Shell 2Q Net Profit Fell QoQ, Launches $2 Billion Buyback -- Update
July 29 2021 - 2:34AM
Dow Jones News
By Jaime Llinares Taboada
Royal Dutch Shell PLC on Thursday reported that its net profit
fell in the second quarter from the prior period, and launched a
$2.0 billion buyback.
The Anglo-Dutch energy company made a net profit of $3.43
billion for the three months to June, down from $5.66 billion in
the first quarter. The group booked impairments of $1.8 billion and
charges of $1.2 billion due to the fair value accounting of
commodity derivatives.
However, adjusted earnings on a current cost of supply basis
rose to $5.53 billion from $3.23 billion, beating a market
consensus of $5.07 billion--taken from Vara Research and based on
21 analysts' estimates. The quarter-on-quarter increase reflected
higher oil prices, one-off favorable tax impacts, higher marketing
margins and lower operating expenses, the company said.
In addition, Shell said it will pay a dividend of 0.24 cents a
share for the period, and launched a $2.0 billion share buyback,
which is targeted to be completed by the end of 2021. This is part
of Shell's commitment to increase shareholder distributions to
20%-30% of cash flow from operations, it said.
As for the third quarter of the year, Shell said that due to the
impact of maintenance activities, integrated gas production will
average 870,000-920,000 oil-equivalent barrels per day, with LNG
liquefaction volumes totaling 7.4 million-8.0 million metric tons
over the three months. Upstream production is forecast at 2.10
million-2.25 million oil-equivalent barrels per day.
Refinery utilization is seen at 73%-81%, and sales volumes of
oil products are projected at between 4.3 million and 5.3 million
barrels per day.
As for chemicals, plant utilization is expected at 77%-85%, with
sales volumes of 3.6 million-3.9 million tons.
Shares at 0703 were up 2.7% at 1,443.2 pence.
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
July 29, 2021 03:20 ET (07:20 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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