-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OdPLQ628OWKUcq/xKjfLbxpePQvWiXNwajGOiSFzTyz6o0WhZbeWEfqfKtOokYSP f3k1+atf0FsM/6AQ285SpQ== 0000950123-10-040673.txt : 20100429 0000950123-10-040673.hdr.sgml : 20100429 20100429165244 ACCESSION NUMBER: 0000950123-10-040673 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20100331 FILED AS OF DATE: 20100429 DATE AS OF CHANGE: 20100429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BP PLC CENTRAL INDEX KEY: 0000313807 STANDARD INDUSTRIAL CLASSIFICATION: PETROLEUM REFINING [2911] IRS NUMBER: 000000000 STATE OF INCORPORATION: X0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-06262 FILM NUMBER: 10782403 BUSINESS ADDRESS: STREET 1: 1 ST JAMES'S SQUARE STREET 2: LONDON CITY: SW1Y 4PD STATE: X0 ZIP: 00000 BUSINESS PHONE: 442074964000 MAIL ADDRESS: STREET 1: BP AMERICA INC. STREET 2: 501 WESTLAKE PARK BOULEVARD CITY: HOUSTON STATE: TX ZIP: 77079 FORMER COMPANY: FORMER CONFORMED NAME: BP AMOCO PLC DATE OF NAME CHANGE: 19990104 FORMER COMPANY: FORMER CONFORMED NAME: BRITISH PETROLEUM CO PLC DATE OF NAME CHANGE: 19970226 6-K 1 u08838e6vk.htm 6-K e6vk
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
for the period ended 31 March 2010
Commission File Number 1-06262
BP p.l.c.
(Translation of registrant’s name into English)
1 ST JAMES’S SQUARE, LONDON, SW1Y 4PD, ENGLAND
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F þ      Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes o       No þ
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-
THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE IN THE PROSPECTUS INCLUDED IN THE REGISTRATION STATEMENT ON FORM F-3 (FILE NO. 333-157906) OF BP CAPITAL MARKETS p.l.c. AND BP p.l.c.; THE PROSPECTUS INCLUDED IN THE REGISTRATION STATEMENT ON FORM F-3 (FILE NO. 333-155798) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-79399) OF BP p.l.c.,THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-67206) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-103924) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-102583) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-123482) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-123483) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-131583) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-131584) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-132619) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-146868) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-146870) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-146873) OF BP p.l.c., THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-149778) OF BP p.l.c., AND TO BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.
 
 

 


 

BP p.l.c. AND SUBSIDIARIES
FORM 6-K FOR THE PERIOD ENDED 31 MARCH 2010(a)
             
        Page
1.
  Management’s Discussion and Analysis of Financial Condition and Results of Operations for the period January-March 2010(b)     3-10, 17-19  
 
           
2.
  Consolidated Financial Statements including Notes to Consolidated Financial Statements for the period January-March 2010     11-16, 20-24  
 
           
3.
  Signatures     25  
 
           
4.
  Exhibit 99.1: Computation of Ratio of Earnings to Fixed Charges     26  
 
           
 
  Exhibit 99.2: Capitalization and Indebtedness     27  
 
(a)
  In this Form 6-K, references to the first quarter 2010 and first quarter 2009 refer to the three-month periods ended 31 March  2010 and 31 March 2009 respectively.        
 
           
(b)
  This discussion should be read in conjunction with the consolidated financial statements and related notes provided elsewhere in this Form 6-K and with the information, including the consolidated financial statements and related notes, in BP’s Annual Report on Form 20-F for the year ended 31 December 2009.        
 EX-99.1
 EX-99.2

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BP p.l.c.
Group results
First quarter 2010
(LOGO)
London 29 April 2010
                         
    First quarter  
                    2010 vs  
    2010     2009     2009  
     
$ million
                       
Profit for the period(a)
    6,079       2,562       137 %
Inventory holding (gains) losses, net of tax
    (481 )     (175 )        
     
Replacement cost profit(b)
    5,598       2,387       135 %
     
 
                       
— Profit per ordinary share (cents)
    32.39       13.69       137 %
— Profit per ADS (dollars)
    1.94       0.82          
— Replacement cost profit per ordinary share (cents)
    29.82       12.75       134 %
— Replacement cost profit per ADS (dollars)
    1.79       0.77          
     
  BP’s first-quarter replacement cost profit was $5,598 million, compared with $2,387 million a year ago, an increase of 135%. Replacement cost profit for the group is a non-GAAP measure. For further information see pages 4 and 16. BP’s profit for the first quarter was $6,079 million, compared with $2,562 million a year ago.
  Non-operating items and fair value accounting effects for the first quarter had a net $49 million unfavourable impact compared with a net $194 million unfavourable impact in the first quarter of 2009. Information on fair value accounting effects is non-GAAP and further details are provided on page 18.
  Finance costs and net finance income or expense relating to pensions and other post-retirement benefits were $228 million for the first quarter, compared with $368 million for the same period last year.
  The effective tax rate on replacement cost profit for the first quarter was 34%, compared with 37.5% a year ago. The effective tax rate on profit for the first quarter was 34%, compared with 37.1% a year ago.
  Net cash provided by operating activities for the first quarter was $7.7 billion, compared with $5.6 billion a year ago.
  Net debt at the end of the first quarter was $25.2 billion. The ratio of net debt to net debt plus equity was 19% compared with 23% a year ago. Net debt information is non-GAAP and is defined on page 5. Gross finance debt at the end of the quarter was $32.2 billion compared to $34.7 billion a year ago. The ratio of gross debt to gross debt plus equity was 23%, compared with 28% a year ago.
  Total capital expenditure, including acquisitions and asset exchanges, for the first quarter was $4.7 billion. Organic capital expenditure(c) in the first quarter was $3.8 billion. Disposal proceeds were $0.1 billion for the first quarter. For 2010 as a whole, we continue to expect organic capital expenditure of around $20 billion and disposal proceeds of $2-3 billion.
  The quarterly dividend, to be paid on 21 June 2010, is 14 cents per share ($0.84 per ADS), the same as a year ago. The corresponding amount in sterling will be announced on 8 June 2010. A scrip dividend alternative is available, allowing shareholders to elect to receive their dividend in the form of new ordinary shares and ADS holders in the form of new ADSs. Details of the scrip dividend programme are available at www.bp.com/scrip.
 
(a)   Profit attributable to BP shareholders.
 
(b)   Replacement cost profit reflects the replacement cost of supplies and is the measure of profit or loss for each operating segment that is required to be disclosed under International Financial Reporting Standards, as explained in more detail on page 16. The replacement cost profit for the period is arrived at by excluding from profit inventory holding gains and losses and their associated tax effect. Replacement cost profit for the group is not a recognized GAAP measure.
 
    Management believes this information is useful to illustrate to investors the fact that crude oil and product prices can vary significantly from period to period and that the impact on our reported result under IFRS can be significant. Inventory holding gains and losses vary from period to period due principally to changes in oil prices as well as changes to underlying inventory levels. In order for investors to understand the operating performance of the group excluding the impact of oil price changes on the replacement of inventories, and to make comparisons of operating performance between reporting periods, BP’s management believes it is helpful to disclose this information.
 
(c)   Organic capital expenditure excludes acquisitions and asset exchanges and the accounting for our transaction with Value Creation Inc. (see page 15).
 
The commentaries above and following should be read in conjunction with the cautionary statement on page 10.
 

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Analysis of replacement cost profit before interest and tax and
reconciliation to profit for the period
                 
    First quarter  
    2010     2009  
     
$ million
               
Exploration and Production
    8,292       4,320  
Refining and Marketing
    729       1,090  
Other businesses and corporate
    (328 )     (761 )
Consolidation adjustment
    208       (405 )
     
RC profit before interest and tax(a)
    8,901       4,244  
     
 
               
Finance costs and net finance income or expense relating to pensions and other post-retirement benefits
    (228 )     (368 )
Taxation on a replacement cost basis
    (2,966 )     (1,454 )
Minority interest
    (109 )     (35 )
     
Replacement cost profit attributable to BP shareholders
    5,598       2,387  
     
 
               
Inventory holding gains (losses)
    705       254  
Taxation (charge) credit on inventory holding gains and losses
    (224 )     (79 )
     
Profit for the period attributable to BP shareholders
    6,079       2,562  
     
 
(a)   Replacement cost profit reflects the replacement cost of supplies. Replacement cost profit for the group is a non-GAAP measure. For further information see page 16.
Total of non-operating items and fair value accounting effects(a)(b)
                 
    First quarter  
    2010     2009  
     
$ million
               
Exploration and Production
    104       469  
Refining and Marketing
    (60 )     (459 )
Other businesses and corporate
    (118 )     (321 )
     
 
    (74 )     (311 )
Taxation credit (charge)(c)
    25       117  
     
 
    (49 )     (194 )
     
 
(a)   An analysis of non-operating items by type is provided on page 17 and an analysis by region is shown on pages 7, 9 and 10.
 
(b)   Information on fair value accounting effects is non-GAAP. For further details, see page 18.
 
(c)   Tax is calculated using the quarter’s effective tax rate on replacement cost profit.

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Per share amounts
                 
    First quarter  
    2010     2009  
     
Per ordinary share (cents)(a)
               
Profit for the period
    32.39       13.69  
RC profit for the period
    29.82       12.75  
 
Per ADS (dollars)(a)
               
Profit for the period
    1.94       0.82  
RC profit for the period
    1.79       0.77  
     
 
(a)   See Note 4 on page 22 for details of the calculation of earnings per share.
Net debt ratio — net debt: net debt + equity
                 
    First quarter  
    2010     2009  
     
$ million
               
Gross debt
    32,153       34,698  
Less: fair value asset (liability) of hedges related to finance debt
    152       (323 )
     
 
    32,001       35,021  
Cash and cash equivalents
    6,841       8,360  
     
Net debt
    25,160       26,661  
     
Equity
    104,978       91,179  
Net debt ratio
    19%     23%
     
Net debt and net debt ratio are non-GAAP measures. Net debt includes the fair value of associated derivative financial instruments that are used to hedge foreign exchange and interest rate risks relating to finance debt, for which hedge accounting is claimed. The derivatives are reported on the balance sheet within the headings ‘Derivative financial instruments’. We believe that net debt and net debt ratio provide useful information to investors. Net debt enables investors to see the economic effect of gross debt, related hedges and cash and cash equivalents in total. The net debt ratio enables investors to see how significant net debt is relative to equity from shareholders.
Dividends
Dividends Payable
BP has announced a dividend of 14 cents per ordinary share to be paid in June. The corresponding amount in sterling will be announced on 8 June 2010, and calculated from the average of the market exchange rates for the four dealing days commencing on 2 June 2010. Holders of American Depositary Shares (ADSs) will receive $0.84 per ADS. The dividend is payable on 21 June 2010 to shareholders and ADS holders on the register on 7 May 2010. A scrip dividend alternative is available, allowing shareholders to elect to receive their dividend in the form of new ordinary shares and ADS holders in the form of new ADSs. Details of the scrip dividend programme including the first quarter interim dividend and timetable are available at www.bp.com/scrip.
                 
    First quarter  
Dividends Paid   2010     2009  
     
Dividends paid per ordinary share
               
cents
    14.000       14.000  
pence
    8.679       9.818  
Dividends paid per ADS (cents)
    84.00       84.00  
     

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Exploration and Production
                 
    First quarter  
    2010     2009  
     
$ million
               
Profit before interest and tax(a)
    8,316       4,286  
Inventory holding (gains) losses
    (24 )     34  
     
Replacement cost profit before interest and tax(b)
    8,292       4,320  
     
 
By region
               
US
    2,762       1,143  
Non-US
    5,530       3,177  
     
 
    8,292       4,320  
     
 
(a)   Includes profit after interest and tax of equity-accounted entities.
 
(b)   See page 16 for information on replacement cost reporting for operating segments.
The replacement cost profit before interest and tax for the first quarter was $8,292 million, an increase of 92% compared with the first quarter of 2009. This increase was primarily due to higher realizations and higher earnings from equity-accounted entities (mainly TNK-BP), partly offset by a lower contribution from the gas marketing and trading business, higher production taxes and higher depreciation. Unit production costs were 3% lower than a year ago after adjusting for restructuring costs, and were 3% higher than a year ago including restructuring costs. Unit production costs after adjusting for restructuring costs is a non-GAAP measure – see page 19 for details.
The net non-operating gain of $41 million in the first quarter primarily relates to fair value gains on embedded derivatives, partly offset by restructuring costs. The corresponding quarter in 2009 included a net non-operating gain of $311 million. Additionally, in the first quarter, fair value accounting effects had a favourable impact of $63 million compared with a favourable impact of $158 million a year ago.
Production for the quarter was 4,010mboe/d, broadly flat with the first quarter of 2009 reflecting continued strong operational performance. After adjusting for entitlement impacts in our production-sharing agreements (PSAs) production was 1% higher. As previously indicated, we expect production in 2010 to be slightly lower than in 2009. The actual outcome will depend on a number of factors including the oil price and its impact on PSAs and OPEC quota restrictions. In the second quarter, we expect a normal seasonal turnaround effect of around 100mboe/d. These turnaround activities are planned for some of our higher-margin areas including the North Sea and the Gulf of Mexico, where activity is currently under way at Thunder Horse. This will impact costs and margins as well as volumes.
Two major projects started up during the first quarter. In the ultra-deepwater Gulf of Mexico, first oil was achieved from the Great White field (BP 33.3%). In Canada, the Noel major project commenced exporting and selling gas.
During the quarter, we announced that BP will pay Devon Energy $7.0 billion for assets in Brazil, Azerbaijan and the US deepwater Gulf of Mexico. These include ten exploration blocks in Brazil; a major portfolio of deepwater exploration acreage and prospects in the US Gulf of Mexico; and an interest in the ACG development in the Caspian Sea. Completion of certain of these transfers is subject to regulatory approvals and other third-party consents. In addition, BP will sell to Devon Energy a 50% stake in our Kirby oil sands interests in Alberta, Canada, for $500 million. The parties have agreed to form a 50:50 joint venture, operated by Devon, to pursue the development of Kirby. Devon will commit to fund an additional $150 million of capital costs on BP’s behalf.
Also during the quarter, BP and Value Creation Inc. (VCI) of Calgary agreed to form a partnership to explore and develop the Terre de Grace oil sands acreage, in the Athabasca region of Alberta, Canada, using in-situ techniques. BP will hold a 75% interest and VCI a 25% interest in a newly formed partnership. BP has agreed to pay $900 million for the interest with $500 million paid in cash at closing.
Furthermore, on behalf of our partners, BP announced the first major contracts to support the expansion of production from the Rumaila field in southern Iraq (BP has a 38% working interest).
After the end of the quarter, BP agreed with Total to acquire its 15.7% interest in Valhall and its 25% interest in Hod, both fields located in the southern part of the Norwegian continental shelf, for the sum of $991 million to be paid in cash. The agreement will deepen BP’s position as operator by giving BP a 43.8% interest in Valhall and 50% in Hod, subject to third-party consents and government approval. The deal has an effective date of 1 January 2010.
On 20 April 2010, the semi-submersible drilling rig Deepwater Horizon owned and operated by Transocean Limited caught fire in the US Gulf of Mexico and subsequently sank. The rig was drilling an exploration well (Mississippi Canyon 252) in which BP has a 65% interest. As operator under the MC 252 lease, BP is committed to doing everything in its power to contain the environmental consequences of the incident. BP is currently ramping up preparations for a major cleaning effort on the shorelines of Louisiana, Mississippi, Alabama and Florida. Efforts continue to stem the flow of oil from the well, currently estimated at up to 5,000 barrels a day. Preliminary estimates indicate that current efforts to contain the spill and secure the well are costing the MC 252 owners about $6 million per day. This figure is expected to rise as activity increases. It is too early to quantify other potential costs and liabilities associated with the incident.

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Exploration and Production
                 
    First quarter  
    2010     2009  
     
$ million
               
Non-operating items
               
US
    (62 )     71  
Non-US
    103       240  
     
 
    41       311  
     
 
               
Fair value accounting effects(a)
               
US
    81       208  
Non-US
    (18 )     (50 )
     
 
    63       158  
     
 
               
Exploration expense
               
US
    69       44  
Non-US
    51       75  
     
 
    120       119  
     
 
               
Production (net of royalties)(b)
               
Liquids (mb/d) (net of royalties)(c)
               
US
    665       643  
Europe
    215       212  
Russia
    849       822  
Rest of World
    798       827  
     
 
    2,527       2,504  
     
Of which equity-accounted entities
    1,132       1,116  
     
Natural gas (mmcf/d) (net of royalties)
               
US
    2,221       2,335  
Europe
    599       838  
Russia
    673       642  
Rest of World
    5,107       4,952  
     
 
    8,600       8,767  
     
Of which equity-accounted entities
    1,093       1,072  
     
Total hydrocarbons (mboe/d)(d)
               
US
    1,048       1,046  
Europe
    318       357  
Russia
    965       933  
Rest of World
    1,679       1,680  
     
 
    4,010       4,016  
     
Of which equity-accounted entities
    1,320       1,301  
     
Average realizations(e)
               
Total liquids ($/bbl)
    71.86       41.26  
Natural gas ($/mcf)
    4.26       3.63  
Total hydrocarbons ($/boe)
    49.16       31.40  
     
 
(a)   These effects represent the favourable (unfavourable) impact relative to management’s measure of performance. Further information on fair value accounting effects is provided on page 18.
 
(b)   Includes BP’s share of production of equity-accounted entities.
 
(c)   Crude oil and natural gas liquids.
 
(d)   Natural gas is converted to oil equivalent at 5.8 billion cubic feet = 1 million barrels.
 
(e)   Based on sales of consolidated subsidiaries only — this excludes equity-accounted entities.
Because of rounding, some totals may not agree exactly with the sum of their component parts.

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Refining and Marketing
                 
    First quarter  
    2010     2009  
     
$ million
               
Profit before interest and tax(a)
    1,408       1,417  
Inventory holding (gains) losses
    (679 )     (327 )
     
Replacement cost profit before interest and tax(b)
    729       1,090  
     
 
By region
               
US
    (63 )     308  
Non-US
    792       782  
     
 
    729       1,090  
     
 
(a)   Includes profit after interest and tax of equity-accounted entities.
 
(b)   See page 16 for information on replacement cost reporting for operating segments.
The replacement cost profit before interest and tax for the first quarter was $729 million, compared with $1,090 million for the same period last year.
The first quarter’s result included a net non-operating charge of $70 million compared with a net charge of $350 million a year ago. Fair value accounting effects had a favourable impact of $10 million in the first quarter compared with an unfavourable impact of $109 million in the first quarter of 2009.
Compared with a year ago, the result reflected a significantly weaker supply and trading contribution in contrast to the particularly strong contribution in the first quarter of last year. The result was also impacted by a weaker refining environment, with the indicator margin at around half the level of the same period in 2009, and marketing margins for some products compressed by rising crude prices. These factors were partially offset by operational improvements and further cost efficiencies in the fuels value chains, and continued strong performance in the international businesses. In addition, BP’s actual refining margins fell by less than the indicator would suggest as a result of BP’s highly upgraded refining portfolio.
In the fuels value chains, Solomon refining availability was up by three percentage points year on year to 95.3%, the highest level since 2004. Refining throughput increased by over 8% compared with the same quarter last year and by over 5% compared with the previous quarter, principally driven by increased throughputs in our US refineries.
In the international businesses, our petrochemicals business had a particularly strong quarter with production volumes up almost 40% compared with the same period last year and 12% on the previous quarter.
In February, BP announced that it had received an offer from Delek Europe B.V. for the retail fuels and convenience business and selected fuels terminals in France. As a result, BP has agreed a period of exclusivity with Delek Europe B.V. to negotiate the terms for the sale and to allow consultation with the relevant works councils. Any transaction will be subject to regulatory approval and is expected to include a BP brand licence agreement.
In March, BP announced that in sub-Saharan Africa it intends to sell its marketing businesses in Namibia, Malawi, Tanzania, Zambia and Botswana and focus its fuel marketing activities on South Africa and Mozambique.
There has been some improvement in refining margins in the early part of the second quarter although we expect opportunities for further improvement to be limited. BP’s refinery turnaround activities are expected to be higher in the second quarter than in the first. Continued low market volatility would limit the supply and trading contribution in the quarter. In the international businesses, we expect the current petrochemicals margins to come under some pressure as new capacity comes onstream.

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Refining and Marketing
                 
    First quarter  
    2010     2009  
     
$ million
               
Non-operating items
               
US
    (3 )     (134 )
Non-US
    (67 )     (216 )
     
 
    (70 )     (350 )
     
 
               
Fair value accounting effects(a)
               
US
    16       65  
Non-US
    (6 )     (174 )
     
 
    10       (109 )
     
 
               
Refinery throughputs (mb/d)
               
US
    1,366       1,164  
Europe
    780       783  
Rest of World
    282       299  
     
Total throughput
    2,428       2,246  
     
Refining availability (%)(b)
    95.3       92.3  
     
 
               
Sales volumes (mb/d)(c)
               
Marketing sales by region
               
US
    1,418       1,402  
Europe
    1,428       1,529  
Rest of World
    629       617  
     
Total marketing sales
    3,475       3,548  
Trading/supply sales
    2,622       2,312  
     
Total refined product sales
    6,097       5,860  
     
 
               
Global Indicator Refining Margin (GIM) ($/bbl)(d)
               
US Gulf Coast
    3.50       6.69  
US Midwest
    1.86       7.03  
US West Coast
    3.32       9.96  
North West Europe
    4.29       4.67  
Mediterranean
    3.11       3.56  
Singapore
    0.97       2.51  
BP Average GIM
    3.08       6.20  
     
 
               
Chemicals production (kte)
               
US
    940       713  
Europe
    981       788  
Rest of World
    1,887       1,244  
     
Total production
    3,808       2,745  
     
 
(a)   These effects represent the favourable (unfavourable) impact relative to management’s measure of performance. Further information on fair value accounting effects is provided on page 18.
 
(b)   Refining availability represents Solomon Associates’ operational availability, which is defined as the percentage of the year that a unit is available for processing after subtracting the annualized time lost due to turnaround activity and all planned mechanical, process and regulatory maintenance downtime.
 
(c)   Does not include volumes relating to crude oil.
 
(d)   The Global Indicator Refining Margin (GIM) is the average of regional indicator margins weighted for BP’s crude refining capacity in each region. Each regional indicator margin is based on a single representative crude with product yields characteristic of the typical level of upgrading complexity. The regional indicator margins may not be representative of the margins achieved by BP in any period because of BP’s particular refinery configurations and crude and product slate.

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Other businesses and corporate
                 
    First quarter
    2010   2009
     
$ million
               
Profit (loss) before interest and tax(a)
    (326 )     (800 )
Inventory holding (gains) losses
    (2 )     39  
     
Replacement cost profit (loss) before interest and tax(b)
    (328 )     (761 )
     
 
               
By region
               
US
    (231 )     (279 )
Non-US
    (97 )     (482 )
     
 
    (328 )     (761 )
     
 
               
Results include
               
Non-operating items
               
US
    (106 )     (116 )
Non-US
    (12 )     (205 )
     
 
    (118 )     (321 )
     
 
(a)   Includes profit after interest and tax of equity-accounted entities.
 
(b)   See page 16 for information on replacement cost reporting for operating segments.
Other businesses and corporate comprises the Alternative Energy business, Shipping, the group’s aluminium asset, Treasury (which includes interest income on the group’s cash and cash equivalents), and corporate activities worldwide.
The replacement cost loss before interest and tax for the first quarter was $328 million, compared with a loss of $761 million a year ago. The net non-operating charge for the first quarter was $118 million, compared with a net charge of $321 million a year ago. In addition, there were favourable foreign exchange effects and lower costs, and improved margins in Alternative Energy.
In Alternative Energy, our solar business achieved sales of 54MW in the first quarter. In March, BP Solar announced the closure of manufacturing at its Frederick facility, in Maryland, US, as it moves its manufacturing to lower-cost locations. BP Solar will maintain its US presence in sales and marketing, research and technology, project development, and key business support activities.
In our US wind business, construction has commenced at the 125MW Goshen North wind farm (BP 50%) in Bonneville County, Idaho. BP’s net wind generation capacity(c) at the end of the first quarter was 711MW (1,237MW gross), compared with 678MW (1,113MW gross) at the end of the same period a year ago.
 
(c)   Net wind capacity is the sum of the rated capacities of the assets/turbines that have entered into commercial operation, including BP’s share of equity-accounted entities. The gross data is the equivalent capacity on a gross-JV basis, which includes 100% of the capacity of equity-accounted entities where BP has partial ownership.
Cautionary statement regarding forward-looking statements: The foregoing discussion contains forward-looking statements particularly those regarding production and quarterly phasing of production, second quarter seasonal turn-around effect and its impact on costs, margins and volumes; refining and petrochemicals margins; refinery turnaround activities; expected supply and trading contribution in the second quarter; dividend and optional scrip dividend. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will or may occur in the future. Actual results may differ from those expressed in such statements, depending on a variety of factors including the timing of bringing new fields onstream; future levels of industry product supply; demand and pricing; OPEC quota restrictions; PSA effects; operational problems; general economic conditions; political stability and economic growth in relevant areas of the world; changes in laws and governmental regulations; regulatory or legal actions; exchange rate fluctuations; development and use of new technology; the success or otherwise of partnering; the actions of competitors; natural disasters and adverse weather conditions; changes in public expectations and other changes to business conditions; wars and acts of terrorism or sabotage; and other factors discussed in this Announcement. For more information you should refer to our Annual Report and Accounts 2009 and our 2009 Annual Report on Form 20-F filed with the US Securities and Exchange Commission.

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Group income statement
                 
    First quarter
    2010     2009  
     
$ million
               
Sales and other operating revenues (Note 2)
    73,071       47,296  
Earnings from jointly controlled entities — after interest and tax
    403       220  
Earnings from associates — after interest and tax
    763       285  
Interest and other income
    142       203  
Gains on sale of businesses and fixed assets
    38       81  
     
Total revenues and other income
    74,417       48,085  
 
Purchases
    51,641       30,777  
Production and manufacturing expenses (Note 3)
    5,740       5,894  
Production and similar taxes (Note 3)
    1,276       674  
Depreciation, depletion and amortization
    2,996       2,823  
Impairment and losses on sale of businesses and fixed assets
    164       137  
Exploration expense
    120       119  
Distribution and administration expenses
    3,020       3,349  
Fair value (gain) loss on embedded derivatives
    (146 )     (186 )
     
Profit before interest and taxation
    9,606       4,498  
Finance costs
    238       318  
Net finance (income) expense relating to pensions and other post-retirement benefits
    (10 )     50  
     
Profit before taxation
    9,378       4,130  
Taxation
    3,190       1,533  
     
Profit for the period
    6,188       2,597  
     
Attributable to
               
BP shareholders
    6,079       2,562  
Minority interest
    109       35  
     
 
    6,188       2,597  
     
 
               
Earnings per share — cents (Note 4)
               
Profit for the period attributable to BP shareholders
               
Basic
    32.39       13.69  
Diluted
    31.99       13.54  

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Group statement of comprehensive income
                 
    First quarter  
    2010     2009  
$ million
               
Profit for the period
    6,188       2,597  
     
Currency translation differences
    (526 )     (1,011 )
Available-for-sale investments marked to market
    (93 )     74  
Available-for-sale investments – recycled to the income statement
          2  
Cash flow hedges marked to market
    (162 )     (211 )
Cash flow hedges – recycled to the income statement
    (94 )     239  
Cash flow hedges – recycled to the balance sheet
    13       71  
Taxation
    (119 )     (82 )
     
Other comprehensive income
    (981 )     (918 )
     
Total comprehensive income
    5,207       1,679  
     
Attributable to
               
BP shareholders
    5,105       1,668  
Minority interest
    102       11  
     
 
    5,207       1,679  
     
Group statement of changes in equity
                         
    BP              
    shareholders’     Minority     Total  
    equity     interest     equity  
$ million
                       
At 31 December 2009
    101,613       500       102,113  
     
 
                       
Total comprehensive income
    5,105       102       5,207  
Dividends
    (2,626 )     (3 )     (2,629 )
Share-based payments (net of tax)
    (13 )           (13 )
Transactions involving minority interests
          300       300  
     
 
                       
At 31 March 2010
    104,079       899       104,978  
     
                         
    BP              
    shareholders’     Minority     Total  
    equity     interest     equity  
$ million
                       
At 31 December 2008
    91,303       806       92,109  
     
 
                       
Total comprehensive income
    1,668       11       1,679  
Dividends
    (2,619 )     (111 )     (2,730 )
Share-based payments (net of tax)
    121             121  
     
 
                       
At 31 March 2009
    90,473       706       91,179  
     

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Group balance sheet
                 
    31 March     31 December  
    2010     2009  
$ million
               
Non-current assets
               
Property, plant and equipment
    108,232       108,275  
Goodwill
    8,409       8,620  
Intangible assets
    12,675       11,548  
Investments in jointly controlled entities
    15,484       15,296  
Investments in associates
    13,396       12,963  
Other investments
    1,459       1,567  
     
Fixed assets
    159,655       158,269  
Loans
    982       1,039  
Other receivables
    2,216       1,729  
Derivative financial instruments
    4,770       3,965  
Prepayments
    1,359       1,407  
Deferred tax assets
    464       516  
Defined benefit pension plan surpluses
    1,494       1,390  
     
 
    170,940       168,315  
     
Current assets
               
Loans
    236       249  
Inventories
    23,221       22,605  
Trade and other receivables
    31,159       29,531  
Derivative financial instruments
    5,355       4,967  
Prepayments
    2,647       1,753  
Current tax receivable
    238       209  
Cash and cash equivalents
    6,841       8,339  
     
 
    69,697       67,653  
     
Total assets
    240,637       235,968  
     
Current liabilities
               
Trade and other payables
    38,146       35,204  
Derivative financial instruments
    5,530       4,681  
Accruals
    5,482       6,202  
Finance debt
    8,356       9,109  
Current tax payable
    2,624       2,464  
Provisions
    1,646       1,660  
     
 
    61,784       59,320  
     
Non-current liabilities
               
Other payables
    3,206       3,198  
Derivative financial instruments
    3,899       3,474  
Accruals
    656       703  
Finance debt
    23,797       25,518  
Deferred tax liabilities
    20,156       18,662  
Provisions
    12,752       12,970  
Defined benefit pension plan and other post-retirement benefit plan deficits
    9,409       10,010  
     
 
    73,875       74,535  
     
Total liabilities
    135,659       133,855  
     
Net assets
    104,978       102,113  
     
Equity
               
BP shareholders’ equity
    104,079       101,613  
Minority interest
    899       500  
     
 
    104,978       102,113  
     

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Condensed group cash flow statement
                 
    First quarter  
    2010     2009  
$ million
               
Operating activities
               
Profit before taxation
    9,378       4,130  
Adjustments to reconcile profit before taxation to net cash provided by operating activities
               
Depreciation, depletion and amortization and exploration expenditure written off
    3,017       2,849  
Impairment and (gain) loss on sale of businesses and fixed assets
    126       56  
Earnings from equity-accounted entities, less dividends received
    (669 )     (252 )
Net charge for interest and other finance expense, less net interest paid
    46       89  
Share-based payments
    (146 )     86  
Net operating charge for pensions and other post-retirement benefits, less contributions and benefit payments for unfunded plans
    (490 )     26  
Net charge for provisions, less payments
    (48 )     281  
Movements in inventories and other current and non-current assets and liabilities(a)
    (1,940 )     32  
Income taxes paid
    (1,581 )     (1,725 )
     
Net cash provided by operating activities
    7,693       5,572  
     
Investing activities
               
Capital expenditure
    (4,289 )     (4,817 )
Acquisitions, net of cash acquired
           
Investment in jointly controlled entities
    (82 )     (103 )
Investment in associates
    (6 )     (47 )
Proceeds from disposal of fixed assets
    108       311  
Proceeds from disposal of businesses, net of cash disposed
           
Proceeds from loan repayments
    56       117  
Other
          47  
     
Net cash used in investing activities
    (4,213 )     (4,492 )
 
           
Financing activities
               
Net issue of shares
    128       35  
Proceeds from long-term financing
    342       4,619  
Repayments of long-term financing
    (2,495 )     (2,580 )
Net decrease in short-term debt
    (247 )     (182 )
Dividends paid – BP shareholders
    (2,626 )     (2,619 )
– Minority interest
    (3 )     (111 )
     
Net cash used in financing activities
    (4,901 )     (838 )
     
Currency translation differences relating to cash and cash equivalents
    (77 )     (79 )
     
Increase (decrease) in cash and cash equivalents
    (1,498 )     163  
Cash and cash equivalents at beginning of period
    8,339       8,197  
     
Cash and cash equivalents at end of period
    6,841       8,360  
     
 
(a)     Includes
               
Inventory holding (gains) losses
    (705 )     (254 )
Fair value (gain) loss on embedded derivatives
    (146 )     (186 )
 
               
Inventory holding gains and losses and fair value gains and losses on embedded derivatives are also included within profit before taxation.

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Table of Contents

Capital expenditure and acquisitions
                 
    First quarter  
    2010     2009  
$ million
               
By business
               
Exploration and Production
               
US
    1,133       1,670  
Non-US(a)
    2,815       2,035  
     
 
    3,948       3,705  
     
Refining and Marketing
               
US
    528       567  
Non-US
    144       226  
     
 
    672       793  
     
Other businesses and corporate
               
US
    28       56  
Non-US
    39       41  
     
 
    67       97  
     
 
    4,687       4,595  
     
By geographical area
               
US
    1,689       2,293  
Non-US(a)
    2,998       2,302  
     
 
    4,687       4,595  
     
Included above:
               
Acquisitions and asset exchanges
           
     
 
(a)   First quarter 2010 included capital expenditure of $900 million in Exploration and Production relating to the formation of a partnership with Value Creation Inc. to develop the Terre de Grace oil sands acreage in the Athabasca region of Alberta, Canada.
Exchange rates
                 
    First quarter  
    2010     2009  
US dollar/sterling average rate for the period
    1.56       1.43  
US dollar/sterling period-end rate
    1.51       1.42  
US dollar/euro average rate for the period
    1.38       1.30  
US dollar/euro period-end rate
    1.34       1.32  
     

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Analysis of replacement cost profit before interest and tax and reconciliation to profit before taxation(a)
                 
    First quarter  
    2010     2009  
     
$ million
               
By business
               
Exploration and Production
               
US
    2,762       1,143  
Non-US
    5,530       3,177  
     
 
    8,292       4,320  
     
Refining and Marketing
               
US
    (63 )     308  
Non-US
    792       782  
     
 
    729       1,090  
     
Other businesses and corporate
               
US
    (231 )     (279 )
Non-US
    (97 )     (482 )
     
 
    (328 )     (761 )
     
 
    8,693       4,649  
Consolidation adjustment
    208       (405 )
     
Replacement cost profit before interest and tax(b)
    8,901       4,244  
Inventory holding gains (losses)(c)
               
Exploration and Production
    24       (34 )
Refining and Marketing
    679       327  
Other businesses and corporate
    2       (39 )
     
Profit before interest and tax
    9,606       4,498  
Finance costs
    238       318  
Net finance (income) expense relating to pensions and other post-retirement benefits
    (10 )     50  
     
Profit before taxation
    9,378       4,130  
     
 
Replacement cost profit (loss) before interest and tax
               
By geographical area
               
US
    2,590       854  
Non-US
    6,311       3,390  
     
 
    8,901       4,244  
     
 
(a)   IFRS requires that the measure of profit or loss disclosed for each operating segment is the measure that is provided regularly to the chief operating decision maker for the purposes of performance assessment and resource allocation. For BP, this measure of profit or loss is replacement cost profit before interest and tax. In addition, a reconciliation is required between the total of the operating segments’ measures of profit or loss and the group profit or loss before taxation.
 
(b)   Replacement cost profit reflects the replacement cost of supplies. The replacement cost profit for the period is arrived at by excluding from profit inventory holding gains and losses and their associated tax effect. Replacement cost profit for the group is not a recognized GAAP measure.
 
(c)   Inventory holding gains and losses represent the difference between the cost of sales calculated using the average cost to BP of supplies acquired during the period and the cost of sales calculated on the first-in first-out (FIFO) method after adjusting for any changes in provisions where the net realizable value of the inventory is lower than its cost. Under the FIFO method, which we use for IFRS reporting, the cost of inventory charged to the income statement is based on its historic cost of purchase, or manufacture, rather than its replacement cost. In volatile energy markets, this can have a significant distorting effect on reported income. The amounts disclosed represent the difference between the charge (to the income statement) for inventory on a FIFO basis (after adjusting for any related movements in net realizable value provisions) and the charge that would have arisen if an average cost of supplies was used for the period. For this purpose, the average cost of supplies during the period is principally calculated on a monthly basis by dividing the total cost of inventory acquired in the period by the number of barrels acquired. The amounts disclosed are not separately reflected in the financial statements as a gain or loss. No adjustment is made in respect of the cost of inventories held as part of a trading position and certain other temporary inventory positions.

Management believes this information is useful to illustrate to investors the fact that crude oil and product prices can vary significantly from period to period and that the impact on our reported result under IFRS can be significant. Inventory holding gains and losses vary from period to period due principally to changes in oil prices as well as changes to underlying inventory levels. In order for investors to understand the operating performance of the group excluding the impact of oil price changes on the replacement of inventories, and to make comparisons of operating performance between reporting periods, BP’s management believes it is helpful to disclose this information.

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Non-operating items(a)
                 
    First quarter
    2010     2009  
     
$ million
               
Exploration and Production
               
Impairment and gain (loss) on sale of businesses and fixed assets
    (13 )     73  
Environmental and other provisions
           
Restructuring, integration and rationalization costs
    (104 )     (1 )
Fair value gain (loss) on embedded derivatives
    146       243  
Other
    12       (4 )
     
 
    41       311  
     
Refining and Marketing
               
Impairment and gain (loss) on sale of businesses and fixed assets
    (45 )     (21 )
Environmental and other provisions
           
Restructuring, integration and rationalization costs
    12       (263 )
Fair value gain (loss) on embedded derivatives
          (57 )
Other
    (37 )     (9 )
     
 
    (70 )     (350 )
     
Other businesses and corporate
               
Impairment and gain (loss) on sale of businesses and fixed assets
    (68 )     (108 )
Environmental and other provisions
          (75 )
Restructuring, integration and rationalization costs
    (38 )     (71 )
Fair value gain (loss) on embedded derivatives
           
Other
    (12 )     (67 )
     
 
    (118 )     (321 )
     
 
Total before taxation
    (147 )     (360 )
Taxation credit (charge)(b)
    50       135  
     
Total after taxation for period
    (97 )     (225 )
     
 
(a)   An analysis of non-operating items by region is shown on pages 7, 9 and 10.
 
(b)   Tax is calculated using the quarter’s effective tax rate on replacement cost profit.
Non-operating items are charges and credits arising in consolidated entities that BP discloses separately because it considers such disclosures to be meaningful and relevant to investors. These disclosures are provided in order to enable investors better to understand and evaluate the group’s financial performance.

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Non-GAAP information on fair value accounting effects
                 
    First quarter  
    2010     2009  
     
$ million
               
Favourable (unfavourable) impact relative to management’s measure of performance
               
Exploration and Production
    63       158  
Refining and Marketing
    10       (109 )
     
 
    73       49  
Taxation charge(a)
    (25 )     (18 )
     
 
    48       31  
     
 
(a)   Tax is calculated using the quarter’s effective tax rate on replacement cost profit.
BP uses derivative instruments to manage the economic exposure relating to inventories above normal operating requirements of crude oil, natural gas and petroleum products as well as certain contracts to supply physical volumes at future dates. Under IFRS, these inventories and contracts are recorded at historic cost and on an accruals basis respectively. The related derivative instruments, however, are required to be recorded at fair value with gains and losses recognized in income because hedge accounting is either not permitted or not followed, principally due to the impracticality of effectiveness testing requirements. Therefore, measurement differences in relation to recognition of gains and losses occur. Gains and losses on these inventories and contracts are not recognized until the commodity is sold in a subsequent accounting period. Gains and losses on the related derivative commodity contracts are recognized in the income statement from the time the derivative commodity contract is entered into on a fair value basis using forward prices consistent with the contract maturity.
IFRS requires that inventory held for trading be recorded at its fair value using period end spot prices whereas any related derivative commodity instruments are required to be recorded at values based on forward prices consistent with the contract maturity. Depending on market conditions, these forward prices can be either higher or lower than spot prices resulting in measurement differences.
BP enters into contracts for pipelines and storage capacity that, under IFRS, are recorded on an accruals basis. These contracts are risk-managed using a variety of derivative instruments which are fair valued under IFRS. This results in measurement differences in relation to recognition of gains and losses.
The way that BP manages the economic exposures described above, and measures performance internally, differs from the way these activities are measured under IFRS. BP calculates this difference for consolidated entities by comparing the IFRS result with management’s internal measure of performance, under which the inventory and the supply and capacity contracts in question are valued based on fair value using relevant forward prices prevailing at the end of the period. We believe that disclosing management’s estimate of this difference provides useful information for investors because it enables investors to see the economic effect of these activities as a whole. The impacts of fair value accounting effects, relative to management’s internal measure of performance, are shown in the table above. A reconciliation to GAAP information is set out below.
Reconciliation of non-GAAP information
                 
    First quarter  
    2010     2009  
     
$ million
               
Exploration and Production
               
Replacement cost profit before interest and tax adjusted for fair value accounting effects
    8,229       4,162  
Impact of fair value accounting effects
    63       158  
     
Replacement cost profit before interest and tax
    8,292       4,320  
     
 
               
Refining and Marketing
               
Replacement cost profit before interest and tax adjusted for fair value accounting effects
    719       1,199  
Impact of fair value accounting effects
    10       (109 )
     
Replacement cost profit before interest and tax
    729       1,090  
     
 
               
Total group
               
Profit before interest and tax adjusted for fair value accounting effects
    9,533       4,449  
Impact of fair value accounting effects
    73       49  
     
Profit before interest and tax
    9,606       4,498  
     

18


Table of Contents

Realizations and marker prices
                 
    First quarter  
    2010     2009  
     
Average realizations(a)
               
Liquids ($/bbl)(b)
               
US
    69.77       39.47  
Europe
    75.71       47.59  
Rest of World
    72.94       40.89  
BP Average
    71.86       41.26  
     
Natural gas ($/mcf)
               
US
    4.84       3.38  
Europe
    4.91       5.56  
Rest of World
    3.90       3.41  
BP Average
    4.26       3.63  
     
Total hydrocarbons ($/boe)
               
US
    54.54       31.83  
Europe
    60.39       41.36  
Rest of World
    42.20       28.35  
BP Average
    49.16       31.40  
     
Average oil marker prices ($/bbl)
               
Brent
    76.36       44.46  
West Texas Intermediate
    78.84       43.20  
Alaska North Slope
    79.14       45.40  
Mars
    75.85       43.83  
Urals (NWE– cif)
    75.31       43.65  
Russian domestic oil
    35.52       19.52  
     
Average natural gas marker prices
               
Henry Hub gas price ($/mmBtu)(c)
    5.30       4.91  
UK Gas – National Balancing Point (p/therm)
    35.65       46.80  
     
 
(a)   Based on sales of consolidated subsidiaries only – this excludes equity-accounted entities.
 
(b)   Crude oil and natural gas liquids.
 
(c)   Henry Hub First of Month Index.
Non-GAAP information on unit production costs adjusted for restructuring costs(a)
                 
    First quarter  
    2010     2009  
     
$ million
               
Production costs
    1,524       1,499  
Restructuring costs included in production costs
    (86 )      
     
Production costs adjusted for restructuring costs
    1,438       1,499  
     
 
               
Production (net of royalties)(b)
               
Total hydrocarbons (mboe/d)(c)
    2,690       2,715  
 
               
Unit production costs adjusted for restructuring costs ($/boe)(d)
    5.94       6.13  
 
(a)   Production costs are costs incurred by Exploration and Production to operate and maintain wells and related equipment and facilities. Amounts do not include ad valorem and severance taxes. Restructuring costs are included within non-operating items. Further information on non-operating items is provided on page 17.
 
(b)   Excludes BP’s share of production of equity-accounted entities.
 
(c)   Natural gas is converted to oil equivalent at 5.8 billion cubic feet = 1 million barrels.
 
(d)   For first quarter 2009, there were no restructuring costs within production costs.

19


Table of Contents

Notes
1.   Basis of preparation
 
    The interim financial information included in this report has been prepared in accordance with IAS 34 ‘Interim Financial Reporting’.
 
    The results for the interim periods are unaudited and in the opinion of management include all adjustments necessary for a fair presentation of the results for the periods presented. All such adjustments are of a normal recurring nature. This report should be read in conjunction with the consolidated financial statements and related notes for the year ended 31 December 2009 included in BP Annual Report and Accounts 2009 and in BP Annual Report on Form 20-F 2009.
 
    BP prepares its consolidated financial statements included within its Annual Report and Accounts on the basis of International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB), IFRS as adopted by the European Union (EU) and in accordance with the provisions of the UK Companies Act 2006. IFRS as adopted by the EU differs in certain respects from IFRS as issued by the IASB, however, the differences have no impact on the group’s consolidated financial statements for the periods presented. The financial information presented herein has been prepared in accordance with the accounting policies expected to be used in preparing the Annual Report and Accounts and the Annual Report on Form 20-F for 2010, which do not differ significantly from those used in the BP Annual Report and Accounts 2009 or in BP Annual Report on Form 20-F 2009.
 
    BP has adopted the revised version of IFRS 3 ‘Business Combinations’, with effect from 1 January 2010. The revised standard still requires the purchase method of accounting to be applied to business combinations but introduces some changes to the accounting treatment. Assets and liabilities arising from business combinations that occurred before 1 January 2010 were not required to be restated and thus there was no effect on the group’s reported income or net assets on adoption.
 
    In addition, BP has adopted the amended version of IAS 27, ‘Consolidated and Separate Financial Statements’, also with effect from 1 January 2010. This requires the effects of all transactions with minority interests to be recorded in equity if there is no change in control. When control is lost, any remaining interest in the entity is remeasured to fair value and a gain or loss recognized in profit or loss. There was no effect on the group’s reported income or net assets on adoption.

20


Table of Contents

Notes
2.   Sales and other operating revenues
                 
    First quarter  
    2010     2009  
     
$ million
               
By business
               
Exploration and Production
    18,080       12,343  
Refining and Marketing
    64,286       40,573  
Other businesses and corporate
    790       584  
     
 
    83,156       53,500  
     
 
               
Less: sales between businesses
               
Exploration and Production
    9,746       5,800  
Refining and Marketing
    135       111  
Other businesses and corporate
    204       293  
     
 
    10,085       6,204  
     
 
               
Third party sales and other operating revenues
               
Exploration and Production
    8,334       6,543  
Refining and Marketing
    64,151       40,462  
Other businesses and corporate
    586       291  
     
Total third party sales and other operating revenues
    73,071       47,296  
     
 
               
By geographical area
               
US
    26,108       17,580  
Non-US
    54,009       33,586  
     
 
    80,117       51,166  
Less: sales between areas
    7,046       3,870  
     
 
    73,071       47,296  
     
3.   Production and similar taxes
                 
    First quarter  
    2010     2009  
     
$ million
               
US
    313       79  
Non-US
    963       595  
     
 
    1,276       674  
     
    Comparative figures have been restated to include amounts previously reported as production and manufacturing expenses amounting to $213 million for the first quarter 2009, which we believe are more appropriately classified as production taxes. There was no effect on the group profit for the period or the group balance sheet.

21


Table of Contents

Notes
4.   Earnings per share and shares in issue
    Basic earnings per ordinary share (EpS) amounts are calculated by dividing the profit for the period attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. The calculation of EpS is performed separately for each discrete quarterly period, and for the year-to-date period. As a result, the sum of the discrete quarterly EpS amounts in any particular year-to-date period may not be equal to the EpS amount for the year-to-date period.
 
    For the diluted EpS calculation the weighted average number of shares outstanding during the period is adjusted for the number of shares that are potentially issuable in connection with employee share-based payment plans using the treasury stock method.
                 
    First quarter  
    2010     2009  
     
$ million
               
Results for the period
               
Profit for the period attributable to BP shareholders
    6,079       2,562  
Less: preference dividend
           
     
Profit attributable to BP ordinary shareholders
    6,079       2,562  
Inventory holding (gains) losses, net of tax
    (481 )     (175 )
     
RC profit attributable to BP ordinary shareholders
    5,598       2,387  
     
 
Basic weighted average number of shares outstanding (thousand)(a)
    18,769,888       18,720,354  
ADS equivalent (thousand)(a)
    3,128,315       3,120,059  
     
 
               
Weighted average number of shares outstanding used to calculate diluted earnings per share (thousand)(a)
    19,004,740       18,920,515  
ADS equivalent (thousand)(a)
    3,167,457       3,153,419  
     
 
               
Shares in issue at period-end (thousand)(a)
    18,784,361       18,724,785  
ADS equivalent (thousand)(a)
    3,130,727       3,120,798  
 
(a)   Excludes treasury shares and the shares held by the Employee Share Ownership Plans and includes certain shares that will be issuable in the future under employee share plans.

22


Table of Contents

Notes
5.   Analysis of changes in net debt
                 
    First quarter  
    2010     2009  
     
$ million
               
Opening balance
               
Finance debt
    34,627       33,204  
Less: Cash and cash equivalents
    8,339       8,197  
Less: FV asset (liability) of hedges related to finance debt
    127       (34 )
     
Opening net debt
    26,161       25,041  
     
 
               
Closing balance
               
Finance debt
    32,153       34,698  
Less: Cash and cash equivalents
    6,841       8,360  
Less: FV asset (liability) of hedges related to finance debt
    152       (323 )
     
Closing net debt
    25,160       26,661  
     
Decrease (increase) in net debt
    1,001       (1,620 )
     
 
               
Movement in cash and cash equivalents (excluding exchange adjustments)
    (1,421 )     242  
Net cash outflow (inflow) from financing (excluding share capital)
    2,400       (1,857 )
Other movements
    7       7  
     
Movement in net debt before exchange effects
    986       (1,608 )
Exchange adjustments
    15       (12 )
     
Decrease (increase) in net debt
    1,001       (1,620 )
     
6.   TNK-BP operational and financial information
                 
    First quarter  
    2010     2009  
     
Production (Net of royalties) (BP share)
               
Crude oil (mb/d)
    849       822  
Natural gas (mmcf/d)
    673       642  
Total hydrocarbons (mboe/d)(a)
    965       933  
     
$ million
               
Income statement (BP share)
               
Profit (loss) before interest and tax
    788       419  
Finance costs
    (38 )     (68 )
Taxation
    (168 )     (185 )
Minority interest
    (39 )     (32 )
     
Net income
    543       134  
     
Cash flow
               
Dividends received
    256        
     
                 
    31 March     31 December  
Balance sheet   2010     2009  
     
Investments in associates
    9,428       9,141  
     
 
(a)   Natural gas is converted to oil equivalent at 5.8 billion cubic feet = 1 million barrels.

23


Table of Contents

Notes
7.   Inventory valuation
    A provision of $46 million was held at 31 December 2009 to write inventories down to their net realizable value. The net movement in the provision during the first quarter 2010 was a decrease of $22 million (first quarter 2009 was a decrease of $1,163 million).
8.   Post balance sheet event
    On 20 April 2010, the semi-submersible drilling rig Deepwater Horizon owned and operated by Transocean Limited caught fire in the US Gulf of Mexico and subsequently sank. The rig was drilling an exploration well (Mississippi Canyon 252) in which BP has a 65% interest. As operator under the MC 252 lease, BP is committed to doing everything in its power to contain the environmental consequences of the incident. BP is currently ramping up preparations for a major cleaning effort on the shorelines of Louisiana, Mississippi, Alabama and Florida. Efforts continue to stem the flow of oil from the well, currently estimated at up to 5,000 barrels a day. Preliminary estimates indicate that current efforts to contain the spill and secure the well are costing the MC 252 owners about $6 million per day. This figure is expected to rise as activity increases. It is too early to quantify other potential costs and liabilities associated with the incident.
9.   Second-quarter results
    BP’s second-quarter results will be announced on 27 July 2010.
10.   Statutory accounts
    The financial information shown in this publication, which was approved by the board of directors on 26 April 2010, is unaudited and does not constitute statutory financial statements.

24


Table of Contents

Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
         
     
  BP p.l.c.
(Registrant)
 
 
Dated: 29 April 2010  /s/ D J Pearl    
  D J PEARL   
  Deputy Company Secretary   
 

25

EX-99.1 2 u08838exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
Computation of ratio of earnings to fixed charges
         
    First quarter 2010  
    $ million, except ratio  
Profit before taxation
    9,378  
 
       
Group’s share of income in excess of dividends of equity-accounted entities
    (669 )
 
       
Capitalized interest, net of amortization
    11  
 
       
 
     
Profit as adjusted
    8,720  
 
     
 
       
Fixed charges:
       
 
       
Interest expense
    144  
Rental expense representative of interest
    312  
Capitalized interest
    51  
 
     
 
    507  
 
     
 
       
Total adjusted earnings available for payment of fixed charges
    9,227  
 
     
 
       
Ratio of earnings to fixed charges
    18.2  
 
     

26

EX-99.2 3 u08838exv99w2.htm EX-99.2 exv99w2
Exhibit 99.2
Capitalization and indebtedness
The following table shows the unaudited consolidated capitalization and indebtedness of the BP group as of 31 March 2010 in accordance with IFRS:
         
    31 March 2010  
    $ million  
Share capital
       
Authorized share capital (1)
    9,021  
 
     
Capital shares (2-3)
    5,183  
Paid-in surplus (4)
    11,033  
Merger reserve (4)
    27,206  
Own shares
    (71 )
Available-for-sale investments
    661  
Cash flow hedges
    (164 )
Foreign currency translation reserve
    4,117  
Treasury shares
    (21,263 )
Share-based payment reserve
    1,397  
Profit and loss account
    75,980  
 
     
BP shareholders’ equity
    104,079  
 
     
 
       
Finance debt (5-7)
       
Due within one year
    8,356  
Due after more than one year
    23,797  
 
     
Total finance debt
    32,153  
 
     
Total capitalization (8)
    136,232  
 
     
 
(1)   Authorized share capital comprises 36 billion ordinary shares, par value US$0.25 per share, and 12,750,000 cumulative preference shares, par value £1 per share.
 
(2)   Issued share capital as of 31 March 2010 comprised 18,777,884,384 ordinary shares, par value US$0.25 per share, and 12,706,252 preference shares, par value £1 per share. This excludes 1,866,287,922 ordinary shares which have been bought back and held in treasury by BP and 112,803,287 ordinary shares which have been bought back for cancellation. These shares are not taken into consideration in relation to the payment of dividends and voting at shareholders’ meetings.
 
(3)   Capital shares represent the ordinary shares of BP which have been issued and are fully paid.
 
(4)   Paid-in surplus and merger reserve represent additional paid-in capital of BP which cannot normally be returned to shareholders.
 
(5)   Finance debt recorded in currencies other than US dollars has been translated into US dollars at the relevant exchange rates existing on 31 March 2010.
 
(6)   Obligations under finance leases are included within finance debt in the above table.
 
(7)   As of 31 March 2010, the parent company, BP p.l.c., had outstanding guarantees totalling US$27,834 million, of which US$27,801 million related to guarantees in respect of borrowings by its subsidiary undertakings. Thus 86% of the finance debt had been guaranteed by BP. BP had, as of 31 March 2010, no material outstanding contingent indebtedness and there have been no material changes since that date. All of BP’s debt is unsecured.
 
(8)   There has been no material change since 31 March 2010 in the consolidated capitalization and indebtedness of BP. Except for the matters disclosed in note 8 on page 24 in connection with the Deepwater Horizon drilling rig, there has been no material change since 31 March 2010 in relation to the contingent liabilities of BP.

27

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