Shell
(Shel)
on
Thursday
announced
a
new
$3.5
billion
(£2.80
billion)
share
buyback,
alongside
lower
first
quarter
earnings
which
nonetheless
beat
market
expectations.
Shares
in
oil
major
rose
1.2%
to
£28.51
in
London.
In
the
first
quarter,
Shell
said
total
revenue,
which
includes
its
share
of
joint
ventures
and
associates,
fell
16%
to
$74.70
billion
from
$89.02
billion
a
year
prior.
Shell’s
pretax
profit
slipped
23%
to
$11.04
billion
from
$14.35
billion
a
year
prior.
Adjusted
earnings
fell
20%
to
$7.73
billion
from
$9.65
billion
a
year
prior,
ahead
of
the
$6.25
billion
Bloomberg-cited
consensus.
Basic
earnings
per
share
fell
9.5%
to
$1.14
from
$1.26.
The
dividend
was
increased
20%
to
$0.344
from
$0.2875.
The
buyback,
pitched
at
the
same
level
as
the
past
two
quarters,
is
expected
to
be
completed
by
the
second
quarter
2024
results
announcement.
Stuart
Lamont,
investment
manager
at
RBC
Brewin
Dolphin,
said:
“Shell
has
beaten
expectations
by
a
reasonable
margin,
despite
the
impact
of
lower
gas
prices
during
the
first
quarter.
Earnings
are
up,
costs
have
fallen,
and
the
oil
and
gas
major
has
brought
debt
down
too
–
all
in
all,
it’s
a
solid
set
of
numbers
and
underlines
why
the
market,
generally,
remains
bullish
on
Shell.
“Investors
were
looking
for
reassurance
on
volumes
and
capital
discipline,
as
these
ultimately
feed
through
to
cash
returns.
Today’s
update
has
delivered
on
both
fronts,
with
the
addition
of
an
extension
to
the
share
buyback
programme.”
Key
Morningstar
Metrics
for
Shell
Stock
•
Fair
Value
Estimate:
£29.00
•
Morningstar
Rating:
3
stars
•
Morningstar
Economic
Moat
Rating:
None
•
Morningstar
Uncertainty
Rating:
High
Shell
Sees
Fall
in
Renewables
Earnings
Chief
executive
Wael
Sawan
commented:
“Shell
delivered
another
quarter
of
strong
operational
and
financial
performance,
demonstrating
our
continued
focus
on
delivering
more
value
with
less
emissions.”
Integrated
Gas
earnings,
which
includes
liquefied
natural
gas,
fuels
and
other
products,
rose
15%
to
$2.76
billion
from
$2.41
billion
a
year
ago.
But
Upstream
earnings,
which
includes
exploration
and
extraction
of
crude
oil,
natural
gas
and
natural
gas
liquids,
declined
19%
to
$2.27
billion
from
$2.79
billion.
Marketing
earnings,
which
includes
the
Mobility,
Lubricants,
and
Sectors
and
Decarbonisation
businesses,
fell
37%
to
$774
million
from
$1.18
billion.
Chemicals
&
Products
earnings,
which
includes
chemicals
manufacturing
plants
and
refineries
which
turn
crude
oil
and
other
feedstocks
into
a
range
of
oil
product,
fell
34%
to
$1.15
billion
from
$1.75
billion.
There
was
also
a
sharp
fall
in
Renewables
&
Energy
Solutions
earnings,
slumping
to
$553
million
from
$2.21
billion
a
year
ago.
For
2024,
Shell
forecast
cash
capital
expenditure
between
$22
to
$25
billion.
It
expects
Integrated
Gas
production
to
be
around
920
to
980
thousand
barrels
of
oil
equivalent
per
day.
LNG
liquefaction
volumes
are
expected
to
be
around
6.8
to
7.4
million
tonnes.
Upstream
production
is
expected
to
be
around
1,630
to
1,830
thousand
boe/d.
Marketing
sales
volumes
are
expected
to
be
approximately
2,700
to
3,200
thousand
b/d.
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