Shell unveils 33% in Q4 profits
Under-pressure Shell boss Philip Watts today unveiled a 33% fall in fourth quarter profits after one-off charges masked higher oil prices.
The company, which has come under fire from investors after a review showed reserves 20% lower than expected, said underlying profits in the three months to December 31 were $1.86bn (€1.48bn).
Despite the quarterly decline, the Anglo-Dutch company still posted annual profits of $11.7bn (€9.3bn), a rise of 27% on 2002 and one of the highest figures in its history.
The fall in the last three months of 2003 came as no surprise to analysts, as Shell said in December that it expected $1bn (€797.1m) in charges from writing down the value of some assets.
Higher oil prices partly helped offset the restructuring charges, with Brent crude prices averaging 29.45 US dollars a barrel in the fourth quarter, up from 26.80 US dollars for the same period a year earlier.
Sir Philip, who is chairman of the committee of managing directors of the Royal Dutch Shell Group of Companies, said the outlook for this year remained uncertain.
He added in a joint statement with vice chairman Jeroen van der Veer: “We continue to operate in a volatile industry, where short-term performance is impacted significantly by supply/demand imbalances and commodity price movements.”
The company added that it would look to strengthen its reserve booking controls following the furore over the lower level of proved stocks. The announcement was labelled “shocking and unprecedented” by one US law firm.
Shell added today: “It is important to note that we identified the issue, disclosed it and are taking steps to address it.”
