BP Q1 2025 slides reveal $1.4B profit, $750M buyback as company targets cash flow growth

BP PLC (NYSE:BP) presented its first quarter 2025 financial results on April 29, highlighting a $1.4 billion underlying replacement cost profit and announcing a $750 million share buyback program. The energy giant emphasized its strategic reset focused on growing upstream operations while maintaining disciplined transition investments to drive shareholder value.

Quarterly Performance Highlights

BP reported an underlying replacement cost profit before interest and tax of $4.5 billion for Q1 2025, with strong operational performance across its business segments. The company maintained high reliability metrics with upstream plant reliability exceeding 95% and refining availability above 96%.

"Strong operational performance, delivering major projects," noted the company in its presentation, as it continues to execute on its strategic priorities.

The quarterly dividend was maintained at 8 cents per ordinary share, consistent with BP’s commitment to deliver resilient distributions to shareholders. The company also announced a $750 million share buyback for Q1, following the completion of the previously announced $1.75 billion buyback from Q4 2024.

As shown in the following slide highlighting the quarter’s key metrics:

The company’s financial position showed some pressure on cash flow, with operating cash flow of $2.8 billion and a working capital build of $3.4 billion. This working capital increase was attributed to seasonal inventory effects and timing of payments, including annual bonus payments and payments related to low carbon assets held for sale. Capital expenditure for the quarter was $3.6 billion, while net debt stood at $27.0 billion.

Strategic Initiatives and Project Updates

BP highlighted significant progress on its upstream growth strategy, delivering three of ten major projects expected to start up between 2025 and 2027. These projects included Cypre (Trinidad), Raven (NASDAQ:RAVN) infills (Egypt), and GTA Phase 1 (Mauritania & Senegal), which collectively are expected to add approximately 100 thousand barrels of oil equivalent per day of peak net production.

The company’s upstream strategy is illustrated in the following slide:

BP also reported strong exploration and access success across multiple global regions, with six exploration discoveries and new access contracts finalized in Iraq and India. The company sanctioned a major project in Trinidad and continued to expand its global footprint.

The global nature of BP’s exploration activities is shown in this world map:

The company is progressing on its divestment program, announcing an agreement for TANAP (Trans-Anatolian Natural Gas Pipeline) and stating its intent to sell Austria & Netherlands retail operations and the Gelsenkirchen refinery. A strategic review of Castrol is also underway as BP continues to optimize its portfolio.

Financial Framework and Outlook

BP outlined a clear financial framework focused on strengthening its balance sheet, delivering resilient shareholder distributions, and maintaining disciplined capital allocation. The company targets a net debt range of $14-18 billion by the end of 2027 and aims to maintain ’A’ range credit metrics through the cycle.

For shareholder distributions, BP expects an annual increase in dividend per ordinary share of at least 4% and intends to share excess cash through buybacks over time. The company targets 30-40% of operating cash flow to be returned to shareholders through dividends and share buybacks.

The financial framework is detailed in the following slide:

Capital expenditure is projected at approximately $14.5 billion for 2025, with guidance of $13-15 billion for 2026-2027, reflecting BP’s disciplined approach to investment allocation.

Looking ahead, BP provided guidance for 2025, expecting reported upstream production to be lower than 2024, with underlying upstream production also slightly lower. The company anticipates $3-4 billion in divestment proceeds for the year.

Forward-Looking Statements

BP outlined ambitious targets through 2027, including adjusted free cash flow growth exceeding 20% CAGR from 2024-2027, a net debt target of $14-18 billion by the end of 2027, structural cost reduction of $4-5 billion by the end of 2027, and a Group Return on Average Capital Employed (ROACE) exceeding 16% in 2027.

These primary targets are illustrated in the following slide:

The company’s strategy for growing shareholder value rests on three pillars: resetting strategy (growing upstream, disciplined transition investment), reallocating capital (reducing capex, significant divestment program), and driving performance (improving downstream operations, cost efficiency).

This comprehensive approach to shareholder value creation is summarized in the following slide:

BP’s price assumptions for the coming years show a gradual increase in Brent crude prices, from $70 per barrel in 2024 to $74.4 per barrel in 2027, suggesting cautious optimism about the oil market outlook.

The company’s focus on operational excellence, portfolio optimization, and disciplined capital allocation positions it to navigate the evolving energy landscape while delivering on its commitment to grow shareholder value through improved cash flow generation and returns.

Full presentation:

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