Tuesday preview: BP reports fourth quarter results

BP is expected to report an increase in earnings in its fourth quarter results on Tuesday as oil prices recover.

UBS sees the oil giant posting earnings of $533m, up from $258m the same period a year earlier.

Production is forecast to fall to 3,314 barrels of oil equivalent per day (boepd) from 3,398 in the fourth quarter of 2015. Earnings per share is predicted to rise to 2.8 cents from 1.4 cents the previous year.

UBS expects BP’s joint venture with Russia’s Rosneft in Siberian fields will benefit from higher oil prices.

However, the exploration and production (E&P) division is unlikely to show the full effect of improved oil prices due to cost phasing and an increase in underlying exploration costs, UBS said.

E&P will also be hit by higher depreciation, depletion and amortisation charges resulting from the impairment write-backs recorded at the third quarter.

The refining and marketing unit is “not as strong as might be expected”, UBS added, due to a number of refineries in maintenance, including the company’s most important at Whiting, Indiana.

“Standard guidance is to expect a lower contribution from trading in 4Q but as with Shell we would not be surprised to see a stronger result given the volatile market around the OPEC meeting was entirely predictable,” UBS said.

“Tax owes much to guesswork but we modelled 25%, below a more 'normal' 30-35%, but closer to something recognisable than anything we have seen for perhaps four quarters.”

Tuesday 07 February

INTERIMS
Mattioli Woods

INTERIM DIVIDEND PAYMENT DATE
Johnson Matthey, Workspace Group

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Industrial Production (GER) (07:00)

FINALS
BP, BP, Plus500 Ltd (DI), RM, St. Modwen Properties

AGMS
Dewhurst, UDG Healthcare Public Limited Company

TRADING ANNOUNCEMENTS
UDG Healthcare Public Limited Company

FINAL DIVIDEND PAYMENT DATE
Mitchells & Butlers, On The Beach Group