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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED RESULTS |
|
|
|
|
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|
|
|
|
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SUMMARY OF UNAUDITED RESULTS |
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
474 |
|
7,044 |
|
10,409 |
|
-93 |
Income/(loss) attributable to Shell plc shareholders |
|
19,360 |
|
42,309 |
|
-54 |
7,306 |
|
6,224 |
|
9,814 |
|
+17 |
Adjusted Earnings |
A |
28,250 |
|
39,870 |
|
-29 |
16,335 |
|
16,336 |
|
20,600 |
|
— |
Adjusted EBITDA |
A |
68,538 |
|
84,289 |
|
-19 |
12,575 |
|
12,332 |
|
22,404 |
|
+2 |
Cash flow from operating activities |
|
54,196 |
|
68,414 |
|
-21 |
(5,657) |
|
(4,827) |
|
(6,918) |
|
|
Cash flow from investing activities |
|
(17,737) |
|
(22,448) |
|
|
6,918 |
|
7,505 |
|
15,486 |
|
|
Free cash flow |
G |
36,460 |
|
45,965 |
|
|
7,113 |
|
5,649 |
|
7,319 |
|
|
Cash capital expenditure |
C |
24,393 |
|
24,833 |
|
|
10,897 |
|
10,097 |
|
11,114 |
|
+8 |
Operating expenses |
F |
39,959 |
|
39,477 |
|
+1 |
10,565 |
|
9,735 |
|
11,037 |
|
+9 |
Underlying operating expenses |
F |
39,201 |
|
39,456 |
|
-1 |
8.4% |
12.0% |
16.7% |
|
ROACE on a Net income basis |
D |
8.4% |
16.7% |
|
11.6% |
12.5% |
15.8% |
|
ROACE on an Adjusted Earnings plus Non-controlling interest (NCI)
basis |
D |
11.6% |
15.8% |
|
81,541 |
|
82,147 |
|
83,795 |
|
|
Total debt |
E |
81,541 |
|
83,795 |
|
|
43,541 |
|
40,470 |
|
44,837 |
|
|
Net debt |
E |
43,541 |
|
44,837 |
|
|
18.8% |
17.3% |
18.9% |
|
Gearing |
E |
18.8% |
18.9% |
|
2,827 |
|
2,706 |
|
2,831 |
|
+4 |
Total production available for sale (thousand boe/d) |
|
2,791 |
|
2,864 |
|
-3 |
0.07 |
|
1.06 |
|
1.47 |
-93 |
Basic earnings per share ($) |
|
2.88 |
|
5.76 |
|
-50 |
1.11 |
|
0.93 |
|
1.39 |
|
+19 |
Adjusted Earnings per share ($) |
B |
4.20 |
|
5.43 |
|
-23 |
0.3440 |
|
0.3310 |
|
0.2875 |
|
+4 |
Dividend per share ($) |
|
1.2935 |
|
1.0375 |
|
+25 |
1.Q4 on Q3 change
Quarter Analysis1
Income attributable to Shell plc shareholders,
compared with the third quarter 2023, reflected higher LNG trading
and optimisation margins, favourable deferred tax movements, and
higher production, offset by lower refining margins, lower margins
from crude and oil products trading and optimisation, and higher
operating expenses.
Fourth quarter 2023 income attributable to Shell plc
shareholders also included net impairment charges and reversals
($3.9 billion), and unfavourable movements due to the fair value
accounting of commodity derivatives. These charges and unfavourable
movements are included in identified items amounting to a net loss
of $6.0 billion in the quarter. This compares with identified items
in the third quarter 2023 which amounted to a net loss of $0.1
billion, and mainly related to impairment charges, largely offset
by favourable movements due to the fair value accounting of
commodity derivatives.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as income attributable to Shell plc shareholders and
adjusted for the above identified items and the cost of supplies
adjustment of positive $0.8 billion.
Cash flow from operating activities for the fourth quarter 2023
was $12.6 billion, and primarily driven by Adjusted EBITDA,
and a working capital inflow of $3.3 billion, partly offset by
tax payments of $3.6 billion, and a derivatives outflow of
$1.0 billion and the timing impact of payments relating to emission
certificates and biofuel programmes of $0.9 billion. The working
capital inflow mainly reflected inventory movements due to lower
prices.
Cash flow from investing activities for the
quarter was an outflow of $5.7 billion, and included cash
capital expenditure of $7.1 billion, and divestment proceeds
of $0.6 billion.
Net debt and Gearing: At the
end of the fourth quarter 2023, net debt was $43.5 billion,
compared with $40.5 billion at the end of the third quarter 2023,
mainly reflecting share buybacks, cash dividends paid to Shell plc
shareholders, lease
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
additions, and interest payments, partly offset by free cash
flow. Gearing was 18.8% at the end of the fourth quarter 2023,
compared with 17.3% at the end of the third quarter 2023, driven by
higher net debt and lower equity.
Shareholder distributions
Total shareholder distributions in the quarter amounted to $6.2
billion comprising repurchases of shares of $4.0 billion and
cash dividends paid to Shell plc shareholders of $2.2 billion.
Dividends declared to Shell plc shareholders for the fourth quarter
2023 amount to $0.3440 per share. Shell has now completed $3.5
billion of share buybacks announced in the third quarter 2023
results announcement. Today, Shell announces a share buyback
programme of $3.5 billion which is expected to be completed by the
first quarter 2024 results announcement.
Full Year Analysis1
Full year 2023 income attributable to Shell plc shareholders,
compared with the full year 2022, reflected lower realised oil and
gas prices, lower volumes, and lower refining margins, partly
offset by higher LNG trading and optimisation margins, and higher
Marketing margins. By focusing the portfolio and simplifying the
organisation, $1.0 billion of pre-tax structural cost reductions4
were delivered compared with the full year 2022, mainly driven by
divestments.
Full year 2023 income attributable to Shell plc shareholders
also included net impairment charges and reversals of $6.2 billion,
and unfavourable movements of $1.3 billion due to the fair value
accounting of commodity derivatives. These charges and unfavourable
movements are included in identified items amounting to a net loss
of $8.2 billion. This compares with identified items in the
full year 2022 which amounted to a net gain of
$1.2 billion.
Adjusted Earnings and Adjusted EBITDA2 for the full year 2023
were driven by the same factors as income attributable to Shell plc
shareholders and adjusted for identified items and the cost of
supplies adjustment of positive $0.6 billion.
Cash flow from operating activities for the full year 2023 was
$54.2 billion, and primarily driven by Adjusted EBITDA, and a
working capital inflow of $7.8 billion, partly offset by tax
payments of $13.7 billion, and a derivatives outflow of $6.1
billion.
Cash flow from investing activities for the
full year 2023 was an outflow of $17.7 billion and included
cash capital expenditure of $24.4 billion, divestment proceeds
of $3.1 billion, interest received of $2.1 billion, and net
other investing cash inflows of $1.4 billion.
This Unaudited Condensed Financial Report, together with
supplementary financial and operational disclosure for this
quarter, is available at www.shell.com/investors3. Progress to date
on the financial targets that were announced during Capital Markets
Day in June 2023 is available at
www.shell.com/investors/results-and-reporting/progress-on-cmd23.html3.
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
3.Not incorporated by reference.
4.Structural cost reductions describe decreases in underlying
operating expenses as a result of operational efficiencies,
divestments, workforce reductions and other cost-saving measures
that are expected to be sustainable compared with 2022 levels.
FOURTH QUARTER 2023 PORTFOLIO
DEVELOPMENTS
Integrated Gas
In October 2023, we completed the previously announced sale of
our participating interest of 35% in Indonesia’s Masela
production-sharing contract to Indonesia’s PT Pertamina Hulu Energi
and PETRONAS Masela Sdn. Bhd. The participating interest includes
the Abadi gas project.
In October 2023, we and our partners in the Oman LNG LLC venture
signed an amended shareholders’ agreement for Oman LNG LLC (Oman
LNG) extending the business beyond 2024. We will remain the largest
private shareholder in Oman LNG, with a 30% shareholding.
Upstream
In December 2023, we announced the start of production of the
FPSO Sepetiba in the Mero field, offshore Santos Basin in Brazil.
We hold a 19.3% stake in the Mero Unitized Field.
In December 2023, we announced the final investment decision for
Sparta, a deep-water development in the US Gulf of Mexico. We hold
a 51% interest.
In January 2024, we reached an agreement to sell The Shell
Petroleum Development Company of Nigeria Limited (SPDC) to
Renaissance. Completion of the transaction is subject to approvals
by the Federal Government of Nigeria and other conditions.
Page
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Chemicals and Products
In January 2024, we announced the final investment decision to
convert the hydrocracker of the Wesseling site at the Energy and
Chemicals Park Rheinland in Germany into a production unit for
Group III base oils, used in making high-quality lubricants such as
engine and transmission oils. Crude oil processing will end at the
Wesseling site by 2025 but will continue at the Godorf site.
Page
2
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
PERFORMANCE BY SEGMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
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|
|
INTEGRATED GAS |
|
|
|
|
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
1,728 |
|
2,154 |
|
5,293 |
|
-20 |
Segment earnings2 |
|
7,046 |
|
22,212 |
|
-68 |
(2,235) |
|
(375) |
|
(675) |
|
|
Of which: Identified items |
A |
(6,861) |
|
6,075 |
|
|
3,963 |
|
2,529 |
|
5,968 |
|
+57 |
Adjusted Earnings2 |
A |
13,907 |
|
16,137 |
|
-14 |
6,578 |
|
4,871 |
|
8,332 |
|
+35 |
Adjusted EBITDA2 |
A |
23,759 |
|
26,569 |
|
-11 |
3,597 |
|
4,009 |
|
6,409 |
|
-10 |
Cash flow from operating activities |
A |
17,520 |
|
27,692 |
|
-37 |
1,196 |
|
1,099 |
|
1,527 |
|
|
Cash capital expenditure |
C |
4,196 |
|
4,265 |
|
|
113 |
|
122 |
|
123 |
|
-7 |
Liquids production available for sale (thousand b/d) |
|
128 |
|
128 |
|
+1 |
4,570 |
|
4,517 |
|
4,607 |
|
+1 |
Natural gas production available for sale (million scf/d) |
|
4,700 |
|
4,600 |
|
+2 |
901 |
|
900 |
|
917 |
|
— |
Total production available for sale (thousand boe/d) |
|
939 |
|
921 |
|
+2 |
7.06 |
|
6.88 |
|
6.78 |
|
+3 |
LNG liquefaction volumes (million tonnes) |
|
28.29 |
|
29.68 |
|
-5 |
18.09 |
|
16.01 |
|
16.82 |
|
+13 |
LNG sales volumes (million tonnes) |
|
67.09 |
|
65.98 |
|
+2 |
1.Q4 on Q3 change
2.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
Integrated Gas includes liquefied natural gas (LNG), conversion
of natural gas into gas-to-liquids (GTL) fuels and other products.
It includes natural gas and liquids exploration and extraction, and
the operation of the upstream and midstream infrastructure
necessary to deliver these to market. Integrated Gas also includes
the marketing, trading and optimisation of LNG, including LNG as a
fuel for heavy-duty vehicles.
Quarter Analysis1
Segment earnings, compared with the third
quarter 2023, reflected the net effect of higher contributions from
trading and optimisation, and realised prices (increase of $1,559
million), and higher volumes (increase of $81 million), partly
offset by higher operating expenses (increase of $146 million), and
unfavourable deferred tax movements ($140 million). Trading and
optimisation results reflect seasonality and a high number of
optimisation opportunities.
Fourth quarter 2023 segment earnings also included unfavourable
movements of $1,587 million due to the fair value accounting of
commodity derivatives, and impairment charges of $547 million. As
part of Shell's normal business, commodity derivative hedge
contracts are entered into for mitigation of economic exposures on
future purchases and sales. As these commodity derivatives are
measured at fair value, this creates an accounting mismatch over
periods. These unfavourable movements and impairment charges are
part of identified items and compare with the third quarter 2023
which included unfavourable movements of $340 million due to the
fair value accounting of commodity derivatives.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the quarter was
primarily driven by Adjusted EBITDA, partly offset by net cash
outflows related to derivatives of $1,596 million, tax payments of
$731 million and working capital outflows of $654 million.
Total oil and gas production was in line with the third quarter
2023. LNG liquefaction volumes increased by 3% mainly due to lower
maintenance.
Full Year Analysis1
Segment earnings, compared with the full year 2022, reflected
the net effect of lower realised prices and higher contributions
from trading and optimisation (decrease of $1,143 million), lower
volumes (decrease of $466 million), and unfavourable deferred tax
movements ($728 million).
Full year 2023 segment earnings also included unfavourable
movements of $4,407 million due to the fair value accounting of
commodity derivatives, and net impairment charges and reversals of
$2,247 million. These unfavourable movements and net impairment
charges and reversals are part of identified items and compare with
the full year 2022 which included favourable movements of $6,273
million due to the fair value accounting of commodity derivatives,
and net impairment reversals of $779 million, partly offset by
other impacts of $608 million, which mainly comprised loan
write-downs, as well as charges of $387 million due to provisions
for onerous contracts.
Page
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the full year 2023 was
primarily driven by Adjusted EBITDA, and a working capital inflow
of $2,023 million, partly offset by net cash outflows related to
derivatives of $4,668 million, and tax payments of $3,574
million.
Total oil and gas production, compared with the full year 2022,
increased by 2% mainly due to ramp-up of new fields in Oman,
Canada, Australia, and Trinidad and Tobago, and lower maintenance
in Pearl GTL (Qatar) and Trinidad and Tobago, partly offset by
derecognition of Sakhalin-related volumes, and production-sharing
contract effects in Egypt and Pearl GTL (Qatar). LNG liquefaction
volumes decreased by 5% mainly due to the derecognition of
Sakhalin-related volumes.
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
Page
4
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
UPSTREAM |
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
|
Full year |
|
|
|
|
|
|
|
|
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
|
|
|
|
|
|
|
|
2,179 |
|
1,983 |
|
1,380 |
|
+10 |
Segment earnings2 |
|
8,528 |
|
16,222 |
|
-47 |
|
|
|
|
|
|
|
|
(909) |
|
(238) |
|
(1,681) |
|
|
Of which: Identified items |
A |
(1,267) |
|
(1,096) |
|
|
|
|
|
|
|
|
|
|
3,088 |
|
2,221 |
|
3,061 |
|
+39 |
Adjusted Earnings2 |
A |
9,794 |
|
17,319 |
|
-43 |
|
|
|
|
|
|
|
|
7,910 |
|
7,412 |
|
9,418 |
|
+7 |
Adjusted EBITDA2 |
A |
30,607 |
|
42,100 |
|
-27 |
|
|
|
|
|
|
|
|
5,787 |
|
5,336 |
|
7,224 |
|
+8 |
Cash flow from operating activities |
A |
21,450 |
|
29,641 |
|
-28 |
|
|
|
|
|
|
|
|
2,436 |
|
2,007 |
|
1,845 |
|
|
Cash capital expenditure |
C |
8,343 |
|
8,143 |
|
|
|
|
|
|
|
|
|
|
1,361 |
|
1,311 |
|
1,331 |
|
+4 |
Liquids production available for sale (thousand b/d) |
|
1,325 |
|
1,333 |
|
-1 |
|
|
|
|
|
|
|
|
2,952 |
|
2,564 |
|
3,067 |
|
+15 |
Natural gas production available for sale (million scf/d) |
|
2,754 |
|
3,272 |
|
-16 |
|
|
|
|
|
|
|
|
1,870 |
|
1,753 |
|
1,859 |
|
+7 |
Total production available for sale (thousand boe/d) |
|
1,800 |
|
1,897 |
|
-5 |
|
|
|
|
|
|
|
|
1.Q4 on Q3 change
2.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
The Upstream segment includes exploration and extraction of
crude oil, natural gas and natural gas liquids. It also markets and
transports oil and gas, and operates the infrastructure necessary
to deliver them to the market.
Quarter Analysis1
Segment earnings, compared with the third quarter 2023, mainly
reflected favourable movements in deferred tax positions ($628
million) and higher volumes (increase of $185 million).
Fourth quarter 2023 segment earnings also included net
impairment charges and reversals of $454 million, charges of $424
million related to the impact of the weakening Argentine peso on a
deferred tax position, and legal provisions of $358 million, partly
offset by a gain of $182 million due to the impact of the discount
rate change on provisions. These charges and gains are part of
identified items, and compare with the third quarter 2023 which
included legal provisions of $169 million and charges of $62
million related to the impact of the weakening Brazilian real on a
deferred tax position.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the quarter was
primarily driven by Adjusted EBITDA, partly offset by tax payments
of $2,015 million.
Total production, compared with the third quarter 2023,
increased mainly due to lower scheduled maintenance and growth from
new fields.
Full Year Analysis1
Segment earnings, compared with the full year 2022, mainly
reflected lower realised oil and gas prices (decrease of $5,696
million) and lower volumes (decrease of $2,001 million).
Full year 2023 segment earnings also included net impairment
charges and reversals of $642 million, and net charges of $295
million related to the impact of the weakening Argentine peso and
strengthening Brazilian real on a deferred tax position. These
charges and gains are part of identified items, and compare with
the full year 2022 which included net impairment reversals and
charges of $853 million, and charges of $1,385 million relating to
the EU solidarity contribution and $802 million relating to the UK
Energy Profits Levy.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the full year 2023 was
primarily driven by Adjusted EBITDA, partly offset by tax payments
of $8,470 million.
Total production, compared with the full year 2022, decreased
mainly due to the impact of divestments. The impact of field
decline was more than offset by growth from new fields.
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
Page
5
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARKETING |
|
|
|
|
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
143 |
|
702 |
|
375 |
|
-80 |
Segment earnings² |
|
2,951 |
|
2,133 |
|
+38 |
(549) |
|
(18) |
|
(72) |
|
|
Of which: Identified items |
A |
(229) |
|
(622) |
|
|
692 |
|
720 |
|
446 |
|
-4 |
Adjusted Earnings² |
A |
3,180 |
|
2,754 |
|
+15 |
1,337 |
|
1,519 |
|
1,045 |
|
-12 |
Adjusted EBITDA2 |
A |
6,037 |
|
5,324 |
|
+13 |
2,709 |
|
880 |
|
1,062 |
|
+208 |
Cash flow from operating activities |
A |
6,088 |
|
2,376 |
|
+156 |
1,339 |
|
917 |
|
1,993 |
|
|
Cash capital expenditure |
C |
5,612 |
|
4,831 |
|
|
2,508 |
|
2,654 |
|
2,543 |
|
-5 |
Marketing sales volumes (thousand b/d) |
|
2,554 |
|
2,503 |
|
+2 |
1.Q4 on Q3 change
2.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
The Marketing segment comprises the Mobility, Lubricants, and
Sectors & Decarbonisation businesses. The Mobility business
operates Shell’s retail network including electric vehicle charging
services. The Lubricants business produces, markets and sells
lubricants for road transport, and machinery used in manufacturing,
mining, power generation, agriculture and construction. The Sectors
& Decarbonisation business sells fuels, speciality products and
services including low-carbon energy solutions to a broad range of
commercial customers including the aviation, marine, and
agricultural sectors.
Quarter Analysis1
Segment earnings, compared with the third quarter 2023,
reflected lower Marketing margins (decrease of $101 million)
including lower Lubricants margins due to higher feedstock costs
and impact of seasonality on Mobility margins, partly offset by
higher Sectors & Decarbonisation margins. Fourth quarter 2023
segment earnings also included lower tax charges (decrease of $121
million) mainly due to one-off tax helps.
Fourth quarter 2023 segment earnings also included impairment
charges of $406 million, and charges of $97 million related to
redundancy and restructuring. These charges are part of identified
items.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the quarter was
primarily driven by Adjusted EBITDA and working capital inflows of
$1,843 million. These inflows were partly offset by tax payments of
$280 million and non-cash cost-of-sales (CCS) adjustments of $81
million.
Marketing sales volumes (comprising hydrocarbon sales), compared
with the third quarter 2023, decreased mainly due to
seasonality.
Full Year Analysis1
Segment earnings, compared with the full year 2022, reflected
higher Marketing margins (increase of $1,465 million) including
higher unit margins in Mobility, higher margins in Lubricants due
to lower feedstock costs and higher volumes in Sectors &
Decarbonisation. These were partly offset by higher operating
expenses (increase of $703 million) and higher depreciation charges
(increase of $264 million) mainly due to asset acquisitions.
Full year 2023 segment earnings also included net impairment
charges and reversals of $457 million, and charges of $111 million
related to redundancy and restructuring partly offset by gains of
$298 million related to indirect tax credits. These charges and
gains are part of identified items and compare with the full year
2022 which included net impairment charges and reversals of $321
million, net losses of $135 million related to the sale of assets,
and provisions for onerous contracts of $62 million.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified
items.
Cash flow from operating activities for the full year 2023 was
primarily driven by Adjusted EBITDA, working capital inflows of
$873 million, and the timing impact of payments relating to
emission certificates and biofuel programmes of $296 million. These
inflows were partly offset by tax payments of $744 million, and
non-cash cost-of-sales (CCS) adjustments of $221 million.
Marketing sales volumes (comprising hydrocarbon sales), compared
with the full year 2022, increased mainly due to improved demand in
Aviation.
Page
6
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
Page
7
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHEMICALS AND PRODUCTS |
|
|
|
|
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
(1,792) |
|
1,173 |
|
332 |
|
-253 |
Segment earnings² |
|
1,530 |
|
4,515 |
|
-66 |
(1,875) |
|
(207) |
|
(412) |
|
|
Of which: Identified items |
A |
(2,160) |
|
(204) |
|
|
83 |
|
1,380 |
|
744 |
|
-94 |
Adjusted Earnings² |
A |
3,690 |
|
4,719 |
|
-22 |
770 |
|
2,591 |
|
1,574 |
|
-70 |
Adjusted EBITDA2 |
A |
7,710 |
|
8,561 |
|
-10 |
207 |
|
2,379 |
|
3,119 |
|
-91 |
Cash flow from operating activities |
A |
6,987 |
|
12,906 |
|
-46 |
1,031 |
|
879 |
|
786 |
|
|
Cash capital expenditure |
C |
3,192 |
|
3,838 |
|
|
1,315 |
|
1,334 |
|
1,434 |
|
-1 |
Refinery processing intake (thousand b/d) |
|
1,349 |
|
1,402 |
|
-4 |
1,560 |
|
1,548 |
|
1,800 |
|
+1 |
Refining & Trading sales volumes (thousand b/d) |
|
1,570 |
|
1,700 |
|
-8 |
2,588 |
|
2,998 |
|
3,017 |
|
-14 |
Chemicals sales volumes (thousand tonnes) |
|
11,245 |
|
12,281 |
|
-8 |
1.Q4 on Q3 change
2.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
The Chemicals and Products segment includes chemicals
manufacturing plants with their own marketing network, and
refineries which turn crude oil and other feedstocks into a range
of oil products which are moved and marketed around the world for
domestic, industrial and transport use. The segment also includes
the pipeline business, trading and optimisation of crude oil, oil
products and petrochemicals, and Oil Sands activities (the
extraction of bitumen from mined oil sands and its conversion into
synthetic crude oil).
Quarter Analysis1
Segment earnings, compared with the third quarter 2023,
reflected lower Products margins (decrease of $1,193 million)
mainly driven by lower refining margins due to lower global product
demand and lower margins from trading and optimisation. Segment
earnings also reflected lower Chemicals margins (decrease of $150
million) including the impact of continuing global oversupply as
well as weak demand and lower income from joint ventures and
associates. In addition, the fourth quarter 2023 reflected higher
operating expenses (increase of $76 million). These were partly
offset by favourable deferred tax movements (increase of $123
million).
Fourth quarter 2023 segment earnings also included net
impairment charges and reversals of $1,977 million mainly relating
to the Chemicals assets in Singapore, and charges of $78 million
related to redundancy and restructuring partly offset by favourable
movements of $130 million due to the fair value accounting of
commodity derivatives. These charges and gains are part of
identified items, and compare with the third quarter 2023 which
included net impairment charges and reversals of $79 million, legal
provisions of $74 million, and unfavourable movements of $53
million due to the fair value accounting of commodity
derivatives.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified items.
In the fourth quarter 2023, Chemicals had negative Adjusted
Earnings of $492 million and Products had positive Adjusted
Earnings of $576 million.
Cash flow from operating activities for the quarter was
primarily driven by working capital inflows of $1,353 million,
Adjusted EBITDA, cash inflows relating to commodity derivatives of
$294 million, and dividends (net of profits) from joint ventures
and associates of $222 million. These inflows were partly offset by
non-cash cost-of-sales (CCS) adjustments of $1,028 million, the
timing impact of payments relating to emission certificates and
biofuel programmes of $970 million, and tax payments of $273
million.
Chemicals manufacturing plant utilisation was 62% compared with
70% in the third quarter 2023, due to higher planned and unplanned
maintenance in North America and economic optimisation.
Refinery utilisation was 81% compared with 84% in the third
quarter 2023, due to planned maintenance in North America.
Full Year Analysis1
Segment earnings, compared with the full year 2022, reflected
lower Products margins (decrease of $1,528 million) mainly driven
by lower refining margins partly offset by higher margins from
trading and optimisation. The segment earnings also reflected
higher depreciation charges (increase of $546 million) due to
start-up of operations at Shell Polymers Monaca in the USA. These
were partly offset by higher Chemicals margins (increase of $612
million).
Full year 2023 segment earnings also included net impairment
charges and reversals of $2,204 million mainly relating to the
Chemicals assets in Singapore, and charges of $84 million related
to redundancy and restructuring partly offset by
Page
8
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
favourable movements of $213 million due to the fair value
accounting of commodity derivatives. These charges and gains are
part of identified items, and compare with the full year 2022 which
included net impairment charges and reversals of $226 million,
legal provisions of $149 million, unfavourable movements of $147
million related to the fair value accounting of commodity
derivatives, tax charges relating to the EU solidarity contribution
of $74 million partly offset by gains of $223 million related to
the sale of assets, and gains of $104 million related to the
remeasurement of redundancy and restructuring costs.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified items.
In the full year 2023, Chemicals had negative Adjusted Earnings of
$1,622 million and Products had positive Adjusted Earnings of
$5,313 million.
Cash flow from operating activities for the full year 2023 was
primarily driven by Adjusted EBITDA, working capital inflows of
$609 million, cash inflows relating to commodity derivatives of
$529 million, and dividends (net of profits) from joint ventures
and associates of $300 million. These inflows were partly offset by
the timing impact of payments relating to emission certificates and
biofuel programmes of $1,224 million, non-cash cost-of-sales (CCS)
adjustments of $627 million, and tax payments of $484 million.
Chemicals manufacturing plant utilisation was 68% compared with
79% in the full year 2022, mainly due to planned and unplanned
maintenance and economic optimisation during the full year
2023.
Refinery utilisation was 85% compared with 86% in the full year
2022.
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
Page
9
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RENEWABLES AND ENERGY SOLUTIONS |
|
|
|
|
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
Reference |
2023 |
2022 |
% |
(291) |
|
600 |
|
4,673 |
|
-148 |
Segment earnings2 |
|
3,038 |
|
(1,059) |
|
+387 |
(445) |
|
667 |
|
4,379 |
|
|
Of which: Identified items |
A |
2,333 |
|
(2,805) |
|
|
155 |
|
(67) |
|
293 |
|
+331 |
Adjusted Earnings2 |
A |
705 |
|
1,745 |
|
-60 |
228 |
|
79 |
|
396 |
|
+187 |
Adjusted EBITDA2 |
A |
1,413 |
|
2,459 |
|
-43 |
(1,265) |
|
(34) |
|
2,674 |
|
-3655 |
Cash flow from operating activities |
A |
2,984 |
|
(6,394) |
|
+147 |
1,026 |
|
659 |
|
1,076 |
|
|
Cash capital expenditure |
C |
2,681 |
|
3,469 |
|
|
68 |
|
76 |
|
66 |
|
-11 |
External power sales (terawatt hours)3 |
|
279 |
|
243 |
|
+15 |
175 |
|
170 |
|
241 |
|
+3 |
Sales of pipeline gas to end-use customers (terawatt hours)4 |
|
738 |
|
843 |
|
-12 |
1.Q4 on Q3 change
2.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
3.Physical power sales to third parties; excluding financial
trades and physical trade with brokers, investors, financial
institutions, trading platforms, and wholesale traders.
4.Physical natural gas sales to third parties; excluding
financial trades and physical trade with brokers, investors,
financial institutions, trading platforms, and wholesale traders.
Excluding sales of natural gas by other segments and LNG sales.
Renewables and Energy Solutions includes activities such as
renewable power generation, the marketing and trading and
optimisation of power and pipeline gas, as well as carbon credits,
and digitally enabled customer solutions. It also includes the
production and marketing of hydrogen, development of commercial
carbon capture and storage hubs, investment in nature-based
projects that avoid or reduce carbon emissions, and Shell Ventures,
which invests in companies that work to accelerate the energy and
mobility transformation.
Quarter Analysis1
Segment earnings, compared with the third
quarter 2023, reflected higher margins (increase of $118 million)
mainly due to trading and optimisation primarily in Europe and the
Americas as a result of market volatility and seasonality, and
favourable tax movements ($110 million), partly offset by higher
operating expenses (increase of $38 million).
Fourth quarter 2023 segment earnings also included impairment
charges of $551 million, partly offset by favourable movements of
$125 million due to the fair value accounting of commodity
derivatives. As part of Shell's normal business, commodity
derivative hedge contracts are entered into for mitigation of
economic exposures on future purchases, sales and inventory. As
these commodity derivatives are measured at fair value, this
creates an accounting mismatch over periods. These charges and
favourable movements are part of identified items and compare with
the third quarter 2023 which included favourable movements of $506
million due to the fair value accounting of commodity
derivatives.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified items.
Most Renewables and Energy Solutions activities were loss-making in
the fourth quarter 2023, more than offset by positive adjusted
earnings from trading and optimisation.
Cash flow from operating activities for the
quarter was primarily driven by working capital outflows of $970
million, tax payments of $413 million, and net cash outflows
related to derivatives of $268 million, partly offset by Adjusted
EBITDA.
Full Year Analysis1
Segment earnings, compared with the full year 2022, reflected
lower margins (decrease of $684 million) mainly from trading and
optimisation due to lower gas and power prices in 2023,
unfavourable tax movements ($218 million), and higher operating
expenses (increase of $186 million).
Full year 2023 segment earnings also included favourable
movements of $2,756 million due to the fair value accounting of
commodity derivatives, partly offset by net impairment charges and
reversals of $669 million. These favourable movements and charges
are part of identified items and compare with the full year 2022
which included unfavourable movements of $2,444 million due to the
fair value accounting of commodity derivatives, and impairment
charges of $361 million.
Adjusted Earnings and Adjusted EBITDA2 were driven by the same
factors as the segment earnings and adjusted for identified items.
Most Renewables and Energy Solutions activities were loss-making
for the full year 2023, more than offset by positive adjusted
earnings from trading and optimisation.
Cash flow from operating activities for the full year 2023 was
primarily driven by working capital inflows of $3,723 million, and
Adjusted EBITDA, partly offset by net cash outflows related to
derivatives of $1,988 million, and tax payments of $762
million.
Page
10
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
Additional Growth Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
|
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
%¹ |
|
|
2023 |
2022 |
% |
|
|
|
|
Renewable power generation capacity (gigawatt): |
|
|
|
|
2.5 |
|
2.5 |
|
2.2 |
|
+2 |
– In operation2 |
|
2.5 |
|
2.2 |
|
+13 |
4.1 |
|
4.9 |
|
4.2 |
|
-17 |
– Under construction and/or committed for sale3 |
|
4.1 |
|
4.2 |
|
-3 |
1.Q4 on Q3 change
2.Shell's equity share of renewable generation capacity post
commercial operation date. It excludes Shell's equity share of
associates where information cannot be obtained.
3.Shell's equity share of renewable generation capacity under
construction and/or committed for sale under long-term offtake
agreements (PPA). It excludes Shell's equity share of associates
where information cannot be obtained.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CORPORATE |
|
|
|
Quarters |
$ million |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
Reference |
2023 |
2022 |
(586) |
|
(460) |
|
(654) |
|
Segment earnings1 |
|
(2,811) |
|
(2,461) |
|
(19) |
|
22 |
|
(28) |
|
Of which: Identified items |
A |
(69) |
|
(90) |
|
(567) |
|
(482) |
|
(626) |
|
Adjusted Earnings1 |
A |
(2,742) |
|
(2,371) |
|
(488) |
|
(136) |
|
(164) |
|
Adjusted EBITDA1 |
A |
(987) |
|
(725) |
|
1,540 |
|
(238) |
|
1,916 |
|
Cash flow from operating activities |
A |
(832) |
|
2,192 |
|
1.Segment earnings, Adjusted Earnings and Adjusted EBITDA are
presented on a CCS basis (see Note 2).
The Corporate segment covers the non-operating activities
supporting Shell, comprising Shell’s holdings and treasury
organisation, its self-insurance activities and its headquarters
and central functions. All finance expense and income and related
taxes are included in Corporate segment earnings rather than in the
earnings of business segments.
Quarter Analysis1
Segment earnings, compared with the third quarter 2023,
reflected unfavourable movements in currency exchange rate effects
and net interest expense, partly offset by a favourable movement in
tax credits.
Adjusted EBITDA2 was mainly driven by unfavourable currency
exchange rate effects.
Full Year Analysis1
Segment earnings, compared with the full year 2022, were
primarily driven by unfavourable movements in currency exchange
rate effects and tax credits.
Adjusted EBITDA2 was mainly driven by unfavourable currency
exchange rate effects.
1.All earnings amounts are shown post-tax, unless stated
otherwise.
2.Adjusted EBITDA is without taxation.
PRELIMINARY RESERVES UPDATE
When final volumes are reported in the 2023 Annual Report and
Accounts and 2023 Form 20-F, Shell expects that SEC proved oil and
gas reserves additions before taking into account production will
be approximately 1.3 billion boe, and that 2023 production will be
approximately 1.1 billion boe. As a result, total proved reserves
on an SEC basis are expected to be approximately 9.8 billion boe.
Acquisitions and divestments of 2023 reserves are expected to
account for a net increase of approximately 0.2 billion boe.
The proved Reserves Replacement Ratio on an SEC basis is
expected to be 120% for the year and 120% for the 3-year average.
Excluding the impact of acquisitions and divestments, the proved
Reserves Replacement Ratio is expected to be 99% for the year and
90% for the 3-year average.
Further information will be provided in the 2023 Annual Report
and Accounts and 2023 Form 20-F.
OUTLOOK FOR THE FIRST QUARTER
2024
Cash capital expenditure for full year 2024 is expected to be
within $22 - $25 billion.
Page
11
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Integrated Gas production is expected to be approximately 930 -
990 thousand boe/d. LNG liquefaction volumes are expected to be
approximately 7.0 - 7.6 million tonnes. Outlook reflects Prelude
back in operation after a major turnaround.
Upstream production is expected to be approximately 1,730 -
1,930 thousand boe/d. Production outlook reflects the planned
maintenance in deep-water assets.
Marketing sales volumes are expected to be approximately 2,150 -
2,650 thousand b/d.
Refinery utilisation is expected to be approximately 83% - 91%,
higher due to completion of planned maintenance activities in North
America. Chemicals manufacturing plant utilisation is expected to
be approximately 68% - 76%.
Corporate Adjusted Earnings are expected to be a net expense of
approximately $400 - $600 million in the first quarter and a net
expense of approximately $1,500 - $2,100 million for the full year
2024. This excludes the impact of currency exchange rate and fair
value accounting effects.
Energy Transition Strategy Update: As Shell progresses towards
its goal of achieving net-zero emissions by 2050 in an evolving
energy marketplace serving a dynamic world, Shell continuously
evaluates and updates its energy transition strategy, including its
interim targets to reduce the carbon intensity of the energy
products it sells. Shell expects to publish its 2024 Energy
Transition Strategy on March 14, 2024. This publication will update
shareholders and wider society on Shell’s energy transition
strategy in line with its Capital Markets Day 2023 communications
and set out Shell’s climate targets and ambitions for the
future.
FORTHCOMING EVENTS
|
|
|
|
|
|
|
Date |
Event |
February 14, 2024 |
Shell LNG Outlook 2024 |
March 14, 2024 |
Publication of Annual Report and Accounts and filing of Form 20-F
for the year ended December 31, 2023 |
March 14, 2024 |
Publication of Energy Transition Strategy 2024 |
March 27, 2024 |
Annual ESG Update |
May 2, 2024 |
First quarter 2024 results and dividends |
May 21, 2024 |
Annual General Meeting |
August 1, 2024 |
Second quarter 2024 results and dividends |
October 31, 2024 |
Third quarter 2024 results and dividends |
Page
12
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF INCOME |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
78,732 |
|
76,350 |
|
101,303 |
|
Revenue1 |
316,620 |
|
381,314 |
|
768 |
|
747 |
|
(268) |
|
Share of profit/(loss) of joint ventures and associates |
3,725 |
|
3,972 |
|
631 |
|
913 |
|
160 |
|
Interest and other income/(expenses)2 |
2,838 |
|
915 |
|
80,131 |
|
78,011 |
|
101,195 |
|
Total revenue and other income/(expenses) |
323,183 |
|
386,201 |
|
54,745 |
|
49,144 |
|
65,489 |
|
Purchases |
212,883 |
|
258,488 |
|
6,807 |
|
6,384 |
|
7,220 |
|
Production and manufacturing expenses |
25,240 |
|
25,518 |
|
3,621 |
|
3,447 |
|
3,491 |
|
Selling, distribution and administrative expenses |
13,433 |
|
12,883 |
|
469 |
|
267 |
|
403 |
|
Research and development |
1,287 |
|
1,075 |
|
467 |
|
436 |
|
649 |
|
Exploration |
1,750 |
|
1,712 |
|
11,221 |
|
5,911 |
|
6,459 |
|
Depreciation, depletion and amortisation2 |
31,290 |
|
18,529 |
|
1,166 |
|
1,131 |
|
1,040 |
|
Interest expense |
4,673 |
|
3,181 |
|
78,496 |
|
66,720 |
|
84,752 |
|
Total expenditure |
290,555 |
|
321,386 |
|
1,635 |
|
11,291 |
|
16,443 |
|
Income/(loss) before taxation |
32,628 |
|
64,815 |
|
1,099 |
|
4,115 |
|
5,975 |
|
Taxation charge/(credit) |
12,991 |
|
21,941 |
|
536 |
|
7,176 |
|
10,469 |
|
Income/(loss) for the period¹ |
19,638 |
|
42,874 |
|
62 |
|
132 |
|
59 |
|
Income/(loss) attributable to non-controlling interest |
277 |
|
565 |
|
474 |
|
7,044 |
|
10,409 |
|
Income/(loss) attributable to Shell plc
shareholders |
19,360 |
|
42,309 |
|
0.07 |
|
1.06 |
|
1.47 |
|
Basic earnings per share ($)3 |
2.88 |
|
5.76 |
|
0.07 |
|
1.05 |
|
1.46 |
|
Diluted earnings per share ($)3 |
2.85 |
|
5.71 |
|
1. See Note 2 “Segment information”.
2. See Note 8 “Other notes to the
unaudited Condensed Consolidated Financial Statements”.
3. See Note 4 “Earnings per share”.
Page
13
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
536 |
|
7,176 |
|
10,469 |
|
Income/(loss) for the period |
19,638 |
|
42,874 |
|
|
|
|
Other comprehensive income/(loss) net of tax: |
|
|
|
|
|
Items that may be reclassified to income in later periods: |
|
|
2,571 |
|
(1,460) |
|
2,855 |
|
– Currency translation differences |
1,397 |
|
(2,986) |
|
29 |
|
1 |
|
12 |
|
– Debt instruments remeasurements |
41 |
|
(78) |
|
11 |
|
141 |
|
(345) |
|
– Cash flow hedging gains/(losses) |
71 |
|
(232) |
|
— |
|
— |
|
(264) |
|
– Net investment hedging gains/(losses) |
(44) |
|
180 |
|
(53) |
|
(39) |
|
(32) |
|
– Deferred cost of hedging |
(148) |
|
200 |
|
135 |
|
(72) |
|
77 |
|
– Share of other comprehensive income/(loss) of joint ventures and
associates |
18 |
|
274 |
|
2,692 |
|
(1,429) |
|
2,303 |
|
Total |
1,335 |
|
(2,642) |
|
|
|
|
Items that are not reclassified to income in later periods: |
|
|
(1,207) |
|
180 |
|
(2,090) |
|
– Retirement benefits remeasurements |
(1,083) |
|
5,466 |
|
(84) |
|
(38) |
|
(37) |
|
– Equity instruments remeasurements |
(99) |
|
(491) |
|
(186) |
|
17 |
|
(227) |
|
– Share of other comprehensive income/(loss) of joint ventures and
associates |
(201) |
|
(253) |
|
(1,477) |
|
159 |
|
(2,354) |
|
Total |
(1,383) |
|
4,722 |
|
1,215 |
|
(1,270) |
|
(51) |
|
Other comprehensive income/(loss) for the
period |
(47) |
|
2,080 |
|
1,750 |
|
5,906 |
|
10,417 |
|
Comprehensive income/(loss) for the period |
19,590 |
|
44,954 |
|
96 |
|
149 |
|
114 |
|
Comprehensive income/(loss) attributable to non-controlling
interest |
314 |
|
621 |
|
1,654 |
|
5,757 |
|
10,303 |
|
Comprehensive income/(loss) attributable to Shell plc
shareholders |
19,277 |
|
44,333 |
|
Page
14
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEET |
$ million |
|
|
|
December 31, 2023 |
December 31, 2022 |
Assets |
|
|
Non-current assets |
|
|
Goodwill |
16,660 |
|
16,039 |
|
Other intangible assets |
10,253 |
|
9,662 |
|
Property, plant and equipment |
194,835 |
|
198,642 |
|
Joint ventures and associates |
24,457 |
|
23,864 |
|
Investments in securities |
3,246 |
|
3,362 |
|
Deferred tax1 |
6,454 |
|
7,815 |
|
Retirement benefits |
9,151 |
|
10,200 |
|
Trade and other receivables |
6,298 |
|
6,920 |
|
Derivative financial instruments² |
801 |
|
582 |
|
|
272,154 |
|
277,086 |
|
Current assets |
|
|
Inventories |
26,019 |
|
31,894 |
|
Trade and other receivables |
53,273 |
|
66,510 |
|
Derivative financial instruments² |
15,098 |
|
24,437 |
|
Cash and cash equivalents |
38,774 |
|
40,246 |
|
|
133,164 |
|
163,087 |
|
Assets classified as held for sale1 |
951 |
|
2,851 |
|
|
134,115 |
|
165,938 |
|
Total assets |
406,269 |
|
443,024 |
|
Liabilities |
|
|
Non-current liabilities |
|
|
Debt |
71,610 |
|
74,794 |
|
Trade and other payables |
3,103 |
|
3,432 |
|
Derivative financial instruments² |
2,301 |
|
3,563 |
|
Deferred tax1 |
15,347 |
|
16,186 |
|
Retirement benefits1 |
7,549 |
|
7,296 |
|
Decommissioning and other provisions1 |
22,531 |
|
23,845 |
|
|
122,440 |
|
129,116 |
|
Current liabilities |
|
|
Debt |
9,931 |
|
9,001 |
|
Trade and other payables |
68,237 |
|
79,357 |
|
Derivative financial instruments² |
9,529 |
|
23,779 |
|
Income taxes payable |
3,422 |
|
4,869 |
|
Decommissioning and other provisions |
4,041 |
|
2,910 |
|
|
95,161 |
|
119,916 |
|
Liabilities directly associated with assets classified as held for
sale1 |
307 |
|
1,395 |
|
|
95,468 |
|
121,311 |
|
Total liabilities |
217,908 |
|
250,427 |
|
Equity attributable to Shell plc shareholders |
186,606 |
|
190,472 |
|
Non-controlling interest1 |
1,755 |
|
2,125 |
|
Total equity |
188,361 |
|
192,597 |
|
Total liabilities and equity |
406,269 |
|
443,024 |
|
1. See Note 8 “Other notes to the
unaudited Condensed Consolidated Financial Statements”.
2. See Note 7 “Derivative financial
instruments and debt excluding lease liabilities”.
Page
15
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
|
Equity attributable to Shell plc shareholders |
|
|
|
$ million |
Share capital1 |
Shares held in trust |
Other reserves² |
Retained earnings |
Total |
Non-controlling interest |
|
Total equity |
At January 1, 2023 |
584 |
|
(726) |
|
21,132 |
|
169,482 |
|
190,472 |
|
2,125 |
|
|
192,597 |
|
Comprehensive income/(loss) for the period |
— |
|
— |
|
(83) |
|
19,359 |
|
19,277 |
|
314 |
|
|
19,590 |
|
Transfer from other comprehensive income |
— |
|
— |
|
(112) |
|
112 |
|
— |
|
— |
|
|
— |
|
Dividends³ |
— |
|
— |
|
— |
|
(8,389) |
|
(8,389) |
|
(764) |
|
|
(9,153) |
|
Repurchases of shares4 |
(40) |
|
— |
|
40 |
|
(14,571) |
|
(14,571) |
|
— |
|
|
(14,571) |
|
Share-based compensation |
— |
|
(271) |
|
168 |
|
(85) |
|
(188) |
|
— |
|
|
(188) |
|
Other changes |
— |
|
— |
|
— |
|
6 |
|
6 |
|
80 |
|
|
86 |
|
At December 31, 2023 |
544 |
|
(998) |
|
21,145 |
|
165,915 |
|
186,606 |
|
1,755 |
|
|
188,361 |
|
At January 1, 2022 |
641 |
|
(610) |
|
18,909 |
|
153,026 |
|
171,966 |
|
3,360 |
|
|
175,326 |
|
Comprehensive income/(loss) for the period |
— |
|
— |
|
2,024 |
|
42,309 |
|
44,333 |
|
621 |
|
|
44,954 |
|
Transfer from other comprehensive income |
— |
|
— |
|
(34) |
|
34 |
|
— |
|
— |
|
|
— |
|
Dividends3 |
— |
|
— |
|
— |
|
(7,283) |
|
(7,283) |
|
(206) |
|
|
(7,489) |
|
Repurchases of shares4 |
(57) |
|
— |
|
57 |
|
(18,547) |
|
(18,547) |
|
— |
|
|
(18,547) |
|
Share-based compensation |
— |
|
(116) |
|
176 |
|
131 |
|
191 |
|
— |
|
|
191 |
|
Other changes |
— |
|
— |
|
— |
|
(188) |
|
(188) |
|
(1,650) |
|
|
(1,838) |
|
At December 31, 2022 |
584 |
|
(726) |
|
21,132 |
|
169,482 |
|
190,472 |
|
2,125 |
|
|
192,597 |
|
1. See Note 5 “Share capital”.
2. See Note 6 “Other reserves”.
3. The amount charged to retained
earnings is based on prevailing exchange rates on payment date.
4. Includes shares committed to
repurchase under an irrevocable contract and repurchases subject to
settlement at the end of the quarter.
Page
16
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF CASH FLOWS |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
|
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
1,635 |
|
|
11,291 |
|
16,443 |
|
Income before taxation for the period |
32,628 |
|
64,815 |
|
|
|
|
|
Adjustment for: |
|
|
571 |
|
|
513 |
|
596 |
|
– Interest expense (net) |
2,360 |
|
2,135 |
|
11,221 |
|
|
5,911 |
|
6,459 |
|
– Depreciation, depletion and amortisation1 |
31,290 |
|
18,529 |
|
243 |
|
|
186 |
|
395 |
|
– Exploration well write-offs |
868 |
|
881 |
|
(222) |
|
|
74 |
|
(21) |
|
– Net (gains)/losses on sale and revaluation of non-current assets
and businesses |
(246) |
|
(642) |
|
(768) |
|
|
(747) |
|
268 |
|
– Share of (profit)/loss of joint ventures and associates |
(3,725) |
|
(3,972) |
|
1,145 |
|
|
749 |
|
1,413 |
|
– Dividends received from joint ventures and associates |
3,674 |
|
4,398 |
|
4,088 |
|
|
(3,151) |
|
2,902 |
|
– (Increase)/decrease in inventories |
6,325 |
|
(8,360) |
|
(704) |
|
|
(1,126) |
|
5,179 |
|
– (Increase)/decrease in current receivables |
12,401 |
|
(8,989) |
|
(47) |
|
|
4,711 |
|
2,308 |
|
– Increase/(decrease) in current payables |
(10,888) |
|
11,915 |
|
328 |
|
|
(2,807) |
|
(7,669) |
|
– Derivative financial instruments |
(5,723) |
|
(2,619) |
|
(68) |
|
|
1 |
|
135 |
|
– Retirement benefits |
(37) |
|
417 |
|
(223) |
|
|
70 |
|
218 |
|
– Decommissioning and other provisions |
(473) |
|
35 |
|
(1,021) |
|
|
(150) |
|
(1,850) |
|
– Other1 |
(548) |
|
2,991 |
|
(3,604) |
|
|
(3,191) |
|
(4,372) |
|
Tax paid |
(13,712) |
|
(13,120) |
|
12,575 |
|
|
12,332 |
|
22,404 |
|
Cash flow from operating activities |
54,196 |
|
68,414 |
|
(6,960) |
|
|
(5,259) |
|
(6,417) |
|
Capital expenditure |
(22,993) |
|
(22,600) |
|
(109) |
|
|
(350) |
|
(860) |
|
Investments in joint ventures and associates |
(1,202) |
|
(1,973) |
|
(44) |
|
|
(40) |
|
(42) |
|
Investments in equity securities |
(197) |
|
(260) |
|
540 |
|
|
184 |
|
52 |
|
Proceeds from sale of property, plant and equipment and
businesses |
2,565 |
|
1,431 |
|
49 |
|
|
68 |
|
119 |
|
Proceeds from joint ventures and associates from sale, capital
reduction and repayment of long-term loans |
474 |
|
511 |
|
24 |
|
|
7 |
|
65 |
|
Proceeds from sale of equity securities |
51 |
|
117 |
|
568 |
|
|
586 |
|
401 |
|
Interest received |
2,124 |
|
906 |
|
960 |
|
|
701 |
|
518 |
|
Other investing cash inflows |
4,269 |
|
2,060 |
|
(685) |
|
|
(724) |
|
(754) |
|
Other investing cash outflows |
(2,825) |
|
(2,640) |
|
(5,657) |
|
|
(4,827) |
|
(6,918) |
|
Cash flow from investing activities |
(17,737) |
|
(22,448) |
|
(27) |
|
|
88 |
|
(248) |
|
Net increase/(decrease) in debt with maturity period within three
months |
(211) |
|
318 |
|
|
|
|
|
Other debt: |
|
|
64 |
|
|
187 |
|
31 |
|
– New borrowings |
1,029 |
|
269 |
|
(4,054) |
|
|
(3,368) |
|
(2,217) |
|
– Repayments |
(10,650) |
|
(8,459) |
|
(1,366) |
|
|
(1,049) |
|
(1,183) |
|
Interest paid |
(4,441) |
|
(3,677) |
|
702 |
|
|
(26) |
|
356 |
|
Derivative financial instruments |
723 |
|
(1,799) |
|
(1) |
|
|
6 |
|
(1,974) |
|
Change in non-controlling interest |
(22) |
|
(1,965) |
|
|
|
|
|
Cash dividends paid to: |
|
|
(2,201) |
|
|
(2,179) |
|
(1,785) |
|
– Shell plc shareholders |
(8,393) |
|
(7,405) |
|
(128) |
|
|
(51) |
|
(42) |
|
– Non-controlling interest |
(764) |
|
(206) |
|
(3,977) |
|
|
(2,725) |
|
(4,474) |
|
Repurchases of shares |
(14,617) |
|
(18,437) |
|
(714) |
|
|
(30) |
|
(542) |
|
Shares held in trust: net sales/(purchases) and dividends
received |
(889) |
|
(593) |
|
(11,703) |
|
|
(9,147) |
|
(12,078) |
|
Cash flow from financing activities |
(38,238) |
|
(41,954) |
|
529 |
|
|
(421) |
|
860 |
|
Effects of exchange rate changes on cash and cash equivalents |
307 |
|
(736) |
|
(4,256) |
|
|
(2,063) |
|
4,268 |
|
Increase/(decrease) in cash and cash
equivalents |
(1,471) |
|
3,276 |
|
43,031 |
|
|
45,094 |
|
35,978 |
|
Cash and cash equivalents at beginning of
period |
40,246 |
|
36,970 |
|
38,774 |
|
|
43,031 |
|
40,246 |
|
Cash and cash equivalents at end of period |
38,774 |
|
40,246 |
|
1.See Note 8 “Other notes to the unaudited Condensed
Consolidated Financial Statements”.
Page
17
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
1. Basis of
preparation
These unaudited Condensed Consolidated Financial Statements of
Shell plc (“the Company”) and its subsidiaries (collectively
referred to as “Shell”) have been prepared on the basis of the same
accounting principles as those used in the Company's Annual Report
and Accounts (pages 237 to 307) for the year ended December 31,
2022 as filed with the Registrar of Companies for England and Wales
and the Autoriteit Financiële Markten (the Netherlands) and Form
20-F (pages 216 to 287) for the year ended December 31, 2022 as
filed with the US Securities and Exchange Commission, and should be
read in conjunction with these filings.
The financial information presented in the unaudited Condensed
Consolidated Financial Statements does not constitute statutory
accounts within the meaning of section 434(3) of the Companies Act
2006 (“the Act”). Statutory accounts for the year ended December
31, 2022 were published in Shell's Annual Report and Accounts, a
copy of which was delivered to the Registrar of Companies for
England and Wales, and in Shell's Form 20-F. The auditor's report
on those accounts was unqualified, did not include a reference to
any matters to which the auditor drew attention by way of emphasis
without qualifying the report and did not contain a statement under
sections 498(2) or 498(3) of the Act. The statutory accounts for
the year ended December 31, 2023 will be delivered to the Registrar
of Companies for England and Wales in due course.
On consolidation, assets and liabilities of non-dollar entities
are translated to dollars at period-end rates of exchange, while
their statements of income, other comprehensive income and cash
flows are translated at average rates. Until the end of 2022 this
translation was performed at quarterly average rates. As from
January 1, 2023 this translation is performed at monthly average
rates. This change had no significant impact on Shell's financial
reporting.
New standards adopted in 2023
IFRS 17 Insurance contracts (IFRS 17) as issued in 2017, with
amendments published in 2020 and 2021, was adopted as from January
1, 2023. The adoption of IFRS 17 had no significant effect on
Shell's financial reporting.
Deferred Tax related to Assets and Liabilities arising from a
Single Transaction (Amendments to IAS 12 Income taxes (IAS 12)),
published in May 2021, was adopted as from January 1, 2023. The
adoption of these amendments had no significant effect on Shell's
financial reporting.
International Tax Reform — Pillar Two Model Rules (Amendments to
IAS 12) as issued on May 23, 2023, was adopted as from that
date. The amendments to IAS 12 introduce a temporary mandatory
relief from accounting for deferred tax that arises from
legislation implementing OECD Pillar Two. On June 20, 2023,
the United Kingdom substantively enacted Pillar Two. The adoption
of the Pillar Two Model Rules by the jurisdictions in which Shell
operates is not expected to have a significant impact on Shell. As
required by the amendments to IAS 12, Shell has applied the
exception to recognising and disclosing information about deferred
tax assets and liabilities related to Pillar Two income taxes.
Key accounting considerations, significant judgements and
estimates
Future long-term commodity price assumptions and management’s
view on the future development of refining margins represent a
significant estimate. Future long-term commodity price assumptions
were subject to change in the second quarter 2023. These
assumptions continued to apply for impairment testing purposes in
the fourth quarter 2023.
The discount rate applied in assessing value in use represents a
significant estimate. The discount rate applied was subject to
change in the second quarter 2023.
The discount rate applied to provisions is reviewed on a regular
basis. The discount rate was reviewed and adjusted in the fourth
quarter 2023. See Note 8.
2. Segment
information
Segment earnings are presented on a current cost of supplies
basis (CCS earnings), which is the earnings measure used by the
Chief Executive Officer for the purposes of making decisions about
allocating resources and assessing performance. On this basis, the
purchase price of volumes sold during the period is based on the
current cost of supplies during the same period after making
allowance for the tax effect. CCS earnings therefore exclude the
effect of changes in the oil price on inventory carrying amounts.
Sales between segments are based on prices generally equivalent to
commercially available prices.
Page
18
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUE AND CCS EARNINGS BY SEGMENT |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
|
|
|
Third-party revenue |
|
|
10,437 |
|
8,338 |
|
13,802 |
|
Integrated Gas |
37,645 |
|
54,751 |
|
1,263 |
|
1,617 |
|
2,945 |
|
Upstream |
6,475 |
|
8,352 |
|
26,429 |
|
29,577 |
|
28,417 |
|
Marketing |
108,858 |
|
120,638 |
|
30,290 |
|
27,779 |
|
33,480 |
|
Chemicals and Products |
118,780 |
|
144,342 |
|
10,302 |
|
9,032 |
|
22,656 |
|
Renewables and Energy Solutions |
44,819 |
|
53,190 |
|
11 |
|
7 |
|
4 |
|
Corporate |
42 |
|
41 |
|
78,732 |
|
76,350 |
|
101,303 |
|
Total third-party revenue1 |
316,620 |
|
381,314 |
|
|
|
|
Inter-segment revenue |
|
|
2,614 |
|
2,472 |
|
5,038 |
|
Integrated Gas |
11,560 |
|
18,412 |
|
10,948 |
|
10,277 |
|
13,229 |
|
Upstream |
41,231 |
|
52,285 |
|
185 |
|
154 |
|
183 |
|
Marketing |
624 |
|
606 |
|
610 |
|
569 |
|
602 |
|
Chemicals and Products |
2,252 |
|
2,684 |
|
1,567 |
|
894 |
|
2,035 |
|
Renewables and Energy Solutions |
4,707 |
|
6,791 |
|
— |
|
— |
|
— |
|
Corporate |
— |
|
— |
|
|
|
|
CCS earnings |
|
|
1,728 |
|
2,154 |
|
5,293 |
|
Integrated Gas |
7,046 |
|
22,212 |
|
2,179 |
|
1,983 |
|
1,380 |
|
Upstream |
8,528 |
|
16,222 |
|
143 |
|
702 |
|
375 |
|
Marketing |
2,951 |
|
2,133 |
|
(1,792) |
|
1,173 |
|
332 |
|
Chemicals and Products |
1,530 |
|
4,515 |
|
(291) |
|
600 |
|
4,673 |
|
Renewables and Energy Solutions |
3,038 |
|
(1,059) |
|
(586) |
|
(460) |
|
(654) |
|
Corporate |
(2,811) |
|
(2,461) |
|
1,381 |
|
6,152 |
|
11,399 |
|
Total CCS earnings2 |
20,283 |
|
41,562 |
|
1.Includes revenue from sources other than from contracts with
customers, which mainly comprises the impact of fair value
accounting of commodity derivatives. Fourth quarter 2023 included
income of $3,021 million (third quarter 2023:
$3,530 million income; fourth quarter 2022:
$10,371 million income). This amount includes both the
reversal of prior gains of $711 million (third quarter 2023:
$2,583 million gains; fourth quarter 2022: $621 million
losses) related to sales contracts and prior losses of
$248 million (third quarter 2023: $965 million losses;
fourth quarter 2022: $1,032 million losses) related to
purchase contracts that were previously recognised and where
physical settlement took place in the fourth quarter 2023.
2.See Note 3 "Reconciliation of income for the period to CCS
Earnings, Operating expenses and Total Debt".
Page
19
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Cash capital expenditure represents cash spent on maintaining
and developing assets as well as on investments in the period.
Management regularly monitors this measure as a key lever to
delivering sustainable cash flows. Cash capital expenditure is the
sum of the following lines from the Consolidated Statement of Cash
Flows: Capital expenditure, Investments in joint ventures and
associates and Investments in equity securities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH CAPITAL EXPENDITURE BY SEGMENT |
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
|
|
|
Capital expenditure |
|
|
1,034 |
|
958 |
|
818 |
|
Integrated Gas |
3,491 |
|
3,432 |
|
2,547 |
|
2,013 |
|
1,951 |
|
Upstream |
8,249 |
|
8,020 |
|
1,337 |
|
893 |
|
1,825 |
|
Marketing |
5,563 |
|
4,527 |
|
1,029 |
|
803 |
|
786 |
|
Chemicals and Products |
3,106 |
|
3,835 |
|
932 |
|
523 |
|
955 |
|
Renewables and Energy Solutions |
2,314 |
|
2,609 |
|
81 |
|
68 |
|
82 |
|
Corporate |
271 |
|
175 |
|
6,960 |
|
5,259 |
|
6,417 |
|
Total capital expenditure |
22,993 |
|
22,600 |
|
|
|
|
Add: Investments in joint ventures and
associates |
|
|
162 |
|
141 |
|
709 |
|
Integrated Gas |
705 |
|
833 |
|
(111) |
|
(6) |
|
(106) |
|
Upstream |
94 |
|
123 |
|
2 |
|
24 |
|
168 |
|
Marketing |
49 |
|
304 |
|
2 |
|
76 |
|
1 |
|
Chemicals and Products |
84 |
|
2 |
|
56 |
|
114 |
|
86 |
|
Renewables and Energy Solutions |
261 |
|
703 |
|
(2) |
|
1 |
|
2 |
|
Corporate |
9 |
|
9 |
|
109 |
|
350 |
|
860 |
|
Total investments in joint ventures and
associates |
1,202 |
|
1,973 |
|
|
|
|
Add: Investments in equity
securities |
|
|
— |
|
— |
|
— |
|
Integrated Gas |
— |
|
— |
|
— |
|
— |
|
— |
|
Upstream |
— |
|
— |
|
— |
|
— |
|
— |
|
Marketing |
— |
|
— |
|
— |
|
— |
|
— |
|
Chemicals and Products |
2 |
|
1 |
|
38 |
|
21 |
|
35 |
|
Renewables and Energy Solutions |
106 |
|
157 |
|
6 |
|
19 |
|
7 |
|
Corporate |
90 |
|
103 |
|
44 |
|
40 |
|
42 |
|
Total investments in equity securities |
197 |
|
260 |
|
|
|
|
Cash capital expenditure |
|
|
1,196 |
|
1,099 |
|
1,527 |
|
Integrated Gas |
4,196 |
|
4,265 |
|
2,436 |
|
2,007 |
|
1,845 |
|
Upstream |
8,343 |
|
8,143 |
|
1,339 |
|
917 |
|
1,993 |
|
Marketing |
5,612 |
|
4,831 |
|
1,031 |
|
879 |
|
786 |
|
Chemicals and Products |
3,192 |
|
3,838 |
|
1,026 |
|
659 |
|
1,076 |
|
Renewables and Energy Solutions |
2,681 |
|
3,469 |
|
85 |
|
87 |
|
91 |
|
Corporate |
370 |
|
287 |
|
7,113 |
|
5,649 |
|
7,319 |
|
Total Cash capital expenditure |
24,393 |
|
24,833 |
|
Page
20
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
3. Reconciliation of income for the period to CCS
Earnings, Operating expenses and Total Debt
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF INCOME FOR THE PERIOD TO CCS
EARNINGS |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
474 |
|
7,044 |
|
10,409 |
|
Income/(loss) attributable to Shell plc shareholders |
19,360 |
|
42,309 |
|
62 |
|
132 |
|
59 |
|
Income/(loss) attributable to non-controlling interest |
277 |
|
565 |
|
536 |
|
7,176 |
|
10,469 |
|
Income/(loss) for the period |
19,638 |
|
42,874 |
|
|
|
|
Current cost of supplies adjustment: |
|
|
1,089 |
|
(1,304) |
|
1,210 |
|
Purchases |
815 |
|
(1,714) |
|
(263) |
|
327 |
|
(301) |
|
Taxation |
(203) |
|
444 |
|
19 |
|
(47) |
|
22 |
|
Share of profit/(loss) of joint ventures and associates |
33 |
|
(42) |
|
846 |
|
(1,024) |
|
930 |
|
Current cost of supplies adjustment |
645 |
|
(1,312) |
|
|
|
|
Of which: |
|
|
811 |
|
(969) |
|
904 |
|
Attributable to Shell plc shareholders |
649 |
|
(1,196) |
34 |
|
(55) |
|
27 |
|
Attributable to non-controlling interest |
(5) |
|
(116) |
1,381 |
|
6,152 |
|
11,399 |
|
CCS earnings |
20,283 |
|
41,562 |
|
|
|
|
Of which: |
|
|
1,285 |
|
6,075 |
|
11,313 |
|
CCS earnings attributable to Shell plc shareholders |
20,010 |
|
41,113 |
|
97 |
|
77 |
|
86 |
|
CCS earnings attributable to non-controlling interest |
273 |
|
449 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF OPERATING EXPENSES |
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
6,807 |
|
6,384 |
|
7,220 |
|
Production and manufacturing expenses |
25,240 |
|
25,518 |
|
3,621 |
|
3,447 |
|
3,491 |
|
Selling, distribution and administrative expenses |
13,433 |
|
12,883 |
|
469 |
|
267 |
|
403 |
|
Research and development |
1,287 |
|
1,075 |
|
10,897 |
|
10,097 |
|
11,114 |
|
Operating expenses |
39,959 |
|
39,477 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF TOTAL DEBT |
|
|
|
Quarters |
$ million |
|
|
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
|
|
|
December 31, 2023 |
September 30, 2023 |
December 31, 2022 |
|
December 31, 2023 |
December 31, 2022 |
|
9,931 |
|
10,119 |
|
9,001 |
|
Current debt |
9,931 |
|
9,001 |
|
|
71,610 |
|
72,028 |
|
74,794 |
|
Non-current debt |
71,610 |
|
74,794 |
|
|
81,541 |
|
82,147 |
|
83,795 |
|
Total debt |
81,541 |
|
83,795 |
|
|
4. Earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE |
Quarters |
|
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
474 |
|
7,044 |
|
10,409 |
|
Income/(loss) attributable to Shell plc shareholders ($
million) |
19,360 |
|
42,309 |
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares used as the basis for
determining: |
|
|
6,558.3 |
|
6,668.1 |
|
7,063.9 |
|
Basic earnings per share (million) |
6,733.5 |
|
7,347.5 |
|
6,631.1 |
|
6,736.7 |
|
7,127.2 |
|
Diluted earnings per share (million) |
6,799.8 |
|
7,410.5 |
|
Page
21
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
5. Share
capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ISSUED AND FULLY PAID ORDINARY SHARES OF €0.07
EACH1 |
|
Number of shares |
|
Nominal value ($ million) |
|
A |
B |
Ordinary shares |
|
A |
B |
Ordinary shares |
Total |
At January 1, 2023 |
|
|
7,003,503,393 |
|
|
|
|
584 |
|
584 |
|
Repurchases of shares |
|
|
(479,394,344) |
|
|
|
|
(40) |
|
(40) |
|
At December 31, 2023 |
|
|
6,524,109,049 |
|
|
|
|
544 |
|
544 |
|
At January 1, 2022 |
4,101,239,499 |
|
3,582,892,954 |
|
|
|
345 |
|
296 |
|
|
641 |
|
Repurchases of shares before assimilation |
— |
|
(34,106,548) |
|
|
|
— |
|
(3) |
|
|
(3) |
|
Assimilation of ordinary A and B shares into ordinary shares on
January 29, 2022 |
(4,101,239,499) |
|
(3,548,786,406) |
|
7,650,025,905 |
|
|
(345) |
|
(293) |
|
638 |
|
— |
|
Repurchases of B shares on January 27 and 28, 2022, cancelled as
ordinary shares on February 2 and 3, 2022 |
|
|
(507,742) |
|
|
|
|
— |
|
— |
|
Repurchases of shares after assimilation |
|
|
(646,014,770) |
|
|
|
|
(54) |
|
(54) |
|
At December 31, 2022 |
|
|
7,003,503,393 |
|
|
|
|
584 |
|
584 |
|
1.Share capital at December 31, 2022, also included 50,000
issued and fully paid sterling deferred shares of £1 each, which
were redeemed on March 27, 2023. Upon redemption, the sterling
deferred shares were treated as cancelled and the Company's issued
share capital was reduced by the nominal value of the shares
redeemed in accordance with section 688 of the UK Companies Act
2006.
On January 29, 2022, as part of the simplification announced on
December 20, 2021, the Company's A shares and B shares assimilated
into a single line of ordinary shares. This is reflected in the
above table.
At Shell plc’s Annual General Meeting on May 23, 2023, the
Board was authorised to allot ordinary shares in Shell plc, and to
grant rights to subscribe for, or to convert, any security into
ordinary shares in Shell plc, up to an aggregate nominal amount of
approximately €161 million (representing approximately 2,307
million ordinary shares of €0.07 each), and to list such shares or
rights on any stock exchange. This authority expires at the earlier
of the close of business on August 22, 2024, or the end of the
Annual General Meeting to be held in 2024, unless previously
renewed, revoked or varied by Shell plc in a general meeting.
6. Other
reserves
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER RESERVES |
$ million |
Merger reserve |
Share premium reserve |
Capital redemption reserve |
Share plan reserve |
Accumulated other comprehensive income |
Total |
At January 1, 2023 |
37,298 |
|
154 |
|
196 |
|
1,140 |
|
(17,656) |
|
21,132 |
|
Other comprehensive income/(loss) attributable to Shell plc
shareholders |
— |
|
— |
|
— |
|
— |
|
(83) |
|
(83) |
|
Transfer from other comprehensive income |
— |
|
— |
|
— |
|
— |
|
(112) |
|
(112) |
|
Repurchases of shares |
— |
|
— |
|
40 |
|
— |
|
— |
|
40 |
|
Share-based compensation |
— |
|
— |
|
— |
|
168 |
|
— |
|
168 |
|
At December 31, 2023 |
37,298 |
|
154 |
|
236 |
|
1,308 |
|
(17,851) |
|
21,145 |
|
At January 1, 2022 |
37,298 |
|
154 |
|
139 |
|
964 |
|
(19,646) |
|
18,909 |
|
Other comprehensive income/(loss) attributable to Shell plc
shareholders |
— |
|
— |
|
— |
|
— |
|
2,024 |
|
2,024 |
|
Transfer from other comprehensive income |
— |
|
— |
|
— |
|
— |
|
(34) |
|
(34) |
|
Repurchases of shares |
— |
|
— |
|
57 |
|
— |
|
— |
|
57 |
|
Share-based compensation |
— |
|
— |
|
— |
|
176 |
|
— |
|
176 |
|
At December 31, 2022 |
37,298 |
|
154 |
|
196 |
|
1,140 |
|
(17,656) |
|
21,132 |
|
The merger reserve and share premium reserve were established as
a consequence of Shell plc (formerly Royal Dutch Shell plc)
becoming the single parent company of Royal Dutch Petroleum Company
and The “Shell” Transport and Trading
Page
22
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Company, p.l.c., now The Shell Transport and Trading Company
Limited, in 2005. The merger reserve increased in 2016 following
the issuance of shares for the acquisition of BG Group plc. The
capital redemption reserve was established in connection with
repurchases of shares of Shell plc. The share plan reserve is in
respect of equity-settled share-based compensation plans.
7. Derivative financial
instruments and debt excluding lease
liabilities
As disclosed in the Consolidated Financial Statements for the
year ended December 31, 2022, presented in the Annual Report and
Accounts and Form 20-F for that year, Shell is exposed to the risks
of changes in fair value of its financial assets and liabilities.
The fair values of the financial assets and liabilities are defined
as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market
participants at the measurement date. Methods and assumptions used
to estimate the fair values at December 31, 2023, are consistent
with those used in the year ended December 31, 2022, though the
carrying amounts of derivative financial instruments have changed
since that date. The movement of the derivative financial
instruments between December 31, 2022 and December 31, 2023 is a
decrease of $9,339 million for the current assets and a decrease of
$14,250 million for the current liabilities.
The table below provides the comparison of the fair value with
the carrying amount of debt excluding lease liabilities, disclosed
in accordance with IFRS 7 Financial Instruments: Disclosures.
|
|
|
|
|
|
|
|
|
|
DEBT EXCLUDING LEASE LIABILITIES |
$ million |
December 31, 2023 |
December 31, 2022 |
Carrying amount |
53,832 |
|
56,152 |
|
Fair value¹ |
50,866 |
|
51,959 |
|
1. Mainly determined from the prices
quoted for these securities.
8. Other notes to the unaudited Condensed Consolidated
Financial Statements
Consolidated Statement of Income
Interest and other income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
631 |
|
913 |
|
160 |
|
Interest and other
income/(expenses) |
2,838 |
|
915 |
|
|
|
|
Of which: |
|
|
595 |
|
618 |
|
445 |
|
Interest income |
2,313 |
|
1,046 |
|
14 |
|
7 |
|
15 |
|
Dividend income (from investments in equity securities) |
50 |
|
216 |
|
222 |
|
(75) |
|
21 |
|
Net gains/(losses) on sales and revaluation of non-current assets
and businesses |
257 |
|
642 |
|
(398) |
|
168 |
|
(510) |
|
Net foreign exchange gains/(losses) on financing activities |
(458) |
|
(340) |
|
199 |
|
195 |
|
189 |
|
Other |
677 |
|
(649) |
|
Depreciation, depletion and amortisation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
11,221 |
|
5,911 |
|
6,459 |
|
Depreciation, depletion and
amortisation |
31,290 |
|
18,529 |
|
|
|
|
Of which: |
|
|
5,986 |
5,716 |
5,731 |
Depreciation |
23,106 |
|
22,393 |
|
5,508 |
359 |
788 |
Impairments |
8,946 |
|
2,313 |
|
(273) |
(163) |
(60) |
Impairment reversals |
(762) |
|
(6,177) |
|
Impairments recognised in the fourth quarter 2023 of
$5,508 million pre-tax ($4,044 million post-tax) relate
to various assets in Chemicals and Products ($2,490 million),
Upstream ($1,161 million), Integrated Gas ($873 million),
Renewables and Energy Solutions ($614 million) and Marketing
($370 million). Impairments in Chemicals and Products
principally relate to the impairment of chemicals assets in
Singapore triggered by lower expected chemicals margins and linked
to portfolio choices. Impairments recognised in Upstream
principally relate to projects in North America, Nigeria and the
UK
Page
23
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
triggered by factors including revised reserves estimates and
portfolio choices. Impairments recognised in Integrated Gas
principally relate to a project in Australia triggered by factors
including revised production estimates and regulatory changes.
Impairments recognised in Renewables and Energy Solutions mainly
relate to an asset in North America triggered by annual goodwill
impairment testing reflecting factors including the impact of the
deteriorated macro environment.
Impairments recognised in the third quarter 2023 of
$359 million pre-tax ($299 million post-tax) mainly
related to various assets in Renewables and Energy Solutions and
Chemicals and Products. Impairments in the fourth quarter 2022
mainly related to Renewables and Energy Solutions, Chemicals and
Products and Upstream.
Condensed Consolidated Balance Sheet
Deferred tax
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
|
December 31, 2023 |
December 31, 2022 |
Non-current assets |
|
|
Deferred tax |
6,454 |
|
7,815 |
|
Non-current liabilities |
|
|
Deferred tax |
15,347 |
|
16,186 |
Net deferred liability |
(8,893) |
|
(8,371) |
|
The presentation in the balance sheet takes into consideration
the offsetting of deferred tax assets and deferred tax liabilities
within the same tax jurisdiction, where this is permitted. The
overall deferred tax position in a particular tax jurisdiction
determines if a deferred tax balance related to that jurisdiction
is presented within deferred tax assets or deferred tax
liabilities.
Shell's net deferred tax position was a liability of
$8,893 million at December 31, 2023 (December 31, 2022:
$8,371 million). The net increase in the net deferred tax
liability is mainly driven by a reduction of the deferred tax asset
due to the utilisation of tax losses partly offset by an increase
of the deferred tax asset due to impairments.
Assets classified as held for sale
|
|
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
|
|
December 31, 2023 |
December 31, 2022 |
|
Assets classified as held for sale |
951 |
|
2,851 |
|
|
Liabilities directly associated with assets classified as held for
sale |
307 |
|
1,395 |
|
|
Assets classified as held for sale and associated liabilities at
December 31, 2023, principally relate to an asset in Chemicals
and Products in Europe, a Renewables and Energy Solutions project
in North America and an asset in Marketing in Asia. The major
classes of assets and liabilities classified as held for sale at
December 31, 2023, are Inventories ($463 million; December 31,
2022: $8 million) and Property, plant and equipment
($250 million; December 31, 2022: $2,526 million).
Retirement benefits
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
|
December 31, 2023 |
December 31, 2022 |
Non-current assets |
|
|
Retirement benefits |
9,151 |
|
10,200 |
|
Non-current liabilities |
|
|
Retirement benefits |
7,549 |
|
7,296 |
|
Surplus/(deficit) |
1,602 |
|
2,904 |
|
Amounts recognised in the balance sheet in relation to defined
benefit plans include both plan assets and obligations that are
presented on a net basis on a plan-by-plan basis. The change of the
net retirement benefit liability is mainly driven by a decrease of
the market yield on high-quality corporate bonds, a decrease in
long-term inflation rate expectations, experience losses due to
high short-term inflation and returns on plan assets.
Page
24
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Decommissioning and other provisions
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
Non-current liabilities |
December 31, 2023 |
December 31, 2022 |
Decommissioning and other provisions |
22,531 |
|
23,845 |
|
The discount rate applied at December 31, 2023 was 4.5%
(September 30, 2023: 3.25%, December 31, 2022: 3.25%). Besides
movements such as additions, utilisation, accretion and the effect
of currency translation, the change in non-current decommissioning
and other provisions includes a decrease of $2,916 million as
a result of the change in the discount rate, partly offset by an
increase of $1,340 million resulting from changes in cost
estimates for decommissioning & restoration provisions.
Non-controlling interest
|
|
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
|
|
December 31, 2023 |
December 31, 2022 |
|
Non-controlling interest |
1,755 |
|
2,125 |
|
|
The change in non-controlling interest is mainly driven by
dividend payments to non-controlling shareholders during the second
quarter 2023.
Consolidated Statement of Cash Flows
Cash flow from operating activities - Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
(1,021) |
|
(150) |
|
(1,850) |
|
Other |
(548) |
|
2,991 |
|
Cash flow from operating activities - Other for the fourth
quarter 2023 includes $875 million of net outflows (third
quarter 2023: $630 million net outflows; fourth quarter 2022:
$541 million net outflows) due to the timing of payments
relating to emission certificates and biofuel programmes in Europe
and North America and $398 million in relation to reversal of
currency exchange gains on Cash and cash equivalents (third quarter
2023: $336 million losses; fourth quarter 2022:
$683 million gains).
9. Post-balance sheet events
On January 16, 2024, Shell reached an agreement to sell its
Nigerian onshore subsidiary The Shell Petroleum Development Company
of Nigeria Limited (SPDC) for a consideration of $1.3 billion
with additional cash payments up to $1.1 billion as well as
further contingent payments. Under the agreed deal structure,
economic performance accrues to the buyer with effect from December
31, 2021, however, Shell will continue to consolidate SPDC until
control transfers at completion. At completion Shell will provide
secured term loans of up to $1.2 billion and additional
financing of up to $1.3 billion over future years. Completion
of the transaction is subject to approvals by the Federal
Government of Nigeria and other conditions.
On January 30, 2024, the principal defined benefit pension plan
in the USA, Shell Pension Plan, entered into a contract with an
external party to settle $5,052 million of pension
liabilities. The settlement price consisted of $4,920 million
of pension assets. As a result of this transaction, all legal and
constructive obligations for a tranche of benefits provided by the
Shell Pension Plan have been eliminated. No significant impact is
expected on the Group income statement, balance sheet or cashflow
statement.
Page
25
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
ALTERNATIVE PERFORMANCE (NON-GAAP)
MEASURES
A.Adjusted Earnings, Adjusted earnings before interest,
taxes, depreciation and amortisation (“Adjusted EBITDA”) and Cash
flow from operating activities
The “Adjusted Earnings” measure aims to facilitate a comparative
understanding of Shell’s financial performance from period to
period by removing the effects of oil price changes on inventory
carrying amounts and removing the effects of identified items.
These items are in some cases driven by external factors and may,
either individually or collectively, hinder the comparative
understanding of Shell’s financial results from period to period.
This measure excludes earnings attributable to non-controlling
interest.
We define “Adjusted EBITDA” as “Income/(loss) for the period”
adjusted for current cost of supplies; identified items; tax
charge/(credit); depreciation, amortisation and depletion;
exploration well write-offs and net interest expense. All items
include the non-controlling interest component. Management uses
this measure to evaluate Shell's performance in the period and over
time.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EARNINGS |
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
474 |
|
7,044 |
|
10,409 |
|
Income/(loss) attributable to Shell plc
shareholders |
19,360 |
|
42,309 |
|
811 |
|
(969) |
|
904 |
|
Add: Current cost of supplies adjustment attributable to Shell plc
shareholders1 |
649 |
|
(1,196) |
|
|
|
|
Of which: |
|
|
63 |
|
(56) |
|
96 |
|
Marketing |
175 |
|
(420) |
|
748 |
|
(913) |
|
808 |
|
Chemicals and Products |
475 |
|
(776) |
|
1,285 |
|
6,075 |
|
11,313 |
|
CCS earnings attributable to Shell plc
shareholders1 |
20,010 |
|
41,113 |
|
|
|
|
Of which: |
|
|
1,728 |
|
2,154 |
|
5,293 |
|
Integrated Gas |
7,046 |
|
22,212 |
|
2,179 |
|
1,983 |
|
1,380 |
|
Upstream |
8,528 |
|
16,222 |
|
143 |
|
702 |
|
375 |
|
Marketing |
2,951 |
|
2,133 |
|
(1,792) |
|
1,173 |
|
332 |
|
Chemicals and Products |
1,530 |
|
4,515 |
|
(291) |
|
600 |
|
4,673 |
|
Renewables and Energy Solutions |
3,038 |
|
(1,059) |
|
(586) |
|
(460) |
|
(654) |
|
Corporate |
(2,811) |
|
(2,461) |
|
97 |
|
77 |
|
86 |
|
Less: Non-controlling interest |
273 |
|
449 |
|
(6,022) |
|
(149) |
|
1,498 |
|
Less: Identified items attributable to Shell plc
shareholders |
(8,240) |
|
1,243 |
|
|
|
|
Of which: |
|
|
(2,235) |
|
(375) |
|
(675) |
|
Integrated Gas |
(6,861) |
|
6,075 |
|
(909) |
|
(238) |
|
(1,681) |
|
Upstream |
(1,267) |
|
(1,096) |
|
(549) |
|
(18) |
|
(72) |
|
Marketing |
(229) |
|
(622) |
|
(1,875) |
|
(207) |
|
(412) |
|
Chemicals and Products |
(2,160) |
|
(204) |
|
(445) |
|
667 |
|
4,379 |
|
Renewables and Energy Solutions |
2,333 |
|
(2,805) |
|
(19) |
|
22 |
|
(28) |
|
Corporate |
(69) |
|
(90) |
|
(11) |
|
— |
|
13 |
|
Less: Non-controlling interest |
(11) |
|
15 |
|
7,306 |
|
6,224 |
|
9,814 |
|
Adjusted Earnings |
28,250 |
|
39,870 |
|
|
|
|
Of which: |
|
|
3,963 |
|
2,529 |
|
5,968 |
|
Integrated Gas |
13,907 |
|
16,137 |
|
3,088 |
|
2,221 |
|
3,061 |
|
Upstream |
9,794 |
|
17,319 |
|
692 |
|
720 |
|
446 |
|
Marketing |
3,180 |
|
2,754 |
|
83 |
|
1,380 |
|
744 |
|
Chemicals and Products |
3,690 |
|
4,719 |
|
155 |
|
(67) |
|
293 |
|
Renewables and Energy Solutions |
705 |
|
1,745 |
|
(567) |
|
(482) |
|
(626) |
|
Corporate |
(2,742) |
|
(2,371) |
|
108 |
|
77 |
|
73 |
|
Less: Non-controlling interest |
284 |
|
434 |
|
1. See Note 2 “Segment information”.
Page
26
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EBITDA |
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
7,306 |
|
6,224 |
|
9,814 |
|
Adjusted Earnings |
28,250 |
|
39,870 |
|
108 |
|
77 |
|
73 |
|
Add: Non-controlling interest |
284 |
|
434 |
|
2,121 |
|
3,621 |
|
3,991 |
|
Add: Taxation charge/(credit) excluding tax impact of identified
items |
13,674 |
|
18,578 |
|
|
|
|
Of which: |
|
|
1,064 |
|
845 |
|
940 |
|
Integrated Gas |
3,834 |
|
4,704 |
|
1,570 |
|
2,155 |
|
2,921 |
|
Upstream |
8,277 |
|
11,831 |
|
104 |
|
288 |
|
161 |
|
Marketing |
900 |
|
952 |
|
(262) |
|
232 |
|
(19) |
|
Chemicals and Products |
303 |
|
841 |
|
(10) |
|
65 |
|
(3) |
|
Renewables and Energy Solutions |
324 |
|
346 |
|
(344) |
|
37 |
|
(9) |
|
Corporate |
35 |
|
(96) |
|
5,986 |
|
5,716 |
|
5,732 |
|
Add: Depreciation, depletion and amortisation excluding
impairments |
23,106 |
|
22,393 |
|
|
|
|
Of which: |
|
|
1,457 |
|
1,413 |
|
1,414 |
|
Integrated Gas |
5,756 |
|
5,544 |
|
2,951 |
|
2,771 |
|
2,944 |
|
Upstream |
11,309 |
|
11,889 |
|
533 |
|
495 |
|
417 |
|
Marketing |
1,916 |
|
1,573 |
|
951 |
|
951 |
|
848 |
|
Chemicals and Products |
3,714 |
|
3,004 |
|
89 |
|
82 |
|
104 |
|
Renewables and Energy Solutions |
392 |
|
365 |
|
6 |
|
4 |
|
4 |
|
Corporate |
19 |
|
18 |
|
243 |
|
186 |
|
395 |
|
Add: Exploration well write-offs |
867 |
|
881 |
|
|
|
|
Of which: |
|
|
63 |
|
35 |
|
9 |
|
Integrated Gas |
121 |
|
142 |
|
180 |
|
151 |
|
385 |
|
Upstream |
746 |
|
738 |
|
1,165 |
|
1,130 |
|
1,040 |
|
Add: Interest expense excluding identified items |
4,669 |
|
3,181 |
|
|
|
|
Of which: |
|
|
36 |
|
51 |
|
27 |
|
Integrated Gas |
146 |
|
84 |
|
135 |
|
119 |
|
111 |
|
Upstream |
507 |
|
345 |
|
9 |
|
23 |
|
20 |
|
Marketing |
49 |
|
45 |
|
22 |
|
41 |
|
9 |
|
Chemicals and Products |
61 |
|
22 |
|
1 |
|
1 |
|
2 |
|
Renewables and Energy Solutions |
4 |
|
2 |
|
961 |
|
895 |
|
871 |
|
Corporate |
3,902 |
|
2,683 |
|
595 |
|
618 |
|
445 |
|
Less: Interest income |
2,313 |
|
1,046 |
|
|
|
|
Of which: |
|
|
4 |
|
1 |
|
27 |
|
Integrated Gas |
6 |
|
43 |
|
14 |
|
5 |
|
5 |
|
Upstream |
27 |
|
22 |
|
1 |
|
8 |
|
— |
|
Marketing |
9 |
|
— |
|
24 |
|
13 |
|
8 |
|
Chemicals and Products |
57 |
|
24 |
|
7 |
|
1 |
|
1 |
|
Renewables and Energy Solutions |
12 |
|
(2) |
|
544 |
|
590 |
|
404 |
|
Corporate |
2,201 |
|
959 |
|
16,335 |
|
16,336 |
|
20,600 |
|
Adjusted EBITDA |
68,538 |
|
84,289 |
|
|
|
|
Of which: |
|
|
6,578 |
|
4,871 |
|
8,332 |
|
Integrated Gas |
23,759 |
|
26,569 |
|
7,910 |
|
7,412 |
|
9,418 |
|
Upstream |
30,607 |
|
42,100 |
|
1,337 |
|
1,519 |
|
1,045 |
|
Marketing |
6,037 |
|
5,324 |
|
770 |
|
2,591 |
|
1,574 |
|
Chemicals and Products |
7,710 |
|
8,561 |
|
228 |
|
79 |
|
396 |
|
Renewables and Energy Solutions |
1,413 |
|
2,459 |
|
(488) |
|
(136) |
|
(164) |
|
Corporate |
(987) |
|
(725) |
|
1,109 |
|
(1,351) |
|
1,231 |
|
Less: Current cost of supplies adjustment before taxation |
848 |
|
(1,755) |
|
Page
27
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Of which: |
|
|
81 |
|
(70) |
|
123 |
|
Marketing |
221 |
|
(568) |
|
1,028 |
|
(1,280) |
|
1,108 |
|
Chemicals and Products |
627 |
|
(1,187) |
|
246 |
|
(13) |
|
643 |
|
Joint ventures and associates (dividends received less profit) |
79 |
|
(2,157) |
|
|
|
|
Of which: |
|
|
208 |
|
(40) |
|
88 |
|
Integrated Gas |
241 |
|
(522) |
|
(250) |
|
43 |
|
192 |
|
Upstream |
(692) |
|
(2,650) |
|
35 |
|
(15) |
|
108 |
|
Marketing |
126 |
|
233 |
|
222 |
|
(23) |
|
176 |
|
Chemicals and Products |
300 |
|
694 |
|
29 |
|
21 |
|
77 |
|
Renewables and Energy Solutions |
102 |
|
85 |
|
1 |
|
— |
|
2 |
|
Corporate |
3 |
|
4 |
|
(1,030) |
|
(2,549) |
|
(2,051) |
|
Derivative financial instruments |
(6,142) |
|
624 |
|
|
|
|
Of which: |
|
|
(1,596) |
|
(454) |
|
(949) |
|
Integrated Gas |
(4,668) |
|
6,104 |
|
52 |
|
(20) |
|
— |
|
Upstream |
51 |
|
(35) |
|
3 |
|
7 |
|
52 |
|
Marketing |
(25) |
|
3 |
|
294 |
|
(372) |
|
23 |
|
Chemicals and Products |
529 |
|
(219) |
|
(268) |
|
(1,407) |
|
(1,322) |
|
Renewables and Energy Solutions |
(1,988) |
|
(4,998) |
|
487 |
|
(304) |
|
145 |
|
Corporate |
(41) |
|
(230) |
|
(3,604) |
|
(3,191) |
|
(4,372) |
|
Tax paid |
(13,712) |
|
(13,120) |
|
|
|
|
Of which: |
|
|
(731) |
|
(679) |
|
(712) |
|
Integrated Gas |
(3,574) |
|
(2,824) |
|
(2,015) |
|
(2,090) |
|
(3,364) |
|
Upstream |
(8,470) |
|
(9,423) |
|
(280) |
|
(224) |
|
(160) |
|
Marketing |
(744) |
|
(494) |
|
(273) |
|
52 |
|
(217) |
|
Chemicals and Products |
(484) |
|
(288) |
|
(413) |
|
(258) |
|
24 |
|
Renewables and Energy Solutions |
(762) |
|
(27) |
|
108 |
|
8 |
|
57 |
|
Corporate |
322 |
|
(64) |
|
(1,601) |
|
(35) |
|
(1,575) |
|
Other |
(1,558) |
|
2,456 |
|
|
|
|
Of which: |
|
|
(208) |
|
(38) |
|
(417) |
|
Integrated Gas |
(261) |
|
(223) |
|
135 |
|
(87) |
|
203 |
|
Upstream |
(374) |
|
486 |
|
(148) |
|
55 |
|
(90) |
|
Marketing |
42 |
|
(185) |
|
(1,132) |
|
(531) |
|
(403) |
|
Chemicals and Products |
(1,052) |
|
2,212 |
|
128 |
|
342 |
|
(79) |
|
Renewables and Energy Solutions |
496 |
|
(237) |
|
(376) |
|
223 |
|
(788) |
|
Corporate |
(410) |
|
403 |
|
3,336 |
|
433 |
|
10,390 |
|
(Increase)/decrease in working capital |
7,838 |
|
(5,435) |
|
|
|
|
Of which: |
|
|
(654) |
|
348 |
|
67 |
|
Integrated Gas |
2,023 |
|
(1,412) |
|
(45) |
|
78 |
|
775 |
|
Upstream |
329 |
|
(835) |
|
1,843 |
|
(533) |
|
231 |
|
Marketing |
873 |
|
(3,074) |
|
1,353 |
|
(619) |
|
3,074 |
|
Chemicals and Products |
609 |
|
757 |
|
(970) |
|
1,188 |
|
3,579 |
|
Renewables and Energy Solutions |
3,723 |
|
(3,676) |
|
1,808 |
|
(30) |
|
2,664 |
|
Corporate |
281 |
|
2,805 |
|
12,575 |
|
12,332 |
|
22,404 |
|
Cash flow from operating activities |
54,196 |
|
68,414 |
|
|
|
|
Of which: |
|
|
3,597 |
|
4,009 |
|
6,409 |
|
Integrated Gas |
17,520 |
|
27,692 |
|
5,787 |
|
5,336 |
|
7,224 |
|
Upstream |
21,450 |
|
29,641 |
|
2,709 |
|
880 |
|
1,062 |
|
Marketing |
6,088 |
|
2,376 |
|
207 |
|
2,379 |
|
3,119 |
|
Chemicals and Products |
6,987 |
|
12,906 |
|
(1,265) |
|
(34) |
|
2,674 |
|
Renewables and Energy Solutions |
2,984 |
|
(6,394) |
|
1,540 |
|
(238) |
|
1,916 |
|
Corporate |
(832) |
|
2,192 |
|
Page
28
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
Identified items
Identified items comprise: divestment gains and losses,
impairments, redundancy and restructuring, provisions for onerous
contracts, fair value accounting of commodity derivatives and
certain gas contracts and the impact of exchange rate movements on
certain deferred tax balances, and other items. Identified items in
the table below are presented on a net basis.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
IDENTIFIED ITEMS |
Quarters |
$ million |
Full year |
Q4 2023 |
|
Q3 2023 |
|
Q4 2022 |
|
2023 |
|
2022 |
|
|
|
|
|
Identified items included in Income/(loss) before
taxation |
|
|
|
222 |
|
|
(75) |
|
|
21 |
|
Divestment gains/(losses) |
257 |
|
|
657 |
|
(5,348) |
|
|
(196) |
|
|
(778) |
|
Impairment reversals/(impairments) |
(8,300) |
|
|
2,260 |
|
(275) |
|
|
(20) |
|
|
23 |
|
Redundancy and restructuring |
(329) |
|
|
44 |
|
— |
|
|
— |
|
|
— |
|
Provisions for onerous contracts |
(24) |
|
|
(508) |
|
(1,357) |
|
|
258 |
|
|
5,618 |
|
Fair value accounting of commodity derivatives and certain gas
contracts |
(419) |
|
|
3,244 |
|
(33) |
|
|
50 |
|
|
(1,087) |
|
Other |
82 |
|
|
(1,519) |
|
(6,792) |
|
|
17 |
|
|
3,796 |
|
Total identified items included in Income/(loss) before
taxation |
(8,732) |
|
|
4,178 |
|
(759) |
|
|
167 |
|
|
2,285 |
|
Less: total identified items included in Taxation
charge/(credit) |
(481) |
|
|
2,919 |
|
|
|
|
|
|
Identified items included in Income/(loss) for the
period |
|
|
|
227 |
|
|
(68) |
|
|
(46) |
|
Divestment gains/(losses) |
277 |
|
|
418 |
|
(3,935) |
|
|
(167) |
|
|
(659) |
|
Impairment reversals/(impairments) |
(6,219) |
|
|
725 |
|
(206) |
|
|
(14) |
|
|
17 |
|
Redundancy and restructuring |
(241) |
|
|
43 |
|
— |
|
|
— |
|
|
— |
|
Provisions for onerous contracts |
(18) |
|
|
(487) |
|
(1,336) |
|
|
121 |
|
|
4,181 |
|
Fair value accounting of commodity derivatives and certain gas
contracts |
(1,284) |
|
|
3,421 |
|
(363) |
|
|
(51) |
|
|
74 |
|
Impact of exchange rate movements on tax balances |
(355) |
|
|
(57) |
|
(419) |
|
|
29 |
|
|
(2,056) |
|
Other |
(412) |
|
|
(2,804) |
|
(6,033) |
|
|
(149) |
|
|
1,512 |
|
Impact on CCS earnings |
(8,252) |
|
|
1,259 |
|
|
|
|
|
|
Of which: |
|
|
|
(2,235) |
|
|
(375) |
|
|
(675) |
|
Integrated Gas |
(6,861) |
|
|
6,075 |
|
(909) |
|
|
(238) |
|
|
(1,681) |
|
Upstream |
(1,267) |
|
|
(1,096) |
|
(549) |
|
|
(18) |
|
|
(72) |
|
Marketing |
(229) |
|
|
(622) |
|
(1,875) |
|
|
(207) |
|
|
(412) |
|
Chemicals and Products |
(2,160) |
|
|
(204) |
|
(445) |
|
|
667 |
|
|
4,379 |
|
Renewables and Energy Solutions |
2,333 |
|
|
(2,805) |
|
(19) |
|
|
22 |
|
|
(28) |
|
Corporate |
(69) |
|
|
(90) |
|
(11) |
|
|
— |
|
|
13 |
|
Impact on CCS earnings attributable to non-controlling
interest |
(11) |
|
|
15 |
|
(6,022) |
|
|
(149) |
|
|
1,498 |
|
Impact on CCS earnings attributable to Shell plc
shareholders |
(8,240) |
|
|
1,243 |
|
The identified items categories above may include after-tax
impacts of identified items of joint ventures and associates which
are fully reported within "Share of profit/(loss) of joint ventures
and associates" in the Consolidated Statement of Income, and fully
reported as identified items included in Income/(loss) before
taxation in the table above. Identified items related to
subsidiaries are consolidated and reported across appropriate lines
of the Consolidated Statement of Income. Only pre-tax identified
items reported by subsidiaries are taken into account in the
calculation of underlying operating expenses (Reference F).
Provisions for onerous contracts: Provisions for onerous
contracts that relate to businesses that Shell has exited or to
redundant assets or assets that cannot be used.
Fair value accounting of commodity derivatives and certain gas
contracts: In the ordinary course of business, Shell enters into
contracts to supply or purchase oil and gas products, as well as
power and environmental products. Shell also enters into contracts
for tolling, pipeline and storage capacity. Derivative contracts
are entered into for mitigation of resulting economic exposures
(generally price exposure) and these derivative contracts are
carried at period-end market price (fair value), with movements in
fair value recognised in income for the period. Supply and purchase
contracts entered into for operational purposes, as well as
contracts for tolling, pipeline and storage capacity, are, by
contrast, recognised
Page
29
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
when the transaction occurs; furthermore, inventory is carried
at historical cost or net realisable value, whichever is lower. As
a consequence, accounting mismatches occur because: (a) the supply
or purchase transaction is recognised in a different period, or (b)
the inventory is measured on a different basis. In addition,
certain contracts are, due to pricing or delivery conditions,
deemed to contain embedded derivatives or written options and are
also required to be carried at fair value even though they are
entered into for operational purposes. The accounting impacts are
reported as identified items.
Impacts of exchange rate movements on tax
balances represent the impact on tax balances of exchange
rate movements arising on (a) the conversion to dollars of the
local currency tax base of non-monetary assets and liabilities, as
well as losses (this primarily impacts the Upstream and Integrated
Gas segments) and (b) the conversion of dollar-denominated
inter-segment loans to local currency, leading to taxable exchange
rate gains or losses (this primarily impacts the Corporate
segment).
Other identified items represent other credits
or charges that based on Shell management's assessment hinder the
comparative understanding of Shell's financial results from period
to period.
B. Adjusted Earnings per share
Adjusted Earnings per share is calculated as Adjusted Earnings
(see Reference A), divided by the weighted average number of shares
used as the basis for basic earnings per share (see Note 4).
C. Cash capital expenditure
Cash capital expenditure represents cash spent on maintaining
and developing assets as well as on investments in the period.
Management regularly monitors this measure as a key lever to
delivering sustainable cash flows. Cash capital expenditure is the
sum of the following lines from the Consolidated Statement of Cash
Flows: Capital expenditure, Investments in joint ventures and
associates and Investments in equity securities.
See Note 2 “Segment information” for the reconciliation of cash
capital expenditure.
D. Return on average capital employed
Return on average capital employed ("ROACE") measures the
efficiency of Shell’s utilisation of the capital that it employs.
Shell uses two ROACE measures: ROACE on a Net income basis and
ROACE on an Adjusted Earnings plus Non-controlling interest (NCI)
basis, both adjusted for after-tax interest expense.
Both measures refer to Capital employed which consists of total
equity, current debt and non-current debt.
ROACE on a Net income basis
In this calculation, the sum of income for the current and
previous three quarters, adjusted for after-tax interest expense,
is expressed as a percentage of the average capital employed for
the same period.
|
|
|
|
|
|
|
|
|
|
|
|
|
$ million |
Quarters |
|
Q4 2023 |
Q3 2023 |
Q4 2022 |
Income - current and previous three quarters |
19,638 |
29,571 |
42,874 |
Interest expense after tax - current and previous three
quarters |
3,271 |
3,204 |
2,290 |
Income before interest expense - current and previous three
quarters |
22,909 |
32,775 |
45,164 |
Capital employed – opening |
276,392 |
272,227 |
264,413 |
Capital employed – closing |
269,902 |
275,090 |
276,392 |
Capital employed – average |
273,147 |
273,659 |
270,402 |
ROACE on a Net income basis |
8.4% |
12.0% |
16.7% |
Page
30
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
ROACE on an Adjusted Earnings plus Non-controlling
interest (NCI) basis
In this calculation, the sum of Adjusted Earnings (see Reference
A) plus non-controlling interest (NCI) excluding identified items
for the current and previous three quarters, adjusted for after-tax
interest expense, is expressed as a percentage of the average
capital employed for the same period.
|
|
|
|
|
|
|
|
|
|
|
|
|
$ million |
Quarters |
|
Q4 2023 |
Q3 2023 |
Q4 2022 |
Adjusted Earnings - current and previous three quarters
(Reference A) |
28,250 |
30,758 |
39,870 |
Add: Income/(loss) attributable to NCI - current and previous three
quarters |
277 |
275 |
565 |
Add: Current cost of supplies adjustment attributable to NCI -
current and previous three quarters |
(5) |
(12) |
(116) |
Less: Identified items attributable to NCI (Reference A) - current
and previous three quarters |
(11) |
13 |
15 |
Adjusted Earnings plus NCI excluding identified items -
current and previous three quarters |
28,534 |
31,008 |
40,304 |
Add: Interest expense after tax - current and previous three
quarters |
3,271 |
3,204 |
2,290 |
Adjusted Earnings plus NCI excluding identified items
before interest expense - current and previous three
quarters |
31,805 |
34,211 |
42,593 |
Capital employed - average |
273,147 |
273,659 |
270,402 |
ROACE on an Adjusted Earnings plus NCI basis |
11.6% |
12.5% |
15.8% |
E. Gearing and Net debt
Gearing is a measure of Shell’s capital structure and is defined
as net debt as a percentage of total capital. Net debt is defined
as the sum of current and non-current debt, less cash and cash
equivalents, adjusted for the fair value of derivative financial
instruments used to hedge foreign exchange and interest rate risks
relating to debt, and associated collateral balances. Management
considers this adjustment useful because it reduces the volatility
of net debt caused by fluctuations in foreign exchange and interest
rates, and eliminates the potential impact of related collateral
payments or receipts. Debt-related derivative financial instruments
are a subset of the derivative financial instrument assets and
liabilities presented on the balance sheet. Collateral balances are
reported under “Trade and other receivables” or “Trade and other
payables” as appropriate.
|
|
|
|
|
|
|
|
|
|
|
|
|
$ million |
|
|
December 31, 2023 |
September 30, 2023 |
December 31, 2022 |
Current debt |
9,931 |
|
10,119 |
|
9,001 |
|
Non-current debt |
71,610 |
|
72,028 |
|
74,794 |
|
Total debt |
81,541 |
|
82,147 |
|
83,795 |
|
Of which lease liabilities |
27,709 |
|
27,854 |
|
27,643 |
|
Add: Debt-related derivative financial instruments: net
liability/(asset) |
1,835 |
|
3,116 |
|
3,071 |
|
Add: Collateral on debt-related derivatives: net
liability/(asset) |
(1,060) |
|
(1,762) |
|
(1,783) |
|
Less: Cash and cash equivalents |
(38,774) |
|
(43,031) |
|
(40,246) |
|
Net debt |
43,541 |
|
40,470 |
|
44,837 |
|
Add: Total equity |
188,361 |
|
192,943 |
|
192,597 |
|
Total capital |
231,902 |
|
233,414 |
|
237,434 |
|
Gearing |
18.8 |
% |
17.3 |
% |
18.9 |
% |
F. Operating expenses and Underlying
operating expenses
Operating expenses is a measure of Shell’s cost management
performance, comprising the following items from the Consolidated
Statement of Income: production and manufacturing expenses;
selling, distribution and administrative expenses; and research and
development expenses.
Underlying operating expenses is a measure aimed at facilitating
a comparative understanding of performance from period to period by
removing the effects of identified items, which, either
individually or collectively, can cause volatility, in some cases
driven by external factors.
Page
31
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
6,807 |
|
6,384 |
|
7,220 |
|
Production and manufacturing expenses |
25,240 |
|
25,518 |
|
|
|
|
Of which: |
|
|
1,187 |
|
1,125 |
|
1,211 |
|
Integrated Gas |
4,529 |
|
4,907 |
|
2,595 |
|
2,266 |
|
2,736 |
|
Upstream |
9,186 |
|
9,676 |
|
306 |
|
213 |
|
169 |
|
Marketing |
949 |
|
810 |
|
1,943 |
|
2,021 |
|
2,177 |
|
Chemicals and Products |
7,908 |
|
7,583 |
|
732 |
|
760 |
|
877 |
|
Renewables and Energy Solutions |
2,610 |
|
2,520 |
|
44 |
|
(1) |
|
50 |
|
Corporate |
58 |
|
22 |
|
3,621 |
|
3,447 |
|
3,491 |
|
Selling, distribution and administrative expenses |
13,433 |
|
12,883 |
|
|
|
|
Of which: |
|
|
45 |
|
52 |
|
49 |
|
Integrated Gas |
168 |
|
218 |
|
42 |
|
5 |
|
76 |
|
Upstream |
162 |
|
233 |
|
2,167 |
|
2,123 |
|
2,046 |
|
Marketing |
8,137 |
|
7,351 |
|
887 |
|
828 |
|
935 |
|
Chemicals and Products |
3,323 |
|
3,592 |
|
271 |
|
286 |
|
301 |
|
Renewables and Energy Solutions |
1,058 |
|
972 |
|
209 |
|
152 |
|
85 |
|
Corporate |
584 |
|
517 |
|
469 |
|
267 |
|
403 |
|
Research and development |
1,287 |
|
1,075 |
|
|
|
|
Of which: |
|
|
42 |
|
30 |
|
36 |
|
Integrated Gas |
126 |
|
112 |
|
130 |
|
135 |
|
168 |
|
Upstream |
496 |
|
456 |
|
66 |
|
59 |
|
88 |
|
Marketing |
250 |
|
222 |
|
113 |
|
47 |
|
67 |
|
Chemicals and Products |
252 |
|
187 |
|
118 |
|
(4) |
|
43 |
|
Renewables and Energy Solutions |
163 |
|
98 |
|
— |
|
— |
|
— |
|
Corporate |
— |
|
— |
|
10,897 |
|
10,097 |
|
11,114 |
|
Operating expenses |
39,959 |
|
39,477 |
|
|
|
|
Of which identified items: |
|
|
(274) |
|
(19) |
|
23 |
|
Redundancy and restructuring (charges)/reversal |
(325) |
|
46 |
|
(58) |
|
(343) |
|
(100) |
|
(Provisions)/reversal |
(434) |
|
77 |
|
— |
|
— |
|
— |
|
Other |
— |
|
(143) |
|
(332) |
|
(362) |
|
(77) |
|
Total identified items |
(758) |
|
(21) |
|
10,565 |
|
9,735 |
|
11,037 |
|
Underlying operating expenses |
39,201 |
|
39,456 |
|
G. Free cash flow and Organic free cash
flow
Free cash flow is used to evaluate cash available for financing
activities, including dividend payments and debt servicing, after
investment in maintaining and growing the business. It is defined
as the sum of “Cash flow from operating activities” and “Cash flow
from investing activities”.
Cash flows from acquisition and divestment activities are
removed from Free cash flow to arrive at the Organic free cash
flow, a measure used by management to evaluate the generation of
free cash flow without these activities.
Page
32
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
12,575 |
|
12,332 |
|
22,404 |
|
Cash flow from operating activities |
54,196 |
|
68,414 |
|
(5,657) |
|
(4,827) |
|
(6,918) |
|
Cash flow from investing activities |
(17,737) |
|
(22,448) |
|
6,918 |
|
7,505 |
|
15,486 |
|
Free cash flow |
36,460 |
|
45,965 |
|
612 |
|
259 |
|
235 |
|
Less: Divestment proceeds (Reference I) |
3,089 |
|
2,059 |
|
— |
|
(3) |
|
17 |
|
Add: Tax paid on divestments (reported under "Other investing cash
outflows") |
— |
|
17 |
|
206 |
|
3 |
|
971 |
|
Add: Cash outflows related to inorganic capital expenditure1 |
2,522 |
|
4,205 |
|
6,511 |
|
7,246 |
|
16,238 |
|
Organic free cash flow2 |
35,892 |
|
48,128 |
|
1.Cash outflows related to inorganic capital expenditure
includes portfolio actions which expand Shell's activities through
acquisitions and restructuring activities as reported in capital
expenditure lines in the Consolidated Statement of Cash Flows.
2.Free cash flow less divestment proceeds, adding back outflows
related to inorganic expenditure.
H. Cash flow from operating activities
and cash flow from operating activities excluding working capital
movements
Working capital movements are defined as the sum of the
following items in the Consolidated Statement of Cash Flows: (i)
(increase)/decrease in inventories, (ii) (increase)/decrease in
current receivables, and (iii) increase/(decrease) in current
payables.
Cash flow from operating activities excluding working capital
movements is a measure used by Shell to analyse its operating cash
generation over time excluding the timing effects of changes in
inventories and operating receivables and payables from period to
period.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
12,575 |
|
12,332 |
|
22,404 |
|
Cash flow from operating activities |
54,196 |
|
68,414 |
|
4,088 |
|
(3,151) |
|
2,902 |
|
(Increase)/decrease in inventories |
6,325 |
|
(8,360) |
|
(704) |
|
(1,126) |
|
5,179 |
|
(Increase)/decrease in current receivables |
12,401 |
|
(8,989) |
|
(47) |
|
4,711 |
|
2,308 |
|
Increase/(decrease) in current payables |
(10,888) |
|
11,915 |
|
3,336 |
|
433 |
|
10,390 |
|
(Increase)/decrease in working capital |
7,838 |
|
(5,435) |
|
9,238 |
|
11,899 |
|
12,014 |
|
Cash flow from operating activities excluding working
capital movements |
46,359 |
|
73,848 |
|
I. Divestment proceeds
Divestment proceeds represent cash received from divestment
activities in the period. Management regularly monitors this
measure as a key lever to deliver free cash flow.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarters |
$ million |
Full year |
Q4 2023 |
Q3 2023 |
Q4 2022 |
|
2023 |
2022 |
540 |
|
184 |
52 |
Proceeds from sale of property, plant and equipment and
businesses |
2,565 |
1,431 |
49 |
|
68 |
119 |
Proceeds from joint ventures and associates from sale, capital
reduction and repayment of long-term loans |
474 |
511 |
24 |
|
7 |
65 |
Proceeds from sale of equity securities |
51 |
117 |
612 |
|
259 |
235 |
Divestment proceeds |
3,089 |
2,059 |
Page
33
|
|
|
|
SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
CAUTIONARY STATEMENT
All amounts shown throughout this Unaudited Condensed Financial
Report are unaudited. All peak production figures in Portfolio
Developments are quoted at 100% expected production. The numbers
presented throughout this Unaudited Condensed Financial Report may
not sum precisely to the totals provided and percentages may not
precisely reflect the absolute figures, due to rounding.
The companies in which Shell plc directly and indirectly owns
investments are separate legal entities. In this Unaudited
Condensed Financial Report, “Shell”, “Shell Group” and “Group” are
sometimes used for convenience where references are made to Shell
plc and its subsidiaries in general. Likewise, the words “we”, “us”
and “our” are also used to refer to Shell plc and its subsidiaries
in general or to those who work for them. These terms are also used
where no useful purpose is served by identifying the particular
entity or entities. “Subsidiaries”, “Shell subsidiaries” and “Shell
companies” as used in this Unaudited Condensed Financial Report
refer to entities over which Shell plc either directly or
indirectly has control. Entities and unincorporated arrangements
over which Shell has joint control are generally referred to as
“joint ventures” and “joint operations”, respectively. “Joint
ventures” and “joint operations” are collectively referred to as
“joint arrangements”. Entities over which Shell has significant
influence but neither control nor joint control are referred to as
“associates”. The term “Shell interest” is used for convenience to
indicate the direct and/or indirect ownership interest held by
Shell in an entity or unincorporated joint arrangement, after
exclusion of all third-party interest.
Forward-Looking Statements
This Unaudited Condensed Financial Report contains
forward-looking statements (within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995) concerning the financial
condition, results of operations and businesses of Shell. All
statements other than statements of historical fact are, or may be
deemed to be, forward-looking statements. Forward-looking
statements are statements of future expectations that are based on
management’s current expectations and assumptions and involve known
and unknown risks and uncertainties that could cause actual
results, performance or events to differ materially from those
expressed or implied in these statements. Forward-looking
statements include, among other things, statements concerning the
potential exposure of Shell to market risks and statements
expressing management’s expectations, beliefs, estimates,
forecasts, projections and assumptions. These forward-looking
statements are identified by their use of terms and phrases such as
“aim”, “ambition”, “anticipate”, “believe”, “could”, “estimate”,
“expect”, “goals”, “intend”, “may”, “milestones”, “objectives”,
“outlook”, “plan”, “probably”, “project”, “risks”, “schedule”,
“seek”, “should”, “target”, “will” and similar terms and phrases.
There are a number of factors that could affect the future
operations of Shell and could cause those results to differ
materially from those expressed in the forward-looking statements
included in this Unaudited Condensed Financial Report, including
(without limitation): (a) price fluctuations in crude oil and
natural gas; (b) changes in demand for Shell’s products; (c)
currency fluctuations; (d) drilling and production results; (e)
reserves estimates; (f) loss of market share and industry
competition; (g) environmental and physical risks; (h) risks
associated with the identification of suitable potential
acquisition properties and targets, and successful negotiation and
completion of such transactions; (i) the risk of doing business in
developing countries and countries subject to international
sanctions; (j) legislative, judicial, fiscal and regulatory
developments including regulatory measures addressing climate
change; (k) economic and financial market conditions in various
countries and regions; (l) political risks, including the risks of
expropriation and renegotiation of the terms of contracts with
governmental entities, delays or advancements in the approval of
projects and delays in the reimbursement for shared costs; (m)
risks associated with the impact of pandemics, such as the COVID-19
(coronavirus) outbreak; and (n) changes in trading conditions. No
assurance is provided that future dividend payments will match or
exceed previous dividend payments. All forward-looking statements
contained in this Unaudited Condensed Financial Report are
expressly qualified in their entirety by the cautionary statements
contained or referred to in this section. Readers should not place
undue reliance on forward-looking statements. Additional risk
factors that may affect future results are contained in Shell plc’s
Form 20-F for the year ended December 31, 2022 (available at
www.shell.com/investor and www.sec.gov). These risk factors also
expressly qualify all forward-looking statements contained in this
Unaudited Condensed Financial Report and should be considered by
the reader. Each forward-looking statement speaks only as of the
date of this Unaudited Condensed Financial Report, February 1,
2024. Neither Shell plc nor any of its subsidiaries undertake any
obligation to publicly update or revise any forward-looking
statement as a result of new information, future events or other
information. In light of these risks, results could differ
materially from those stated, implied or inferred from the
forward-looking statements contained in this Unaudited Condensed
Financial Report.
Shell’s Net Carbon Intensity
Also, in this Unaudited Condensed Financial Report we may refer
to Shell’s “Net Carbon Intensity”, which includes Shell’s carbon
emissions from the production of our energy products, our
suppliers’ carbon emissions in supplying energy for that production
and our customers’ carbon emissions associated with their use of
the energy products we sell. Shell only controls its own emissions.
The use of the term Shell’s “Net Carbon Intensity” is for
convenience only and not intended to suggest these emissions are
those of Shell plc or its subsidiaries.
Shell’s net-Zero Emissions Target
Shell’s operating plan, outlook and budgets are forecasted for a
ten-year period and are updated every year. They reflect the
current economic environment and what we can reasonably expect to
see over the next ten years. Accordingly, they reflect our Scope 1,
Scope 2 and Net Carbon Intensity (NCI) targets over the next ten
years. However, Shell’s operating plans cannot reflect our 2050
net-zero emissions target and 2035 NCI target, as these targets are
currently outside our planning period. In the future, as society
moves towards net-zero emissions, we expect Shell’s operating plans
to reflect this movement. However, if society is not net zero in
2050, as of today, there would be significant risk that Shell may
not meet this target.
Forward-Looking Non-GAAP measures
This Unaudited Condensed Financial Report may contain certain
forward-looking non-GAAP measures such as cash capital expenditure
and divestments. We are unable to provide a reconciliation of these
forward-looking Non-GAAP measures to the most comparable GAAP
financial measures because certain information needed to reconcile
those Non-GAAP measures to the most comparable GAAP financial
measures is dependent on future events some of which are outside
the control of Shell, such as oil and gas prices, interest rates
and exchange rates. Moreover, estimating such GAAP measures with
the required precision necessary to provide a meaningful
reconciliation is extremely difficult and could not be accomplished
without unreasonable effort. Non-GAAP measures in respect of future
periods which cannot be reconciled to the most comparable GAAP
financial measure are calculated in a manner which is consistent
with the accounting policies applied in Shell plc’s consolidated
financial statements.
The contents of websites referred to in this Unaudited Condensed
Financial Report do not form part of this Unaudited Condensed
Financial Report.
We may have used certain terms, such as resources, in this
Unaudited Condensed Financial Report that the United States
Securities and Exchange Commission (SEC) strictly prohibits us from
including in our filings with the SEC. Investors are urged to
consider closely the disclosure in our Form 20-F, File No 1-32575,
available on the SEC website www.sec.gov.
This Unaudited Condensed Financial Report contains inside
information.
February 1, 2024
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34
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SHELL PLC4th QUARTER 2023 AND FULL YEAR UNAUDITED
RESULTS |
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The information in this Unaudited Condensed Financial Report
reflects the unaudited consolidated financial position and results
of Shell plc. Company No. 4366849, Registered Office: Shell Centre,
London, SE1 7NA, England, UK. |
Contacts:
- Caroline J.M. Omloo, Company Secretary
- Media: International +44 (0) 207 934 5550; USA +1 832 337
4355
LEI number of Shell plc: 21380068P1DRHMJ8KU70
Classification: Inside Information
Page
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