bp's first quarter 2025 results

Highlights 

1Q25 underlying replacement cost (RC) profit $1.4 billion

• Underlying RC profit for the quarter was $1.4 billion, compared with $1.2 billion for the previous quarter. Compared with the fourth quarter 2024, the underlying result reflects lower impact from turnaround activity, stronger realized refining margins, lower other businesses & corporate underlying charge, partly offset by a weak gas marketing and trading result. The underlying effective tax rate (ETR) in the quarter was 50%.
  
• Reported profit for the quarter was $0.7 billion, compared with a loss of $2.0 billion for the fourth quarter 2024. The reported result for the first quarter is adjusted for inventory holding gains of $0.2 billion (pre-tax) and a net adverse impact of adjusting items of $0.4 billion (pre-tax) to derive the underlying RC profit. Adjusting items include pre-tax net impairments of $0.4 billion and favourable fair value accounting effects of $1.0 billion. See page 24 for more information on adjusting items.
  

Segment results_(b)

• Gas & low carbon energy: The RC profit before interest and tax for the first quarter 2025 was $1.4 billion, compared with $1.3 billion for the previous quarter. After adjusting RC profit before interest and tax for a net favourable impact of adjusting items of $0.4 billion, the underlying RC profit before interest and tax for the first quarter was $1.0 billion, compared with $2.0 billion in the fourth quarter 2024. The first quarter underlying result before interest and tax is largely driven by a weak gas marketing and trading result, lower production, including the impact of divestments, and higher costs, mainly non-cash costs and start up costs related to major projects.
  
• Oil production & operations: The RC profit before interest and tax for the first quarter 2025 was $2.8 billion, compared with $2.6 billion for the previous quarter. After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.1 billion, the underlying RC profit before interest and tax for the first quarter was $2.9 billion, compared with $2.9 billion in the fourth quarter 2024. The first quarter underlying result before interest and tax reflects higher volume and realizations offset by lower income from equity-accounted entities and the absence of the benefit of several non-recurring items in the fourth quarter 2024.
• Customers & products: The RC profit before interest and tax for the first quarter 2025 was $0.1 billion, compared with a loss of $1.9 billion for the previous quarter. After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.6 billion, the underlying RC profit or loss before interest and tax (underlying result) for the first quarter was a profit of $0.7 billion, compared with a loss of $0.3 billion in the fourth quarter 2024. The customers first quarter underlying result was higher by $0.1 billion, reflecting lower costs and stronger midstream performance, partly offset by seasonally lower volumes. The products first quarter underlying result was higher by $0.8 billion, mainly reflecting a lower impact from turnaround activity and stronger realized refining margins. The oil trading contribution was average. 

Operating cash flow $2.8 billion and net debt $27.0 billion

• Operating cash flow of $2.8 billion, which includes a working capital build of $3.4 billion (after adjusting for inventory holding gains, fair value accounting effects and other adjusting items), was around $4.6 billion lower than the previous quarter, reflecting seasonal inventory effects and timing of various payments including annual bonus payments and payments related to low carbon assets held for sale. Net debt was $27.0 billion at the end of the first quarter, primarily driven by lower operating cash flow.

Financial frame

• bp is committed to maintaining a strong balance sheet and maintaining 'A' grade credit range through the cycle. We have a target of $14-18 billion of net debt by the end of 2027_(a).
• Our policy is to maintain a resilient dividend. Subject to board approval, we expect an increase in the dividend per ordinary share of at least 4% per year_(c). For the first quarter, bp has announced a dividend per ordinary share of 8 cents.
• Share buybacks are a mechanism to return excess cash. When added to the resilient dividend, we expect total shareholder distributions of 30-40% of operating cash flow, over time. Related to the first quarter results, bp intends to execute a $0.75 billion share buyback prior to reporting the second quarter results. The $1.75 billion share buyback programme announced with the fourth quarter results was completed on 25 April 2025.
• bp will continue to invest with discipline, driven by value and focused on delivering returns. We expect capital expenditure of around $14.5 billion in 2025 and have a capital frame of around $13-15 billion for 2026 and 2027. 

(a) Potential proceeds from any transactions related to the Castrol strategic review and announcement to bring a strategic partner into Lightsource bp will be allocated to reduce net debt.
(b) RC profit or loss before interest and tax for the fourth quarter 2024 for gas & low carbon energy and customers and products has been restated for material items to reflect the move of our Archaea business from the customers & products segment to the gas & low carbon energy segment.
(c) Subject to board discretion each quarter taking into account factors including current forecasts, the cumulative level of and outlook for cash flow, share count reduction from buybacks and maintaining ‘A’ range credit metrics.