Shell’s profit drops on weaker refining margins
Shell’s earnings fell slightly last quarter after profit margins declined at its refining business amid weaker global demand for oil.
The oil and gas giant said adjusted earnings were $6.03bn (£4.65bn), down from $6.2bn during the same period last year.
However, the figure comfortably beat a company-provided analyst consensus of $5.4bn (£4.1bn) and Shell confirmed plans for further returns to shareholders via dividends.
Shell said the lower refining margins were partly offset by higher volumes in its integrated gas business.
The company said: “Income attributable to Shell shareholders, compared with the second quarter 2024, reflected lower refining margins, lower realised oil prices and higher operating expenses partly offset by favourable tax movements, and higher Integrated gas volumes.”
It added: “Third quarter 2024 income attributable to Shell shareholders also included unfavourable movements relating to an accounting mismatch due to fair value accounting of commodity derivatives, charges related to redundancy and restructuring, and net impairment charges and reversals. These items are included in identified items amounting to a net loss of $1.3bn (£1bn) in the quarter. This compares with identified items in the second quarter of 2024, which amounted to a net loss of $2.7bn (£2.1bn).”
The company outlined plans to return another $3.5bn (£2.7bn) to shareholders via buybacks over the coming months, in addition to the $3.5bn (£2.7bn) buyback announced alongside the company’s second-quarter numbers.
The company said it would maintain its current dividend policy.
The company reported net debt of $35.2bn (£27.1bn) at the end of the third quarter, down from the $38.4bn (£29.6bn) reported at the end of the second quarter.
Gearing was 15.7 per cent at the end of the third quarter 2024, compared with 17 per cent at the end of the second quarter 2024, mainly driven by lower net debt.
With additional reporting by the Press Association.