SHELL PLC
3rd QUARTER 2024 UNAUDITED RESULTS
SUMMARY OF UNAUDITED RESULTSQuarters$ million Nine monthsQ3 2024Q2 2024Q3 2023%¹ Reference20242023%4,291 3,517 7,044 +22Income/(loss) attributable to Shell plc shareholders 15,166 18,887 -206,028 6,293 6,224 -4Adjusted EarningsA20,055 20,944 -416,005 16,806 16,336 -5Adjusted EBITDAA51,523 52,204 -114,684 13,508 12,332 +9Cash flow from operating activities 41,522 41,622 -(3,857) (3,338) (4,827) Cash flow from investing activities (10,723) (12,080) 10,827 10,170 7,505 Free cash flowG30,799 29,542 4,950 4,719 5,649 Cash capital expenditureC14,161 17,280 9,570 8,950 10,097 +7Operating expensesF27,517 29,062 -58,864 8,651 9,735 +2Underlying operating expensesF26,569 28,635 -712.8%12.8%13.9% ROACE2D12.8%13.9% 76,613 75,468 82,147 Total debtE76,613 82,147 35,234 38,314 40,470 Net debtE35,234 40,470 15.7%17.0%17.3% GearingE15.7%17.3% 2,801 2,817 2,706 -1Oil and gas production available for sale (thousand boe/d) 2,843 2,779 +20.69 0.55 1.06+25Basic earnings per share ($) 2.39 2.78 -140.96 0.99 0.93 -3Adjusted Earnings per share ($)B3.16 3.08 +30.3440 0.3440 0.3310 -Dividend per share ($) 1.0320 0.9495 +9 1.Q3 on Q2 change
2.Effective first quarter 2024, the definition has been amended and comparative information has been revised. See Reference D.
Quarter Analysis1
Income attributable to Shell plc shareholders, compared with the second quarter 2024, reflected lower refining margins, lower realised oil prices and higher operating expenses partly offset by favourable tax movements, and higher Integrated Gas volumes.
Third quarter 2024 income attributable to Shell plc shareholders also included unfavourable movements relating to an accounting mismatch due to fair value accounting of commodity derivatives, charges related to redundancy and restructuring, and net impairment charges and reversals. These items are included in identified items amounting to a net loss of $1.3 billion in the quarter. This compares with identified items in the second quarter 2024 which amounted to a net loss of $2.7 billion.
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 $0.5 billion.
Cash flow from operating activities for the third quarter 2024 was $14.7 billion, and primarily driven by Adjusted EBITDA, and working capital inflows of $2.7 billion partly offset by tax payments of $3.0 billion. The working capital inflow mainly reflected inventory movements due to lower oil prices and lower volumes.
Cash flow from investing activities for the quarter was an outflow of $3.9 billion, and included cash capital expenditure of $4.9 billion.
Net debt and Gearing: At the end of the third quarter 2024, net debt was $35.2 billion, compared with $38.3 billion at the end of the second quarter 2024, mainly reflecting free cash flow, partly offset by share buybacks, cash dividends paid to Shell plc shareholders, lease additions and interest payments. Gearing was 15.7% at the end of the third quarter 2024, compared with 17.0% at the end of the second quarter 2024, mainly driven by lower net debt.
SHELL PLC
3rd QUARTER 2024 UNAUDITED RESULTS Shareholder distributions
Total shareholder distributions in the quarter amounted to $5.7 billion comprising repurchases of shares of $3.5 billion and cash dividends paid to Shell plc shareholders of $2.2 billion. Dividends declared to Shell plc shareholders for the third quarter 2024 amount to $0.3440 per share. Shell has now completed $3.5 billion of share buybacks announced in the second quarter 2024 results announcement. Today, Shell announces a share buyback programme of $3.5 billion which is expected to be completed by the fourth quarter 2024 results announcement.
Nine Months Analysis1
Income attributable to Shell plc shareholders, compared with the first nine months 2023, reflected lower refining margins, lower LNG trading and optimisation margins, lower realised LNG and gas prices as well as lower trading and optimisation margins of power and pipeline gas in Renewables and Energy Solutions, partly offset by lower operating expenses, higher Marketing margins and volumes, higher realised Chemicals margins, and higher Integrated Gas and Upstream volumes.
First nine months 2024 income attributable to Shell plc shareholders also included net impairment charges and reversals, reclassifications from equity to profit and loss of cumulative currency translation differences related to funding structures, unfavourable movements relating to an accounting mismatch due to fair value accounting of commodity derivatives, and charges related to redundancy and restructuring, partly offset by favourable differences in exchange rates and inflationary adjustments on deferred tax. These charges, reclassifications and movements are included in identified items amounting to a net loss of $4.6 billion. This compares with identified items in the first nine months 2023 which amounted to a net loss of $2.2 billion.
Adjusted Earnings and Adjusted EBITDA2 for the first nine months 2024 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 $0.3 billion.
Cash flow from operating activities for the first nine months 2024 was $41.5 billion, and primarily driven by Adjusted EBITDA, the timing impact of payments relating to emission certificates and biofuel programmes of $1.2 billion and cash inflows relating to commodity derivatives of $1.2 billion, partly offset by tax payments of $9.1 billion, and working capital outflow of $0.3 billion.
Cash flow from investing activities for the first nine months 2024 was an outflow of $10.7 billion and included cash capital expenditure of $14.2 billion, partly offset by divestment proceeds of $2.0 billion, and interest received of $1.8 billion.
This Unaudited Condensed Interim Financial Report, together with supplementary financial and operational disclosure for this quarter, is available at www.shell.com/investors 3 .
1.All earnings amounts are shown post-tax, unless stated otherwise.
2.Adjusted EBITDA is without taxation.
3.Not incorporated by reference.
THIRD QUARTER 2024 PORTFOLIO DEVELOPMENTS
Integrated Gas
In July 2024, we announced the final investment decision (FID) on the Manatee project, an undeveloped gas field in the East Coast Marine Area (ECMA) in Trinidad and Tobago.
In July 2024, we signed an agreement to invest in the Abu Dhabi National Oil Company's (ADNOC) Ruwais LNG project in Abu Dhabi through a 10% participating interest. The Ruwais LNG project will consist of two 4.8 mtpa LNG liquefaction trains with a total capacity of 9.6 mtpa.
In August 2024, Arrow Energy, an incorporated joint venture between Shell (50%) and PetroChina (50%), announced plans to develop Phase 2 of Arrow Energy's Surat Gas Project in Queensland, Australia. The gas from the project will flow to the Shell-operated QCLNG LNG (joint venture between Shell (73.75%), CNOOC (25%) and MidOcean Energy (1.25%)) facility on Curtis Island, near Gladstone.
Upstream
In July 2024, the operator of the Jerun field in Malaysia, SapuraOMV Upstream Sdn Bhd, announced that first gas has been achieved. Jerun is operated by SapuraOMV Upstream (40%) in partnership with Sarawak Shell Berhad (30%) and PETRONAS Carigali Sdn Bhd (30%).
In August 2024, we announced the FID on a 'waterflood' project at our Vito asset in the US Gulf of Mexico. Water will be injected into the reservoir formation to displace additional oil.
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SHELL PLC
3rd QUARTER 2024 UNAUDITED RESULTS Marketing
In July 2024, we announced that we are temporarily pausing on-site construction work at our 820,000 tonnes a year biofuels facility at the Shell Energy and Chemicals Park Rotterdam in the Netherlands to address project delivery and ensure future competitiveness given current market conditions.
Renewables and Energy Solutions
In October 2024, we signed an agreement to acquire a 100% equity stake in RISEC Holdings, LLC (RISEC), which owns a 609-megawatt (MW) two-unit combined-cycle gas turbine power plant in Rhode Island, USA. The transaction is subject to regulatory approvals and is expected to close in the first quarter 2025.
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SHELL PLC
3rd QUARTER 2024 UNAUDITED RESULTS PERFORMANCE BY SEGMENT
INTEGRATED GAS Quarters$ million Nine monthsQ3 2024Q2 2024Q3 2023%¹ Reference20242023%2,631 2,454 2,156 +7Segment earnings 7,846 5,325 +47(240) (220) (375) Of which: Identified itemsA(1,379) (4,625) 2,871 2,675 2,531 +7Adjusted EarningsA9,225 9,951 -75,234 5,039 4,874 +4Adjusted EBITDAA16,410 17,189 -53,623 4,183 4,009 -13Cash flow from operating activitiesA12,518 13,923 -101,236 1,151 1,099 Cash capital expenditureC3,429 3,000 136 137 122 -1Liquids production available for sale (thousand b/d) 137 134 +24,669 4,885 4,517 -4Natural gas production available for sale (million scf/d) 4,835 4,744 +2941 980 900 -4Total production available for sale (thousand boe/d) 971 952 +27.50 6.95 6.88 +8LNG liquefaction volumes (million tonnes) 22.03 21.23 +417.04 16.41 16.01 +4LNG sales volumes (million tonnes) 50.32 49.01 +3 1.Q3 on Q2 change
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.
Quarter Analysis1
Segment earnings, compared with the second quarter 2024, reflected higher LNG liquefaction volumes (increase of $237 million).
Third quarter 2024 segment earnings also included unfavourable movements of $213 million relating to an accounting mismatch due to fair value accounting of commodity derivatives. These unfavourable movements are part of identified items and compare with the second quarter 2024 which included a charge of $122 million due to unrecoverable indirect tax receivables, and unfavourable movements of $98 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.
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 $814 million, net cash outflows related to derivatives of $373 million and working capital outflows of $247 million.
Total oil and gas production, compared with the second quarter 2024, decreased by 4% mainly due to production-sharing contract effects, and higher maintenance in Trinidad and Tobago. LNG liquefaction volumes increased by 8% mainly due to higher feedgas supply in Nigeria, and Trinidad and Tobago.
Nine Months Analysis1
Segment earnings, compared with the first nine months 2023, reflected the combined effect of lower contributions from trading and optimisation and lower realised prices (decrease of $1,787 million), partly offset by higher volumes (increase of $513 million), lower operating expenses (decrease of $171 million), and favourable d
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