Royal Dutch Shell (LON:RDSA) is expected to announce a surge in annual profits when it updates investors on its full-year performance this Thursday, City A.M. reports. The Anglo-Dutch energy giant’s fourth-quarter performance, however, is expected to have been impacted by a drop in oil prices at the end of last year.
Shell’s share price has fallen into the red in London in today’s session, having given up 1.31 percent to 2,222.00p as of 14:36 GMT. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.79 percent lower at 6,755.36 points. The group’s shares have lost more than 11 percent of their value over the past year, as compared with a near 12-percent fall in the Footsie.
Shell results preview
City A.M. reported yesterday that according to analysts from S&P Global, Shell’s net income is expected to have climbed 34 percent to $21.1 billion (£15.9 billion) last year, up from $15.7 billion in the prior-year period.
“For 2018 as a whole revenues and profits should easily breach previous highs set back in 2013 especially since costs have been cut back dramatically,” The Share Centre said, as quoted by the newswire.
The results will come after the Anglo-Dutch oil major reported one of its ‘strongest-ever’ quarters in November.
“The Q4 is currently expected to be very strong as well, but given recent volatility and the rout in the oil price, things may not turn out as well as hoped,” Chris Beauchamp, market analyst at IG, commented in a note, adding that the company is expected to report a 27-percent rise in earnings for the quarter, to 66.5 cents per share.
Morgan Stanley lowered its rating on Shell last week, arguing that the Anglo-Dutch group’s planned share buybacks, dividends and debt reduction would not leave much room for capital expenditure to increase.