Energy giant BP posted stronger-than-expected second quarter profit that easily beat expectations and said its new chairman will review the entire portfolio to reverse years of under performance.
The company will seek to cut costs beyond its current targets after announcing a turnaround plan in February that included a reduction in structural costs of $4 billion to $5 billion by the end of 2027.
The company has committed to cut spending and divest $20 billion of assets over the same period.
Activist investor Elliott Investment Management has called on new chairman Albert Manifold to make urgent improvements to the firm’s cost base and capital allocation, citing a weak turnaround plan.
BP appointed Mr Manifold, previously CEO of building-materials company CRH, as chairman starting 1 September.
He “will conduct a thorough review of our portfolio of businesses to ensure we are maximising shareholder value moving forward – allocating capital effectively,” said chief executive Murray Auchincloss. “BP can and will do better for its investors.
“This has been another strong quarter for BP operationally and strategically. We are delivering on our plan to grow the upstream and focus the downstream.”
The company reported underlying replacement cost profit, used as a proxy for net profit, of $2.35 billion for the three months to the end of June. That comfortably beat analyst expectations of $1.81bn, according to an LSEG-compiled consensus.
Net profit came in at $2.76bn over the second quarter of last year and $1.38bn in the first three months of 2025.
Its quarterly dividend will increase to 8.32 cents from 8 cents and that it will maintain the pace of its share buyback program at $750 million for the second quarter.
On Monday it announced its largest oil and gas discovery in 25 years off the coast of Brazil, reflecting a potentially significant boost as it continues to double down on hydrocarbons.
The company’s vice president for oil production, Gordon Birrell, said it was a “significant discovery” and the largest since 1999, when a giant gasfield in the Caspian Sea was discovered.
BP has recently been the subject of takeover speculation, prompting domestic rival Shell to say in late June that it had “no intention” of making an offer.
Shares of the company are up around 3.3% year-to-date.
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