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Shell Raises Dividends and Buybacks as Oil Giant Reports Full-Year Profit and Increased Adjusted Earnings in Q4 2021

UTC by Ibukun Ogundare · 3 min read
Shell Raises Dividends and Buybacks as Oil Giant Reports Full-Year Profit and Increased Adjusted Earnings in Q4 2021
Photo: Depositphotos

At the end of the last quarter, Shell’s net debt reduced from $57.6 billion in Q3 to $52.6 billion.

Oil industry company Shell Plc (NYSE: SHEL) has reported a sharp jump in its full-year profit and exceeded analysts’ expectations, according to its Q4 report. On the 3rd of February, Shell Plc released its 2021 Q4 earnings report and full-year unaudited result as oil and gas prices rebound. Oil demand globally began to recover on strong growth as travel and business resumed amid the persisting global health crisis. There is continued demand for gasoline and diesel despite the emerging variants of the coronavirus. The International Energy Agency wrote in a report that mobility indicators remain despite the new cases of Covid-19.

Shell Announces Q4 Earnings and Full-Year Profits

Shell reported $19.28 billion as its adjusted earnings for the full year 2021, including $6.39 billion in the year’s final quarter. The adjusted earnings for the year is a significant increase over the previous year’s record of $4.85 billion. According to analysts’ estimates polled by Refinitiv, the expected full-year 2021 net profit would be $17.8 billion.

Speaking on the full-year profit, Shell CEO Ben van Beurden referred to 2021 as a “momentous year” for the company. Beurden added that the company’s growth over the past year will enable it “to be bolder and move faster.” He boastfully said Shell delivered a “very strong financial performance” last year. The CEO noted that the company’s financial strength and discipline would aid its transformation.

Shell reported that its cash flow from operating activities for 2021 Q4 was $8.2 billion. According to the company, this included negative capital movement worth $3 billion and negative impacts of $2.7 billion. While announcing the Q4 and full-year unaudited results, Shell stated:

“Cash flow from investing activities for the quarter was an inflow of $2.6 billion, mainly driven by proceeds from sale of property, plant and equipment and businesses of $8.8 billion, mostly due to the Permian shale in the USA, partly offset by capital expenditure of $6.2 billion.”

Shell concluded to sell its Permian shale business in the US during its first board meeting in the UK at the end of 2021.

Shell Records Lower Net Debt

At the end of the last quarter, Shell’s net debt reduced from $57.6 billion in Q3 to $52.6 billion. The net debt is also $23 billion lower than the 2020 record. Also, the oil giant declared $0.24 dividends per share to all shareholders. For 2022 Q1, the Board expects interim dividend to increase about 4% to $0.25 per share. In addition, the company expects to buy back $8.5 billion worth of shares. The back shares will include the $5.5 billion generated from the sale of its Permian Shale assets in the US. On the other hand, Shell share bay backs in 2021 was a total of $3.5 billion.

Earlier today, Shell stock gained 1.3% in pre-market trading.

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Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

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