The Shell logo is displayed outside a petrol station in Radstock in Somerset, England, on Feb. 17, 2024.
Matt Cardy | Getty Images News | Getty Images
British oil giant Shell on Thursday posted stronger-than-expected second-quarter profit despite lower refining margins and weaker liquified natural gas trading.
The oil and gas major reported adjusted earnings of $6.3 billion for the three-month period through to the end of June, beating analyst expectations of $5.9 billion, according to estimates compiled by LSEG.
Shell’s second-quarter profits were down 19% when compared to the first three months of the year. The company reported adjusted earnings of $5.1 billion in the second quarter of 2023.
Shell said it would launch a $3.5 billion share buyback program over the next three months, a similar scheme as in the previous quarter. The company’s dividend remains unchanged at 34 cents per share.
“Shell delivered another strong quarter of operational and financial results,” Shell CEO Wael Sawan said in a statement.
“We further strengthened our leading LNG portfolio, and made good progress across our Capital Markets Day 2023 financial targets, including $1.7 billion of structural cost reductions since 2022,” he added.
Shell recently warned that it expected to take an impairment charge of up to $2 billion after the sale of its Singapore refinery and the suspension of on-site construction at its Rotterdam plant in the Netherlands.
In an update published July 2, Shell announced it would temporarily pause on-site construction at its 820,000 metric ton a year biofuels facility in Rotterdam “to address project delivery and ensure future competitiveness given current market conditions.”
Shell confirmed in early May that it had agreed to sell its refinery and petrochemical assets in Singapore to a joint venture of Indonesian petrochemical firm PT Chandra Asri and Swiss-based trading house Glencore.
The transaction, which is expected to be completed by the end of the year, was regarded as part of CEO Wael Sawan’s plans to lower Shell’s carbon footprint and focus on its most profitable businesses.
London-listed shares of the company have climbed more than 10% so far this year, outperforming European peers.
British rival BP on Tuesday increased its dividend and extended its share repurchasing program on the back of stronger-than-expected earnings.
U.S. oil giants Exxon Mobil and Chevron are both scheduled to report second-quarter results on Friday.
