SHEL Shell Plc

By Jaime Llinares Taboada

Shell PLC on Thursday reported that its earnings rose even further in the second quarter, reflecting higher energy prices, refining margins and gas-and-power trading profits. Here's what the energy giant had to say:

On 2Q performance:

"Income attributable to Shell plc shareholders, compared with the first quarter 2022, mainly reflected higher realised prices, higher refining margins, and higher gas and power trading and optimisation results, partly offset by lower LNG trading and optimisation results."

"[Integrated Gas] earnings, compared with the first quarter 2022, mainly reflected higher production (increase of $109 million, post-tax), more than offset by the net of lower trading and optimisation results and assets realising higher prices (decrease of $296 million, post-tax)."

"[Upstream] earnings, compared with the first quarter 2022, mainly reflected higher realised oil and gas prices (increase of $1,417 million, post-tax), and share of profit of joint ventures and associated gain relating to storage and working gas transfer effects ($480 million, post-tax).

"[Marketing] earnings, compared with the first quarter 2022, reflected higher Marketing margins (increase of $127 million, post-tax) including higher Mobility sales volumes due to seasonality, partly offset by lower Lubricants margins due to higher feedstock costs. These were partly offset by tax charges mainly linked to hyperinflation (increase of $96 million, post-tax)."

"[Chemicals and Products] earnings, compared with the first quarter 2022, reflected higher Products margins (increase of $1,096 million, post-tax) reflecting higher realised Refining margins including the effects of dislocation in product markets, partly offset by lower contributions from trading and optimisation, as well as lower operating expenses (decrease of $111 million, post-tax). These were partly offset by lower Chemicals margins (decrease of $160 million, post-tax) due to higher feedstock and utility costs as well as higher turnarounds."

"[Renewables and Energy Solutions] earnings, compared with the first quarter 2022, mainly reflected higher trading and optimisation results for gas and power, due to extraordinary gas and power price volatility, across North America, Europe and Australia, and favourable movements in joint venture earnings related to tax."

On 3Q outlook:

"Cash capital expenditure is expected to be in line with the $23 - $27 billion range for the full year."

"Integrated Gas production is expected to be approximately 890 - 940 thousand boe/d. LNG liquefaction volumes are expected to be approximately 6.9 - 7.5 million tonnes. Third quarter 2022 outlook includes substantially more planned maintenance compared with second quarter 2022 and uncertainty around the impact of "Permitted Industrial Actions" at Prelude."

"Upstream production is expected to be approximately 1,750 - 1,950 thousand boe/d in the third quarter 2022. The third quarter production outlook reflects that Salym-related volumes in Russia are no longer recognised."

"Marketing sales volumes are expected to be approximately 2,350 - 2,850 thousand b/d. Refinery utilisation is expected to be approximately 90% - 98%."

"Chemicals manufacturing plant utilisation is expected to be approximately 82% - 90%. Chemicals sales volumes are expected to be approximately 3,100 - 3,600 thousand tonnes."

"Corporate Adjusted Earnings are expected to be a net expense of approximately $450 - $650 million in the third quarter 2022 and a net expense of approximately $2,000 - $2,400 million for the full year 2022. This excludes the impact of currency exchange rate effects."

Write to Jaime Llinares Taboada at jaime.llinares@wsj.com; @JaimeLlinaresT

(END) Dow Jones Newswires

July 28, 2022 04:21 ET (08:21 GMT)

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