BP posted third-quarter underlying replacement cost profit, its version of net income, of $8.46 billion on Friday, compared with expectations of $7.33 billion in a company-provided poll of analysts and $2.2 billion a year ago.
The British major’s operating cash flow was $14.8 billion, and net debt was $13.9 billion, meeting its target to reduce net debt a year early. Strong cash generation combined with allocating excess cash to strengthen the balance sheet enabled an $8.4 billion reduction in net debt.
“We have now delivered our net debt and structural cost reductions targets and have line of sight on the remaining two of the four primary financial targets we set ourselves for 2027,” CEO Meg O’Neill said in a statement.
The US-Israeli war on Iran has boosted profits for oil majors, leading to questions over how they will allocate the extra cash. BP said on Friday it would use the excess cash flow generated by earnings to address remaining liabilities in full from the Deepwater Horizon oil spill in 2010.
Deepwater Horizon oil spill payables and provisions stood at $5.94 billion, according to BP data.
(Reporting by Stephanie Kelly and Shadia Nasralla; Editing by Joe Bavier)