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| FOR IMMEDIATE RELEASE | |
| London 7 February 2023 | |
| BP p.l.c. Group results | |
| Fourth quarter and full year 2022 |
“For a printer friendly version of this announcement please click on the link below to open a PDF version of the announcement”
http://www.rns-pdf.londonstockexchange.com/rns/0874P_1-2023-2-6.pdf
| Performing while transforming |
| Financial summary | Fourth | Third | Fourth | ||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) for the period attributable to bp shareholders | 10,803 | (2,163) | 2,326 | (2,487) | 7,565 | ||
| Inventory holding (gains) losses*, net of tax | 1,066 | 2,186 | (358) | (1,019) | (2,826) | ||
| Replacement cost (RC) profit (loss)* | 11,869 | 23 | 1,968 | (3,506) | 4,739 | ||
| Net (favourable) adverse impact of adjusting items*, net of tax | (7,062) | 8,127 | 2,097 | 31,159 | 8,076 | ||
| Underlying RC profit* | 4,807 | 8,150 | 4,065 | 27,653 | 12,815 | ||
| Operating cash flow* | 13,571 | 8,288 | 6,116 | 40,932 | 23,612 | ||
| Capital expenditure* | (7,369) | (3,194) | (3,633) | (16,330) | (12,848) | ||
| Divestment and other proceeds(a) | 614 | 606 | 2,265 | 3,123 | 7,632 | ||
| Surplus cash flow* | 5,080 | 3,530 | 2,993 | 19,289 | 6,308 | ||
| Net issue (repurchase) of shares(b) | (3,240) | (2,876) | (1,725) | (9,996) | (3,151) | ||
| Net debt*(c) | 21,422 | 22,002 | 30,613 | 21,422 | 30,613 | ||
| Return on average capital employed (ROACE)* (%) | 30.5% | 13.3% | |||||
| Adjusted earnings before interest, taxation, depreciation and amortization (adjusted EBITDA)* | 60,747 | 37,315 | |||||
| Adjusted earnings before interest, depreciation and amortization (adjusted EBIDA)* | 45,695 | 30,783 | |||||
| Announced dividend per ordinary share (cents per share) | 6.610 | 6.006 | 5.460 | 24.082 | 21.630 | ||
| Underlying RC profit per ordinary share* (cents) | 26.44 | 43.15 | 20.53 | 145.63 | 63.65 | ||
| Underlying RC profit per ADS* (dollars) | 1.59 | 2.59 | 1.23 | 8.74 | 3.82 |
| • Net debt reduced to $21.4bn; 2022 ROACE 30.5% | • 10% increase in resilient dividend to 6.61 cents per ordinary share; further $2.75bn share buyback announced | • Delivering resilient hydrocarbons – Cassia C start-up; first LNG cargo loaded at Coral Sul FLNG; 20-year extension to Tangguh PSC* | • Continued progress in transformation to an IEC – accelerating biogas strategy with completion of Archaea Energy acquisition; >65% increase in EV charge points in 2022 |
| Throughout 2022, bp continued to focus on delivery of our Integrated Energy Company strategy. We are helping provide the energy the world needs today and – at the same time – investing with discipline into our transition and the energy transition – as demonstrated by the Archaea Energy acquisition. We are strengthening bp, with our strongest upstream plant reliability on record and our lowest production costs in 16 years, helping to generate strong returns and reducing debt for the 11th quarter in a row. Importantly, we are delivering for our shareholders – with buybacks and a growing dividend. This is exactly what we said we would do and will continue to do – performing while transforming. |
| Bernard LooneyChief executive officer |
(a) Divestment proceeds are disposal proceeds as per the condensed group cash flow statement. See page 3 for more information on divestment and other proceeds.
(b) Full year 2022 excludes the ordinary shares issued as non-cash consideration for the acquisition of the public units of BP Midstream Partners LP. See Note 8 for more information.
(c) See Note 10 for more information.
RC profit (loss), underlying RC profit (loss), surplus cash flow, net debt, ROACE, adjusted EBITDA, adjusted EBIDA, underlying RC profit per ordinary share and underlying RC profit per ADS are non-GAAP measures. Inventory holding (gains) losses and adjusting items are non-GAAP adjustments.
* For items marked with an asterisk throughout this document, definitions are provided in the Glossary on page 36 .
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| Highlights | ||
| Underlying replacement cost profit* $4.8 billion | ||
| • Underlying replacement cost profit for the quarter was $4.8 billion, compared with $8.2 billion for the previous quarter. Compared to the third quarter, the result was impacted by a below average gas marketing and trading result after the exceptional result in the third quarter, lower oil and gas realizations, a higher level of refinery turnaround and maintenance activity, and lower marketing margins and seasonally lower volumes. An underlying ETR* of 40% in the fourth quarter brings the full year underlying ETR* to 34%.• Reported profit for the quarter was $10.8 billion, compared with a loss of $2.2 billion for the third quarter 2022. The reported result for the fourth quarter is adjusted by inventory holding losses net of tax of $1.1 billion and a gain for adjusting items* net of tax of $7.1 billion to derive the underlying replacement cost profit. Adjusting items include favourable fair value accounting effects* of $13.2 billion before tax, primarily due to a decrease in forward gas prices compared to the end of the third quarter. | ||
| Net debt* reduced to $21.4 billion; further $2.75 billion share buyback announced | ||
| • Operating cash flow* in the quarter was $13.6 billion including a working capital release (after adjusting for inventory holding losses*, fair value accounting effects and other adjusting items) of $4.2 billion (see page 31).• Capital expenditure* in the fourth quarter and full year was $7.4 billion and $16.3 billion respectively. Within this, inorganic spend was $3.5 billion in the fourth quarter and full year, including $3.0 billion for Archaea Energy, net of adjustments, and $0.5 billion for the earlier than expected completion of the acquisition of EDF Energy Services.• During the fourth quarter, bp completed share buybacks of $3.2 billion. The $2.5 billion share buyback programme announced with the third quarter results was completed on 3 February 2023.• In the fourth quarter, bp generated surplus cash flow* of $5.1 billion and intends to execute a $2.75 billion share buyback from surplus cash flow prior to announcing its first-quarter-2023 results. bp has now announced share buybacks from surplus cash flow equivalent to 60% of cumulative surplus cash flow since the start of 2021.• Net debt fell for the eleventh successive quarter to reach $21.4 billion at the end of the fourth quarter. | ||
| Growing distributions; updating disciplined financial frame | ||
| • A resilient dividend remains bp’s first priority within its disciplined financial frame. It is underpinned by a cash balance point* of $40 per barrel Brent, $11 per barrel RMM and $3 per mmBtu Henry Hub (all 2021 real).• For the fourth quarter, bp has announced a dividend per ordinary share of 6.610 cents an increase of around 10%. This increase is underpinned by strong underlying performance and supported by the confidence we have in delivering higher adjusted EBITDA* as a result of our updated investment plans.• bp is committed to maintaining a strong investment grade credit rating, targeting further progress within an ‘A’ grade credit rating. For 2023 bp intends to allocate 40% of surplus cash flow to further strengthening the balance sheet.• bp continues to focus on disciplined investment allocation. For 2023 bp expects capital expenditure of $16-18 billion and for 2024-30 now expects capital expenditure in a range of $14-18 billion including inorganic capital expenditure*.• For 2023 and subject to maintaining a strong investment grade credit rating, bp remains committed to using 60% of surplus cash flow for share buybacks.• Based on bp’s current forecasts, at around $60 per barrel Brent and subject to the board’s discretion each quarter, bp expects to be able to deliver share buybacks of around $4.0 billion per annum, at the lower end of its capital expenditure range, and have capacity for an annual increase in the dividend per ordinary share of around 4%. | ||
| Continued progress in transformation to an Integrated Energy Company | ||
| • In a separate announcement , bp has today provided an update on the significant progress made in executing its transformation to an Integrated Energy Company (IEC) since outlining its new strategy.• In resilient hydrocarbons bp has accelerated its biogas strategy – part of its bioenergy Transition Growth Engine – completing the acquisition of Archaea Energy a leading US biogas company. Delivering on its focus on cost and efficiency, in 2022 bp delivered its lowest upstream unit production cost* since 2006 and highest upstream plant reliability* on record.• In convenience and mobility bp continues to make strategic progress, announcing an exclusive agreement in the UK with Marks and Spencer (M&S) to install fast(a) charge points to around 70 of their stores, adding up to 900 charge points within the next two years; and increasing the number of EV charge points by over 65% versus 2021.• In low carbon energy bp has continued to make rapid progress building its portfolio of green hydrogen* projects, signing memoranda of understanding (MoUs) with both Mauritania and Egypt to explore the potential for large scale green hydrogen developments. |
| During 2022 bp delivered four quarters of robust underlying financial performance. We have raised our dividend by 21% since 4Q 2021, reduced net debt by $9.2 billion, invested with discipline and announced $11.25 billion of share buybacks. As we look to 2023, we remain focused on the disciplined delivery of our financial frame, with its five priorities, underpinned by a $40/bbl balance point, unchanged. |
| Murray AuchinclossChief financial officer |
(a) “fast charging” includes rapid charging ≥50kW and ultra-fast charging ≥150kW.
| The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 42. |
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Financial results
At 31 December 2021, the group’s reportable segments were gas & low carbon energy, oil production & operations, customers & products and Rosneft. The group has ceased to report Rosneft as a separate segment in the group’s financial reporting for 2022. From the first quarter of 2022, the group’s reportable segments are gas & low carbon energy, oil production & operations and customers & products. For more information see Note 1 Basis of preparation – Investment in Rosneft. For the period from 1 January 2022 to 27 February 2022, net income from Rosneft is classified as an adjusting item.
In addition to the highlights on page 2:
• Profit attributable to bp shareholders in the fourth quarter was $10.8 billion compared with $2.3 billion in the same period of 2021. Loss attributable to bp shareholders in the full year was $2.5 billion compared with a profit of $7.6 billion in the same period of 2021.
– The increase in the underlying replacement cost profit for both periods reflects higher gas and liquids realizations and higher refining margins, partially offset by higher tax and the absence of bp share of earnings from Rosneft. The fourth quarter result also reflects an adverse impact of turnaround and maintenance activity, and the year a favourable impact of strong trading performance.
– Adjusting items* in the fourth quarter and full year were a favourable pre-tax impact of $9.7 billion and an adverse pre-tax impact of $29.8 billion respectively, compared with an adverse pre-tax impact of $3.0 billion and $8.7 billion in the same periods of 2021.
◦ As a result of bp’s two nominated directors stepping-down from the Rosneft board on 27 February 2022, bp determined that it no longer meets the criteria set out under IFRS for having “significant influence” over Rosneft. bp therefore no longer equity accounts for its interest in Rosneft from that date, treating it prospectively as a financial asset measured at fair value. Within the full year result, the loss of significant influence and an impairment assessment led to a net pre-tax charge of $24.0 billion classified as an adjusting item, reducing equity by $14.4 billion. A further $1.5 billion pre-tax charge relating to bp’s decision to exit its other businesses with Rosneft in Russia is also included in the full year result, reducing equity by $1.2 billion. See Note 1 for further information.
◦ Adjusting items for the fourth quarter and full year 2022 also include increases in pre-tax fair value accounting effects* of $13.2 billion and decreases of $3.5 billion respectively, compared with a decreasing pre-tax impact of $0.9 billion and $8.1 billion in the same periods of 2021. Under IFRS, reported earnings include the mark-to-market value of the hedges used to risk-manage LNG contracts, but not of the LNG contracts themselves. The underlying result includes the mark-to-market value of the hedges but also recognizes changes in value of the LNG contracts being risk managed.
◦ Adjusting items for the fourth quarter also includes net impairment charges of $3.6 billion principally as a result of expected portfolio changes in our oil production & operations segment, the annual review of price assumptions used for investment appraisal and value-in-use impairment testing and the annual review of discount rates used for impairment tests. The full year 2022 also includes a non-taxable gain of $2.0 billion arising from the contribution of bp’s Angolan business to Azule Energy.
• The effective tax rate (ETR) on RC profit or loss* for the fourth quarter and full year was 33% and 117% respectively, compared with 38% and 51% for the same periods in 2021. Excluding adjusting items, the underlying ETR* for the fourth quarter and full year was 40% and 34% respectively, compared with 34% and 32% for the same periods a year ago. The higher underlying ETR for the fourth quarter and full year reflects the UK Energy Profits Levy on North Sea profits and the absence of equity-accounted earnings from Rosneft, for the full year this is partly offset by changes in the geographical mix of profits. ETR on RC profit or loss and underlying ETR are non-GAAP measures.
• Operating cash flow* for the fourth quarter and full year 2022 was $13.6 billion and $40.9 billion respectively, compared with $6.1 billion and $23.6 billion for the same periods in 2021 primarily as an outcome of higher underlying profits and working capital movements.
• Capital expenditure* in the fourth quarter and full year 2022 was $7.4 billion and $16.3 billion respectively, compared with $3.6 billion and $12.8 billion in the same periods of 2021, higher as a result of acquisitions completed during the fourth quarter 2022.
• Total divestment and other proceeds for the fourth quarter and full year were $0.6 billion and $3.1 billion respectively, compared with $2.3 billion and $7.6 billion for the same periods in 2021. Other proceeds for the full year 2022 consist of $0.6 billion of proceeds from the disposal of a loan note related to the Alaska divestment. See page 32 for further information.
• At the end of the fourth quarter, net debt* was $21.4 billion, compared with $22.0 billion at the end of the third quarter 2022 and $30.6 billion at the end of the fourth quarter 2021.
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Analysis of RC profit (loss) before interest and tax and reconciliation to profit (loss) for the period
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| RC profit (loss) before interest and tax | |||||||
| gas & low carbon energy | 16,439 | (2,956) | 1,911 | 14,696 | 2,133 | ||
| oil production & operations | 1,688 | 6,965 | 3,212 | 19,721 | 10,501 | ||
| customers & products | 771 | 2,586 | (426) | 8,869 | 2,208 | ||
| other businesses & corporate(a) | 103 | (1,093) | (369) | (26,737) | (348) | ||
| Of which: | |||||||
| other businesses & corporate excluding Rosneft | 103 | (1,093) | (924) | (2,704) | (2,777) | ||
| Rosneft | – | – | 555 | (24,033) | 2,429 | ||
| Consolidation adjustment – UPII* | 147 | (21) | (7) | 139 | (67) | ||
| RC profit loss before interest and tax | 19,148 | 5,481 | 4,321 | 16,688 | 14,427 | ||
| Finance costs and net finance expense relating to pensions and other post-retirement benefits | (818) | (633) | (751) | (2,634) | (2,855) | ||
| Taxation on a RC basis | (6,103) | (4,646) | (1,350) | (16,430) | (5,911) | ||
| Non-controlling interests | (358) | (179) | (252) | (1,130) | (922) | ||
| RC profit (loss) attributable to bp shareholders* | 11,869 | 23 | 1,968 | (3,506) | 4,739 | ||
| Inventory holding gains (losses)* | (1,428) | (2,868) | 472 | 1,351 | 3,655 | ||
| Taxation (charge) credit on inventory holding gains and losses | 362 | 682 | (114) | (332) | (829) | ||
| Profit (loss) for the period attributable to bp shareholders | 10,803 | (2,163) | 2,326 | (2,487) | 7,565 |
Analysis of underlying RC profit (loss) before interest and tax
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Underlying RC profit (loss) before interest and tax | |||||||
| gas & low carbon energy | 3,148 | 6,240 | 2,211 | 16,063 | 7,528 | ||
| oil production & operations | 4,428 | 5,211 | 4,024 | 20,224 | 10,292 | ||
| customers & products | 1,902 | 2,725 | 611 | 10,789 | 3,252 | ||
| other businesses & corporate(a) | (306) | (405) | 210 | (1,171) | 1,337 | ||
| Of which: | |||||||
| other businesses & corporate excluding Rosneft | (306) | (405) | (535) | (1,171) | (1,383) | ||
| Rosneft | – | – | 745 | – | 2,720 | ||
| Consolidation adjustment – UPII | 147 | (21) | (7) | 139 | (67) | ||
| Underlying RC profit before interest and tax | 9,319 | 13,750 | 7,049 | 46,044 | 22,342 | ||
| Finance costs and net finance expense relating to pensions and other post-retirement benefits | (649) | (565) | (494) | (2,209) | (2,073) | ||
| Taxation on an underlying RC basis | (3,505) | (4,856) | (2,238) | (15,052) | (6,532) | ||
| Non-controlling interests | (358) | (179) | (252) | (1,130) | (922) | ||
| Underlying RC profit attributable to bp shareholders* | 4,807 | 8,150 | 4,065 | 27,653 | 12,815 |
Reconciliations of underlying RC profit attributable to bp shareholders to the nearest equivalent IFRS measure are provided on page 1 for the group and on pages 6-15 for the segments.
(a) From first quarter 2022 the results of Rosneft, previously reported as a separate segment, are also included in other businesses & corporate. Comparative information for 2021 has been restated to reflect the changes in reportable segments. For more information see Note 1 Basis of preparation – Investment in Rosneft.
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Operating Metrics
| Operating metrics | Year 2022 | vs Year 2021 | ||
| Tier 1 and tier 2 process safety events* | 50 | -12 | ||
| Reported recordable injury frequency* | 0.187 | +14.1% | ||
| upstream* production(a) (mboe/d) | 2,253 | +1.6% | ||
| upstream unit production costs*(b) ($/boe) | 6.07 | -11.0% | ||
| bp-operated hydrocarbon plant reliability* | 96.0% | +2.0 | ||
| bp-operated refining availability*(a) | 94.5% | -0.3 |
(a) See Operational updates on pages 6, 9 and 11.
(b) Reflecting higher volumes and lower costs including impact of conversion to equity-accounted entities.
Reserves replacement ratio*
The organic reserves replacement ratio (RRR) on a combined basis of subsidiaries and equity-accounted entities was 20% for the year (2021 50%). The decrease is largely due to price related reserves reductions in our production-sharing agreements*. The announced exit from Russia is treated as a divestment and therefore impacts only total RRR, not organic.
Outlook & Guidance
Macro outlook
• In the first quarter, bp expects oil prices to remain supported by recovering Chinese demand, ongoing uncertainty around the level of Russian exports and low inventory levels.
• bp expects the outlook for global gas prices during the first quarter to remain dependent on weather in the Northern Hemisphere and the pace of Chinese demand recovery.
• bp expects industry refining margins to remain elevated in the first quarter due to sanctioning of Russian crude and product.
1Q23 guidance
• Looking ahead, we expect first-quarter 2023 reported upstream* production to be broadly flat compared to fourth quarter 2022.
• In our customers business, we expect seasonally lower volumes and in Castrol base oil prices to remain high, although lower than the fourth quarter 2022. In refining, we expect margins to remain elevated and a lower level of turnaround activity.
2023 guidance
In addition to the guidance on page 2:
• bp expects both reported and underlying upstream production to be broadly flat compared with 2022. Within this, bp expects underlying production* from oil production & operations to be slightly higher and production from gas & low carbon energy to be lower. bp expects the start-up of Mad Dog Phase 2 in the second quarter of 2023 and first gas from the Tangguh expansion and GTA Phase 1 Tortue projects in the fourth quarter of 2023.
• bp expects the other businesses & corporate underlying annual charge to be in a range of $1.1-1.3 billion for 2023. The charge may vary from quarter to quarter.
• bp expects the depreciation, depletion and amortization to be slightly above 2022.
• The underlying ETR* for 2023 is expected to be around 40% but is sensitive to the impact that volatility in the current price environment may have on the geographical mix of the group’s profits and losses.
• bp expects capital expenditure* of $16-18 billion in 2023 including inorganic capital expenditure*.
• Having realized $15.9 billion of divestment and other proceeds since the second quarter of 2020, bp now expects divestment and other proceeds of $2-3 billion in 2023 and continues to expect to reach $25 billion of divestment and other proceeds between the second half of 2020 and 2025.
• bp expects Gulf of Mexico oil spill payments for the year to be around $1.3 billion pre-tax including $1.2 billion pre-tax to be paid during the second quarter.
• Against the authority granted at bp’s 2022 annual general meeting to repurchase up to 1.95 billion shares, bp has repurchased 1.11 billion shares.
• In setting the dividend per ordinary share and buyback each quarter, the board will continue to take into account factors including the cumulative level of and outlook for surplus cash flow*, the cash balance point* and the maintenance of a strong investment grade credit rating.
| The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 42. |
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gas & low carbon energy*
Financial results
• The replacement cost profit before interest and tax for the fourth quarter and full year was $16,439 million and $14,696 million respectively, compared with $1,911 million and $2,133 million for the same periods in 2021. The fourth quarter and full year is adjusted by a favourable impact of net adjusting items* of $13,291 million and adverse impact of $1,367 million respectively to derive the underlying replacement cost profit, compared with adverse impacts of net adjusting items of $300 million and $5,395 million for the same periods in 2021.
• After adjusting items, the underlying replacement cost profit before interest and tax* for the fourth quarter and full year was $3,148 million and $16,063 million respectively, compared with $2,211 million and $7,528 million for the same periods in 2021. Adjusting items include favourable fair value accounting effects* of $12,502 million for the quarter and an adverse effect of $1,811 million for the full year. The adjusting items for the fourth quarter primarily arose from a significant decrease in forward gas prices during the quarter. Under IFRS, reported earnings include the mark-to-market value of the hedges used to risk-manage LNG contracts, but not of the LNG contracts themselves. The underlying result includes the mark-to-market value of the hedges but also recognizes changes in value of the LNG contracts being risk managed, which decreased as forward prices fell.
• The underlying replacement cost profit for the fourth quarter, compared with the same period in 2021, reflects higher realizations, partially offset by lower production and a lower gas marketing and trading result. For the full year the result reflects higher realizations, higher production and an exceptional gas marketing and trading result.
Operational update
• Reported production for the quarter was 956mboe/d, 1.8% lower than the same period in 2021. Underlying production* was 2.4% lower, mainly due to base decline in Trinidad.
• Reported production for the full year was 957mboe/d, 4.9% higher than the same period in 2021. Underlying production for the full year was 4.9% higher due to the ramp-up of major projects*.
• Renewables pipeline* at the end of the quarter was 37.2GW (bp net). The renewables pipeline increased by 10.3GW during the quarter due to additions to the renewables pipeline in support of hydrogen in Australia. The renewables pipeline increased by 14.1GW for the full year, primarily as a result of bp and its partner EnBW being awarded a lease option off the east coast of Scotland to develop an offshore wind project (1.45GW bp net) in the first quarter of 2022, net additions to Lightsource bp’s pipeline, and the additions to the renewables pipeline in the fourth quarter in support of hydrogen in Australia.
Strategic progress
gas
• On 23 December the government of Indonesia granted a 20-year extension, to 2055, of the Tangguh production-sharing contract* (Tangguh PSC) to bp (40.22% and operator), and its Tangguh PSC partners.
• On 29 November bp announced its Cassia C development offshore Trinidad had safely delivered first gas. Cassia C is bp Trinidad and Tobago’s (bp 70%) first offshore compression platform and its biggest offshore facility.
• On 28 November bp was awarded two exploration blocks in the Mediterranean sea, offshore Egypt by the Egyptian Natural Gas Holding Company. The Northwest Abu Qir Offshore Area (bp 82.75% operator, Wintershall-Dea 17.25%) is located west of the recently awarded North King Mariout block (bp 100%) and north of the Raven field. The Bellatrix-Seti East block (bp 50%, Eni 50% operator) is located west of the Atoll field and North Tabya blocks.
• On 8 December Trinidad’s Ministry of Energy and Energy Industries announced that it had reached agreement with the Atlantic LNG shareholders, including bp, on substantial commercial terms for the consolidation of its operations into a single entity which is a key milestone towards unlocking the energy future for Trinidad and Tobago. The new structure is expected to be effective in October 2024 and will enable increased focus on operational efficiency and reliability and underpin future upstream investments.
• On 14 November bp began lifting cargoes of LNG from Mozambique’s first LNG project. bp has a long-term agreement to purchase 100% of the LNG output from the facility that has the capacity to produce up to 3.4 million tonnes of LNG per year.
low carbon energy
• On 8 November and 8 December bp signed memoranda of understanding with the governments of Mauritania and Egypt, respectively to explore the potential for establishing green hydrogen* production facilities in the countries.
• Lightsource bp brought 2.7GW to FID (1.34GW bp net) in full year 2022, an increase of 32% compared with 2.0GW (1.0GW bp net) in 2021, and divested 0.9GW of projects (0.45GW bp net) during the year, resulting in $0.1 billion of gains on disposal recognized in bp’s share of equity-accounted earnings.
• On 9 December bp announced it will partner with Shell and Lightsource bp to develop a 148 megawatt-peak solar project in Trinidad and Tobago following approval by the country’s government. It is the country’s first commercial-scale renewable energy project.
• On 14 December bp agreed with its Flat Ridge 2 joint venture partner to purchase their 50% ownership in that wind farm. bp now owns 100%, adding an additional 235MW of capacity to bp’s renewable portfolio.
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gas & low carbon energy (continued)
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) before interest and tax | 16,429 | (2,970) | 1,903 | 14,688 | 2,166 | ||
| Inventory holding (gains) losses* | 10 | 14 | 8 | 8 | (33) | ||
| RC profit (loss) before interest and tax | 16,439 | (2,956) | 1,911 | 14,696 | 2,133 | ||
| Net (favourable) adverse impact of adjusting items | (13,291) | 9,196 | 300 | 1,367 | 5,395 | ||
| Underlying RC profit before interest and tax | 3,148 | 6,240 | 2,211 | 16,063 | 7,528 | ||
| Taxation on an underlying RC basis | (1,163) | (1,478) | (509) | (4,367) | (1,677) | ||
| Underlying RC profit before interest | 1,985 | 4,762 | 1,702 | 11,696 | 5,851 |
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Depreciation, depletion and amortization | |||||||
| Total depreciation, depletion and amortization | 1,373 | 1,177 | 1,265 | 5,008 | 4,464 | ||
| Exploration write-offs | |||||||
| Exploration write-offs | (6) | 10 | 2 | 2 | 43 | ||
| Adjusted EBITDA* | |||||||
| Total adjusted EBITDA | 4,515 | 7,427 | 3,478 | 21,073 | 12,035 | ||
| Capital expenditure* | |||||||
| gas | 1,032 | 872 | 928 | 3,227 | 3,180 | ||
| low carbon energy(a)(b) | 577 | 86 | 109 | 1,024 | 1,561 | ||
| Total capital expenditure | 1,609 | 958 | 1,037 | 4,251 | 4,741 |
(a) Full year 2021 includes $712 million in respect of the remaining payment to Equinor for our investment in our strategic US offshore wind partnership and $326 million as a lease option fee deposit paid to The Crown Estate in connection with our participation in the UK Round 4 Offshore Wind Leasing together with our partner EnBW.
(b) Fourth quarter and full year 2022 include $504 million in respect of the acquisition of EDF Energy Services. Power trading is reported under low carbon energy.
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| Production (net of royalties)(b) | |||||||
| Liquids* (mb/d) | 121 | 117 | 122 | 118 | 113 | ||
| Natural gas (mmcf/d) | 4,844 | 5,011 | 4,941 | 4,866 | 4,632 | ||
| Total hydrocarbons* (mboe/d) | 956 | 981 | 974 | 957 | 912 | ||
| Average realizations* (c) | |||||||
| Liquids ($/bbl) | 80.50 | 88.03 | 71.63 | 89.86 | 63.60 | ||
| Natural gas ($/mcf) | 9.40 | 9.85 | 6.94 | 8.91 | 5.11 | ||
| Total hydrocarbons* ($/boe) | 57.60 | 60.80 | 43.68 | 56.34 | 33.75 |
(c) Includes bp’s share of production of equity-accounted entities in the gas & low carbon energy segment.
(d) Realizations are based on sales by consolidated subsidiaries only – this excludes equity-accounted entities.
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gas & low carbon energy (continued)
| 31 December 2022 | 30 September 2022 | 31 December 2021 | ||
| low carbon energy(a) | ||||
| Renewables (bp net, GW) | ||||
| Installed renewables capacity* | 2.2 | 2.0 | 1.9 | |
| Developed renewables to FID* | 5.8 | 4.6 | 4.4 | |
| Renewables pipeline | 37.2 | 26.9 | 23.1 | |
| of which by geographical area: | ||||
| Renewables pipeline – Americas | 17.0 | 17.5 | 16.2 | |
| Renewables pipeline – Asia Pacific(b) | 11.8 | 1.7 | 1.4 | |
| Renewables pipeline – Europe | 8.3 | 7.6 | 5.3 | |
| Renewables pipeline – Other | 0.1 | 0.1 | 0.2 | |
| of which by technology: | ||||
| Renewables pipeline – offshore wind | 5.2 | 5.2 | 3.7 | |
| Renewables pipeline – onshore wind | 6.3 | – | – | |
| Renewables pipeline – solar | 25.7 | 21.7 | 19.4 | |
| Total Developed renewables to FID and Renewables pipeline | 43.0 | 31.5 | 27.5 |
(a) Because of rounding, some totals may not agree exactly with the sum of their component parts.
(b) 31 December 2022 includes 10.3GW of onshore wind and solar pipeline in support of hydrogen.
Top of page 9
oil production & operations
Financial results
• The replacement cost profit before interest and tax for the fourth quarter and full year was $1,688 million and $19,721 million respectively, compared with $3,212 million and $10,501 million for the same periods in 2021. The fourth quarter and full year is adjusted by an adverse impact of net adjusting items* of $2,740 million and $503 million respectively to derive the underlying replacement cost profit, compared with an adverse impact of net adjusting items of $812 million and a favourable impact of $209 million for the same periods in 2021. Adjusting items in the fourth quarter principally relate to impairments as a result of expected portfolio changes. See Note 4 and page 30 for more information.
• After adjusting items, the underlying replacement cost profit before interest and tax* for the fourth quarter and full year was $4,428 million and $20,224 million respectively, compared with $4,024 million and $10,292 million for the same periods in 2021.
• The underlying replacement cost profit for the fourth quarter compared to the same quarter in 2021, reflects higher oil and gas realizations, partly offset by the impact of portfolio changes. For the full year the result reflects primarily higher realizations.
Operational update
• Reported production for the quarter was 1,309mboe/d, 3.6% lower than the fourth quarter of 2021. Underlying production* for the quarter was flat compared with the fourth quarter of 2021.
• Reported production for the full year was 1,297mboe/d, 0.8% lower than the same period of 2021. Underlying production for the full year was 2.1% higher compared with the same period of 2021 reflecting bpx energy performance, major projects* and reduced weather impacts in the US Gulf of Mexico partly offset by base performance.
• Progressed operational performance in upstream* in 2022, delivering the highest bp-operated hydrocarbon plant reliability* on record at 96%.
Strategic Progress
• On 16 December bp was awarded operatorship of the Bumerangue block, in the Santos Pre Salt Basin, in Brazil.
• On 7 November the National Agency for Petroleum, Gas and Biofuels (ANPG), ExxonMobil Angola and the Angola Block 15 partners announced a new discovery at the Bavuca South-1 exploration well. Azule Energy, the bp and ENI 50:50 joint venture, owns 42% of block 15.
• In the Permian, methane flaring intensity averaged <0.5% in 2022, the lowest recorded in BPX Energy.
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit before interest and tax | 1,686 | 6,966 | 3,212 | 19,714 | 10,509 | ||
| Inventory holding (gains) losses* | 2 | (1) | – | 7 | (8) | ||
| RC profit before interest and tax | 1,688 | 6,965 | 3,212 | 19,721 | 10,501 | ||
| Net (favourable) adverse impact of adjusting items | 2,740 | (1,754) | 812 | 503 | (209) | ||
| Underlying RC profit before interest and tax | 4,428 | 5,211 | 4,024 | 20,224 | 10,292 | ||
| Taxation on an underlying RC basis | (2,015) | (2,921) | (1,235) | (9,143) | (4,123) | ||
| Underlying RC profit before interest | 2,413 | 2,290 | 2,789 | 11,081 | 6,169 |
Top of page 10
oil production & operations (continued)
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Depreciation, depletion and amortization | |||||||
| Total depreciation, depletion and amortization | 1,383 | 1,381 | 1,628 | 5,564 | 6,528 | ||
| Exploration write-offs | |||||||
| Exploration write-offs | 73 | 180 | 45 | 383 | 125 | ||
| Adjusted EBITDA* | |||||||
| Total adjusted EBITDA | 5,884 | 6,772 | 5,697 | 26,171 | 16,945 | ||
| Capital expenditure* | |||||||
| Total capital expenditure | 1,430 | 1,386 | 1,272 | 5,278 | 4,838 |
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| Production (net of royalties)(a) | |||||||
| Liquids* (mb/d) | 966 | 959 | 1,004 | 952 | 978 | ||
| Natural gas (mmcf/d) | 1,989 | 2,075 | 2,053 | 1,998 | 1,903 | ||
| Total hydrocarbons* (mboe/d) | 1,309 | 1,317 | 1,358 | 1,297 | 1,307 | ||
| Average realizations* (b) | |||||||
| Liquids ($/bbl) | 80.43 | 93.14 | 71.07 | 89.62 | 62.57 | ||
| Natural gas(c) ($/mcf) | 10.20 | 12.12 | 8.73 | 10.46 | 5.49 | ||
| Total hydrocarbons*(c) ($/boe) | 74.60 | 86.83 | 66.19 | 82.23 | 55.65 |
(a) Includes bp’s share of production of equity-accounted entities in the oil production & operations segment.
(b) Realizations are based on sales by consolidated subsidiaries only – this excludes equity-accounted entities.
(c) Realizations calculation methodology has been changed to reflect gas price fluctuations within the North Sea region. All comparatives are restated. There is no impact on financial results.
Top of page 11
customers & products
Financial results
• The replacement cost profit before interest and tax for the fourth quarter and full year was $771 million and $8,869 million respectively, compared with a loss of $426 million and a profit of $2,208 million for the same periods in 2021. The fourth quarter and full year is adjusted by an adverse impact of net adjusting items* of $1,131 million and $1,920 million respectively to derive the underlying replacement cost profit, mainly relating to impairment charges (see Note 4), compared with an adverse impact of net adjusting items of $1,037 million and $1,044 million for the same periods in 2021.
• After adjusting items, the underlying replacement cost profit before interest and tax* for the fourth quarter and full year was $1,902 million and $10,789 million respectively, compared with a profit of $611 million and $3,252 million for the same periods in 2021.
• The customers & products result for the fourth quarter and full year were higher than the same periods in 2021. This reflects a stronger performance in refining and oil trading.
• customers – the convenience and mobility results, excluding Castrol, for the fourth quarter and full year were higher compared with the same periods in 2021. The benefits of a stronger convenience, retail fuels and aviation performance were partially offset by inflationary cost pressures. The full year result also included higher midstream performance, including biofuels, and adverse foreign exchange impacts.
Castrol results for the fourth quarter and full year were lower than the same periods in 2021, due to higher input costs, ongoing COVID restrictions, notably in China, and adverse foreign exchange impacts.
• products – the products results for the fourth quarter and full year were higher compared with the same periods in 2021. In refining, the fourth quarter and full year results benefited from higher realized margins, partially offset by higher energy costs, and turnaround and maintenance activity. In oil trading the fourth quarter and full year results were higher compared to the same period in 2021. The full year result benefited from an exceptionally strong oil trading performance in the first half of 2022.
Operational update
• Utilization for the full year was similar to 2021, however the fourth quarter was lower compared to the same period in 2021, primarily due to the bp-Husky Toledo refinery shutdown and a higher level of maintenance activity. bp-operated refining availability* for the fourth quarter and full year was 95.0% and 94.5% respectively, compared with 95.4% and 94.8% for the same periods in 2021.
Strategic progress
• Strategic convenience sites* grew to 2,400, an increase of more than 250 compared to 2021.
• In December, bp announced an exclusive agreement in the UK with its convenience partner M&S for bp pulse to install fast(a)charge points in around 70 of their stores, with initial ambition to add up to 900 charge points within the next two years. This follows bp’s announcement in October that its strategic partnership with REWE in Germany has been expanded to include the installation of fast(a) charge points at up to 180 of their sites.
• EV charge points* installed and energy sold grew by more than 65% and around 150% respectively, compared to 2021, with charge points now at around 22,000. In addition, we continued to build momentum in fleets. In October, bp announced plans to establish a bp pulse Gigahub network, a series of large, EV fast(a) charging hubs designed to serve ride-hail and taxi fleets, near US airports and high-demand locations, with an initial location near Los Angeles Airport in collaboration with Hertz.
• In November, Castrol announced an investment in Ki Mobility solutions (KMS) to create a co-branded service and maintenance network in India, supported by KMS’s digitally integrated multi-brand service platform. The investment supports Castrol’s aim to grow its presence in service and maintenance for both EV and non-EV vehicles.
• In December, bp completed its purchase of Archaea Energy Inc., a leading provider of renewable natural gas, marking a milestone in the growth of bp’s strategic bioenergy business. Bioenergy is one of five strategic transition growth engines that bp intends to grow rapidly through this decade.
• In November, bp announced its Cherry Point refinery in the US had doubled its renewable diesel production capacity compared to the fourth quarter in 2021. The refinery now has the capability to co-process more than 7,000 barrels a day of renewable diesel.
• Following a fire at the bp-Husky Toledo refinery in Ohio, US, the refinery remains shut down. bp continues to work with Cenovus Energy, its partner in the facility, on the announced sale of bp’s 50% interest in the refinery to Cenovus Energy.
(a) “fast charging” includes rapid charging ≥50kW and ultra-fast charging ≥150kW.
Top of page 12
customers & products (continued)
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) before interest and tax | (645) | (269) | (14) | 10,235 | 5,563 | ||
| Inventory holding (gains) losses* | 1,416 | 2,855 | (412) | (1,366) | (3,355) | ||
| RC profit (loss) before interest and tax | 771 | 2,586 | (426) | 8,869 | 2,208 | ||
| Net (favourable) adverse impact of adjusting items | 1,131 | 139 | 1,037 | 1,920 | 1,044 | ||
| Underlying RC profit before interest and tax | 1,902 | 2,725 | 611 | 10,789 | 3,252 | ||
| Of which:(a) | |||||||
| customers – convenience & mobility | 628 | 1,137 | 637 | 2,966 | 3,052 | ||
| Castrol – included in customers | 70 | 151 | 207 | 700 | 1,037 | ||
| products – refining & trading | 1,274 | 1,588 | (26) | 7,823 | 200 | ||
| Taxation on an underlying RC basis | (400) | (725) | (640) | (2,308) | (1,210) | ||
| Underlying RC profit before interest | 1,502 | 2,000 | (29) | 8,481 | 2,042 |
(a) A reconciliation to RC profit before interest and tax by business is provided on page 34.
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Adjusted EBITDA*(b) | |||||||
| customers – convenience & mobility | 962 | 1,448 | 966 | 4,252 | 4,358 | ||
| Castrol – included in customers | 110 | 187 | 243 | 853 | 1,187 | ||
| products – refining & trading | 1,681 | 1,974 | 399 | 9,407 | 1,894 | ||
| 2,643 | 3,422 | 1,365 | 13,659 | 6,252 | |||
| Depreciation, depletion and amortization | |||||||
| Total depreciation, depletion and amortization | 741 | 697 | 754 | 2,870 | 3,000 | ||
| Capital expenditure* | |||||||
| customers – convenience & mobility | 694 | 404 | 692 | 1,779 | 1,564 | ||
| Castrol – included in customers | 98 | 42 | 53 | 235 | 173 | ||
| products – refining & trading(c) | 3,455 | 309 | 532 | 4,473 | 1,308 | ||
| Total capital expenditure | 4,149 | 713 | 1,224 | 6,252 | 2,872 |
(b) A reconciliation to RC profit before interest and tax by business is provided on page 34.
(c) Fourth quarter and full year 2022 include $3,030 million in respect of the Archaea Energy acquisition.
| Retail(d) | Fourth | Third | Fourth | ||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| bp retail sites* – total (#) | 20,650 | 20,550 | 20,500 | 20,650 | 20,500 | ||
| bp retail sites in growth markets* | 2,650 | 2,600 | 2,700 | 2,650 | 2,700 | ||
| Strategic convenience sites* | 2,400 | 2,250 | 2,150 | 2,400 | 2,150 |
(d) Reported to the nearest 50.
| Marketing sales of refined products (mb/d) | Fourth | Third | Fourth | ||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| US | 1,126 | 1,143 | 1,151 | 1,136 | 1,115 | ||
| Europe | 1,069 | 1,098 | 936 | 1,021 | 863 | ||
| Rest of World | 461 | 451 | 496 | 456 | 461 | ||
| 2,656 | 2,692 | 2,583 | 2,613 | 2,439 | |||
| Trading/supply sales of refined products | 325 | 355 | 395 | 350 | 393 | ||
| Total sales volume of refined products | 2,981 | 3,047 | 2,978 | 2,963 | 2,832 |
Top of page 13
customers & products (continued)
| Refining marker margin*(e) | Fourth | Third | Fourth | ||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| bp average refining marker margin (RMM) ($/bbl) | 32.2 | 35.5 | 15.1 | 33.1 | 13.2 |
(e) The RMM in the quarter is calculated based on bp’s current refinery portfolio. On a comparative basis, the fourth quarter and full year 2021 RMM would be $15.3/bbl and $13.6/bbl respectively.
| Refinery throughputs (mb/d) | Fourth | Third | Fourth | ||||
| quarter | quarter | quarter | Year | Year | |||
| 2022 | 2022 | 2021 | 2022 | 2021 | |||
| US | 615 | 703 | 720 | 678 | 719 | ||
| Europe | 763 | 809 | 833 | 804 | 787 | ||
| Rest of World | – | – | 91 | 22 | 88 | ||
| Total refinery throughputs | 1,378 | 1,512 | 1,644 | 1,504 | 1,594 | ||
| bp-operated refining availability* (%) | 95.0 | 94.3 | 95.4 | 94.5 | 94.8 |
Top of page 14
other businesses & corporate
Other businesses & corporate comprises innovation & engineering, bp ventures, Launchpad, regions, corporates & solutions, our corporate activities & functions and any residual costs of the Gulf of Mexico oil spill. From first quarter 2022 the results of Rosneft, previously reported as a separate segment, are also included in other businesses & corporate. Comparative information for 2021 has been restated to reflect the changes in reportable segments. For more information see Note 1 Basis of Preparation – Investment in Rosneft.
Financial results
• The replacement cost result before interest and tax for the fourth quarter and full year was a profit of $103 million and a loss of $26,737 million respectively, compared with a loss of $369 million and $348 million for the same periods in 2021. The fourth quarter and full year is adjusted by a favourable impact of net adjusting items* of $409 million and an adverse impact of $25,566 million respectively to derive the underlying replacement cost profit, compared with an adverse impact of net adjusting items of $579 million and $1,685 million for the same periods in 2021. The adjusting items for the full year of 2022 mainly relate to Rosneft. Fair value accounting effects* for the fourth quarter and full year had a favourable impact of $515 million and an adverse impact of $1,381 million respectively, compared with an adverse impact of $212 million and $849 million for the same periods in 2021.
• After adjusting items, the underlying replacement cost loss before interest and tax* for the fourth quarter and full year was $306 million and $1,171 million respectively, compared with a profit of $210 million and $1,337 million for the same periods in 2021.
• For other businesses & corporate excluding Rosneft, after excluding adjusting items, the underlying replacement cost loss before interest and tax for the fourth quarter and full year was $306 million and $1,171 million respectively, compared with $535 million and $1,383 million for the same periods in 2021.
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) before interest and tax | 103 | (1,093) | (301) | (26,737) | (89) | ||
| Inventory holding (gains) losses* | – | – | (68) | – | (259) | ||
| RC profit (loss) before interest and tax | 103 | (1,093) | (369) | (26,737) | (348) | ||
| Net (favourable) adverse impact of adjusting items(a) | (409) | 688 | 579 | 25,566 | 1,685 | ||
| Underlying RC profit (loss) before interest and tax | (306) | (405) | 210 | (1,171) | 1,337 | ||
| Taxation on an underlying RC basis | 43 | 206 | 55 | 439 | 25 | ||
| Underlying RC profit (loss) before interest | (263) | (199) | 265 | (732) | 1,362 |
(a) Includes fair value accounting effects relating to the hybrid bonds that were issued on 17 June 2020. See page 37 for more information.
other businesses & corporate (excluding Rosneft)
Strategic progress
• We have taken the decision to no longer seek new companies for bp’s Launchpad accelerator, with our focus now to scale and build businesses within our 5 transition growth engines – bioenergy, convenience, EV charging, renewables and hydrogen.
• In December, bp ventures made a $20-million AUD investment in 5B Holdings Pty Ltd, an Australian renewable company with technology that enables rapid deployment of solar power at scale.
• On 2 February 2023, bp and Chubu Electric signed a memorandum of understanding to explore opportunities for decarbonisation in Japan and the wider Asia region, including plans for a feasibility study for a carbon capture, utilization, and storage (CCUS) hub in the Nagoya port area.
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) before interest and tax | 103 | (1,093) | (924) | (2,704) | (2,777) | ||
| Inventory holding (gains) losses* | – | – | – | – | – | ||
| RC profit (loss) before interest and tax | 103 | (1,093) | (924) | (2,704) | (2,777) | ||
| Net (favourable) adverse impact of adjusting items | (409) | 688 | 389 | 1,533 | 1,394 | ||
| Underlying RC profit (loss) before interest and tax | (306) | (405) | (535) | (1,171) | (1,383) | ||
| Taxation on an underlying RC basis | 43 | 206 | 128 | 439 | 294 | ||
| Underlying RC profit (loss) before interest | (263) | (199) | (407) | (732) | (1,089) |
Top of page 15
other businesses & corporate (Rosneft)
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) before interest and tax | – | – | 623 | (24,033) | 2,688 | ||
| Inventory holding (gains) losses* | – | – | (68) | – | (259) | ||
| RC profit (loss) before interest and tax | – | – | 555 | (24,033) | 2,429 | ||
| Net (favourable) adverse impact of adjusting items | – | – | 190 | 24,033 | 291 | ||
| Underlying RC profit (loss) before interest and tax | – | – | 745 | – | 2,720 | ||
| Taxation on an underlying RC basis | – | – | (73) | – | (269) | ||
| Underlying RC profit (loss) before interest | – | – | 672 | – | 2,451 |
Top of page 16
Financial statements
Group income statement
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Sales and other operating revenues (Note 6) | 69,257 | 55,011 | 50,554 | 241,392 | 157,739 | ||
| Earnings from joint ventures – after interest and tax | 189 | 498 | 243 | 1,128 | 543 | ||
| Earnings from associates – after interest and tax | 129 | 275 | 896 | 1,402 | 3,456 | ||
| Interest and other income | 608 | 159 | 259 | 1,103 | 581 | ||
| Gains on sale of businesses and fixed assets | 173 | 1,866 | 286 | 3,866 | 1,876 | ||
| Total revenues and other income | 70,356 | 57,809 | 52,238 | 248,891 | 164,195 | ||
| Purchases | 34,101 | 39,993 | 32,089 | 141,043 | 92,923 | ||
| Production and manufacturing expenses | 6,841 | 7,193 | 6,397 | 28,610 | 25,843 | ||
| Production and similar taxes | 557 | 639 | 406 | 2,325 | 1,308 | ||
| Depreciation, depletion and amortization (Note 7) | 3,714 | 3,467 | 3,863 | 14,318 | 14,805 | ||
| Net impairment and losses on sale of businesses and fixed assets (Note 4) | 3,629 | 417 | 1,223 | 30,522 | (1,121) | ||
| Exploration expense | 140 | 225 | 102 | 585 | 424 | ||
| Distribution and administration expenses | 3,654 | 3,262 | 3,365 | 13,449 | 11,931 | ||
| Profit (loss) before interest and taxation | 17,720 | 2,613 | 4,793 | 18,039 | 18,082 | ||
| Finance costs | 834 | 649 | 759 | 2,703 | 2,857 | ||
| Net finance (income) expense relating to pensions and other post-retirement benefits | (16) | (16) | (8) | (69) | (2) | ||
| Profit (loss) before taxation | 16,902 | 1,980 | 4,042 | 15,405 | 15,227 | ||
| Taxation | 5,741 | 3,964 | 1,464 | 16,762 | 6,740 | ||
| Profit (loss) for the period | 11,161 | (1,984) | 2,578 | (1,357) | 8,487 | ||
| Attributable to | |||||||
| bp shareholders | 10,803 | (2,163) | 2,326 | (2,487) | 7,565 | ||
| Non-controlling interests | 358 | 179 | 252 | 1,130 | 922 | ||
| 11,161 | (1,984) | 2,578 | (1,357) | 8,487 | |||
| Earnings per share (Note 8) | |||||||
| Profit (loss) for the period attributable to bp shareholders | |||||||
| Per ordinary share (cents) | |||||||
| Basic | 59.43 | (11.45) | 11.75 | (13.10) | 37.57 | ||
| Diluted | 58.36 | (11.45) | 11.66 | (13.10) | 37.33 | ||
| Per ADS (dollars) | |||||||
| Basic | 3.57 | (0.69) | 0.70 | (0.79) | 2.25 | ||
| Diluted | 3.50 | (0.69) | 0.70 | (0.79) | 2.24 |
Top of page 17
Condensed group statement of comprehensive income
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Profit (loss) for the period | 11,161 | (1,984) | 2,578 | (1,357) | 8,487 | ||
| Other comprehensive income | |||||||
| Items that may be reclassified subsequently to profit or loss | |||||||
| Currency translation differences(a) | 2,142 | (1,725) | (619) | (3,786) | (921) | ||
| Exchange (gains) losses on translation of foreign operations reclassified to gain or loss on sale of businesses and fixed assets(b) | (32) | – | 36 | 10,759 | 36 | ||
| Cash flow hedges and costs of hedging | 584 | (142) | 408 | 763 | (259) | ||
| Share of items relating to equity-accounted entities, net of tax | 392 | (134) | 104 | 402 | 44 | ||
| Income tax relating to items that may be reclassified | (108) | (54) | (24) | (334) | 65 | ||
| 2,978 | (2,055) | (95) | 7,804 | (1,035) | |||
| Items that will not be reclassified to profit or loss | |||||||
| Remeasurements of the net pension and other post-retirement benefit liability or asset(c) | (1,508) | 112 | 1,306 | 340 | 4,416 | ||
| Cash flow hedges that will subsequently be transferred to the balance sheet | 1 | (1) | – | (4) | 1 | ||
| Income tax relating to items that will not be reclassified | 538 | 19 | (434) | 68 | (1,317) | ||
| (969) | 130 | 872 | 404 | 3,100 | |||
| Other comprehensive income | 2,009 | (1,925) | 777 | 8,208 | 2,065 | ||
| Total comprehensive income | 13,170 | (3,909) | 3,355 | 6,851 | 10,552 | ||
| Attributable to | |||||||
| bp shareholders | 12,760 | (4,042) | 3,095 | 5,782 | 9,654 | ||
| Non-controlling interests | 410 | 133 | 260 | 1,069 | 898 | ||
| 13,170 | (3,909) | 3,355 | 6,851 | 10,552 |
(a) Fourth and third quarter 2022 are principally affected by movements in the Pound Sterling against the US dollar. Full year 2022 is principally affected by movements in the Russian rouble and Pound Sterling against the US dollar.
(b) See Note 1 Basis of preparation – Investment in Rosneft.
(c) See Note 1 Basis of preparation – Pensions and other post-retirement benefits for further information.
Top of page 18
Condensed group statement of changes in equity
| bp shareholders’ | Non-controlling interests | Total | |||
| $ million | equity(a) | Hybrid bonds | Other interest | equity | |
| At 1 January 2022 | 75,463 | 13,041 | 1,935 | 90,439 | |
| Total comprehensive income | 5,782 | 519 | 550 | 6,851 | |
| Dividends | (4,365) | – | (294) | (4,659) | |
| Cash flow hedges transferred to the balance sheet, net of tax | 1 | – | – | 1 | |
| Issue of ordinary share capital(b) | 820 | – | – | 820 | |
| Repurchase of ordinary share capital | (10,493) | – | – | (10,493) | |
| Share-based payments, net of tax | 847 | – | – | 847 | |
| Issue of perpetual hybrid bonds | (4) | 374 | – | 370 | |
| Payments on perpetual hybrid bonds | 15 | (544) | – | (529) | |
| Transactions involving non-controlling interests, net of tax | (513) | – | (144) | (657) | |
| At 31 December 2022 | 67,553 | 13,390 | 2,047 | 82,990 | |
| bp shareholders’ | Non-controlling interests | Total | |||
| $ million | equity | Hybrid bonds | Other interest | equity | |
| At 1 January 2021 | 71,250 | 12,076 | 2,242 | 85,568 | |
| Total comprehensive income | 9,654 | 507 | 391 | 10,552 | |
| Dividends | (4,316) | – | (311) | (4,627) | |
| Cash flow hedges transferred to the balance sheet, net of tax | (10) | – | – | (10) | |
| Repurchase of ordinary share capital | (3,151) | – | – | (3,151) | |
| Share-based payments, net of tax | 632 | – | – | 632 | |
| Share of equity-accounted entities’ changes in equity, net of tax | 556 | – | – | 556 | |
| Issue of perpetual hybrid bonds | (26) | 950 | – | 924 | |
| Payments on perpetual hybrid bonds | (7) | (492) | – | (499) | |
| Transactions involving non-controlling interests, net of tax | 881 | – | (387) | 494 | |
| At 31 December 2021 | 75,463 | 13,041 | 1,935 | 90,439 |
(a) In 2022 $9.2 billion of the opening foreign currency translation reserve has been moved to the profit and loss account reserve as a result of bp’s decision to exit its shareholding in Rosneft and its other businesses with Rosneft in Russia. For more information see Note 1.
(b) Relates to ordinary shares issued as non-cash consideration for the acquisition of the public units of BP Midstream Partners LP.
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Group balance sheet
| 31 December | 31 December | ||
| $ million | 2022 | 2021 | |
| Non-current assets | |||
| Property, plant and equipment | 106,044 | 112,902 | |
| Goodwill | 11,960 | 12,373 | |
| Intangible assets | 10,200 | 6,451 | |
| Investments in joint ventures | 12,400 | 9,982 | |
| Investments in associates(a) | 8,201 | 21,001 | |
| Other investments | 2,670 | 2,544 | |
| Fixed assets | 151,475 | 165,253 | |
| Loans | 1,271 | 922 | |
| Trade and other receivables | 1,092 | 2,693 | |
| Derivative financial instruments | 12,841 | 7,006 | |
| Prepayments | 576 | 479 | |
| Deferred tax assets | 3,908 | 6,410 | |
| Defined benefit pension plan surpluses | 9,269 | 11,919 | |
| 180,432 | 194,682 | ||
| Current assets | |||
| Loans | 315 | 355 | |
| Inventories | 28,081 | 23,711 | |
| Trade and other receivables | 34,010 | 27,139 | |
| Derivative financial instruments | 11,554 | 5,744 | |
| Prepayments | 2,092 | 2,486 | |
| Current tax receivable | 621 | 542 | |
| Other investments | 578 | 280 | |
| Cash and cash equivalents | 29,195 | 30,681 | |
| 106,446 | 90,938 | ||
| Assets classified as held for sale (Note 3) | 1,242 | 1,652 | |
| 107,688 | 92,590 | ||
| Total assets | 288,120 | 287,272 | |
| Current liabilities | |||
| Trade and other payables | 63,984 | 52,611 | |
| Derivative financial instruments | 12,618 | 7,565 | |
| Accruals | 6,398 | 5,638 | |
| Lease liabilities | 2,102 | 1,747 | |
| Finance debt | 3,198 | 5,557 | |
| Current tax payable | 4,065 | 1,554 | |
| Provisions | 6,332 | 5,256 | |
| 98,697 | 79,928 | ||
| Liabilities directly associated with assets classified as held for sale (Note 3) | 321 | 359 | |
| 99,018 | 80,287 | ||
| Non-current liabilities | |||
| Other payables | 10,387 | 10,567 | |
| Derivative financial instruments | 13,537 | 6,356 | |
| Accruals | 1,233 | 968 | |
| Lease liabilities | 6,447 | 6,864 | |
| Finance debt | 43,746 | 55,619 | |
| Deferred tax liabilities | 10,526 | 8,780 | |
| Provisions | 14,992 | 19,572 | |
| Defined benefit pension plan and other post-retirement benefit plan deficits | 5,244 | 7,820 | |
| 106,112 | 116,546 | ||
| Total liabilities | 205,130 | 196,833 | |
| Net assets | 82,990 | 90,439 | |
| Equity | |||
| bp shareholders’ equity | 67,553 | 75,463 | |
| Non-controlling interests | 15,437 | 14,976 | |
| Total equity | 82,990 | 90,439 |
(a) See Note 1 Basis of preparation – Investment in Rosneft.
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Condensed group cash flow statement
| Fourth | Third | Fourth | |||||
| quarter | quarter | quarter | Year | Year | |||
| $ million | 2022 | 2022 | 2021 | 2022 | 2021 | ||
| Operating activities | |||||||
| Profit (loss) before taxation | 16,902 | 1,980 | 4,042 | 15,405 | 15,227 | ||
| Adjustments to reconcile profit (loss) before taxation to net cash provided by operating activities | |||||||
| Depreciation, depletion and amortization and exploration expenditure written off | 3,781 | 3,657 | 3,909 | 14,703 | 14,972 | ||
| Net impairment and (gain) loss on sale of businesses and fixed assets | 3,456 | (1,449) | 937 | 26,656 | (2,997) | ||
| Earnings from equity-accounted entities, less dividends received | 582 | (391) | (201) | (830) | (2,157) | ||
| Net charge for interest and other finance expense, less net interest paid | 186 | 72 | 74 | 396 | 466 | ||
| Share-based payments | 166 | 251 | 226 | 795 | 627 | ||
| Net operating charge for pensions and other post-retirement benefits, less contributions and benefit payments for unfunded plans | (60) | (15) | (184) | (257) | (655) | ||
| Net charge for provisions, less payments | (1,013) | 173 | 194 | 440 | 2,934 | ||
| Movements in inventories and other current and non-current assets and liabilities | (6,847) | 6,764 | (1,709) | (6,270) | (626) | ||
| Income taxes paid | (3,582) | (2,754) | (1,172) | (10,106) | (4,179) | ||
| Net cash provided by operating activities | 13,571 | 8,288 | 6,116 | 40,932 | 23,612 | ||
| Investing activities | |||||||
| Expenditure on property, plant and equipment, intangible and other assets | (3,696) | (3,105) | (2,772) | (12,069) | (10,887) | ||
| Acquisitions, net of cash acquired (Note 2) | (3,522) | (3) | (132) | (3,530) | (186) | ||
| Investment in joint ventures | (107) | (40) | (581) | (600) | (1,440) | ||
| Investment in associates | (44) | (46) | (148) | (131) | (335) | ||
| Total cash capital expenditure | (7,369) | (3,194) | (3,633) | (16,330) | (12,848) | ||
| Proceeds from disposal of fixed assets | 27 | 12 | 520 | 709 | 1,145 | ||
| Proceeds from disposal of businesses, net of cash disposed | 587 | 594 | 1,745 | 1,841 | 5,812 | ||
| Proceeds from loan repayments | 7 | 15 | 36 | 67 | 197 | ||
| Cash provided from investing activities | 621 | 621 | 2,301 | 2,617 | 7,154 | ||
| Net cash used in investing activities | (6,748) | (2,573) | (1,332) | (13,713) | (5,694) | ||
| Financing activities | |||||||
| Net issue (repurchase) of shares (Note 8) | (3,240) | (2,876) | (1,725) | (9,996) | (3,151) | ||
| Lease liability payments | (513) | (478) | (502) | (1,961) | (2,082) | ||
| Proceeds from long-term financing | 10 | 1 | 648 | 2,013 | 6,987 | ||
| Repayments of long-term financing | (2,197) | (4,035) | (2,963) | (11,697) | (16,804) | ||
| Net increase (decrease) in short-term debt | 190 | (618) | 969 | (1,392) | 1,077 | ||
| Issue of perpetual hybrid bonds | 48 | 194 | 65 | 370 | 924 | ||
| Payments relating to perpetual hybrid bonds | (219) | (180) | (100) | (708) | (538) | ||
| Payments relating to transactions involving non-controlling interests (Other interest) | (1) | (2) | – | (9) | (560) | ||
| Receipts relating to transactions involving non-controlling interests (Other interest) | 1 | 3 | 12 | 11 | 683 | ||
| Dividends paid – bp shareholders | (1,088) | (1,140) | (1,077) | (4,358) | (4,304) | ||
| – non-controlling interests | (100) | (66) | (66) | (294) | (311) | ||
| Net cash provided by (used in) financing activities | (7,109) | (9,197) | (4,739) | (28,021) | (18,079) | ||
| Currency translation differences relating to cash and cash equivalents | 177 | (322) | (58) | (684) | (269) | ||
| Increase (decrease) in cash and cash equivalents | (109) | (3,804) | (13) | (1,486) | (430) | ||
| Cash and cash equivalents at beginning of period | 29,304 | 33,108 | 30,694 | 30,681 | 31,111 | ||
| Cash and cash equivalents at end of period | 29,195 | 29,304 | 30,681 | 29,195 | 30,681 |