The BP (LSE:BP) share price saw a slight bump in performance following the announcement of its next interim dividend. Existing shareholders on the record since 13 August are set to receive 3.95p per share on 24 September.
There may be some discrepancy between the dividends received for shareholders of the British listing compared to the American listing. This is because the payout is actually being issued in US dollars. As a result, the exchange rate is likely to fluctuate between the date of the announcement and 24 September.
Will the BP dividend cut be reversed?
In 2020, the firm reported a $20.3bn (£14.7bn) loss. As the pandemic forced governments to order strict lockdowns worldwide, most vehicles remained parked at home and many businesses using BP’s product closed down temporarily. Consequently, the collapsing demand for fuel, sent oil prices plummeting, taking the BP share price with it. In order to maintain the firm’s financial health, the management team decided to cut quarterly dividend payments in half last August.
Since then, oil prices have recovered. And according to the latest interim report, the financial performance of BP has improved drastically. Operating income for the first half of 2021 came in at $8.25bn versus a loss of $21.9bn in 2020 and a gain of $4.9bn in 2019. Despite this performance, there has yet to be an official confirmation of whether the dividend cut will be reversed.
Investors are estimated to receive a total dividend of 21.84c by the end of 2021. Based on today’s exchange rates, that is the equivalent of 15.84p per share.
Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.