UpdateShell's downstream operations Q3 earnings fall 5%

01 November 2012 08:21  [Source: ICIS news]

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SINGAPORE (ICIS)--Shell’s downstream operations in the third quarter had a 5% year-on-year decline in earnings at current cost of supplies (CCS) at $1.73bn (€1.33bn), weighed by lower chemicals earnings and reduced contributions from marketing and trading, the Anglo-Dutch energy giant said on Thursday.

The numbers did not take into account a net charge of $134m for the September quarter, which was lower than the $338m recorded in the same period in 2011, the company said in a statement.

Including the net charge, the downstream segment’s CCS earnings rose by 8% year on year to $1.6bn, it said.

“Rising oil prices during the third quarter 2012 and the global economic slowdown impacted marketing contributions, the company said.

“Compared with the third quarter 2011, chemicals earnings decreased due to rising feedstock prices in Europe, the impact of Hurricane Isaac on operations in the Gulf of Mexico as well as the global economic slowdown,” it said.

Chemical sales volumes fell by 3% year on year to 4.7m tonnes in the third quarter, mainly due to the capacity reductions in Europe and the impact of Hurricane Isaac.

Groupwide third-quarter CCS earnings before identified items fell by 6% year on year to $6.56bn, while net income attributable to shareholders was up by 2% at $7.14bn.

Shell’s third-quarter CCS earnings declined by 15% year on year to $6.13bn.

“Our earnings were driven by lower oil and gas prices, and lower chemicals margins, which offset the benefits of our operating performance, underlying growth in oil and gas production, and higher results in integrated gas and oil Products,” said CEO Peter Voser.

For the first nine months of the year, Shell’s CCS earnings excluding identified items slipped by 1% year on year to $19.6bn, while net income was down by 18% at $19.9bn.

CCS earnings for January-September 2012 were down 11% to $19.8bn, Shell said.

($1 = €0.77)

By: Nurluqman Suratman

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