	Replacement cost profit	13,955	25,593	(45)%

13.93	26.59	18.38	- per ordinary share (cents)	74.49	136.20	(45)%
0.84	1.60	1.10	- per ADS (dollars)	4.47	8.17

BP's fourth-quarter replacement cost profit was $3,447 million, compared with $2,587 million a year ago, an increase of 33%. For the full year, replacement cost profit was $13,955 million compared with $25,593 million a year ago, down 45%.
Non-operating items and fair value accounting effects for the fourth quarter had a net $937 million unfavourable impact compared with a net $18 million unfavourable impact in the fourth quarter of 2008. For the full year, the respective amounts were $622 million unfavourable and $650 million unfavourable. Non-operating items for the fourth quarter and full year 2009 included a goodwill impairment of $1.6 billion relating to our US West Coast fuels value chain in Refining and Marketing.
Finance costs and net finance income or expense relating to pensions and other post-retirement benefits were $302 million for the fourth quarter, compared with $251 million for the same period last year. For the full year, the respective amounts were $1,302 million and $956 million.
The effective tax rate on replacement cost profit for the fourth quarter and full year was 34% and 33% respectively, compared with 44% and 36% a year ago. Adjusting for the impact of the goodwill impairment in Refining and Marketing, which is not tax deductible, the effective tax rate for the fourth quarter was 27% and for the full year was 31%. In 2010, we expect the effective tax rate to be around 33-34%.
Net cash provided by operating activities for the quarter and full year was $7.3 billion and $27.7 billion compared with $5.6 billion and $38.1 billion respectively a year ago.
Net debt at the end of the quarter was $26.2 billion. The ratio of net debt to net debt plus equity was 20% compared with 21% a year ago.
Cash costs^(b) for the full year were more than $4 billion lower than in 2008, of which approximately 40% related to foreign exchange benefits and lower fuel costs. Excluding the effects of changes in exchange rates and fuel costs, we expect further reductions in cash costs in 2010.
Total capital expenditure, including acquisitions and asset exchanges, for the fourth quarter and full year was $5.9 billion and $20.3 billion respectively. Excluding acquisitions and asset exchanges, capital expenditure in 2009 was $20.0 billion. Disposal proceeds were $1.1 billion for the quarter and $2.7 billion for the full year. In 2010, we expect capital expenditure, excluding acquisitions and asset exchanges, to be around $20 billion and we expect disposal proceeds of $2-3 billion.
The quarterly dividend, to be paid in March, is 14 cents per share ($0.84 per ADS), the same as a year ago. In sterling terms, the quarterly dividend is 8.679 pence per share, compared with 9.818 pence per share a year ago, a decrease of 12%.
Subject to shareholder approval at the Annual General Meeting on 15 April, an optional scrip dividend programme, allowing shareholders to choose to receive dividends in the form of new fully paid shares in BP p.l.c. in lieu of cash, will be available for future dividends. This would replace the companys current dividend reinvestment plans. Further details of this proposal will be published on 5 March with the notice of meeting for the Annual General Meeting.

^(a)Profit attributable to BP shareholders.

^(b)Cash costs are a subset of production and manufacturing expenses plus distribution and administration expenses. They represent the substantial majority of the expenses in these line items but exclude associated non-operating items and certain costs that are variable, primarily with volumes (such as freight costs). They are the principal operating and overhead costs that management considers to be most directly under their control although they include certain foreign exchange and commodity price effects.

Forward Looking Statements - Cautionary Statement:
This presentation and the associated slides and discussion contain forward looking statements, particularly those regarding production growth and future production; oil and gas markets; cash costs; capital expenditure and capital efficiency; divestments; effective tax rate; refining and petrochemical margins; global economic outlook; dividend and scrip dividend; efficiency of our regional business service centres; reverse of consolidation adjustments reflecting higher volumes of equity barrels in our downstream inventories at year-end and higher prices; foreign exchange and energy costs; depreciation, depletion and amortization; underlying average quarterly charge from other business and corporate costs; strategy (including our focus on upstream profit growth, cost and capital efficiency, downstream turnaround and cost efficiency, focus and disciplined investment in Alternative Energy and corporate efficiency). By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that will or may occur in the future. Actual results may differ from those expressed in such statements, depending on a variety of factors, including the timing of bringing new fields on stream; future levels of industry product supply; demand and pricing; operational problems; general economic conditions; political stability and economic growth in relevant areas of the world; changes in laws and governmental regulations; regulatory or legal actions; exchange rate fluctuations; development and use of new technology; changes in public expectations and other changes in business conditions; the actions of competitors; natural disasters and adverse weather conditions; wars and acts of terrorism or sabotage; and other factors discussed elsewhere in this presentation.

Reconciliations to GAAP:
This presentation also contains financial information which is not presented in accordance with generally accepted accounting principles (GAAP). A quantitative reconciliation of this information to the most directly comparable financial measure calculated and presented in accordance with GAAP can be found on our website at www.bp.com

Cautionary Note to US Investors:
We use certain terms in this presentation, such as “resources” and “non-proved reserves”, that the SEC’s rules prohibit us from including in our filings with the SEC. U.S. investors are urged to consider closely the disclosures in our Form 20-F, SEC File No. 1-06262. This form is available on our website at www.bp.com. You can also obtain this form from the SEC by calling 1-800-SEC-0330 or by logging on to their website at www.sec.gov.

BP Fourth Quarter and Full-Year 2009 Results

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