Shell Profit Soars on Oil Recovery -- Update
April 26 2018 - 2:12AM
Dow Jones News
By Sarah Kent
LONDON -- Royal Dutch Shell PLC on Thursday reported its highest
quarterly profit since 2013, as higher oil prices and years of cost
cutting boosted earnings.
The Anglo-Dutch oil giant said its first-quarter profit on a
current cost-of-supplies basis -- a number similar to the net
income that U.S. oil companies report -- rose 69% from a year
earlier to $5.7 billion.
The company delivered more than $5 billion in free cash flow --
a newly important metric for investors concerned about big oil
companies' ability to finance their dividends after the oil price
collapsed in 2014.
In other signs of an improving financial outlook, Shell said it
had completed $26 billion of its $30 billion divestment program,
which began in 2016 to help pay down debt taken on during the
company's $50 billion acquisition of BG Group. The company said it
is on track to buy back at least $25 billion worth of shares by
2020, but gave no indication when the previously flagged program
would begin.
Shell is the biggest oil company yet to report results for the
quarter -- a period where the industry has everything to prove.
After years of retrenchment, investors are expecting companies to
deliver billions of dollars in free cash flow, buoyed by rising oil
prices and stringent cost cuts.
Exxon Mobil Corp. and Chevron Corp. are due to publish their
first-quarter results Friday. BP PLC reports on May 1.
Write to Sarah Kent at sarah.kent@wsj.com
(END) Dow Jones Newswires
April 26, 2018 02:57 ET (06:57 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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