Shell profits rise on high oil price

Energy giant Royal Dutch Shell said Thursday that net profits climbed almost 16 percent in the first quarter, boosted by "strong" oil prices and rising output.

Europe's biggest oil company announced that adjusted earnings after tax, which strip out movements in the value of energy inventories and other non-operating items, jumped to $7.28 billion in the three months to March 31.

That compared with $6.29 billion in the first quarter of 2011, and comfortably beat market expectations of $6.75 billion according to analysts polled by Dow Jones Newswires.

Total sales increased by nine percent to $119.92 billion in the reporting period, while oil and gas production rose one percent to 3.552 million barrels of oil equivalent per day. Analysts had predicted output to fall 0.6 percent.

The better-than-expected results sent Shell's share price rallying by more than three percent in morning deals.

"Shell's first quarter 2012 earnings increased from year-ago levels, through a combination of improved operating performance, increased upstream volumes and strong oil prices," said chief executive Peter Voser in the statement.

"Energy demand fundamentals are robust, but with near-term volatility in energy prices as a result of economic and political events."

The oil major added that it expected to raise more than $4.0 billion in asset sales this year, which compared with previous guidance of between $2-3 billion.

Shareholders also received a 2.4-percent increase in their first-quarter dividend from last year, the company added, with the payout rising to 43 cents per ordinary share.

"We are making good progress against our targets to deliver a more competitive performance," Voser said.

"Our profits pay for Shell's dividends and substantial investments in new energy projects, to ensure affordable, reliable energy supplies for our customers, which create value for our shareholders."

Investors applauded the results, sending Shell's 'B' share price rising by 3.2 percent to 2,259 pence on London's FTSE 100 index of leading companies, which was 0.07 percent higher at 5,722.88 points.

"Shell reported net income which at $7.3 billion was circa 10.0 percent ahead of market expectations," noted Deutsche Bank analyst Elaine Dunphy in a research note to clients.

"Looking ahead, with production continuing to ramp we expect that at current oil prices, results will continue to make progress."

World oil prices remain at elevated levels partly because of ongoing concerns over supply disruptions from key crude producer Iran. High oil prices translate into rising revenues and profits for the energy sector.

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • Chronicling the komedya in Antique VERA Files - The Inbox
    Chronicling the komedya in Antique

    By Alex C. Delos Santos, VERA Files The first time Cecile Locsin-Nava, a scholar on cultural studies in Western Visayas, came to Antique around ten years ago was to gather data for a research on the korido, or Philippine narrative … Continue reading → …

  • Ayungin dilemma Ramon Casiple - Parallaxis
    Ayungin dilemma

    China faces a dilemma in Ayungin Shoal and other contested areas. If it waits for the ITLOS—which may decide against it—it would have tacitly bound itself to UNCLOS and risk a rogue state reputation if it asserts its claim in the South China Sea. If its militarily acts now, it may face international isolation. …

  • 48 nabbed in biggest anti-trafficking catch in Bongao VERA Files - The Inbox
    48 nabbed in biggest anti-trafficking catch in Bongao

    By Jake Soriano, VERA Files Bongao, Tawi-tawi—A team of Marines and policemen intercepted around noon Thursday 48 people, 12 of them minors, believed recruited by a human trafficking syndicate for work in Malaysia. The arrest constitutes what advocates called the … Continue reading → …

POLL
Loading...
Poll Choice Options