BP Amoco's quarterly profit more than doubles

Posted: Tuesday, August 08, 2000

LONDON - BP Amoco PLC posted a 164 percent jump in its second-quarter profit Tuesday, thanks to higher oil and gas prices, better refining margins and continued cost savings.

Earnings from Atlantic Richfield Corp., which BP Amoco acquired in April, also contributed to the performance.

The London-based company reported a second quarter pro forma profit of $3.6 billion, or 17 cents per share, compared with $1.37 billion, or 7 cents per share, in the year-ago quarter.

BP Amoco said it trimmed costs by $1 billion by merging with ARCO, achieving half of its annual target for cost savings. It spent $2.4 billion on capital expenditures, up 35 percent from last year.

``We have achieved a great deal in the last 18 months, integrating all our operation and delivering ahead of schedule on the cost savings we targeted. Now we can do more,'' chief executive Sir John Browne said.

``Our objective is double-digit growth in earnings, on constant assumptions which do not rely on exceptional prices or margins.''

For the first half of the year, the company earned $6.3 billion, or $30.47 per share, up from $2.128 billion, or $10.98 per share, in the first six months of 1999.

BP Amoco shares ended trading at 593 pence ($8.90) each, down 2 percent from Monday's close.

The company's U.S. shares fell $2.375, or 4 percent, to $52.813 in afternoon trading on the New York Stock Exchange.

Quarterly operating profit for exploration and production, BP's biggest line of business, rose to $3.12 billion, up 112 percent from last year's level of $1.47 billion. The business benefitted from higher oil prices and a 51 percent surge in the volumes of gas sold.

Operating profit for the refining and marketing business jumped 128 percent to $1.28 billion, compared to $560 million for the same quarter last year. Refining margins were especially strong in the United States, due to higher gasoline prices.

Browne said the company's short-term outlook was ``broadly positive,'' with crude prices firm but volatile.

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