Shares in Royal Dutch Shell (LON:RDSA) have climbed higher in London this morning as the Anglo-Dutch oil major posted what it referred to as a ‘strong start’ to the year. The update follows peer BP’s (LON:BP) first-quarter update earlier in the week.
As of 09:39 BST, Shell’s share price had added 2.40 percent to 2,471.50p, lending support to the benchmark FTSE 100 index which currently stands 0.07 percent higher at 7,390.05 points. The group’s shares have given up a little over two percent of their value over the past year, largely in line with the Footsie.
Q1 results lift Shell share price
Shell’s shares have been in demand even as the blue-chip oil major disclosed in a statement today that current cost of supply (CCS) earnings attributable to shareholders excluding identified items had fallen to $5.3 billion, from $5.7 billion in the prior-year period. The company attributed the decline to lower realised chemicals and refining margins, decreased realised oil prices and lower tax credits, partly offset by stronger contributions from trading as well as increased realised LNG and gas prices. The oil major further suffered a negative impact of $43 million related to the implementation of the IFRS 16 accounting standard.
“Shell has made a strong start to 2019, with the first quarter financial performance demonstrating the strength of our strategy and the quality of our portfolio of assets,” the oil major’s chief executive Ben van Beurden commented in the statement, adding that its Downstream business had delivered “robust results despite challenging market conditions”.
Van Beurden further pointed out that the company would meet its 2020 outlook.
Analysts weigh in on performance
“Overall, we see this as a strong set of numbers confirming Shell is getting closer to reaching its 2020 free cash flow targets,” RBC Capital Markets analyst Biraj Borkhataria said in a note, as quoted by Bloomberg News.