DISPITE WINDFALL TAXES
Energy giant Shell announces rise in profits
AFP
Thu, 2 November 2023
Energy majors are benefiting from elevated oil prices (Paul ELLIS)
British energy giant Shell on Thursday said net profit rose 4.5 percent to $7 billion in the third quarter from a year earlier, as it benefits from high oil prices.
"Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets," chief executive Wael Sawan said in a statement.
"We continue to simplify our portfolio while delivering more value with less emissions," he added in an earnings statement.
Energy majors are benefiting from elevated oil prices, which are being fuelled by concerns the Israel-Hamas conflict could widen across the crude-rich Middle East.
Shell also announced a fresh buyback of shares worth $3.5 billion.
Adjusted earnings in the third quarter stood at $6.2 billion, up compared with the second quarter, on "robust operational performance and higher oil prices and refining margins".
Over the first nine months of 2023 Shell's profit was however down sharply, reflecting lower oil prices year-on-year.
Crude futures had soared at the start of 2022 following the invasion of Ukraine by major oil producer Russia.
After later falling somewhat, they are once more on the rise owing to fears of escalation in the Israel-Hamas conflict.
bcp/ach
Shell profits boosted by oil and gas amid green energy losses
Jonathan Leake
Thu, 2 November 2023
shell
Shell’s profits hit $6.2bn (£5.1bn) in the third quarter, as the energy giant was boosted by its oil and gas production.
The company said the results were driven by rising oil prices, which cancelled out a drop-off in its renewables division where the company posted a $67m loss.
It comes as Shell doubles down on its fossil fuels strategy in a bid to increase profits.
The latest profits were higher than the $5.1bn (£4.2bn) recorded in the previous quarter but down on the $9.5bn earned over the same period last year.
Thursday’s figures also revealed a $3.5bn share buyback, which will take the total handed to investors in 2023 up to $23bn.
Shell’s latest results revealed $2.5bn profits from its gas operations and a further $2.2bn from its upstream oil plants. It also posted $1.4bn across its chemicals division.
Wael Sawan, Shell’s chief executive, said: “Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets.”
He also hailed the accelerated share buyback programme, which is linked to the belief that Shell’s shares are underpriced compared to American rivals.
Those tensions have been exacerbated by the recent mega-mergers in the US, such as last month’s deal between ExxonMobil and Pioneer Natural Resources and Chevron’s $60bn acquisition of Hess Corporation.
Shell also confirmed in Thursday’s announcement that it was cutting capital expenditure by about $2bn a year to release more money for dividends.
Sinead Gorman, Shell’s chief financial officer said: “We set out a path to increase shareholder value. We continue to maintain discipline and have taken the decision to further lower our 2023 cash capital expenditure outlook to $23bn-25bn.”
Ms Gorman said Shell was also striving to simplify the business, which comes after it recently axed 200 jobs across its low-carbon division and sold off its retail energy arm.
She said: “We have agreed to sell our home energy business in the UK and Germany.
“And following the strategic review we announced earlier this year, divestment is the priority focus for our Singapore refining and chemical assets at the moment.
“These have not been easy decisions. But these are necessary steps to further simplify and focus our portfolio.”
The company’s continued profits from oil and gas prompted criticism from environmental groups.
Jonathan Noronha-Gant, a campaigner at Global Witness, said: ‘’Shell’s shareholders remain some of the biggest winners of Russia’s brutal war in Ukraine and ongoing global instability.
Shell posts $6.2 billion third-quarter profit, announces $3.5 billion share buyback
By Jenni Reid,CNBC • Published November 2, 2023
Frederic J. Brown | Afp | Getty Images
People pump gas into their vehicles at a Shell petrol station on October 2, 2023 in Alhambra, California.
Shell on Thursday reported $6.2 billion profit for the third quarter, roughly in line with estimates.
Profit was higher than the $5.1 billion of the second quarter, but marked a sharp decline from the $9.45 billion reported a year ago.
British oil giant Shell on Thursday reported $6.2 billion profit for the third quarter, roughly in line with estimates, as the company benefited from higher oil prices and refining margins.
Analysts expected adjusted earnings of $6.48 billion, according to an LSEG-compiled consensus.
Profit was higher than the $5.1 billion of the second quarter, but marked a sharp decline from the $9.45 billion reported a year ago, when the Russia-Ukraine conflict bolstered oil and gas prices.
The company also announced a $3.5 billion share buyback to be carried out over the next three months. Shell CEO Wael Sawan said the $6.5 billion set for the second half of the year was now "well in excess" of the $5 billion announced in June.
"Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets," Sawan said in a statement.
Free cash flow fell from $12.1 billion in the second quarter to $7.5 billion. Cash capital expenditure rose from $5.1 billion to $5.6 billion.
Energy majors are coming off the back of a record year for profits, which was fuelled by soaring fossil fuel prices.
Oil prices have again risen sharply through the third quarter 2023 on the back of factors including Saudi Arabian and Russian supply cuts, while the International Energy Agency has said oil markets will remain on edge amid the escalation in conflict in the Middle East.
BP on Tuesday posted a year-on-year fall in third-quarter profit from $8.15 billion to $3.293 billion, below analyst estimates, though France's TotalEnergies slightly outperformed last week.
While BP said its muted quarterly performance was partly due to weakness in gas marketing and trading, Shell said performance in its integrated gas division was steady, noting favorable trading.
Shell's renewables and energy solutions division meanwhile reported a $67 million loss, which it attributed to weaker margins due to seasonal effects and lower trading. Capital expenditure was $659 million.
The results come amid criticism over the pace of the company's decarbonization program, including from groups of its own shareholders.
Shell confirmed last week that it will cut 200 positions within its low-carbon solutions unit in 2024.
"Another share buyback should be good news for shareholders, but there is little said about its plans to achieve net zero in today's update – this remains a longer term concern for many, after the company announced its decision to focus on oil and gas production earlier this year," Stuart Lamont, investment manager at RBC Brewin Dolphin, said in a note.
"With the geopolitical environment still volatile, oil prices look likely to continue recent rises which should mean a strong final quarter for Shell."
London-listed shares of Shell were 1.1% higher at 8:30 a.m. on Thursday.
Also on CNBC
People pump gas into their vehicles at a Shell petrol station on October 2, 2023 in Alhambra, California.
Shell on Thursday reported $6.2 billion profit for the third quarter, roughly in line with estimates.
Profit was higher than the $5.1 billion of the second quarter, but marked a sharp decline from the $9.45 billion reported a year ago.
British oil giant Shell on Thursday reported $6.2 billion profit for the third quarter, roughly in line with estimates, as the company benefited from higher oil prices and refining margins.
Analysts expected adjusted earnings of $6.48 billion, according to an LSEG-compiled consensus.
Profit was higher than the $5.1 billion of the second quarter, but marked a sharp decline from the $9.45 billion reported a year ago, when the Russia-Ukraine conflict bolstered oil and gas prices.
The company also announced a $3.5 billion share buyback to be carried out over the next three months. Shell CEO Wael Sawan said the $6.5 billion set for the second half of the year was now "well in excess" of the $5 billion announced in June.
"Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets," Sawan said in a statement.
Free cash flow fell from $12.1 billion in the second quarter to $7.5 billion. Cash capital expenditure rose from $5.1 billion to $5.6 billion.
Energy majors are coming off the back of a record year for profits, which was fuelled by soaring fossil fuel prices.
Oil prices have again risen sharply through the third quarter 2023 on the back of factors including Saudi Arabian and Russian supply cuts, while the International Energy Agency has said oil markets will remain on edge amid the escalation in conflict in the Middle East.
BP on Tuesday posted a year-on-year fall in third-quarter profit from $8.15 billion to $3.293 billion, below analyst estimates, though France's TotalEnergies slightly outperformed last week.
While BP said its muted quarterly performance was partly due to weakness in gas marketing and trading, Shell said performance in its integrated gas division was steady, noting favorable trading.
Shell's renewables and energy solutions division meanwhile reported a $67 million loss, which it attributed to weaker margins due to seasonal effects and lower trading. Capital expenditure was $659 million.
The results come amid criticism over the pace of the company's decarbonization program, including from groups of its own shareholders.
Shell confirmed last week that it will cut 200 positions within its low-carbon solutions unit in 2024.
"Another share buyback should be good news for shareholders, but there is little said about its plans to achieve net zero in today's update – this remains a longer term concern for many, after the company announced its decision to focus on oil and gas production earlier this year," Stuart Lamont, investment manager at RBC Brewin Dolphin, said in a note.
"With the geopolitical environment still volatile, oil prices look likely to continue recent rises which should mean a strong final quarter for Shell."
London-listed shares of Shell were 1.1% higher at 8:30 a.m. on Thursday.
Also on CNBC
FTSE 100: Shell launches $3.5bn share buyback as profits hit $6.2bn
Pedro Goncalves
·Finance Reporter, Yahoo Finance UK
Thu, 2 November 2023
Shell shareholder rewards hit $23bn for the year. Photo: Sergei Karpukhin/Reuters (Sergei Karpukhin / reuters)
Shell (SHEL.L) will hand its shareholders $3.5bn (£2.9bn) in share buybacks as it reported quarterly profit of $6.2bn (£5.1bn), helped by oil prices rising again.
The London-listed oil and gas producer said its adjusted earnings fell 34% in the three months to September with a year earlier, landing at a little over 6.2bn (£5.1bn).
Shell said that while it would keep its dividend unchanged at $0.331 per share, it was to raise awards via share buybacks.
Shell plc (SHEL.L)
View quote details
Chief executive officer, Wael Sawan, said the oil company would hand shareholders $6.5bn in share buybacks over the second half of the year, “well in excess of the $5bn announced at Capital Markets Day in June”.
Read more: FTSE and European stocks higher ahead of BoE interest rate call
In total, the company’s shareholder payouts for 2023 stand at $23bn, he said.
"Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets,” Sawan said.
"We continue to simplify our portfolio while delivering more value with less emissions," he added.
The size of the payouts was criticised by Jonathan Noronha-Gant a campaigner at Global Witness.
“Shell’s shareholders remain some of the biggest winners of Russia’s brutal war in Ukraine and ongoing global instability.
Read more: What are share repurchases?
“The turmoil in fossil fuel markets allows Shell to rake in enormous profits – but instead of investing in clean energy, the company has doubled down on oil, gas, and shareholder pay-outs.”
This summer Shell abandoned its target to reduce oil production by 1-2% every year until 2030, saying it had met the target early by selling off some of its assets meaning another company, not it, is responsible for the oil fields.
Read more: Bank of England set to keep UK interest rates on hold
The company has also confirmed that it will cut 200 positions within its low-carbon solutions unit in 2024.
“Another share buyback should be good news for shareholders, but there is little said about its plans to achieve net zero in today’s update – this remains a longer term concern for many, after the company announced its decision to focus on oil and gas production earlier this year,” Stuart Lamont, investment manager at RBC Brewin Dolphin, said in a note.
“With the geopolitical environment still volatile, oil prices look likely to continue recent rises which should mean a strong final quarter for Shell.”
BP (BP.L) on Tuesday posted a year-on-year fall in third-quarter profit from $8.15bn to $3.29bn.
Watch: Shell Accelerates Pace of Share Buybacks as 3Q Profit Rises
Download the Yahoo Finance app, available for Apple and Android.
Pedro Goncalves
·Finance Reporter, Yahoo Finance UK
Thu, 2 November 2023
Shell shareholder rewards hit $23bn for the year. Photo: Sergei Karpukhin/Reuters (Sergei Karpukhin / reuters)
Shell (SHEL.L) will hand its shareholders $3.5bn (£2.9bn) in share buybacks as it reported quarterly profit of $6.2bn (£5.1bn), helped by oil prices rising again.
The London-listed oil and gas producer said its adjusted earnings fell 34% in the three months to September with a year earlier, landing at a little over 6.2bn (£5.1bn).
Shell said that while it would keep its dividend unchanged at $0.331 per share, it was to raise awards via share buybacks.
Shell plc (SHEL.L)
View quote details
Chief executive officer, Wael Sawan, said the oil company would hand shareholders $6.5bn in share buybacks over the second half of the year, “well in excess of the $5bn announced at Capital Markets Day in June”.
Read more: FTSE and European stocks higher ahead of BoE interest rate call
In total, the company’s shareholder payouts for 2023 stand at $23bn, he said.
"Shell delivered another quarter of strong operational and financial performance, capturing opportunities in volatile commodity markets,” Sawan said.
"We continue to simplify our portfolio while delivering more value with less emissions," he added.
The size of the payouts was criticised by Jonathan Noronha-Gant a campaigner at Global Witness.
“Shell’s shareholders remain some of the biggest winners of Russia’s brutal war in Ukraine and ongoing global instability.
Read more: What are share repurchases?
“The turmoil in fossil fuel markets allows Shell to rake in enormous profits – but instead of investing in clean energy, the company has doubled down on oil, gas, and shareholder pay-outs.”
This summer Shell abandoned its target to reduce oil production by 1-2% every year until 2030, saying it had met the target early by selling off some of its assets meaning another company, not it, is responsible for the oil fields.
Read more: Bank of England set to keep UK interest rates on hold
The company has also confirmed that it will cut 200 positions within its low-carbon solutions unit in 2024.
“Another share buyback should be good news for shareholders, but there is little said about its plans to achieve net zero in today’s update – this remains a longer term concern for many, after the company announced its decision to focus on oil and gas production earlier this year,” Stuart Lamont, investment manager at RBC Brewin Dolphin, said in a note.
“With the geopolitical environment still volatile, oil prices look likely to continue recent rises which should mean a strong final quarter for Shell.”
BP (BP.L) on Tuesday posted a year-on-year fall in third-quarter profit from $8.15bn to $3.29bn.
Watch: Shell Accelerates Pace of Share Buybacks as 3Q Profit Rises
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