Key findings

01

A key focus in the 4Q23 results was increasing cash to shareholders with increased buybacks ($3.5bn 1H24, $14bn FY24-FY25), guiding to higher overall distributions (80% of surplus cash flow). 

02

There was emphasis on taking a simplified approach. We see this playing out though lower capex at $16bn for FY24-25 (vs prior guidance of $14-18bn), signalling a pause on acquisitions, continued sell-downs of its renewables pipeline (will include offshore wind) and divestment of higher cost oil and gas assets ($2-3bn weighted to 2H24).

03

Auchincloss seems to be taking a more relaxed approach to growth in oil and gas production, suggesting that production may exceed its proposed peak of ~2.3 Mboe/d in FY25 if new projects are sanctioned. 

04

BP delivered FY23 EBITDA of $1bn for Transition Growth Engines (TGE’s, bioenergy, convenience, EV charging, hydrogen, renewables & power), off the back of $11bn in capex over the last three years (~9% return) and FY23 capex $3.8bn (-22%).

This reflected strong contributions from renewables & power ($400m) and bioenergy ($500m, including Archaea acquisition), offset by losses for EV charging and hydrogen as BP builds its US EV network and green hydrogen capacity for later years.