Today Royal Dutch Shell (LON:RDSB) reported a 71% plunge in Q2 profits in their half year results. The shattering drop comes amid declining oil prices alongside slim refining profits and higher fees as a result of its $54bn purchase of BG Group.
Net profit for the oil giant fell $1.18bn (890m) from $3.99bn in 2015. Earnings associated to its shareholders also dropped 72% down from $3.76bn to $1.05bn. As a result, earnings per share dropped a huge 94% to $0.03 down from $0.53.
Royal Dutch Shell did however manage to maintain its dividend price which stayed at $0.47.
Chief Executive Ben Van Beurden said:
“Lower oil prices continue to be a significant challenge across the business, particularly in the upstream. We are managing the company through the down-cycle by reducing costs, by delivering on lower and more predictable investment levels, executing our asset sales plans and starting up profitable new projects.
“At the same time, integration of Shell and BG is making strong progress, and our operating performance continues to further improve. We are making significant and lasting changes to Shell’s working practices and cost structure. Shell is firmly on track to deliver a $40 billion underlying operating cost run rate at the end of 2016.”
The firm is currently in the process of cost reductions and confirmed that its target for its 2016 programme remain unchanged at $26bn. Shell also reported that it intends to sell up to £30bn of assets up until 2018 where 12,50 jobs will be lost over the 2015/16 season.
BP, who also reported Q2 results under estimates have also been in the process of cutting thousands of jobs to tackle the drop in global oil prices.
At 12:08pm BST Royal Dutch Shell (LON:RDSB) traded at 2,022.52 – 82.48 (-3.92%)
28/07/2016