BP beats expectations despite post-Deepwater disposals BP turned in first-quarter results that beat market expectations by $1bn, thanks to rising production in high-margin areas and a strong contribution from its trading arm. First-quarter profit was $4.2bn, down 9 per cent on a year ago. Consensus estimates had put first-quarter profit at $3.27bn. Bob Dudley, chief executive, said the results "represent a strong start to 2013 across all of our businesses." But they also underscored the ongoing effects of the company's $38bn asset disposal programme, carried out in the wake of the 2010 Deepwater Horizon disaster, which has sharply reduced the size of the company and weighed on production. Output of oil and gas was down year-on-year, despite a ramp-up in production at the end of last year in profitable areas such as Angola and the North Sea. Operating cash flow in the quarter was $4bn, compared with $3.4bn a year ago. BP said that showed the company was on track to meet one of its key performance goals - increasing cash flow to $30bn-$31bn next year, 50 per cent up on the 2011 figure. The company has made big progress on resolving some of the issues that have weighed on its share price in recent years. It finally extricated itself from its troubled Russian joint venture TNK-BP last year, selling its 50 per cent stake to the Russian national energy champion Rosneft in a $27.5bn deal that closed in March. In the US, there is also light at the end of the tunnel, with the first phase of the civil trial over the Gulf of Mexico disaster ending this month. BP said the evidence and testimony presented at the trial, which will establish liability for damages and penalties, "confirms that it was not grossly negligent and that the accident was the result of multiple causes, involving multiple parties." The company has sought to woo investors with an $8bn share buyback, announced after the TNK-BP deal completed. It said that as of April 26, it had bought back 120m shares for a total of $834m. It said it would retain the balance of the cash from the transaction to reduce net debt, which fell to $17.7bn at the end of the quarter - equivalent to a gearing level of 11.9 per cent. That is at the bottom of BP's 10-20 per cent target range. However, despite the good news, BP's share price has been in the doldrums - about 30 per cent lower than it was before the Gulf disaster. In early London trading on Tuesday, the shares rose 2.6 per cent to 468.6p. The TNK-BP deal left BP with a 20 per cent stake in Rosneft. But it was only able to record a contribution from the Russian oil group after March 21, when the TNK-BP sale closed, meaning there was little impact on first-quarter results. The company said the 11 days of earnings from Rosneft were estimated at $85m. BP said its production of oil and gas excluding TNK-BP and Rosneft was 2.33m barrels of oil equivalent a day, 5 per cent lower than the same period in 2012, primarily due to divestments. It said that following the Rosneft transaction, total oil and gas production was more than 3m boe/d. The group's refining and marketing business benefited from a strong contribution from supply and trading operations in the quarter. The company warned that production in the second quarter would be lower as a result of maintenance activity in areas such as the Gulf of Mexico and the North Sea, as well as the ongoing impact of divestments.