BP plc · LSE:BP.
BP — Shareholder Meeting (April 2005)
19 slides from BP's shareholder meeting presentation, Apr 14, 2005
Slide 1: Annual General Meeting
Annual General Meeting Thursday 14th April 2005
Slide 2: Cautionary Statement
Cautionary Statement Forward-looking Statements This presentation contains certain forward-looking statements, particularly those regarding possible acquisitions, capital expenditure, development and delivery of business strategy, divestments and disposals, dividends, earnings, future performance, g
Slide 3: Lord Browne, Group Chief Executive
Lord Browne Group Chief Executive
Slide 4: A sustainable long-term future
A sustainable long-term future • Our purpose: - Provide better goods and services, to more people - Deliver shareholder value on a long-term basis • Deliver profitable, consistent and sustainable performance: - Balance long-term growth with returns to shareholders - Attract and retain the best peopl
Slide 5: 2004 Highlights
2004 Highlights • Record profit of $15.4 billion • Strong cash flow of $23 billion • Quarterly dividend up 26% over last year • Share buybacks of over $7.5 billion • Strong financial position: 22% gearing • Disciplined implementation of strategy • Strong base for a sustainable future Data reflect 20
Slide 6: Oil demand and economic growth
Oil demand and economic growth 5 4 3 % 2 1 0 00 01 02 03 04 Oil demand GDP Sources: Oil demand, BP estimate GDP, ’00-’03 Oxford Economic Forecasting and ’04 Consensus Economics 6
Slide 7: Oil supply
Oil supply Non-OPEC output growth OPEC surplus capacity 6 6 million b/d million b/d 4 4 2 2 0 0 00 01 02 03 04 00 01 02 03 04 Note: year-on-year change Note: end year Source: BP Sources: ’00 – ’03 DOE/EIA; ‘04 BP estimate 7
Slide 8: Strategy unchanged
Strategy unchanged • Balance between investment and distributions - Appropriate investment for long term growth • New sources of cash flow - Cash returns at least as good as existing 8
Slide 9: Reserves replacement
Reserves replacement % BP reserve replacement ratio 200 150 100 50 0 94 95 96 97 98 99 00 01 02 03 04 Source: Company reports; subsidiaries only 9
Slide 10: New profit centres: Project start-ups
New profit centres Project start-ups 2004 2005 2006 Mar 04 Current Mar 04 Current Mar 04 Current view view view view view view Atlas ü Mad Dog early 05 ü Atlantis 2006 Methanol early 04 Azeri 2005 ü Dalia 2006 In Salah mid 04 ü Cannonball Thunder Horse 4Q 05 2005 Shah Deniz late 06 Australia LNG Tra
Slide 11: TNK-BP
TNK-BP • Production growing: - 14% in 2004 - 5% in 2005 • Capital spending expanded to develop new prospects • Organisational capability improving - internal controls - planning - safety / environment - application of new technologies 11
Slide 12: Exploration and Production
Exploration and Production • Production on track - 11% growth in ‘04 - 4.1 – 4.2 million boe/d in ‘05 • Capex - $9.5bn - $10bn in ‘05 – ‘06 12
Slide 13: Refining Portfolio
Refining Portfolio US Europe* % BP capacity 54% 33% net cash margin bottom top bottom top quartile quartile quartile quartile return on investment * after divestment of Lavera and Grangemouth 13
Slide 14: Retail: Growth and quality
Retail Growth and quality Global store sales BP ultimate gross margin $bn $k per m2 Index 2002 =100 6 10 500 5 8 400 4 6 300 3 4 200 2 1 2 100 0 0 0 00 01 02 03 04 02 03 04 total sales sales per m2 14
Slide 15: North America gas sales
North America gas sales bcf/d 30 25 wth l gro nnua 20 a % >20 15 10 5 0 00 01 02 03 04 Source: Growth rate CAGR 00-04 15
Slide 16: Olefins & Derivatives
Olefins & Derivatives • New holding entity being formed - Innovene - O&D interests - Lavera and Grangemouth refineries added • Plan to divest - Probably by IPO - From 2H 2005 - Subject to market conditions and necessary approvals 16
Slide 17: Patterns of investment
Patterns of investment $bn 2004 2005 2006 Capital expenditure 13.7 ~14 ~14 Acquisitions 2.8 Divestments (5) (2) (1) Note: TNK-BP 1.25 1.25 1.25 consideration (equity) Source: 2004 actuals; 2005 and 2006 BP current view Data reflect 2005 reporting changes Divestments are shown on a pre-tax basis 17
Slide 18: Dividend increase
Dividend increase • Step change: - from 7.1 cents / share (paid 4Q04) - to 8.5 cents / share (paid 1Q05) Increase per share paid in 1Q05 versus: Investors Paid 4Q04 Paid 1Q04 Dollar 20% 26% Sterling 16% 23% IFRS requires reporting of dividends in period paid 18
Slide 19: Consistent delivery
Consistent delivery • Sustainability - Strong base of material assets and markets • Discipline - Distributing excess cash to shareholders • Momentum - Investing for growth whilst delivering returns 19