Shell shares benefit: Shell earns billions despite Russia write-down

Overall, the company performed better than analysts had expected, despite write-downs related to the withdrawal from the Russian business. The quarterly dividend is expected to rise four percent to $0.25 per share, Shell announced in London on Thursday. In addition, Shell is making progress with the 8.5 billion dollar share buyback program: The remaining 4.5 billion should be spent by the time the figures for the second quarter are presented at the end of July. In London, Shell shares temporarily rose by 3.37 percent to 23.00 pounds.

The bottom line is that Shell earned 7.1 billion dollars (6.7 billion euros). That’s a quarter more than a year ago, but more than a third less than in the previous quarter. However, due to Russia’s invasion of Ukraine, the group decided to shut down its operations in Russia, which has now required write-downs of $3.9 billion. At the beginning of April, the group had spoken of a burden of 4 to 5 billion. Adjusted for such special effects, the result of 9.1 billion dollars increased significantly compared to the previous quarter and the same period last year.

Analyst Michele della Vigna from the US investment bank Goldman Sachs praised the results. The strong business development enables higher capital distributions to investors. He referred in particular to the inflow of funds. Operating free cash flow increased nearly 80 percent year over year to $14.8 billion.

Should the inflow of funds from operations remain high, that would be positive for investors in terms of dividends and share buybacks. Because: Based on the current economic prospects, Shell is planning distributions of more than 30 percent of the value for the second half of the year.

Shell – Without Russian oil, we have to shut down the Schwedt refinery

According to the oil company Shell, the East German refinery Schwedt would have to reduce its capacity if Russian supplies were to be stopped. Such a failure would probably mean that the refinery would have to be shut down significantly, said Shell boss Ben van Beurden on Thursday. This is due to insufficient other supply routes for the plant and to the special Russian oil that Schwedt specializes in processing.

Shell is the second largest shareholder in Schwedt, which is controlled by the Russian group Rosneft and is supplied with oil via a pipeline. In the event of an oil embargo, Schwedt would have to be supplied with oil from other countries via the ports of Rostock or Danzig. The federal government is aware of the problem and has already held talks with Poland about it. She has also indicated that she is looking for another owner for Schwedt. Exactly how Rosneft could be replaced is unclear. However, Shell, as the second largest shareholder, could play a key role thereafter.

THE HAGUE (dpa-AFX) / London (Reuters)

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