BP Accelerates Share Buybacks as New CEO Woos Investors

BP Plc accelerated share buybacks as its new chief sought to woo investors while sticking to the company’s clean-energy strategy.

After fourth-quarter profit exceeded estimates, the London-based oil and gas giant said it will repurchase $1.75 billion of shares each quarter in the first half of the year, compared with $1.5 billion in the prior three months. BP follows a strong set of results for Big Oil in the fourth quarter, with Exxon Mobil Corp., Chevron Corp. and Shell Plc all surpassing expectations. 

Chief Executive Officer Murray Auchincloss, who was appointed last month, reiterated BP’s plan to transform itself from an oil giant to a clean energy producer, despite recent criticism from shareholders. 

“Our destination remains unchanged,” Auchincloss said in a statement on Tuesday. “We are confident in our strategy, on delivering as a simpler, more focused and higher-value company.”

The earnings announcement caps a tumultuous few months for BP that saw the abrupt resignation of former CEO Bernard Looney, a swell of rumors that it was a potential takeover target, and most recently calls from activist investor Bluebell Capital Partners to divert spending from renewables into oil and gas.

BP’s adjusted net income for the three months ended Dec. 31 was $2.99 billion, compared with $4.81 billion a year earlier and $3.29 billion in the third quarter. That beat the average estimate of $2.76 billion.  

As Auchincloss pledged to spend extra on higher-than-expected buybacks, he kept a tight rein on capital expenditure. BP will target spending of $16 billion both this year and next, compared with a previous range of $14 billion to $18 billion.

BP’s dividend was 7.27 cents per share, 10% higher than a year earlier. The company previously said it has capacity for an annual increase of 4% per share with oil prices at $60 per barrel.