Royal Dutch Shell has released its third-quarter results. And they’re good news for the world’s second largest listed oil and gas company.
The company saw its third-quarter profits soar to a four-year high. They were boosted by rising crude prices as the company pressed ahead with one of the world’s largest share-buyback programmes.
Shell’s cash generation from operations rose by almost 60 per cent to $12.1 billion. According to CNBC, the company has made deep cost savings, which some industry analysts believe are now paying off.
Net income attributable to shareholders in the quarter, based on a current cost of supplies (CCS) and excluding identified items, rose 39 per cent to US$5.624 billion from a year ago. That compared with a company-provided analysts’ consensus of US$5.766 billion. In the second quarter, it was US$4.691 billion.
In July, Shell launched a US$25 billion share-buyback programme, as promised following its 2016 acquisition of BG Group.
Shell completed the first tranche of buybacks in October for US$2 billion. The company said it would soon launch a second tranche of up to $2.5 billion by January 28, 2019.
In a statement on its website, Royal Dutch Shell CEO Ben van Beurden said: “Good operational delivery across all Shell businesses produced one of our strongest-ever quarters, with cash flow from operations of $14.7 billion, excluding working capital movements. Our strong financial performance allowed us to cover the cash dividend, interest payments, share buybacks. And to further pay down debt.
“Our strategy remains on track. We have completed the first tranche of share buybacks, in line with our intention to purchase $25 billion of our shares by the end of 2020. Today I’m pleased to announce the second tranche. Meanwhile, the transformation of our portfolio continued, with further divestments of non-strategic assets and the final investment decision on LNG Canada.”