By Nicholas Earl
Shell has reported another quarter of bumper trading and hefty profits, as the fossil fuel giant revels in historically elevated oil and gas prices this year.
The London-based energy specialist has reported third quarter profits of £8.1bn ($9.45bn) with cash flow from operations clocking in at £10.76bn ($12.5bn) for the three months of summer trading.
These numbers are below the record second quarter of £9.9bn ($11.5bn) earnings and £16.1bn ($18.7bn) cash flow, but still represent hugely robust business for the energy giant.
Shell has further announced its intention to increase the dividend per share for the fourth quarter by an expected 15 per cent – subject to board approval.
It has also unveiled a share buyback programme of £3.44bn ($4bn), expected to be completed by the fourth quarter 2022 results announcement.
Through £15.93bn ($18.5bn) of share buybacks announced in 2022, Shell expects to repurchase some 10 per cent of its share capital.
The company’s net debt increased by £1.64bn ($1.9bn) to £41.58bn ($48.3 billion) in the third quarter, however this includes the absorption of the Sprng energy debt – after it acquired the Indian energy firm earlier this year.
Shell has sought to strengthen its portfolio through a flurry of business activity this year.
Alongside the Sprng Energy acquisition, it has snapped up two stakes in the North Field LNG project in Qatar and announced the purchase of Shell Midstream Partners in the US.
Shell’s chief executive Ben van Beurden said: “We are delivering robust results at a time of ongoing volatility in global energy markets. We continue to strengthen Shell’s portfolio through disciplined investment and transform the company for a low-carbon future. At the same time we are working closely with governments and customers to address their short and long-term energy needs.”
Shell is the first energy giant out the gate with its results for the third quarter, with rivals BP, Chevron, Exxon Mobil, and Saudi Aramco all expected to publish their own updates in the coming days.
Prior to the results, Shell announced earlier this month it expected lower profits due to higher costs of refining and challenging macroeconomic headwinds.
However, the headline results are still highly lucrative for Shell – and are likely to increase Labour’s push for an expansion of the windfall tax.
Shell has committed to spending $25bn on UK energy projects, with 75 per cent of the funds being allocated to low carbon projects.
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