July 25, 2012
WHAT TO WATCH FOR: Shell won’t earn quite as large a net profit as it did in the second quarter of 2011, due to lower oil prices and fewer asset sales, but it will still make billions of dollars. The company’s investors will remain focused on Shell’s gradual progress in growing production and increasing cash-flow.
Shell has invested heavily in new projects throughout the downturn and is aiming to grow production to 4 million barrels of oil or equivalents by 2018. Production in the first quarter of 2012 was 3.55 million barrels per day, but that won’t be repeated, as a major facility was closed for part of the second quarter for maintenance. Analysts are looking for production of around 3.18 million per day.
Oil prices were around $90 per barrel this quarter, down about 46 percent from this time last year.
One bright spot in Shell’s earnings will be a recovery in the company’s refining margins. Although “downstream” activities such as refining and chemicals sales aren’t the main driver of Shell’s profits, they contribute significantly: around $1.3 billion this quarter, from $1.1 billion a year ago, according to Charles Stanley analyst Tony Shepard.
“At an $80/barrel oil price, Shell can fund its capital investment program and grow the dividend,” Shepard wrote. He rates shares an Accumulate, saying they trade at a discount to peers.
WHY IT MATTERS: Shell is one of the largest companies in the world, first on the Forbes 500 list this year. It was less profitable in 2011 than U.S. rival ExxonMobil, but had greater sales.
WHAT’S EXPECTED: Analysts surveyed by FactSet expect net income of $6.66 billion — stripping out one-time effects — on sales of $102.5 billion
LAST YEAR’S QUARTER: Second quarter earnings were $6.55 excluding one-time effects, on sales of $121.3 billion.
© 2012 The Associated Press. All Rights Reserved.
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.
