Shell doesn’t leave their investors in the dark for long and this morning issued an insight into performance for Q1 ahead of Q1 results set for release 4th May.
The main takeaways from the update were higher LNG volumes and earnings, and the front loading of taxes. LNG production is expected to rise to between 930 – 970 kboe/d in Q1, an increase on Q4’s 917 kboe/d.
Operating expenditure is expected to be lower across their oil and gas business which bodes well for cash generation in the first quarter 2023.
Shell shares were 2% higher at the time of writing.
“In its usual teaser ahead of quarterly results Shell is flagging a big loss – but there is a reason investors are brushing this news off,” said Danni Hewson, head of financial analysis at AJ Bell.
“The anticipated loss is a quirk of accounting – reflecting one-off tax charges which could well be the result of booking the impact of future windfall taxes upfront. Based on the performance of the company’s other business units you would still expect Shell to be generating plenty of cash to fund its dividend.
“Volumes in its liquefied natural gas business are expected to be higher and its oil products division is also performing well.
“A recent spike in oil prices on OPEC production cuts should be giving Shell a boost, although not one which will be reflected in these results.”