Shell, the London-based energy company, has announced a $3.5 billion share buyback program after reporting higher refining margins, oil prices, and sales for the third quarter. Despite slightly missing market expectations, the company's adjusted earnings for the quarter reached $6.22 billion, up from $5.07 billion in the preceding quarter.
Strong Growth in Trading Gains
Shell's trading gains for the quarter were attributed to several factors, including higher refining margins, realized oil prices, liquefied natural gas trading, and increased upstream production. These positive results helped offset lower integrated gas volumes. However, overall oil and gas production decreased by 9% due to planned maintenance at key offshore platforms and production-sharing contract effects.
Share Buyback and Dividend Payout
In addition to the buyback program, Shell declared a stable dividend per share payout of 33.10 cents. The company aims to complete the buyback before releasing its fourth-quarter results, following previous buybacks totaling $3 billion during Q3. This exceeds the initial guidance of a buyback program of at least $2.5 billion.
Strong Profit and Cash Flow
On a current cost of supplies basis, Shell's third-quarter profit reached $6.15 billion, up from $3.49 billion in the second quarter. Additionally, the company generated a cash flow from operations of $12.33 billion, surpassing market forecasts of $11.07 billion.
Shell's impressive performance in the third quarter reflects its ability to capitalize on favorable market conditions. With the share buyback program and stable dividend payout, the company aims to further enhance shareholder value.