OSLO: Fresh from its Deepwater Horizon settlement, BP is back in deep water with results that show profits diving on the sliding oil price. FT Opening Quote, with commentary this week by deputy head of Lex Oliver Ralph, is your early City briefing. You can sign up for the full newsletter here.
One has to feel sorry for the people running BP. No sooner has the company finished with one crisis, it is time to move on to the next.
Earlier this month, BP announced a final settlement with the US authorities over the Deepwater Horizon incident, at a cost of $18.7bn. No time to relax though – the falling oil price must be laying waste to the company’s internal forecasts and plans. Second quarter numbers show the damage – underlying replacement cost profit (an industry measure of profits) was $1.3bn. That is a 64 per cent drop on the same period last year. It is also below the $1.6bn consensus estimate.
At least BP is in good company. Norway’s Statoil (whose shares have done no better than BP’s over the past five years) also released an ugly set of first-half numbers. Adjusted profits fell 42 per cent. At the net income line, the company posted a NOK25bn loss, against a NOK36bn profit in the second quarter last year.
Life is looking better in TV-land though. ITV’s revenue jumped 11 per cent in the first half of the year, driven by a combination of higher advertising sales and a good performance from ITV Studios, maker of programmes including Mr Selfridge, Come Dine With Me and I’m A Celebrity…Get Me Out Of Here. Pre-tax profits jumped by a quarter.
Next, the clothing retailer, is also in good shape. The company has a reputation for caution in its outlook, preferring to guide low initially and surprise on the upside. It has just announced an improvement to its guidance for this year – profits will rise by between 3 and 8 per cent this year, against previous expectations of 0 to 7 per cent growth.
