BP Fourth Quarter and Full-Year 2008 Results
Release date: 03 February 2009
Download the full version of our fourth quarter and full-year 2008 results using the link below.
Download the results (SEA) (pdf, 149KB) A webcast presentation was hosted by Tony Hayward, Chief Executive Officer, and Byron Grote, Chief Financial Officer. The presentation discussed BP's fourth quarter and full-year 2008 results, and was followed by a question and answer session. An archive of the presentation is now available.
| Fourth Quarter | Third Quarter | Fourth Quarter | $ million | Year | ||
|---|---|---|---|---|---|---|
| 2007 | 2008 | 2008 | 2008 | 2007 | % | |
| 4,399 | 8,049 | (3,344) | Profit (loss) for the period(a) | 21,157 | 20,845 | |
| (1,004) | 1,980 | 5,931 | Inventory holding (gains) losses, net of tax (b) | 4,436 | (2,475) | |
| 3,395 | 10,029 | 2,587 | Replacement cost profit (b) | 25,593 | 18,370 | 39 |
| 8.75 | 27.76 | 11.32 | - per ordinary share (pence)(c) | 74.02 | 47.92 | |
| 17.90 | 53.43 | 13.93 | - per ordinary share (cents) | 136.20 | 95.85 | 42 |
| 1.07 | 3.21 | 0.84 | - per ADS (dollars) | 8.17 | 5.75 | |
- BP's fourth-quarter replacement cost profit was $2,587 million, compared with $3,395 million a year ago, a decrease of 24% due largely to the significantly lower oil prices. For the full year, replacement cost profit was $25,593 million compared with $18,370 million a year ago, up 39%.
- Non-operating items and fair value accounting effects for the fourth quarter had a net $18 million unfavourable impact compared to a net $1,132 million unfavourable impact for the fourth quarter of 2007. For the full years of 2008 and 2007, the respective amounts were $650 million unfavourable and $571 million unfavourable - see further details on page 3. The most significant non-operating items for the fourth quarter were, on a pre-tax basis, fair value gains on embedded derivatives, which amounted to $1,562 million, and a net charge of $1,460 million for impairments and gains and losses on the sale of businesses and fixed assets.
- Net cash provided by operating activities for the quarter and year was $5.6 billion and $38.1 billion compared with $4.3 billion and $24.7 billion respectively a year ago.
- The effective tax rate on replacement cost profit for the fourth quarter was 44% and for the year was 36%; a year ago, the rates were 38% and 33% respectively. The rate in the fourth quarter reflects the impact of a loss from jointly controlled entities and the impairment of an investment, neither of which generate a corresponding credit to the group tax charge. We expect the tax rate to be in the range of 36% to 39% during 2009.
- Net debt at the end of the quarter was $25.0 billion compared to $26.8 billion a year ago. The ratio of net debt to net debt plus equity was 21%, compared with 22% a year ago.
- Total capital expenditure and acquisitions was $7.0 billion for the quarter and $30.7 billion for the year. Capital expenditure, excluding acquisitions and asset exchanges and excluding the accounting for our transactions with Husky (see page 24) and Chesapeake (see page 17), was $6.8 billion for the quarter and $21.7 billion for the year. Disposal proceeds were $229 million for the quarter and $929 million for the year. In 2009, we expect our capital expenditure, excluding acquisitions and asset exchanges, to be around $20-22 billion, broadly in line with 2008, and we expect disposal proceeds to be around $2-3 billion.
- The quarterly dividend, to be paid in March, is 14 cents per share ($0.84 per ADS) compared with 13.525 cents per share a year ago. For the year, the dividend showed an increase of 22%. In sterling terms, the quarterly dividend is 9.818 pence per share, compared with 6.813 pence per share a year ago; for the year, the increase was 44%. During the quarter, the company did not repurchase any of its own shares for cancellation. For the year, share repurchases were 269.8 million at a cost of $2.9 billion.
(a)Profit (loss) attributable to BP shareholders.
(b)With effect from 1 January 2008, replacement cost profit excludes inventory holding gains and losses net of tax. Comparative amounts have been amended to the new basis. See page 2 for further details.
(c)Comparative for the third quarter has been corrected from 29.75 pence to 27.76 pence.
Cautionary Statement
The foregoing discussion and the notes which follow contain forward-looking statements particularly those regarding tax rate; capital expenditure; disposal proceeds; the expected timing of completion of certain transactions; expected 2008 reserves replacement ratio; the continued slowing of global economies and uncertainty in the global financial markets; anticipated low demand for certain products; impact from falling crude oil prices on US domestic pipeline barrels; potential capacity of the Sherbino wind farm; quarterly charges and expected timing of commencement of production at the Sunrise field. By their nature, forward-looking statements involve risk and uncertainty and actual results may differ from those expressed in such statements depending on a variety of factors including the following: the timing of bringing new fields onstream; industry product supply; demand and pricing; operational problems; general economic conditions (including inflation); political stability and economic growth in relevant areas of the world; changes in laws and governmental regulations and quotas; exchange rate fluctuations; development and use of new technology; the success or otherwise of partnering; the actions of competitors; natural disasters and adverse weather conditions; changes in public expectations and other changes to business conditions; wars and acts of terrorism or sabotage; and other factors discussed in this announcement. For more information you should refer to our Annual Report and Accounts 2007 and our 2007 Annual Report on Form 20-F filed with the US Securities and Exchange Commission.
The foregoing discussion and the notes which follow contain forward-looking statements particularly those regarding tax rate; capital expenditure; disposal proceeds; the expected timing of completion of certain transactions; expected 2008 reserves replacement ratio; the continued slowing of global economies and uncertainty in the global financial markets; anticipated low demand for certain products; impact from falling crude oil prices on US domestic pipeline barrels; potential capacity of the Sherbino wind farm; quarterly charges and expected timing of commencement of production at the Sunrise field. By their nature, forward-looking statements involve risk and uncertainty and actual results may differ from those expressed in such statements depending on a variety of factors including the following: the timing of bringing new fields onstream; industry product supply; demand and pricing; operational problems; general economic conditions (including inflation); political stability and economic growth in relevant areas of the world; changes in laws and governmental regulations and quotas; exchange rate fluctuations; development and use of new technology; the success or otherwise of partnering; the actions of competitors; natural disasters and adverse weather conditions; changes in public expectations and other changes to business conditions; wars and acts of terrorism or sabotage; and other factors discussed in this announcement. For more information you should refer to our Annual Report and Accounts 2007 and our 2007 Annual Report on Form 20-F filed with the US Securities and Exchange Commission.
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