Global oil company and convenience-store operator bp saw profits drop in second-quarter 2023 compared to the previous quarter. On its second-quarter earnings call, bp reported a $2.6 billion profit, compared to $5 billion the previous quarter. It also gave updates on its convenience and electric vehicle (EV) goals.
The lower profit in the second quarter reflects significantly lower realized refining margins, a significantly higher level of turnaround and maintenance activity, a weak oil trading result, lower gas and oil realizations and an exceptional gas marketing and trading result, although lower than the first quarter, bp said.
“Another quarter of performing while transforming,” CEO Bernard Looney said in a statement. “Our underlying performance was resilient with good cash delivery—during a period of significant turnaround activity and weaker margins in our refining business. We’re delivering our strategy at pace—we’ve started up two major oil and gas projects to help keep energy flowing today and we’re accelerating our transformation through our five transition growth engines. And we’re delivering for shareholders growing our dividend and announcing a further share buyback. This reflects confidence in our performance and the outlook for cash flow, as well as continued progress reducing our share count.”
- bp is No. 7. on CSP's 2023 Top 202 list of largest U.S. c-store chains by store count.
Looney and Murray Auchincloss, bp’s chief financial officer, also noted the company’s growth in convenience.
In the first half of 2023, bp delivered record convenience gross margin with about 7% year-over-year growth, Looney said. This is excluding TravelCenters of America, which bp acquired in May, adding a network of 288 sties to its portfolio.
Auchincloss highlighted bp’s five transition growth engines—bioenergy, convenience, EV charging, hydrogen, and renewables and power—and EBITDA (earnings before interest, taxes, depreciation and amortization) goals for each of those areas.
- Read the CSP September 2022 cover story, bp Rethinks the Future of the Oil Company.
In convenience and EV charging, bp is targeting about $1.5 billion EBITDA in 2025. It expects TA to contribute about $800 million of EBITDA by 2025, the majority from convenience.
“We also expect to further expand our network of strategic convenience sites, reaching around 3,000 by 2025 from around 2,750 today,” Auchincloss said.
Its strategic retail sites are defined as those that sell bp-branded vehicle energy, like bp, Aral, Amoco, Thorntons, TravelCenters of America and bp pulse, and either carry one of these strategic convenience brands or a differentiated convenience offer. Chicago-based bp currently has more than 1,500 U.S. c-store sites.
Strategic convenience sties were up 25% in the first half of 2023 versus the first half of 2022 with bp’s TA acquisition, the company said.
And in EV charging, bp expects to be EBITDA positive by 2025 as it accelerates the roll-out of rapid and ultra-fast EV charge points and drives a material increase in energy sold.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.