bp announce 4th quarter and full year 2025 results

10 Feb bp announce 4th quarter and full year 2025 results

(Oilandgaspress) -] 2025 underlying RC profit $7.5bn delivered against a weaker oil price environment. Operating cash flow $24.5bn, including $2.9bn adjusted working capital* build(c).
Strong operations and progress across upstream* and downstream: Record full year upstream plant reliability 96.1%; 2025 underlying production* held broadly flat vs. 2024; 7 major projects* started up in 2025; reserves replacement ratio* increased to 90%; record full year refining availability* 96.3%; customers delivered its highest underlying earnings since 2019 with all businesses growing year on year.
Progress on our strategic targets: Expected proceeds from completed and announced divestments now above $11bn; reached an agreement to sell a 65% shareholding in Castrol – resulting in expected net proceeds of approximately $6bn; closed the sale of Netherlands retail, US onshore wind, and non-controlling interests in US midstream assets; increased group structural cost reduction* target to $5.5-6.5 billion by end 2027.
Positioning the company for the long term: The board has decided to suspend the share buyback and fully allocate excess cash* to accelerate strengthening of our balance sheet. This creates a strong platform to invest with discipline into our distinctive deep hopper of oil & gas opportunities

(a) Divestment proceeds are disposal proceeds as per the condensed group cash flow statement. See page 3 for more information on other proceeds.
(b) See Note 9 for more information.
(c) Change in working capital adjusted for inventory holding losses, fair value accounting effects relating to subsidiaries and other adjusting items. See page 27.

RC profit (loss), underlying RC profit, net debt, ROACE, adjusted EBITDA, underlying operating expenditure, underlying RC profit per ordinary share, underlying RC profit per ADS, adjusted working capital, customers underlying earnings (underlying RC profit before interest and tax) and excess cash are non-IFRS measures. Inventory holding (gains) losses and adjusting items are non-IFRS adjustments.

* For items marked with an asterisk throughout this document, definitions are provided in the Glossary on page 32 (Download press release pdf)

4Q25 underlying replacement cost (RC) profit* $1.5 billion
Underlying RC profit for the quarter of $1.5 billion, compared with $2.2 billion for the previous quarter. Compared with the third quarter 2025, the underlying result reflects lower upstream realizations, adverse impact of upstream production mix, lower refinery throughputs due to higher turnaround activity and the temporary impact of reduced capacity following an outage at the Whiting refinery and seasonally lower customer volumes, partly offset by lower exploration write-offs. The underlying effective tax rate (ETR)* in the quarter was 43%, compared with 39% for the previous quarter, which reflects changes in the geographical mix of profits.
Reported loss for the quarter was $3.4 billion, compared with a profit of $1.2 billion for the third quarter 2025. The reported result for the fourth quarter is adjusted for inventory holding loss* of $0.7 billion (net of tax) and a net adverse impact of adjusting items* of $4.3 billion (net of tax) to derive the underlying RC profit. Adjusting items include post-tax net impairments and impairments in equity-accounted entities of around $4 billion, primarily related to our transition businesses in the gas & low carbon energy segment (see Note 3 and page 25 for more information on adjusting items).

Key 2025 figures:

• Total underlying RC profit was $7.5bn for full year.
• Operating cash flow was $24.5bn for full year.
• Underlying RC profit of $1.5bn for the quarter – up ~32% on 4Q2024.
• 10% reduction in capex compared with 2024.
• Sixth year in a row of 4% uplift in trading.
• Customers & products business had highest earnings since 2019.
• Announced over $11bn of divestments – more than halfway to $20bn disposal programme.

Delivered against primary targets:

• Increased adjusted free cash flow by around 55% in 2025 on a price-adjusted basis – ahead of >20% target. 
• Reduced net debt to $22.2bn.
  • Reminder: Around $6bn of anticipated proceeds from strategic review of Castrol will also be used to strengthen bp’s balance sheet.
• Delivered $2.8bn (or 60%) of $4-5bn structural cost reduction target.
  • Increased this target to $5.5-6.5bn by 2027 to reflect outcome of Castrol strategic review.
• Return on average capital employed was around 14% in 2025 on a price-adjusted basis – increase from around 12% in 2024.

Strong year operationally:

• Reserves replacement ratio was 90% – up from average of ~50% prior two years.
• Record upstream plant reliability (96.1%) and record refining availability (96.3%).
• Beat 2025 production plan – 2.3 million barrels of oil equivalent per day.
• Initial estimate of Bumerangue discoveryis ~8 billion barrels of liquids in place.
• Seven start-ups in 2025 – delivered 150,000 boed of 250,000 boed net peak production expected online by 2027.

Carol Howle, interim chief executive officer, commented:

“2025 was a year of strong underlying financial results, strong operational performance, and meaningful strategic progress. We have made progress against our four primary targets – growing cash flow and returns, reducing costs, and strengthening the balance sheet – but know there is more work to be done, and we are clear on the urgency to deliver.

“With a continued emphasis on capital discipline and returns, we are reducing capital expenditure for 2026 to the lower end of the guidance range, while continuing to drive down our cost base. We are also taking decisive action to high-grade our portfolio and strengthen our company, including the execution of our $20bn disposal programme and the decision to suspend the share buyback and fully allocate excess cash to our balance sheet. These decisions position us to progress long term value growth through the distinctive opportunity set we are creating in our upstream business, including the Bumerangue discovery in Brazil, where our initial estimates indicate around 8 billion barrels of liquids in place.

“We look forward to Meg O’Neill joining as CEO in April as we accelerate our progress to build a simpler, stronger and more valuable bp for the future. We are in action and we can and will do better for our shareholders. “

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