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BP Plc Q1 RC Profit Climbs, Tops View

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British energy giant BP Plc (BP.L,BP_UN.TO,BP) reported Tuesday higher replacement cost profit in its first quarter, as revenues were benefited by increased production and prices.

Looking ahead, the company expects Upstream segment's second-quarter reported production to be lower sequentially, reflecting the expiration of the Abu Dhabi offshore concession and seasonal turnaround and maintenance activities. In the downstream segment, seasonally higher industry refining margins are expected, but lower discounts for North American heavy crude oil.

Group chief executive Bob Dudley said, "We have delivered another strong set of results. Our safe and reliable operations and strong financial delivery have continued into 2018..... Moving through 2018 we're determined to keep delivering our operational targets and maintaining capital discipline while growing cash flow and returns. Over the longer term, our new lower carbon ambitions, including clear targets for our own emissions, will help ensure that all of BP is also focused on advancing the energy transition."

For the first quarter, replacement cost or RC profit was $2.39 billion, higher than last year's $1.41 billion.

Underlying RC profit was $2.59 billion, 71% higher than $1.51 billion last year, mainly due to higher profits in Upstream, partially offset by a higher tax charge.

Underlying RC profit per ordinary share was 12.98 cents compared to 7.74 cents last year. Underlying RC profit per ADS was $0.78 compared to $0.46 a year ago.

On average, six analysts polled by Thomson Reuters expected earnings of $0.68 per share for the quarter. Analysts' estimates typically exclude special items.

In the quarter, profit before tax of $3.91 billion climbed from $2.11 billion in the prior year. Profit attributable to shareholders was $2.47 billion, higher than $1.45 billion last year. Earnings per ADS increased to $0.74 from $0.44.

The company noted that the Upstream segment reported the strongest quarter since third quarter 2014 on both a replacement cost and underlying basis. BP experienced continued Downstream earnings growth with strong refining availability in the US.

First-quarter sales and other operating revenues increased to $68.17 billion from $55.86 billion a year ago.

Reported oil and gas production was 3.7 million barrels of oil equivalent a day in the quarter, 6% higher than 2017. Upstream production, excluding Rosneft, was 9% higher, supported by continued ramp up of major projects. Underlying production increased 13.8%.

Further, BP announced an unchanged quarterly dividend of 10.00 cents per ordinary share or $0.600 per ADS, which is expected to be paid on 22 June 2018.

In London, BP shares were trading at 545.50 pence, up 1.39 percent.

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