Shell Plc (NYSE:SHEL) stock fell on Thursday after the company posted fourth-quarter fiscal 2025 results.
Details
Adjusted earnings per American Depositary Share came in at $1.14, ahead of the consensus estimate of 63 cents.
The company posted its weakest quarterly profit in nearly five years, pressured by lower crude prices and unfavorable tax adjustments in the fourth quarter, CNBC reported Thursday. It marks Shell’s weakest quarterly result since the first three months of 2021, when adjusted earnings came in at $3.2 billion.
“I’d start off by saying it was actually a very strong operational quarter for us,” Shell CEO Wael Sawan told CNBC’s Squawk Box Europe on Thursday.
“A few things hurt us this quarter. Number one was some tax adjustments which went against us, chemicals has indeed been weak, but I would look to the strength actually of our integrated gas, upstream and marketing businesses,” Sawan said.
However, revenue fell short at $64.09 billion, compared with analysts’ forecast of $64.61 billion.
Total adjusted earnings reached $3.3 billion, down both year over year and sequentially, due to unfavorable tax movements along with weaker Marketing margins, lower realized prices, and higher operating costs.
Shell generated $9.4 billion in cash flow from operations during the quarter.
Segment Performance
Integrated Gas production rose 2% quarter over quarter to 948,000 barrels of oil equivalent per day, while LNG liquefaction volumes edged up 7% sequentially to 7.81 million metric tons.
Realized liquids prices further dipped to $55 per barrel from $58 per barrel in the last quarter and gas prices declined to $6.8 from $7.3 per thousand standard cubic feet.
Marketing sales volumes declined sequentially to 2.70 million barrels per day from 2.82 million barrels per day.
Mobility segment output fell slightly to 1.96 million b/d (from 2.06 million b/d in the prior quarter), and Lubricants decreased to 83,000 b/d (from 88,000 b/d), while Sectors & Decarbonisation fell to 658,000 b/d (from 681,000 b/d in the prior quarter).
In a statement, Sawan stated, “2025 was a year of accelerated momentum, with strong operational and financial performance across Shell. We generated free cash flow of $26 billion, made significant progress in focusing our portfolio and reached $5 billion of cost savings since 2022, with more to come.”
Share Buyback & Dividend
Total shareholder distributions stood at $5.5 billion, including $3.4 billion of repurchases and $2.1 billion in cash dividends in the quarter.
Shell stated the start of $3.5 billion share buyback programme, which is expected to be completed before the announcement of first-quarter fiscal 2026 results.
The company increased dividend by 4% to 37.2 cents per share, payable on March 30 to shareholders of record as of February 20, 2026.
At the end of the quarter, net debt stood at $45.7 billion, down from $41.2 billion in the third quarter, with gearing expanding to 20.7% from 18.8% in the previous quarter.
Management Commentary
“2025 was a year of accelerated momentum, with strong operational and financial performance across Shell. We generated free cash flow of $26 billion, made significant progress in focusing our portfolio and reached $5 billion of cost savings since 2022, with more to come,” said CEO Wael Sawan.
Q1 Outlook
The company expects Integrated Gas production of 920 – 980 thousand boe/d and LNG liquefaction volumes of 7.4 – 8.0 million tons in the first quarter of 2026.
Upstream volumes are projected at 1.70 to 1.90 million boe/d, while Marketing volumes should range within 2.55 – 2.75 million b/d.
Refinery utilization is forecast between 90%-98%, and Chemicals plant utilization is expected to fall between 79%-87% in the quarter.
For fiscal 2026, capital expenditures stood at $20 billion to $22 billion.
SHEL Price Action: Shell shares were down 2.78% at $76.59 during premarket trading on Thursday, according to Benzinga Pro data.
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