Shell logs sliding profits as revenues sink

Issued on: 02/05/2024 - 10:49

1 min

Profit after taxation dropped about 15 percent to $7.4 billion in the first quarter from a year earlier, hit also by accounting charges, Shell said in a results statement.

Turnover slid 16 percent to $74.7 billion following a sharp drop in gas prices, which had spiked following key producer Russia's invasion of Ukraine in 2022.

Adjusted earnings sank almost a fifth to $7.7 billion in the reporting period but this beat market expectations, while cash flow from operating activities hit $13.3 billion.

The group unveiled a fresh $3.5-billion stock buyback and forecast capital expenditure this year would reach between $22 billion and $24 billion.

"Shell delivered another quarter of strong operational and financial performance," said chief executive Wael Sawn in the earnings release.

"We continue to deliver on our... targets, giving us the confidence to commence another $3.5-billion buyback programme for the next three months."

The news sent its share price 1.6 percent higher in early morning deals on the rising London stock market.

"Shell's produced yet another quarter of staggering cash flows," said Derren Nathan, head of equity research at stockbroker Hargreaves Lansdown.

"Higher margins and uptime at its refineries more than offset lower earnings in the upstream and integrated gas divisions.

"The strong cash generation is enabling Shell to reduce debt, reward shareholders and continue investing into the business."

Shell had already warned last month that it expected lower natural gas sales in the first quarter after a particularly strong performance in the final three months of 2023.

© 2024 AFP