OIL giant BP made £4billion of profits in the first three months of the year, sparking a fresh debate about how firms have cashed in on the energy crisis.
The mega profits — equivalent to about £45million a day — beat City expectations by more than half a billion pounds, as Labour called once more for a stricter windfall tax.
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The bumper sum led BP to use some of its extra cash to buy back £1.4billion of shares.
In the past year, BP has spent £3.9billion on share buybacks, leading think-tank IPPR to argue the firm is “transferring an outrageous sum of wealth from households to investors”.
BP said the “strong performance” was boosted by its “exceptional” trading arm, where employees bet on the swinging prices of oil and other commodities, rather than producing or digging natural resources.
But BP has been accused of profiteering off inflated energy prices, prompted by Russia’s invasion of Ukraine.
It comes as many homes and businesses struggle to pay higher bills, despite Government support for energy costs totalling £70billion.
Bernard Looney, CEO of BP, recently pocketed a £10million pay packet after record profits.
BP tried to downplay its gains by saying it will pay £800million in UK windfall taxes this year.
It comes a year after the Government began the Energy Profits Levy — but Labour, the Liberal Democrats and energy campaigners say it does not go far enough.
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The levy is now set at 35 per cent, taking the total tax on the proceeds of North Sea oil and gas companies to 75 per cent.
However, BP and other firms gain sizeable tax reductions, while most overseas profits are not covered by the windfall tax.
Murray Auchincloss, BP finance chief, said: “We know how difficult a time it is.”
But he insisted that tax levels were a matter for governments, not companies.
Despite the boon, BP’s shares fell by 8.8 per cent as investors were disappointed the share buyback wasn’t bigger.
LISTING SHAKE-UP
THE City regulator is planning a shake-up of the UK’s listing rules after a wave of companies snubbed the London Stock Exchange.
The Financial Conduct Authority says it will replace its “standard” and “premium” segments with a single category — as well as encourage early-stage companies to float by being “more permissive on dual-class share structures” which are common in the US.
It will also remove shareholder votes on acquisitions to “reduce frictions to companies pursuing business strategies”.
You give love a Vlad name
THE owner of Tinder and Hinge dating apps has said it will finally break up with Russia — more than a year after the invasion of Ukraine.
Match Group said it was “committed to human rights” and was taking steps to “restrict access” to its services.
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The company plans to pull out of Russia in full by June 30. Tinder has about 3.5million users in the country.
Many firms cut ties after last February’s invasion, including Coca-Cola and Starbucks.
But Mark Dixon, founder of the Moral Rating Agency, said of Match Group’s move: “Tinder is fast for dating action but slow on moral action. What changed in the last year that made it wake up now?
“The silver lining is it’s the kind of exit that sends a message. Unplugging Tinder will be immediately noticed by a million Russians.”
DYSON A.I. STAKE
SIR James Dyson is betting on the future of AI with a £100million technology centre.
The inventor, known for his bagless vacuum cleaner, is hiring hundreds of tech and engineering whizzes.
Experts at the centre, based in Bristol, will work on products for launch ten years into the future. It comes four years after Sir James moved his HQ to Singapore.
The billionaire said: “Software, connectivity, AI and new technology batteries will power the next generation of Dyson technology.”
HSBC BOSS: ‘NO BANKING CRISIS’
THE boss of HSBC played down the risk of another worldwide financial crash — despite four banks failing in the past six weeks.
Noel Quinn said lenders had been putting profits ahead of a “balanced risk appetite”, adding: “We do not believe there is a global banking crisis on the horizon.”
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HSBC said profits had been boosted by £1.2billion from its rescue of Silicon Valley Bank’s UK arm.
On Monday First Republic was swooped on by JP Morgan, while March saw US lender Signature Bank collapse and Credit Suisse saved by UBS.
But HSBC revealed profits had tripled to £10.35billion in the first three months of the year — helping it usher in its first dividend since the pandemic and a £1.6billion buyback which may help to win shareholder support.
PEARSON CHAT WOE
SHARES in education company Pearson, the former owner of the Financial Times, tanked by 14 per cent, as a US rival warned schoolkids are turning to ChatGPT instead of study guides to do homework.
Chegg, which offers study aids and on-demand answers to university questions, has had half its value erased after admitting AI chatbots are hurting its business.
It said: “We believe ChatGPT is having an impact on our new customer growth rate.”
KING-SIZE PULL FOR BREWER
GREENE KING has brewed its own “Coronation Ale” to celebrate the big occasion — and predicts its pubs will pull 1.8million pints over the coming long weekend.
The pub chain said its sales rose by two-thirds to £2.2billion over the past year.
Despite making £98.4million in profits, compared with a £70.4million loss last year, Greene King said that the cost of living crisis was depressing consumer confidence.
Boss Nick Mackenzie said he expected the “tough backdrop” to continue but added: “By focusing on the things we can control…we will continue to do what Greene King does so well, playing a meaningful role in supporting the communities we serve and leading the way in making our industry a better place to work.”
The business plans to continue overhauling its estate and growing new brands, such as Hickory’s Smokehouse barbecue food chain, which it bought last October.
