Shell Slips into Red in Q1, Cuts Dividends
Anglo-Dutch major Shell has followed other European companies in swinging to a loss in the first quarter, according to results published on April 30, on the back of lower oil, gas and LNG prices, weaker refining and chemical margins and lower sales volumes.
The company posted a loss attributable to shareholders of $24mn in the three-month period, versus a $6bn profit a year earlier. Current cost of supplies (CCS) earnings for shareholders sank 48% to $2.76bn, while basic CCS earnings/share were $0.35, versus $0.65 in the first quarter of 2019.
Revenues slumped to $60bn, from $83.74bn. Shell also said that its board had decided to cut quarterly dividends to $16/share, effective from the first quarter. This marks the first time the Anglo-Dutch major has reduced its shareholder dividend since the Second World War.
"Given the continued deterioration in the macroeconomic outlook and the significant and mid and long-term uncertainty, we are taking further prudent steps to bolster our resilience, underpin the strength of our balance sheet and support the long-term value creation of Shell," CEO Ben van Beurden said in a statement.
The upstream was Shell's hardest hit segment, with CCS earnings plummeting to $291mn, from $1.65bn a year earlier. Earnings from chemicals tumbled to $148mn, from $451mn, while earnings from oil products were down to $1.36bn, from $1.45bn. Integrated gas earnings fell to $2.14bn, from $2.57bn.
In the past few days, BP, Italy's Eni and Austrian OMV have all published losses following the collapse in oil demand and energy prices.