Investors in oil giant BP, whose chairman is Mr Peter Sutherland, received a triple boost from the group's interim results yesterday that showed higher profits, increased dividend and a promise to introduce a share buyback.

BP's "clean" replacement cost net income surged 26 per cent in the second quarter to £738 million from £588 million a year, compared with forecasts of between £580 million and £710 million. Operating profit for the six months to June 30th hit a record £1.495 billion.

The dividend is being raised to 10.75p for the half-year compared with 9.25p a year ago, against earnings per share 20.5p, down from 1996's 23.8p because of exceptional items. The company said the improved result was based on volume increases, savings and improvements in prices.

But the group added: "Though economic exposures arising from foreign exchange fluctuations are hedged, the result expressed in sterling continues to be adversely affected by the strong pound."

The company revealed it would ask shareholders for approval to buy back shares at the next annual meeting in May.