Just like peers BP (BP.), Exxon Mobil, Chevron and Total, Royal Dutch Shell (RDSB) reports better than expected first quarter numbers as it benefits from a significant year-on-year increase in oil prices.
Brent crude prices averaged around $54 per barrel in the first quarter of this year compared with just under $34 a barrel in the same period last year.
Shares in the Anglo-Dutch giant are up 2.5% to £21.11, having bumped to four-month lows in late April. Net income is up 142% year-on-year to $3.75bn against a consensus forecast of $3.05bn.
OPERATIONS AND MARKET IMPROVE
The dividend is maintained at $0.47 per share. In the words of chief executive Ben van Beurden: ‘We saw notable improvements in Upstream and Chemicals, which benefited from improved operational performance and better market conditions.’
Significantly free cash flow comes in at an impressive $5.2bn (compared to an outflow of $16.3bn in the first quarter of 2016) which is helping the company to reduce its indebtedness after the $54bn acquisition of BG last February.
The company also remains on track to hit its $30bn asset disposal programme by 2018 having sold $20bn worth of assets since 2016.
Management reiterate plans to invest $25bn in 2017, at the lower end of its long-term spending target.
