BP plc (NYSE:BP), the U.K.'s second-largest oil producer, advanced in early New York trading after lifting its quarterly dividend for the second time in six months and saying more share buy-backs were on the cards.
American depositary receipts of BP rose 1.9 percent to $49.97 at 8:09 a.m.
BP will raise its quarterly dividend to 9.75 cents per share, to be paid in June, the London-based company said in a statement today. That's, 8.3 percent higher than a year earlier. This is also above the 9.5 cents announced in October and paid for the subsequent two quarters.
Profit stood at $3.2 billion, down 24 percent on a year ago but slightly ahead of market expectations.
Revenue slipped to $91.71 billion, from $94.11 billion a year earlier.
Cash flow came in at $8.2 billion, more than double the amount from the same period last year.
"As well as progressive growth in the dividend per share, we expect to use surplus cash to support further distributions through share buy-backs or other mechanisms," Chief Executive Bob Dudley said in the statement.
The group's dividends are returning towards levels last seen in 2009 before the Gulf of Mexico oil spill in 2010, after which dividends were suspended for three quarters. Before the Gulf spill, BP had paid a dividend of 14 cents.
The higher payouts will be partially funded by the company's asset sales. By the end of 2015, it has said it will sell $10 billion worth of assets, in addition to the $40 billion worth of disposals made to help pay for the 2010 Gulf of Mexico oil spill.
To date it has offloaded $3 billion worth, including four oilfields in Alaska earlier this month. Disclosing the price today, BP said these were sold for up to $1.5 billion.
BP said it had nearly completed its $8 billion share buyback program, announced after the sale of its 50 per cent stake in its Russian joint venture TNK-BP.
BP's output for the first quarter fell 8.5 percent to 2.13 million barrels of oil a day and the company warned that second-quarter output will be lower than the first quarter, mainly because of planned major maintenance particularly in the higher-margin North Sea and Gulf of Mexico regions.
The company's upstream division, which includes oil exploration, development and production, reported an underlying pretax net profit of $4.4 billion, down from $5.7 billion in the same period last year, hurt by asset sales and a $521 million charge related to its decision not to develop it Utica shale project in Ohio.
BP's downstream division, which includes refining operations and marketing, also reported weaker profit, of $1 billion down from $1.6 billion, because of a weaker refining environment.
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