I suppose it's a good thing when a somewhat mixed quarter represents significant progress for a company. That's precisely the situation at BP (NYSE: BP), which saw its bottom nearly fall out last summer, and, by giving us a combination of good news and bad news, has indicated that it's on its way back.
On the plus side of the ledger for the company's quarter, earnings increased 53% to $4.4 billion, compared to $2.88 billion in the last quarter of 2006, but its replacement cost profit -- a measure that removes the effects of changes in inventory valuations -- slipped 24%. Revenues were up 29% to $79.9 billion.
Aside form its purely financial performance in the quarter, BP, which is operating under its still-new CEO Tony Hayward, continues to attempt to dig out from a string of difficulties in the recent past. Included were an explosion in 2005 at its Texas City, Texas, refinery that took 15 lives and injured hundreds, along with pipeline leaks in Alaska and refinery outages in the U.S.
Nevertheless, there does seem to be progress at the company on several fronts. Perhaps most importantly, unlike its other major integrated company peers, including ExxonMobil (NYSE: XOM), Chevron (NYSE: CVX), and Royal Dutch Shell (NYSE: RDS-A) (NYSE: RDS-B), BP managed -- wonder of wonders -- to increase its worldwide liquids production by about 2%. This unique achievement was the result of new or added output from operations in such places as Trinidad, the Gulf of Mexico, Angola, and Egypt.
But, as has been the case with some other integrated companies, including Chevron and Marathon (NYSE: MRO), the refining segment lagged the upside. As a result of both slimmer refining margins, a refinery turnaround, and a non-cash charge associated with exiting the U.S. convenience store business, the company posted a $1.3 billion quarterly loss in the segment.
So overall, BP, which is also increasing its quarterly dividend by 25%, is making notable progress from the downtrodden status it had as recently as last year. And while its relative turnaround is laudable, I'd recommend that, with crude prices slipping, Fools with a taste for energy look more closely for now at the international oilfield services players.
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