SHEL Shell Plc

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 a sign of how important cash-flow numbers have become, Shell shares opened down roughly 2% in London after its operating cash flow of $9.4 billion missed expectations.

The company also stopped short of launching an anticipated $25 billion share buyback program, though it is still on track to repurchase at least that much stock by 2020.

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 03:58 ET (07:58 GMT)

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