Interim Results Part 3

BP PLC 30 July 2002 PART 3 BP p.l.c. Group Results Second Quarter and Half Year 2002 London 30 July 2002 INVESTOR RELATIONS SUPPLEMENT REPLACEMENT COST OPERATING PROFIT ADJUSTED FOR SPECIAL ITEMS(a) AND ACQUISITION AMORTIZATION(b) Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million Exploration and Production 1,009 809 768 UK 1,577 2,192 190 152 172 Rest of Europe 324 416 1,620 665 1,047 USA 1,712 4,137 1,099 774 902 Rest of World 1,676 2,309 ----------------------- -------------- 3,918 2,400 2,889 5,289 9,054 ----------------------- -------------- Gas, Power and Renewables 37 2 1 UK 3 47 35 47 35 Rest of Europe 82 98 86 (25) 13 USA (12) 111 3 87 65 Rest of World 152 5 ----------------------- -------------- 161 111 114 225 261 ----------------------- -------------- Refining and Marketing 10 (27) 39 UK 12 18 241 165 272 Rest of Europe 437 403 1,357 17 238 USA 255 2,052 154 132 136 Rest of World 268 283 ----------------------- -------------- 1,762 287 685 972 2,756 ----------------------- -------------- Chemicals (33) (31) 12 UK (19) (83) 19 49 80 Rest of Europe 129 99 (1) 53 89 USA 142 12 24 37 65 Rest of World 102 62 ----------------------- -------------- 9 108 246 354 90 ----------------------- -------------- Other businesses and corporate (44) (44) (75) UK (119) (120) 8 1 6 Rest of Europe 7 (12) (62) (83) (44) USA (127) (120) (18) 1 (15) Rest of World (14) 21 ----------------------- -------------- (116) (125) (128) (253) (231) ----------------------- -------------- 5,734 2,781 3,806 6,587 11,930 ======================= ============== (a) Acquisition amortization is depreciation and amortization relating to the fixed asset revaluation adjustments and goodwill consequent upon the ARCO and Burmah Castrol acquisitions. (b) The special items refer to non-recurring charges and credits. The special items for the second quarter comprise restructuring charges for Exploration and Production and Chemicals, business interruption insurance proceeds and costs related to a pipeline incident in Refining and Marketing, Veba, Solvay and Erdolchemie integration costs and an adjustment to the North Sea deferred tax balance for the supplementary UK corporation tax rate. ACQUISITION AMORTIZATION BY BUSINESS Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million Exploration and Production 39 32 37 UK 69 68 420 281 268 USA 549 826 32 32 36 Rest of World 68 67 ----------------------- ------------- 491 345 341 686 961 ----------------------- ------------- Refining and Marketing 98 97 100 UK 197 202 91 96 96 USA 192 188 ----------------------- ------------- 189 193 196 389 390 ----------------------- ------------- 680 538 537 Total acquisition amortization 1,075 1,351 ======================= ============= SPECIAL ITEMS BY BUSINESS (PRE-TAX) Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million Exploration and Production - 50 82 UK 132 - - - - Rest of Europe - - - 62 8 USA 70 - - 15 - Rest of World 15 - ----------------------- ------------- - 127 90 217 - ----------------------- ------------- Gas, Power and Renewables - - - UK - - - - - Rest of Europe - - - - - USA - - - - - Rest of World - - ----------------------- ------------- - - - - - ----------------------- ------------- Refining and Marketing 28 - - UK - 43 64 26 23 Rest of Europe 49 90 4 - (137) USA (137) 8 13 - - Rest of World - 21 ----------------------- ------------- 109 26 (114) (88) 162 ----------------------- ------------- Chemicals - - 22 UK 22 - - 2 16 Rest of Europe 18 - - 30 5 USA 35 - - - - Rest of World - - ----------------------- ------------- - 32 43 75 - ----------------------- ------------- Other businesses and corporate - - - UK - - - - - Rest of Europe - - - - - USA - - - - - Rest of World - - ----------------------- ------------- - - - - - ----------------------- ------------- 109 185 19 Total special items before interest 204 162 50 - - Interest - bond redemption charges - 60 ----------------------- ------------- 159 185 19 Total 204 222 ======================= ============= PER SHARE AMOUNTS Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= Shares in issue at period 22,479 22,456 22,463 end (million) 22,463 22,479 3,747 3,743 3,744 - ADS equivalent (million) 3,744 3,747 Average number of shares 22,448 22,403 22,427 outstanding (million)* 22,415 22,461 3,741 3,734 3,738 - ADS equivalent (million) 3,736 3,744 ----------------------- ------------- Replacement cost profit after 2,701 854 1,509 exceptional items ($m) 2,363 5,769 12.03 3.81 6.73 cents/ordinary share 10.54 25.68 0.72 0.23 0.40 dollars/ADS 0.63 1.54 ----------------------- ------------- Replacement cost profit before 2,648 924 1,293 exceptional items ($m) 2,217 5,649 11.80 4.12 5.77 cents/ordinary share 9.89 25.15 0.71 0.25 0.34 dollars/ADS 0.59 1.51 ----------------------- ------------- Pro forma result adjusted 3,431 1,582 2,181 for special items ($m) 3,763 7,143 15.29 7.06 9.72 cents/ordinary share 16.78 31.80 0.92 0.42 0.59 dollars/ADS 1.01 1.91 ----------------------- ------------- * Excludes shares held by the Employee Share Ownership Plans. REPLACEMENT COST OPERATING PROFIT ADJUSTED FOR NON-CASH CHARGES AND CERTAIN OTHER ITEMS Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million Replacement cost operating profit 4,945 2,058 3,250 (reported) (a) 5,308 10,417 2,130 2,153 2,227 Depreciation and amounts provided (b) 4,380 4,297 22 59 147 Exploration expenditure written off 206 130 Dividends from JVs and associates (69) (122) (115) less share of RCOP (237) (278) (5) (13) (3) Dividends paid to minority shareholders (16) (5) 212 (69) (48) Adjust provisions to cash basis (c) (117) 71 Adjust interest and other income (38) (13) (3) to cash basis (d) (16) (42) ----------------------- ------------- 7,197 4,053 5,455 9,508 14,590 (2,379) (577) (869) Tax paid adjusted for certain items* (1,446) (2,476) ----------------------- ------------- 4,818 3,476 4,586 Adjusted RCOP after tax paid 8,062 12,114 ----------------------- ------------- * Calculation of tax paid adjusted for certain items (2,382) (445) (927) Cash tax paid (1,372) (2,521) 118 (39) 160 Tax charge on exceptional items 121 269 (115) (93) (102) Tax shield assumption + (195) (224) ----------------------- ------------- (2,379) (577) (869) (1,446) (2,476) ----------------------- ------------- + Calculation of tax shield assumption (384) (309) (342) Interest paid (651) (745) 30% 30% 30% Tax rate assumption (e) 30% 30% ----------------------- ------------- (115) (93) (102) (195) (224) ----------------------- ------------- (a) Total replacement cost operating profit is before exceptional items, stock holding gains and losses and interest expense. (b) Includes depreciation and amortization relating to the fixed asset revaluation adjustment and goodwill consequent upon the ARCO and Burmah Castrol acquisitions. (c) Calculated as the net of charge for provisions and utilization of provisions. (d) Calculated as interest and other income, less interest received and dividends received from the group cash flow statement. (e) Deemed tax rate for tax shield adjustment is equal to the UK statutory tax rate. RETURN ON AVERAGE CAPITAL EMPLOYED Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million Replacement cost basis 2,648 924 1,293 RC profit before exceptional items 2,217 5,649 441 333 314 Interest 647 887 18 9 52 Minority shareholders' interest 61 26 ----------------------- -------------- 3,107 1,266 1,659 Adjusted RC profit 2,925 6,562 ======================= ============== 86,241 89,594 90,774 Average capital employed 88,356 87,360 14.4% 5.7% 7.3% ROACE - replacement cost basis 6.6% 15.0% ----------------------- ------------- Pro forma basis 3,107 1,266 1,659 Adjusted RC profit 2,925 6,562 680 538 537 Acquisition amortization 1,075 1,351 53 120 367 Special items (post tax) 487 83 86,241 89,594 90,774 Average capital employed 88,356 87,360 Average capital employed 21,334 18,590 18,163 acquisition adjustment 18,455 21,765 ----------------------- ------------- Average capital employed 64,907 71,004 72,611 (pro forma basis) 69,901 65,595 ROACE - Pro forma basis 23.7% 10.8% 14.1% adjusted for special items 12.8% 24.4% ----------------------- ------------ Historical cost basis Historical cost profit (loss) 2,741 1,296 2,040 after exceptional items 3,336 5,571 441 333 314 Interest 647 887 18 40 46 Minority shareholders' interest 86 26 ----------------------- -------------- 3,200 1,669 2,400 Adjusted historical cost profit 4,069 6,484 ======================= ============== 86,241 89,594 90,774 Average capital employed 88,356 87,360 14.8% 7.5% 10.6% ROACE 9.2% 14.8% NET DEBT RATIO - NET DEBT: NET DEBT + EQUITY Second First Second Quarter Quarter Quarter First Half 2001 2002 2002 2002 2001 ======================= ============= $ million 20,498 24,531 21,409 Gross debt 21,409 20,498 1,666 1,665 1,569 Cash and current asset investments 1,569 1,666 ----------------------- -------------- 18,832 22,866 19,840 Net debt 19,840 18,832 ======================= ============= 66,880 67,481 68,126 Equity 68,126 66,880 22% 25% 23% Net debt ratio 23% 22% ----------------------- -------------- 20,933 18,297 18,028 Acquisition adjustment 18,028 20,933 ----------------------- -------------- 29% 32% 28% Net debt ratio - pro forma basis 28% 29% ======================= ============== This information is provided by RNS The company news service from the London Stock Exchange

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