Shell hails profits progress
Published 28/04/2011 | 11:40
Shell put beleaguered rival BP in the shade today with a 30pc hike in first-quarter profits to $6.2bn (€4.2bn).
The big increase, which was marginally ahead of City expectations, reflected the latest hike in oil prices and better margins in refining.
Upstream production was down 3pc but this compared with an 11pc drop at BP over the same period after the oil giant was forced to sell assets in order to pay for clean-up costs in relation to the Gulf of Mexico oil spill.
BP announced yesterday that its profits fell 2pc to $5.48bn (€3.69bn).
Shell chief executive Peter Voser has responded to the difficult conditions in downstream operations through restructuring initiatives and has refocused the Anglo-Dutch firm's efforts on emerging growth markets.
Mr Voser said: "We continue to make good progress in implementing our strategy - improving near-term performance, delivering a new wave of production growth, and maturing the next generation of growth options for shareholders."
The big boost to Shell's results came from a sharp turnaround in the performance of its downstream arm, which saw profits more than double to $1.65bn (€1.11bn) in the three months.
Richard Hunter, head of equities at Hargreaves Lansdown stockbrokers, said Shell's shares were up 17pc over the last six months, compared to a gain of 7pc
He said: "Whereas BP has had to reorganise its business model and turn its attention to the ongoing fallout from the Gulf of Mexico spill, Shell has continued to power ahead unabated.
"Particular tailwinds, of course, have come in the form of the higher oil price and improved refining margins. Even so, the company's longer term plans, including the disposal of non-core operations and additional focus on continuous improvement, give Shell a focus which should further underpin its position."