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Shell has announced another $3.5 billion share repurchase plan after posting stronger-than-expected third-quarter results, underscoring the oil giant's ability to deliver consistent shareholder returns despite softer energy prices.
The London-listed company reported adjusted earnings of $5.4 billion for the quarter ending September, beating analyst expectations of around $5.05 billion, according to data compiled by LSEG. The figure, however, marked a decline from the $6 billion reported during the same period last year but was up from $4.26 billion in the second quarter.
Chief Executive Officer Wael Sawan credited the company's "robust operational performance" and resilient marketing and deepwater operations across the Gulf of Mexico and Brazil for the solid results. "Shell delivered another strong set of results with clear progress across our portfolio," Sawan said in a statement.
The new $3.5 billion buyback will be completed over the next three months, marking Shell's 16th consecutive quarter of share repurchases worth at least $3 billion. The company's net debt fell to $41.2 billion from $43.2 billion in the previous quarter, reflecting disciplined capital management and strong cash flow generation. Shell's shares slipped slightly, down 0.8% on Thursday morning, but have climbed more than 16% year to date, outpacing most of its industry peers.
"Numbers are solid across nearly all divisions, showing continued earnings growth and reliable cash flow," said Maurizio Carulli, global energy and materials analyst at Quilter Cheviot. "Production in Brazil and the Gulf of Mexico remains strong, and the LNG Canada ramp-up helped boost results. The only soft spot was Chemicals, a relatively small segment that Shell is still optimizing."
Cash flow from operations came in at $12.2 billion, compared with $14.7 billion a year earlier, while capital expenditure stood at $4.9 billion for the quarter. Adjusted earnings fell 9.9% year over year.
Shell's results arrive as other energy majors face margin pressure. France's TotalEnergies reported a modest profit decline, Norway's Equinor missed expectations, and U.S. giants ExxonMobil and Chevron are set to announce results later this week.
