Ratio Analysis of Bp Plc

BP p.l.c is one among the world's largest energy companies. The company is considered as a super power in its sector and is third amongst the list of energy companies in terms of production, supplies, turnover and various other factors. Company produces and supplies oil and gas almost all over the globe.

The company became powerful and highly productive after a various number of takeovers, merges and controversies ever since the company was formed as ‘Anglo-Persian Oil Company' in 1909. BP merged and took over various companies such as Amoco, Arco/AMPM, Sohio, Castrol and Aral. Most of the merges and takeover took either at the end of 19th century or at the beginning of 20th century. All this has helped the company to evolve into the present form. Until 31st December 1998, company was registered as British petroleum p.l.c., but after the merger with Amoco, company also included Amoco to its name, which was then again changed back to BP p.l.c in May 2001 and thereby changing its logo to the current one. The present ‘Helios' logo denotes the Greek sun god. And after the merger the tagline was changed to ‘Beyond petroleum' from ‘British petroleum'. The company now aims at meeting the demand for fossil fuel and to manufacture and deliver better products and services to their consumers.

Across the years, the company was also successful in tackling various environmental and political issues including the latest Mexican oil spill in early 2010. The way in which, the company returned to profit after a huge loss caused by the massive spill over the Gulf of Mexico, is remarkable. After understanding the future scope, BP now emphasis on producing less polluting eco-friendly fuels such as solar energy, biogas and natural gas to reduce carbon emission and thus creating a better place to live.

This report is about evaluating the company's performance over the years through various financial and profitability ratios and suggestions and some recommendations which can be beneficial to improve the performance of the company.

 BACKGROUND:

The success of BP is not a result of a night's hard work or an individual effort; rather it is the result of thousands of individuals working as a team for over a decade. The history of the company can easily be segmented under 6 heads, as:

1901 - 1908 as ‘First oil'

1909 - 1924 as ‘Early history'

1925 - 1945 as ‘Through world war 2'

1946 - 1970 as ‘Post war'

1971 - 1999