BP bucks oil industry gloom

Bloomberg

BP Plc surprised investors with a slight increase in its dividend, bucking the trend in what has otherwise been a bleak earnings season for Big Oil.
In the final set of results for retiring CEO Bob Dudley, the London-based company offered some respite for investors who received nothing but bad news from BP’s peers.
Big payouts, whether as dividends or buybacks, are the only thing attracting many investors to the industry in a world increasingly aware of the impact of fossil fuels on climate change and falling energy prices.
Last week Royal Dutch Shell Plc slowed the pace of its share buybacks due to weak macroeconomic conditions, while Exxon Mobil Corp and Chevron Corp failed to impress.
“We remain confident in delivering the 2021 free cash flow targets and divestment proceeds, and expect to continue to reduce net debt and gearing,” Dudley said on an analyst call. This underpins the company’s “ongoing commitment to sustainably growing distributions to shareholders over the long term,” he added.
BP shares rose 4.4% to 472.75 pence in London, the biggest increase since September. “BP’s results have come in slightly better than expected, but they are still a reflection of the challenging environment for oil and gas companies,” said Stuart Lamont, an investment manager at Brewin Dolphin Ltd.
Fourth-quarter adjusted net income was $2.57 billion, exceeding even the highest analyst estimate. That compares with profit of $3.48 billion a year earlier.
BP’s gearing remained above its target of 30% at the end of 2019.
BP is reducing its debt burden in part by selling unwanted assets.
It has announced $9.4 billion of deals since the start of 2019, putting it well on course to complete the targeted $10 billion of sales in the two years to 2020, CFO Brian Gilvary said. It announced a further $5 billion by mid-2021.
BP completed its share repurchasing programme, buying $1.5 billion of stocks in the fourth quarter.