Shell 3Q Adjusted Earnings Beat Expectations; Will Hike Dividends — Earnings Review

By Joe Hoppe

Shell PLC reported its third quarter earnings Thursday. Here’s what we watched:

ADJUSTED EARNINGS: The multinational energy group generated adjusted earnings of $9.45 billion in the third quarter. This was down from $11.47 billion in the second quarter, but beat the $9.0 billion market consensus–provided by Vara and based on 27 analysts’ estimates.

OPERATING CASH FLOW: Shell’s cash flow generation from operations however missed forecasts. The company reported operating cash flow of $12.54 billion, missing expectations of $14.03 billion from 22 analysts.

WHAT WE WATCHED:

–DIVIDENDS: Shell declared a dividend for the third quarter of 25 cents a share, in line with the previous quarter and up from 24 cents a year prior. However, it also said it will raise dividends by 15% in the fourth quarter.

–BUYBACKS: The company kicked off a $4 billion share-buyback program for the third quarter to reduce its share capital, down from $6 billion in the prior quarter.

–OUTLOOK: Shell expects capital expenditure to be in the $23 billion-$27 billion range for the whole of 2022. It further forecast corporate adjusted earnings to be a net expense of around $450 million to $650 million in the fourth quarter, and a net expense of around $2.20 billion to $2.40 billion for the full year.

Write to Joe Hoppe at joseph.hoppe@wsj.com

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