Published: May 4 2007 03:00 | Last updated: May 4 2007 03:00
That’s five in a row. With its latest set of quarterly results, Royal Dutch Shell has beaten expectations once again. It had a favourable tailwind at the tax line as well as one-off gains at the corporate level. Even after stripping out the latter, however, Shell beat consensus forecasts for net income of $5.7bn handily. In spite of a 40 per cent year-on-year jump in capital expenditure, free cash flow from operations was a healthy $5.8bn.
This performance came against a tricky backdrop. Shell increased adjusted earnings by 10 per cent year on year, even as realised oil and gas prices fell slightly. Meanwhile, the northern hemisphere’s mild winter led to a 13 per cent decline in the amount of gas Shell sold globally.
In the upstream business, net income per barrel of oil equivalent held up at just more than $11, helping to offset lower volumes. Complementing this was a strong showing in the downstream, with both the chemicals and gas and power divisions doing much better than expected. Refining and marketing performed well in spite of a heavy maintenance schedule at Shell’s plants. That is important. In growing contrast to arch-rival BP, Shell predicates its strategy on a “manufacturing” approach to energy, with a bigger emphasis on downstream processing and production of unconventional fuels.
One good quarter – or even five – do not constitute a wholesale vindication of a multi-decade strategy. Shell’s bets on big integrated projects have paid off in the past – it was a pioneer of liquefied natural gas – but industry cost inflation and uncertainty over long-term oil prices present sizeable risks. Meaningful output growth in the upstream, still the dominant division, remains some way off. Still, the resilience displayed in Shell’s recent performance is welcome. And with both refining margins and crude oil prices having recovered, a sixth straight quarter of solid performance looks feasible.
Copyright The Financial Times Limited 2007
This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.
Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
