The Anglo-Dutch group said its cash flow and performance gave it confidence to start paying higher dividends again, just months after the company made the first cut in payments since World War II.
A lack of clarity on its future capital allocation and payout plans had drawn criticism from shareholders, and since the dividend cut in April, the stock has fallen to a 25-year low amid wider discomfort over the oil market.
As part of the plans presented with its third quarter results Thursday, Shell said it will increase its dividend by 4% to 16.65 cents in the third quarter and annually from now, subject to board approval. He had previously reduced his quarterly payment to 16 cents a share from 47 cents.
“Our strong cash flow will allow us to grow our businesses for the future while increasing distributions to shareholders, which makes us a compelling investment case,” said Ben van Beurden, Managing Director.
Shell pursues a net-zero emissions target as pressure to tackle climate change intensifies, but has worked to deliver an updated corporate strategy by February that satisfies shareholders.
The company, like the industry as a whole, seeks to forge an energy transition plan as it grapples with an oil price dragged down by continued efforts by governments to stem the spread of Covid-19.
For the third quarter, net profit adjusted for the cost of supply – Shell’s preferred profit measure – fell to $ 955 million. That compared to $ 4.8 billion in the same period a year ago, but still topped analysts’ estimates of $ 146 million.
This reflects lower oil and gas prices, lower refining margins and lower production volumes compared to the third quarter of 2019 and was only partially offset by lower operating expenses and strong margins. marketing.