* Q2 underlying net income seen up 21 pct
* Investors seek guidance on post-Macondo strategy
* Shares languishing but takeover seen unlikely
By Tom Bergin
LONDON, July 26 (Reuters) - BP boss Bob Dudley is under pressure to outline his post-oil spill strategy and revive the share price when he unveils second-quarter earnings on Tuesday.
A year after BP staunched the massive leak at its Gulf of Mexico well, investors say Dudley still has not set the company on the road to recovery and that big plans for emerging markets’ growth have failed to impress.
“Investors feel that the company has slightly lost its way,” said Paul Mumford, fund manager at Cavendish Asset Management.
On Tuesday, BP unveils second-quarter earnings, which will reflect a drop in production after it sold some oil fields to pay for the cost of the U.S. spill.
While a 50 percent jump in crude prices is predicted to boost underlying profits 21 percent to $6 billion, the improvement is likely to look anaemic compared with BP’s rivals.
Exxon Mobil and Royal Dutch Shell Plc are forecast to report a 50 percent jump in second-quarter underlying net income.
BP reported a $17 billion headline loss for the second quarter of 2010, due to charges related to cleaning up the Gulf.
This year, Dudley -- named Tony Hayward’s replacement as chief executive at BP’s second-quarter results last year -- announced an emerging markets growth strategy.
It involved a flurry of deals constructed around a centrepiece $16-billion share-swap and multi-billion dollar Arctic exploration deal with Kremlin-controlled Rosneft.
That deal fell apart in the face of opposition from BP’s partners in another Russian venture, TNK-BP. Meanwhile analysts have concluded the other deals in India, China and Indonesia are mostly immaterial and offer only tight margins.
The dealmaking has since dried up, while the spat with its partners in TNK-BP sparked by the Rosneft tie-up flared up again last week, leaving investors uncertain about how it will access new acreage and how it can keep what it’s got.
“(BP) needs to begin to articulate its post-Macondo strategy ... A major disposal programme could lower risk and improve valuation,” Paul Spedding, oil analyst at HSBC, said in an email to clients on Monday.
The London-based company’s shares have gained little in the past nine months, despite progress in the legal cases it faced. Its market capitalisation stands at a 50 percent discount to the value of its assets, analysts at Bank of America Merrill Lynch estimate.
This kind of scenario would normally expose a company to takeover but in BP’s case this seems unlikely. The few companies capable of buying it are likely to be dissuaded by outstanding legal claims against BP, or be blocked by the U.S. government.
Some analysts, bankers and investors are beginning to ask whether the best way for BP to address its valuation discount is to break itself up. (Reporting by Tom Bergin; Editing by David Hulmes)