BP lures investors with share buybacks post tough year

Bloomberg

BP Plc set out to win back shareholders after a difficult year, saying it will begin share buybacks after “exceptional” natural gas trading buoyed earnings.
The gesture is aimed at investors who have shown little love for the company since it cut its dividend by half last year. After lagging its European peers for much of 2020, BP re-jigged its priorities to put boosting shareholder returns ahead of other goals.
“It’s a story of delivering on our promise of competitive cash returns for our shareholders, while at the same time transitioning
the company for the future,” Chief Executive Officer Bernard Looney said in a Bloomberg television interview. “It’s been a strong quarter for the company
financially.”
The London-based company’s buybacks will begin at a modest pace, with $500 million of repurchases in the second quarter to offset dilution from the vesting of employee share awards. BP said it will return at least 60% of surplus cash flow to shareholders this year, of which it generated $1.7 billion in the first quarter. It will outline these plans when it publishes its next earnings.
“The message is clear: buybacks are up and running almost a year early,” Sanford C Bernstein Ltd analyst
Oswald Clint wrote in a research note.
Bernstein estimates a further $1.5 billion to $2 billion of buybacks could be possible later this year.