British energy company BP on Tuesday reported better-than-expected first quarter profits on the back of higher oil prices as it hit its debt reduction target early and said it would resume share buybacks in the second quarter.
BP’s first-quarter underlying replacement cost profit, the company’s measure of net profit, came in at $2.6bn compared with a $115m in the final quarter of 2020 and $791m a year earlier.
Analysts had expected a first-quarter profit of $1.4bn. A wave of disposals helped to cut net debt by $5.6bn to reach $33.3bn at the end of the quarter, below BP’s $35m target and a year ahead of schedule.
The company will now embark on a $500m round of share buybacks in the next quarter for investors who saw dividends halved at the start of the Covid-19 pandemic which battered the industry, sparking a collapse in demand and wiping out profits, forcing companies to make massive writedowns and cuts thousands of jobs.
