BP p.l.c. (NYSE:BP) Q1 2024 Earnings Call Transcript May 7, 2024
BP p.l.c. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Craig Marshall: Well, thanks, everyone for joining BP’s First Quarter 2024 Results Call today. As you’ll be aware, we introduced our quarterly trading statement this quarter and this morning also published the slides and script along with a video presentation in conjunction with our stock exchange announcement. Alongside this, the results call has moved to early afternoon UK time and we hope together these updates around our process and disclosures has been helpful to everyone and you’ve had a chance to review everything this morning and this afternoon. So we’re going to aim to finish the call at 2:00 P.M. UK time. As some of you will be aware, we understand our counterparts at Saudi Aramco start their call around that time, and we want to give you a chance to join that as required. So maybe let me start there. And on that note, hand over to Murray for a few brief opening remarks.
Murray Auchincloss: Good. Thanks, Craig, and thanks, everyone for joining Kate and I on the call today. To recap today’s results, we delivered resilient financial performance despite the unplanned outage at our Whiting refinery. First quarter adjusted EBITDA was $10.3 billion and underlying earnings were $2.7 billion. Adjusting for the expected seasonal working capital build, operating cash flow was $7.4 billion in the quarter. We continue to make good strategic progress and this quarter saw the safe start-up of the Azeri Central lease project in the Caspian Sea. BPX also brought online Checkmate, our third central processing facility and in biogas, Archaea brought online its largest modular RNG plant to date and has five in commissioning.
Last week, our JV Azule announced a 42.5% firm-in into an exploration block in the Orange basin offshore Namibia. You’ve also heard about how we are simplifying, removing complexity across the company and today, we have announced a target to deliver at least $2 billion of cash cost savings by the end of 2026. Craig, back to you.
A – Craig Marshall: Super. Thanks, Murray. So we’ll go straight to questions now and we’ll take the first question from Josh Stone at UBS. Josh?
Josh Stone: Yeah. Thanks, Craig, and good afternoon, Murray, and Kate, and appreciate the slightly longer time to study the results. I have two questions, please. First, I want to pick up on your 2025 EBITDA targets, which you reiterated specifically in the TGEs of $3 billion to $4 billion. And if I look at consensus, it feels like few people believe in these numbers and it’s only now almost 18 months away. So if I look at how the business has started, the buyer business looks like it started a bit lower than you might have expected. You talked about TA was impacted by an ongoing recession of freight in the U.S. So maybe my question is, where do you see the biggest risk in these 2025 targets and what do you think the market is missing on that side?
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