Energy

BP Fires 7,000 but Keeps Dividend

Douglas A. McIntyre

Published: February 2, 2016 6:52 am

Last Updated: January 13, 2020 1:47 pm

BP PLC (NYSE: BP), the oil giant that is barely clear of its Deepwater Horizon oil leak debacle, said it would fire 7,000 people as it posted a net loss. It will, however, maintain its dividend.

Results were horrible, primarily due to falling oil prices:

BP today reported its results for the full year and fourth quarter of 2015. Underlying replacement cost profit(1) for the full year was $5.9 billion, compared with $12.1 billion reported for 2014, down 51%. The underlying result for the fourth quarter was $196 million compared with $2.2 billion for the fourth quarter of 2014.

1. Underlying replacement cost profit is adjusted for non-operating items and fair value accounting effects.

As to the specific price of oil:

The Brent crude oil marker price averaged $44 a barrel in 4Q 2015 compared with $77 a year earlier, and the average Henry Hub US gas marker price was $2.27 per million British thermal units compared with $4.04 in 4Q 2014.

Also, layoffs:

BP has taken around $1.5 billion in restructuring charges over the past five quarters; this total is expected to approach $2.5 billion by the end of 2016. BP expects to reduce the number of staff and contractor roles in the Upstream segment by around 4,000 during 2016 and by up to 3,000 from the Downstream by the end of 2017.

Finally:

BP also today announced a dividend of 10 cents per ordinary share for the quarter, payable in March. The dividend remains unchanged.

Take the dividend over people’s jobs every time.