Shell has reported an adjusted net income of $5.3 billion in the first quarter, reflecting lower realised chemicals and refining margins, decreased realised oil prices and lower tax credits. It said this was partly offset by stronger contributions from trading as well as increased realised LNG and gas prices.
Cash flow from operating activities for the first quarter 2019 of $8.6 billion, while earnings from its downstream segment increased to $1.8 billion in the first quarter.
“Shell has made a strong start to 2019, with the first quarter financial performance demonstrating the strength of our strategy and the quality of our portfolio of assets,” Royal Dutch Shell Chief Executive Officer Ben van Beurden commented this morning.
“The power of our brand, serving millions of customers every day, continues to be a differentiator. Our integrated value chain enabled our Downstream business to deliver robust results despite challenging market conditions. The consistent financial performance across all our businesses provides confidence in meeting our 2020 outlook.”
In April, Shell announced the sale of its 50 percent interest in the SASREF joint venture in the Kingdom of Saudi Arabia to Saudi Aramco for $631 million.
First quarter identified items primarily reflected a loss of $157 million related to the fair value accounting of commodity derivatives and impairment charges of $64 million, mainly related to assets in Singapore.
Compared with the first quarter 2018, downstream earnings excluding identified items mainly reflected higher contributions from crude oil and oil products trading and supply, partly offset by lower realised refining, intermediates and base chemicals margins. In addition, there was a positive impact of $38 million related to the implementation of IFRS 16.
In its first quarter statement, Shell announced the launch of the next tranche of its share buyback programme, with a maximum aggregate consideration of $2.75 billion in the period up to and including July 29, 2019. In aggregate, since the launch of the share buyback programme, 215.7 million ordinary shares were bought back for cancellation for a consideration of $6.75 billion.
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