BP's first-quarter replacement cost (RC) profit was $16,596 million, compared with $4,781 million for the same period in 2012. After adjusting for a net gain from non-operating items of $12,424 million and net unfavourable fair value accounting effects of $43 million (both on a post-tax basis), underlying RC profit for the first quarter was $4,215 million, compared with $4,651 million for the same period in 2012. RC profit or loss for the group, underlying RC profit or loss and fair value accounting effects are non-GAAP measures and further information is provided on pages 2, 17 and 19.
Non-operating items for the first quarter on a pre-tax basis amounted to a net gain of $12,401 million, primarily relating to the gain on disposal of our interest in TNK-BP. All amounts relating to the Gulf of Mexico oil spill have been treated as non-operating items, with a minimal net impact on the results this quarter. For further information on the Gulf of Mexico oil spill and its consequences see page 11, Note 2 on pages 23 - 27 and Legal proceedings on pages 32 - 33.
Including the impact of the Gulf of Mexico oil spill, net cash provided by operating activities for the first quarter was $4.0 billion, compared with $3.4 billion in the same period of 2012. Excluding amounts related to the Gulf of Mexico oil spill, net cash provided by operating activities for the first quarter was $4.3 billion, compared with $4.6 billion a year ago.
Net debt at the end of the quarter was $17.7 billion, compared with $31.0 billion a year ago, with the decrease driven primarily by a net cash inflow of $11.8 billion from the sale of our interest in TNK-BP to Rosneft. The ratio of net debt to net debt plus equity at the end of the quarter was 11.9% compared with 20.6% a year ago. Net debt and the ratio of net debt to net debt plus equity are non-GAAP measures. See page 3 for more information.
The effective tax rate (ETR) on replacement cost profit for the first quarter was 14%, compared with 34% for the same period in 2012. The low rate for the first quarter 2013 reflects the fact that the gain on disposal of TNK-BP is expected to be exempt from UK corporation tax under the provisions of the substantial shareholdings exemption introduced for UK companies in 2002. Adjusting for non-operating items and fair value accounting effects, the underlying ETR in the first quarter of 2013 was 39% compared with 33% in the first quarter of 2012. The increase was mainly due to a reduction in equity-accounted earnings (which are reported net of tax) as a result of the TNK-BP disposal.
Total capital expenditure for the first quarter was $17.7 billion, of which organic capital expenditure(d) was $5.7 billion, with the remainder relating to our investment in Rosneft (see below for further information). Disposal proceeds received in cash were $18.3 billion for the quarter.
Finance costs and net finance expense relating to pensions and other post-retirement benefits were a charge of $404 million for the first quarter, compared with $405 million for the same period in 2012.
On 21 March, BP and Rosneft completed transactions for the sale and purchase of BP's 50% interest in TNK-BP for $16.7 billion in cash and 12.84% of Rosneft shares. BP used $4.9 billion of the cash consideration to acquire 5.66% of Rosneft shares from Rosneftegaz. Together with its existing 1.25% shareholding in the company, BP now holds a 19.75% stake in Rosneft, Russia's largest oil company. See pages 9 and 28 for more information.
On 22 March, BP announced its intention to carry out a share repurchase programme with a total value of up to $8 billion over 12-18 months. As at 26 April, BP had bought back 120 million shares for a total amount of $834 million, including fees and stamp duty.
BP today announced a quarterly dividend of 9 cents per ordinary share ($0.54 per ADS), which is expected to be paid on 21 June 2013. The corresponding amount in sterling will be announced on 10 June 2013. A scrip dividend alternative is available, allowing shareholders to elect to receive their dividend in the form of new ordinary shares and ADS holders in the form of new ADSs. Details of the scrip dividend programme are available at bp.com/scrip.
