The UK-based firm said its adjusted earnings reached $3.66 billion in the fourth quarter, down compared to $7.3 billion in the comparable quarter last year.
Adjusted earnings dropped 39 percent compared to $6.03 billion in the prior quarter.
Income attributable to Shell shareholders reached $928 million, up compared to $474 million in Q4 2023 and a 78 percent decrease compared to $4.29 billion in the prior quarter.
Compared to the prior quarter, income attributable to Shell shareholders reflected higher exploration well write-offs, lower margins from crude and oil products trading and optimization, lower marketing margins and volumes, lower LNG trading and optimization margins, lower realized oil prices, and unfavorable tax movements, Shell said.
Also, income attributable to Shell shareholders included net impairment charges and reversals of $2.2 billion, and net losses related to sale of assets.
Shell said these items are included in identified items amounting to a net loss of $2.8 billion in the quarter.
Cash flow from operating activities for the fourth quarter was $13.2 billion, and primarily driven by adjusted Ebitda, and working capital inflows of $2.4 billion partly offset by tax payments of $2.9 billion.
For 2024, Shell reported adjusted earnings of $23.7 billion, down 16 percent, while income attributable to Shell shareholders decreased 17 percent to $16.09 billion.
Cash delivery “solid”
CEO Wael Sawan said 2024 was “another year of strong financial performance across Shell.”
“Despite the lower earnings this quarter, cash delivery remained solid and we generated free cash flow of $40 billion across the year, higher than 2023, in a lower price environment. Our continued focus on simplification helped to deliver over $3 billion in structural cost reductions since 2022, meeting our target ahead of schedule, whilst also making significant progress against all our other financial targets,” he said.
Shell announced a 4 percent increase in its dividends and another $3.5 billion buyback program, making this the 13th consecutive quarter of at least $3 billion of buybacks, Sawan said.
LNG sales down
The company sold 15.50 million tonnes of LNG in October-December, a drop from 18.09 million tonnes of LNG in the same period last year.
LNG sales dropped 9 percent compared to 17.04 million tonnes in the prior quarter.
Shell sold 65.82 million tonnes of LNG in 2024, a 2 percent decrease from 67.09 million tonnes of LNG in 2023.
In addition, liquefaction volumes of 7.06 million tonnes in the fourth quarter were flat compared to the fourth quarter of 2024 but were down 6 percent compared to 7.50 million tonnes in the prior quarter.
According to Shell, liquefaction volumes decreased compared to the prior quarter mainly due to lower feedgas supply and fewer cargoes due to the timing of liftings.
Moreover, Shell’s liquefaction volumes increased 3 percent to 29.09 million tonnes in 2024.
Shell said 2024 liquefaction volumes increased mainly due to lower maintenance in Australia.
The company expects liquefaction volumes to reach about 6.6 – 7.2 million tonnes in the first quarter of 2025.
Shell’s total oil and gas production rose to 905,000 barrels of oil equivalent per day in the fourth quarter compared to 901,000 barrels of oil equivalent per day in the fourth quarter last year, but it dropped compared to 941,000 barrels of oil equivalent per day in the prior quarter.
Compared with the prior quarter, oil and gas production decreased by 4 percent, mainly due to planned maintenance in Pearl GTL (Qatar), Shell said.
Integrated gas earnings drop
Shell’s integrated gas segment reported adjusted earnings of about $2.16 billion in the fourth quarter.
This compares to $3.97 billion in the same period in 2023 and $2.87 billion in the prior quarter.
Segment earnings of $1.74 billion rose slightly compared to $1.73 billion in the same quarter in 2023 but were down 34 percent compared to $2.63 billion in the previous quarter.
Shell reported that segment earnings reflected the net effect of lower contributions from trading and optimisation mainly driven by the comparative (non-cash) impact of expiring hedging contracts and slightly higher realized prices (decrease of $340 million), lower volumes (decrease of $283 million), and higher exploration well writeoffs (increase of $275 million).
Fourth-quarter segment earnings also included impairment charges of $339 million and a loss of $96 million related to sale of assets.
Shell announced earlier this month that it expects trading and optimization results for its integrated gas business in the fourth quarter of 2024 to be “significantly lower” compared to the previous quarter.
