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Shell (RDS.A) Q1 Earnings Beat on Higher Commodity Prices
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Europe’s largest oil company Royal Dutch Shell plc reported first-quarter earnings per ADS (on a current cost of supplies basis, excluding items — the market’s preferred measure) — of 82 cents. The bottom line came in ahead of the Zacks Consensus Estimate of 79 cents and improved from the year-ago profit of 74 cents per ADS.
The outperformance was mainly backed by stronger commodity prices and robust chemical margins.
However, the Hague-based Shell reported revenues of $59.1 billion, which were 3% below first-quarter 2020 sales of $61 billion on lower production and oil products sales volumes.
As per its February announcement, Royal Dutch Shell boosted its quarterly dividend by about 4% to 17.35 cents per share.
Royal Dutch Shell PLC Price, Consensus and EPS Surprise
Upstream: The segment recorded a profit of $963 million (excluding items) during the quarter, surging from $291 million (adjusted) achieved in the year-ago period. This primarily reflects the impact of higher oil and gas prices.
At $55.17 per barrel, the group’s worldwide realized liquids prices were 17.7% above the year-earlier levels while natural gas prices were up 12.7%.
Shell’s upstream volumes averaged 2,462 thousand oil-equivalent barrels per day (MBOE/d), down 9.2% from the year-ago period due to maintenance activities and asset sales. Liquids production totaled 1,579 thousand barrels per day (down 8.7% year over year), while natural gas output came in at 5,126 million standard cubic feet per day (down 9.8%).
Oil Products: In this segment, the Anglo-Dutch super-major reported adjusted income of $877 million, 35.7% lower than the year-ago period. The unfavorable comparison was due to coronavirus-hit sales volumes (down 21.1% year over year) and lower refining margins. Meanwhile, refinery utilization came in at 72%, down 9% from the March quarter of 2020.
Integrated Gas: The unit reported adjusted income of $1.4 billion, down 34% from the $2.1 billion in the January-March quarter of 2020. Results were primarily impacted by higher operating expenses, decrease in marketing and trading contributions, and favorable deferred tax movements in the year-ago period. On a further bearish note, LNG liquefaction volumes decreased 8.1% from the first quarter of 2020 to 8.16 million tons. Meanwhile, the total Integrated Gas production edged up 1.3% year over year to 967 MBOE/d.
Chemicals: The segment recorded a profit of $730 million (excluding items) during the quarter, soaring from the year-ago earnings of $148 million on the back of higher realized margins in base chemicals and intermediates, to go with a robust price environment.
Financial Performance
As of Mar 31, 2021, the Zacks Rank #1 (Strong Buy) company, which trimmed its payout for the first time since World War II in April last year, had $31 billion in cash and $102.4 billion in debt (including short-term debt). Net debt-to-capitalization was approximately 29.9%, up from 28.9% a year ago.
During the quarter under review, Shell generated cash flow from operations of $8.3 billion, returned $1.3 billion to its shareholders through dividends and spent $3.9 billion cash on capital projects.
The company’s cash flow from operations fell 44.2% from the year-earlier level. Meanwhile, the group raked in $7.7 billion in free cash flow during the first quarter, down from $12.1 billion a year ago.
Guidance
Shell expects second-quarter 2021 upstream volumes of 2,150-2,350 MBOE/d, while Integrated Gas production is expected between 880 MBOE/d and 940 MBOE/d. The company also foresees Oil Products sales volumes of 4,000-5,000 thousand barrels per day, Chemicals sales volumes of 3,500-3,800 thousand tons and refinery utilization in the range of 73-81%.
Earnings Schedules of Other Oil Supermajors
Among the big integrated players, ExxonMobil (XOM - Free Report) and Chevron (CVX - Free Report) are scheduled to release tomorrow, while continental rival BP plc (BP - Free Report) came up with better-than-expected bottom line numbers earlier this week.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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Shell (RDS.A) Q1 Earnings Beat on Higher Commodity Prices
Europe’s largest oil company Royal Dutch Shell plc reported first-quarter earnings per ADS (on a current cost of supplies basis, excluding items — the market’s preferred measure) — of 82 cents. The bottom line came in ahead of the Zacks Consensus Estimate of 79 cents and improved from the year-ago profit of 74 cents per ADS.
The outperformance was mainly backed by stronger commodity prices and robust chemical margins.
However, the Hague-based Shell reported revenues of $59.1 billion, which were 3% below first-quarter 2020 sales of $61 billion on lower production and oil products sales volumes.
As per its February announcement, Royal Dutch Shell boosted its quarterly dividend by about 4% to 17.35 cents per share.
Royal Dutch Shell PLC Price, Consensus and EPS Surprise
Royal Dutch Shell PLC price-consensus-eps-surprise-chart | Royal Dutch Shell PLC Quote
Operational Performance
Upstream: The segment recorded a profit of $963 million (excluding items) during the quarter, surging from $291 million (adjusted) achieved in the year-ago period. This primarily reflects the impact of higher oil and gas prices.
At $55.17 per barrel, the group’s worldwide realized liquids prices were 17.7% above the year-earlier levels while natural gas prices were up 12.7%.
Shell’s upstream volumes averaged 2,462 thousand oil-equivalent barrels per day (MBOE/d), down 9.2% from the year-ago period due to maintenance activities and asset sales. Liquids production totaled 1,579 thousand barrels per day (down 8.7% year over year), while natural gas output came in at 5,126 million standard cubic feet per day (down 9.8%).
Oil Products: In this segment, the Anglo-Dutch super-major reported adjusted income of $877 million, 35.7% lower than the year-ago period. The unfavorable comparison was due to coronavirus-hit sales volumes (down 21.1% year over year) and lower refining margins. Meanwhile, refinery utilization came in at 72%, down 9% from the March quarter of 2020.
Integrated Gas: The unit reported adjusted income of $1.4 billion, down 34% from the $2.1 billion in the January-March quarter of 2020. Results were primarily impacted by higher operating expenses, decrease in marketing and trading contributions, and favorable deferred tax movements in the year-ago period. On a further bearish note, LNG liquefaction volumes decreased 8.1% from the first quarter of 2020 to 8.16 million tons. Meanwhile, the total Integrated Gas production edged up 1.3% year over year to 967 MBOE/d.
Chemicals: The segment recorded a profit of $730 million (excluding items) during the quarter, soaring from the year-ago earnings of $148 million on the back of higher realized margins in base chemicals and intermediates, to go with a robust price environment.
Financial Performance
As of Mar 31, 2021, the Zacks Rank #1 (Strong Buy) company, which trimmed its payout for the first time since World War II in April last year, had $31 billion in cash and $102.4 billion in debt (including short-term debt). Net debt-to-capitalization was approximately 29.9%, up from 28.9% a year ago.
You can see the complete list of today’s Zacks #1 Rank stocks here.
During the quarter under review, Shell generated cash flow from operations of $8.3 billion, returned $1.3 billion to its shareholders through dividends and spent $3.9 billion cash on capital projects.
The company’s cash flow from operations fell 44.2% from the year-earlier level. Meanwhile, the group raked in $7.7 billion in free cash flow during the first quarter, down from $12.1 billion a year ago.
Guidance
Shell expects second-quarter 2021 upstream volumes of 2,150-2,350 MBOE/d, while Integrated Gas production is expected between 880 MBOE/d and 940 MBOE/d. The company also foresees Oil Products sales volumes of 4,000-5,000 thousand barrels per day, Chemicals sales volumes of 3,500-3,800 thousand tons and refinery utilization in the range of 73-81%.
Earnings Schedules of Other Oil Supermajors
Among the big integrated players, ExxonMobil (XOM - Free Report) and Chevron (CVX - Free Report) are scheduled to release tomorrow, while continental rival BP plc (BP - Free Report) came up with better-than-expected bottom line numbers earlier this week.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>