Royal Dutch Shell PLC reported fourth-quarter losses
Today’s blog is by Gayl Southard, Administrative Leader for SafeSourcing Inc.
Royal Dutch Shell PLC reported fourth-quarter losses as the company reals from the pandemic fallout. International oil companies are reporting the worst performance in decades. Energy companies cut spending, cut jobs, and wrote down values of their assets. “Shell on Thursday reported a fourth-quarter loss on a net current-cost-of supplies basis—a figure similar in the income that U.S. oil companies report—of $4.5 billion down from a profit of $871 million in the year-earlier.”1
Shell reported a loss of $19.9 billion for a year, compared to a profit of $15.3 billion in 2019. Other oil companies such as Exxon Mobile, Chevron, and BP also reported losses. Profits were hit by the fall of oil and gas prices and weak refining margins.
Chief Executive Ben van Beurden said he is optimistic that the second half of the year will improve. Oil demand is 5% to 7% below levels in 2019, but should return to those levels in 2022, as the aviation sector recovers. “Shell said it would raise its first-quarter dividends by 4%, in line with the commitment made to shareholders last year of annual increases, after cutting it in April for the first time since World War II by two-thirds.”2 . Shell would like to cut their debt to $65 billion from $75.4 billion by the end of the fourth quarter. That would be down from $79 billion from the previous year.
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1, 2 Sarah McFarlane, WSJ, 2/5/2020