BP Profit Misses Estimates as Oil’s Rally Hurts Refining
- Company can’t yet cover spending, dividends at current prices
- Investors may have expected a turnaround too soon, BMO says
The BP Plc company logo sits at a fuel station in London, U.K., on Tuesday, Oct. 27, 2009. BP Plc, Europe’s second-largest oil company, posted third-quarter earnings that beat analyst estimates and raised its cost-cutting target for the year, sending the shares to a 16-month high.
Photographer: Frantzesco Kangaris/BloombergBP Plc reported fourth-quarter earnings that missed analyst estimates after higher oil prices failed to fully compensate for lower income from refining.
Profit adjusted for one-time items and inventory changes totaled $400 million, falling short of the $567.7 million average estimate of analysts. Unlike peers Royal Dutch Shell Plc and Exxon Mobil Corp., which said cash flow now covered spending and dividends at current oil prices, BP said it wouldn’t achieve that until the end of the year, and only if Brent crude rises to about $60 a barrel.