Royal Dutch Shell Plc 4th Quarter 2018 and Full Year Unaudited Results

Source Press Release
Company Royal Dutch Shell 
Tags Refining & Marketing Activities, Strategy - Downstream, LNG & Gas Storage/Processing, Hedging, Upstream Activities, Financial & Operating Data
Date January 31, 2019

SUMMARY OF UNAUDITED RESULTS 
Quarters  $ million    Full year 
Q4 2018  Q3 2018  Q4 2017  %1    Definition  2018  2017   
5,590  5,839  3,807  +47  Income/(loss) attributable to shareholders    23,352  12,977  +80   
7,334  5,570  3,082  +138  CCS earnings attributable to shareholders  Note 2  23,833  12,081  +97   
1,646  (54)  (1,221)    Of which: Identified items  2,429  (3,683)     
5,688  5,624  4,303  +32  CCS earnings attributable to shareholders excluding identified items    21,404  15,764  +36   
120  169  94    Add: CCS earnings attributable to non-controlling interest    531  418     
5,808  5,793  4,397  +32  CCS earnings excluding identified items    21,935  16,182  +36   
        Of which:           
2,363  2,292  1,636    Integrated Gas    9,399  5,268     
1,881  1,886  1,650    Upstream    6,775  3,091     
2,131  2,010  1,396    Downstream    7,567  9,082     
(567)  (395)  (285)    Corporate    (1,806)  (1,259)     
22,021  12,092  7,275  +203  Cash flow from operating activities    53,085  35,650  +49   
(5,312)  (4,082)  (665)    Cash flow from investing activities    (13,659)  (8,029)     
16,709  8,010  6,610    Free cash flow  39,426  27,621     
0.68  0.70  0.46  +48  Basic earnings per share ($)    2.82  1.58  +78   
0.89  0.67  0.37  +141  Basic CCS earnings per share ($)  2.88  1.47  +96   
0.69  0.68  0.52  +33  Basic CCS earnings per share excl. identified items ($)    2.58  1.92  +34   
0.47  0.47  0.47  Dividend per share ($)    1.88  1.88   
1.    Q4 on Q4 change. 

Compared with the fourth quarter 2017, CCS earnings attributable to shareholders excluding identified items of $5.7 billion mainly benefited from higher realised oil, gas and LNG prices as well as stronger contributions from crude oil and LNG trading, partly offset by movements in deferred tax positions. Full year earnings of $21.4 billion also reflected higher realised oil, gas and LNG prices, partly offset by movements in deferred tax positions.

Cash flow from operating activities for the fourth quarter 2018 was $22.0 billion, which included positive working capital movements of $9.1 billion, mainly as a result of a fall in crude oil price and lower inventory levels. Excluding working capital movements, cash flow from operations of $12.9 billion mainly reflected increased earnings, compared with the fourth quarter 2017.

Total dividends distributed to shareholders in the quarter were $3.9 billion. In January 2019, the second tranche of the share buyback programme was completed, with 83.5 million A ordinary shares bought back for cancellation for an aggregate consideration of $2.5 billion. Today, Shell launches the next tranche of the share buyback programme, with a maximum aggregate consideration of $2.5 billion in the period up to and including April 29, 2019.

Royal Dutch Shell Chief Executive Officer Ben van Beurden commented: "

Shell delivered a very strong financial performance in 2018, with cash flow from operations of $49.6 billion, excluding working capital movements. We delivered on our promises for the year, including the completion of the $30 billiondivestment programme and starting up key growth projects while maintaining discipline on capital investment. We paid our entire dividend in cash, further reduced our debt and launched our share buyback programme, with $4.5 billion in shares repurchased so far. 
We will continue with a strong delivery focus in 2019, with a disciplined approach to capital investment and growing both our cash flow and returns. Our strategy to deliver a world-class investment case is working."

 
ADDITIONAL PERFORMANCE MEASURES 
Quarters  $ million  Full year               
Q4 2018  Q3 2018  Q4 2017  %1    Definition  2018  2017 
7,995  5,830  6,778    Capital investment  24,779  24,006     
2,699  613  6,474    Divestments  7,102  17,340     
3,788  3,596  3,756  +1  Total production available for sale (thousand boe/d)    3,666  3,664   
59.89  68.21  55.28  +8  Global liquids realised price ($/b) 2    63.85  49.00  +30   
5.75  4.92  4.44  +30  Global natural gas realised price ($/thousand scf) 2    5.13  4.33  +18   
10,279  9,312  9,776  +5  Operating expenses  39,316  38,083  +3   
10,147  9,248  9,839  +3  Underlying operating expenses  39,025  37,556  +4   
9.4%  8.7%  5.8%    ROACE  9.4%  5.8%     
7.6%  7.1%  5.6%    ROACE (CCS basis excluding identified items)  7.6%  5.6%     
20.3%  23.1%  25.0%    Gearing3  20.3%  25.0%     
1.    Q4 on Q4 change. 2.    Following a reassessment, third quarter 2018 (liquids realised price) and the four quarters of 2017 (natural gas realised price) have been revised. 3.    With effect from 2018, the net debt calculation has been amended (see Definition F). Gearing as previously published at December 31, 2017 was 24.8%. 
                           

Supplementary financial and operational disclosure for this quarter is available at .

FOURTH QUARTER 2018 PORTFOLIO DEVELOPMENTS

Integrated Gas

In December, Shell announced that wells had been opened at its Prelude floating LNG facility in Australia (Shell interest 67.5%). During this initial phase of production, gas and condensate are produced and moved through the facility. Once this has concluded, the facility will be prepared for reliable production of LNG and LPG.

During the quarter, Shell completed the sale of its shares in Shell entities in New Zealand.

Upstream

During the quarter, Shell completed the sale of its Upstream interests in Ireland, as well as the disposal of its interests in the Draugen and Gjøa fields in Norway.

In December, Shell and its partners renewed a number of onshore oil mining leases in the Niger Delta for 20 years (Shell interest 30%).

Downstream

In January, Shell announced the start of production of the fourth alpha olefins unit at the Geismar chemicals manufacturing site in the USA (Shell interest 100%). Start-up operations began in December 2018. Shell's Geismar plant is the largest producer of alpha olefins in the world.

PERFORMANCE BY SEGMENT

 
 
INTEGRATED GAS 
Quarters  $ million  Full year 
Q4 2018  Q3 2018   Q4 2017  %1    2018  2017 
3,579  2,116  848  +322  Segment earnings  11,444  5,078  +125   
1,216  (176)  (788)    Of which: Identified items (Definition A)  2,045  (190)     
2,363  2,292  1,636  +44  Earnings excluding identified items  9,399  5,268  +78   
5,786  3,320  823  +603  Cash flow from operating activities  14,617  6,467  +126   
1,483  862  1,043  +42  Capital investment (Definition C)  4,460  3,827  +17   
213  208  229  -7  Liquids production available for sale (thousand b/d)  214  203  +5   
4,442  4,156  4,364  +2  Natural gas production available for sale (million scf/d)  4,311  3,969  +9   
979  924  981  Total production available for sale (thousand boe/d)  957  887  +8   
8.78  8.18  8.52  +3  LNG liquefaction volumes (million tonnes)  34.32  33.24  +3   
17.39  17.27  17.15  +1  LNG sales volumes (million tonnes)  71.21  66.04  +8   
1.    Q4 on Q4 change. 

Fourth quarter identified items primarily reflected a gain of $1,034 million on sale of assets, mainly related to the divestment of assets in New Zealand as well as revaluation of assets in India. Identified items also included a gain of $321 million related to the fair value accounting of commodity derivatives and impairment charges totalling $190 million, mainly related to investments in Trinidad and Tobago.

Compared with the fourth quarter 2017, Integrated Gas earnings excluding identified items benefited from higher realised oil, gas and LNG prices, as well as higher contributions from LNG trading. These were partly offset by movements in deferred tax positions.

Total production remained largely unchanged compared with the fourth quarter 2017, while LNG liquefaction was 3% higher, mainly due to lower maintenance and increased feedgas availability, partly offset by divestments.  

Cash flow from operating activities of $5,786 million included negative working capital movements of $811 million, compared with negative movements of $1,895 million[i] in the same quarter a year ago. Cash flow from operating activities excluding working capital movements increased compared with the same quarter a year ago, mainly as a result of higher earnings and cash margining receipts on derivatives.

Full year identified items primarily reflected a gain of $1,937 million on sale of assets, mainly related to the divestment of assets in Thailand, New Zealand and India. Identified items also comprised a gain of $481 million related to the fair value accounting of commodity derivatives and impairment charges of $371 million, mainly related to investments in Trinidad and Tobago and Shell's investment in a joint venture. 

Compared with the full year 2017, Integrated Gas earnings excluding identified items benefited from higher realised oil, gas and LNG prices, increased contributions from LNG trading and higher volumes, partly offset by increased operating expenses.

Production volumes were up by 8% compared to the full year 2017, mainly reflecting lower maintenance activity and additional wells from existing fields. LNG liquefaction volumes were 3% higher, largely driven by increased feedgas availability and lower maintenance activities. This more than offset the impact of divestments. 

Cash flow from operating activities of $14,617 million included negative working capital movements of $1,664 million, compared with negative movements of $2,192 million[ii] in 2017. Cash flow from operating activities excluding working capital movements increased compared with the full year 2017, mainly as a result of higher earnings and cash margining receipts on derivatives. 

 
UPSTREAM 
Quarters  $ million  Full year                  
Q4 2018  Q3 2018  Q4 2017  %1    2018  2017 
1,601  2,249  2,050  -22  Segment earnings  6,798  1,551  +338 
(280)  363  400    Of which: Identified items (Definition A)  23  (1,540)   
1,881  1,886  1,650  +14  Earnings excluding identified items  6,775  3,091  +119 
6,869  6,663  3,765  +82  Cash flow from operating activities  22,661  16,337  +39 
3,988  3,037  3,485  +14  Capital investment (Definition C)  12,525  13,648  -8 
1,672  1,602  1,542  +8  Liquids production available for sale (thousand b/d)  1,589  1,622  -2 
6,593  6,206  7,154  -8  Natural gas production available for sale (million scf/d)  6,494  6,699  -3 
2,809  2,672  2,775  +1  Total production available for sale (thousand boe/d)  2,709  2,777  -2 
1.    Q4 on Q4 change. 

Fourth quarter identified items primarily reflected a loss of $420 million on sale of assets, mainly related to a negative non-cash cumulative currency translation difference in connection with the divestment in Ireland, partly offset by a gain of $176 million related to the fair value accounting of commodity derivatives.

Compared with the fourth quarter 2017, Upstream earnings excluding identified items reflected higher realised oil and gas prices as well as lower well write-offs, partly offset by less favourable movements in deferred tax positions. Total production increased by 1% compared with the same quarter a year ago, mainly driven by new field start-ups and ramp-ups, partly offset by divestments. Excluding portfolio impacts, production was 5% higher.

Cash flow from operating activities of $6,869 million included positive working capital movements of $1,720 million, compared with positive movements of $412 million[iii] in the same quarter a year ago. Cash flow from operating activities excluding working capital movements increased compared with the fourth quarter 2017 as a result of higher earnings and cash margining receipts on derivatives related to the divestment in Denmark, partly offset by higher tax payments.

Full year identified items included a net gain of $886 million on sale of assets, mainly related to the divestments in Iraq, Malaysia, Oman and Ireland, as well as a gain of $149 million related to the fair value accounting of commodity derivatives. Identified items also included a $561 million charge related to the impact of the weakening Brazilian real on a deferred tax position and a net impairment charge of $350 million, mainly related to assets in North America and deep-water rig joint ventures.

Compared with the full year 2017, Upstream earnings excluding identified items benefited from higher realised oil and gas prices and lower well write-offs, partly offset by movements in deferred tax positions and lower volumes. Total production was 2% lower compared with the full year 2017, mainly due to divestments and field decline, partly offset by new field start-ups and ramp-ups as well as improved field performance. Excluding portfolio impacts, production was 5% higher than in 2017.

Cash flow from operating activities of $22,661 million included positive working capital movements of $745 million, compared with negative movements of $2 million[iv] in 2017. Cash flow from operating activities excluding working capital movements increased compared with 2017, mainly as a result of higher earnings, partly offset by higher tax payments.

 
DOWNSTREAM 
Quarters  $ million  Full year 
Q4 2018  Q3 2018  Q4 2017  %1    2018  2017 
2,918  1,709  1,116  +161  Segment earnings2        7,601  8,258  -8 
787  (301)  (280)    Of which: Identified items (Definition A)  34  (824)   
2,131  2,010  1,396  +53  Earnings excluding identified items2  7,567  9,082  -17 
        Of which:       
1,835  1,473  884  +108  Oil Products  5,491  6,460  -15 
834  424  96  +769  Refining & Trading  1,513  2,462  -39 
1,001  1,049  788  +27  Marketing  3,978  3,998  -1 
296  537  512  -42  Chemicals  2,076  2,622  -21 
8,794  1,037  2,649  +232  Cash flow from operating activities  13,928  12,429  +12 
2,427  1,860  2,208  +10  Capital investment (Definition C)  7,564  6,416  +18 
2,723  2,675  2,589  +5  Refinery processing intake (thousand b/d)  2,648  2,572  +3 
6,906  6,697  6,861  +1  Oil Products sales volumes (thousand b/d)  6,783  6,599  +3 
4,110  4,145  4,688  -12  Chemicals sales volumes (thousand tonnes)  17,644  18,239  -3 
1.    Q4 on Q4 change. 2.    Earnings are presented on a CCS basis (See Note 2). 

Fourth quarter identified items primarily reflected a gain of $670 million related to the fair value accounting of commodity derivatives and a gain of $297 million on sale of assets, mainly related to the divestment in Argentina. This was partly offset by impairment charges of $160 million, mainly related to assets in Singapore and the UK.

Compared with the fourth quarter 2017, Downstream earnings excluding identified items benefited from increased contributions from crude oil trading and stronger refining and marketing margins, partly offset by higher operating expenses and lower base chemicals and intermediates margins.

Cash flow from operating activities of $8,794 million included positive working capital movements of $7,570 million, compared with negative movements of $334 million[v] in the same quarter a year ago, mainly as a result of a fall in crude oil price and lower inventory levels. Cash flow from operating activities excluding working capital movements decreased compared with the same quarter a year ago as higher cash cost of sales more than offset the increase in CCS earnings.

Oil Products

  • Refining & Trading earnings excluding identified items reflected increased contributions from crude oil trading and improved operational performance. Earnings also benefited from stronger refining margins mainly in Canada, despite lower refining margins in other parts of the portfolio, compared with the fourth quarter 2017. This was partly offset by higher operating expenses.

Refinery availability increased to 94% compared with 89% in the fourth quarter 2017, mainly due to lower downtime.

  • Marketing earnings excluding identified items were higher compared with the fourth quarter 2017, mainly as a result of increased margins.

Compared with the fourth quarter 2017, Oil Products sales volumes increased by 1%, reflecting increased refining and trading volumes.

Chemicals

  • Chemicals earnings excluding identified items reflected lower base chemicals and intermediates margins, mainly in Asia, compared with the fourth quarter 2017.

Chemicals manufacturing plant availability was 93%, remaining at a similar level as in the fourth quarter 2017.

Full year identified items included a gain of $233 million related to the fair value accounting of commodity derivatives and a gain of $225 million on sale of assets, mainly related to the divestment in Argentina. This was partly offset by impairment charges totalling $386 million, mainly related to assets in Singapore and the UK.

Compared with the full year 2017, Downstream earnings excluding identified items reflected higher operating expenses, adverse currency exchange rate effects and lower base chemicals and refining margins, partly offset by improved marketing margins.

Cash flow from operating activities of $13,928 million included positive working capital movements of $3,164 million, compared with negative movements of $148 million[vi] in the full year 2017. Excluding working capital movements, cash flow from operating activities reflected lower earnings and higher cash cost of sales.

Oil Products

  • Refining & Trading earnings excluding identified items reflected higher operating expenses, adverse currency exchange rate effects and lower contributions from oil products trading, partly offset by higher contributions from crude oil trading, compared with the full year 2017.

Refinery availability was 91%, remaining at a similar level as in the full year 2017.

  • Marketing earnings excluding identified items were at a similar level as in the full year 2017, since the impacts of higher operating expenses and adverse currency exchange rate effects were almost fully offset by improved margins. 

Compared with the full year 2017, Oil Products sales volumes increased by 3% as a result of higher refining and trading volumes.

Chemicals

  • Chemicals earnings excluding identified items reflected lower base chemicals margins and higher operating expenses, partly offset by higher intermediates margins, compared with the full year 2017.

Chemicals manufacturing plant availability increased to 93% compared with 92% in 2017.

 
CORPORATE 
Quarters  $ million  Full year 
Q4 2018  Q3 2018  Q4 2017    2018  2017 
(644)  (335)  (838)  Segment earnings  (1,479)  (2,416) 
(77)  60  (553)  Of which: Identified items (Definition A)  327  (1,157) 
(567)  (395)  (285)  Earnings excluding identified items  (1,806)  (1,259) 
572  1,072  38  Cash flow from operating activities  1,879  417 

Fourth quarter identified items primarily reflected a tax charge of $74 million related to the impact of the strengthening Brazilian real on financing positions.

Compared with the fourth quarter 2017, Corporate earnings excluding identified items mainly reflected lower tax credits.

Full year identified items primarily reflected a tax credit of $325 million related to the impact of the weakening Brazilian real on financing positions.

Compared with the full year 2017, Corporate earnings excluding identified items mainly reflected lower tax credits and adverse currency exchange effects, partly offset by higher net interest income.

PRELIMINARY RESERVES UPDATE

When final volumes are reported in the 2018 Annual Report and Form 20-F, Shell expects that SEC proved oil and gas reserves additions before taking into account production will be around 0.7 billion boe, and 2018 production to be 1.4 billion boe. As a result, total proved reserves on an SEC basis are expected to be 11.6 billion boe. Acquisitions and divestments of 2018 reserves are expected to account for a net reduction of 0.2 billion boe.

The proved Reserves Replacement Ratio on an SEC basis is expected to be 53% for the year and 96% for the 3-year average. Excluding the impact of acquisitions and divestments, the reserves replacement ratio is expected to be 66% for the year.

Further information will be provided in the 2018 Annual Report and Form 20-F, which is expected to be filed in March 2019.

OUTLOOK FOR THE FIRST QUARTER 2019

Compared with the first quarter 2018, Integrated Gas production is expected to decrease by some 140 – 170 thousand boe/d, mainly due to divestments, the transfer of some activities into the Upstream segment as of 2019 and higher maintenance activities. LNG liquefaction volumes are expected to be 0.4 – 0.7 million tonnes lower, mainly as a result of divestments and higher maintenance activities.

Compared with the first quarter 2018, Upstream production is expected to be 10 – 50 thousand boe/d lower, mainly due to divestments and field decline, partly offset by ramp-ups of existing fields. This includes the impact of additional activities previously reported in the Integrated Gas segment in 2018.

Refinery availability is expected to decrease in the first quarter 2019 compared with the same period a year earlier as a result of higher maintenance activity.

Oil Products sales volumes are expected to be 40 – 70 thousand boe/d lower compared with the same period a year earlier, mainly as a result of the divestment in Argentina.

Chemicals manufacturing plant availability in the first quarter 2019 is expected to be at a similar level as in the first quarter 2018.

Corporate earnings excluding identified items are expected to be a net charge of $400 – 450 million in the first quarter 2019 and a net charge of $1,700 – 1,900 million for the full year 2019. This excludes the impact of currency exchange rate effects and the impact of IFRS 16 Leases.

The results and outlook reported in this announcement do not include the impact of the application of the new standard IFRS 16, which is effective as of January 1, 2019. The quantitative impact at transition date will be disclosed in the 2018 Annual Report and Form 20-F.

FORTHCOMING EVENTS

The LNG Outlook will be held on February 25, 2019 in London.

Shell will host a webcast covering the impact of IFRS 16 Leases on March 28, 2019.

The Annual General Meeting is scheduled to be held on May 21, 2019.

Shell will host Management Day events on June 4, 2019 in London, and on June 5, 2019 in New York.

First quarter 2019 results and dividends are scheduled to be announced on May 2, 2019. Second quarter 2019 results and dividends are scheduled to be announced on August 1, 2019. Third quarter 2019 results and dividends are scheduled to be announced on October 31, 2019.

UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 
CONSOLIDATED STATEMENT OF INCOME 
  Quarters  $ million  Full year            
  Q4 2018  Q3 2018  Q4 2017    2018  2017   
  102,228  100,151  85,422  Revenue1  388,379  305,179   
  1,351  1,000  1,034  Share of profit of joint ventures and associates  4,106  4,225   
  1,047  397  1,668  Interest and other income  4,071  2,466   
  104,626  101,548  88,124  Total revenue and other income  396,556  311,870   
  78,680  76,070  64,095  Purchases  294,399  223,447   
  6,803  6,256  6,563  Production and manufacturing expenses  26,970  26,652   
  3,162  2,829  2,953  Selling, distribution and administrative expenses  11,360  10,509   
  314  227  260  Research and development  986  922   
  545  322  921  Exploration  1,340  1,945   
  6,244  5,198  5,796  Depreciation, depletion and amortisation  22,135  26,223   
  971  909  984  Interest expense  3,745  4,042   
  96,719  91,811  81,572  Total expenditure  360,935  293,740   
  7,907  9,737  6,552  Income/(loss) before taxation  35,621  18,130   
  2,261  3,696  2,615  Taxation charge/(credit)  11,715  4,695   
  5,646  6,041  3,937  Income/(loss) for the period1  23,906  13,435   
  56  202  130  Income/(loss) attributable to non-controlling interest  554  458   
  5,590  5,839  3,807  Income/(loss) attributable to Royal Dutch Shell plc shareholders  23,352  12,977   
  0.68  0.70  0.46  Basic earnings per share ($)2  2.82  1.58   
  0.67  0.70  0.46  Diluted earnings per share ($)2  2.80  1.56   
1.    See Note 2 "Segment information". 2.    See Note 3 "Earnings per share". 
                   

 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 
  Quarters  $ million  Full year     
  Q4 2018  Q3 2018  Q4 2017    2018  2017       
  5,646  6,041  3,937  Income/(loss) for the period  23,906  13,435   
        Other comprehensive income/(loss) net of tax:       
        Items that may be reclassified to income in later periods:       
  (354)  (500)  355  -  Currency translation differences  (3,172)  5,156   
  258  -  Unrealised gains/(losses) on securities1  593   
  (1)  -  Debt instruments remeasurements1  (15)   
  1,499  (69)  (484)  -  Cash flow hedging gains/(losses)  730  (552)   
  (61)  43  -  Deferred cost of hedging1  (209)   
  17  46  -  Share of other comprehensive income/(loss) of joint ventures and associates  (10)  170   
  1,101  (519)  175  Total  (2,676)  5,367   
        Items that are not reclassified to income in later periods:       
  426  615  (2,056)  -  Retirement benefits remeasurements  3,588  604   
  50  84  -  Equity instruments remeasurements1  (153)   
  194  (2)  -  Share of other comprehensive income/(loss) of joint ventures and associates  193   
  670  697  (2,056)  Total  3,628  604   
  1,771  178  (1,881)  Other comprehensive income/(loss) for the period  952  5,971   
  7,417  6,219  2,056  Comprehensive income/(loss) for the period  24,858  19,406   
  34  173  133  Comprehensive income/(loss) attributable to non-controlling interest  383  578   
  7,383  6,046  1,923  Comprehensive income/(loss) attributable to Royal Dutch Shell plc shareholders  24,475  18,828   
1.    See Note 1 "Basis of preparation" regarding IFRS 9 Financial Instruments.       
 
CONDENSED CONSOLIDATED BALANCE SHEET 
$ million     
  December 31, 2018  December 31, 2017   
Assets       
Non-current assets       
Intangible assets  23,586  24,180   
Property, plant and equipment  223,175  226,380   
Joint ventures and associates  25,329  27,927   
Investments in securities  3,074  7,222   
Deferred tax  12,097  13,791   
Retirement benefits  6,051  2,799   
Trade and other receivables  7,826  8,475   
Derivative financial instruments1  574  919   
  301,712  311,693   
Current assets       
Inventories  21,117  25,223   
Trade and other receivables  42,431  44,565   
Derivative financial instruments1  7,193  5,304   
Cash and cash equivalents  26,741  20,312   
  97,482  95,404   
Total assets  399,194  407,097   
Liabilities       
Non-current liabilities       
Debt  66,690  73,870   
Trade and other payables  2,735  3,447   
Derivative financial instruments1  1,399  981   
Deferred tax  14,837  13,007   
Retirement benefits  11,653  13,247   
Decommissioning and other provisions  21,533  24,966   
  118,847  129,518   
Current liabilities       
Debt  10,134  11,795   
Trade and other payables  48,888  51,410   
Derivative financial instruments1  7,184  5,253   
Taxes payable  7,497  7,250   
Retirement benefits  451  594   
Decommissioning and other provisions  3,659  3,465   
  77,813  79,767   
Total liabilities  196,660  209,285   
Equity attributable to Royal Dutch Shell plc shareholders    198,646  194,356   
Non-controlling interest  3,888  3,456   
Total equity  202,534  197,812   
Total liabilities and equity  399,194  407,097   
1.    See Note 6 "Derivative financial instruments and debt excluding finance lease liabilities".   
                             

   
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 
  Equity attributable to Royal Dutch Shell plc shareholders   
$ million  Share capital1  Shares 
held in 
trust 
Other reserves2  Retained earnings  Total  Non-
controlling
interest 
Total equity   
At January 1, 2018 (as previously published)  696  (917)  16,932  177,645  194,356  3,456  197,812   
Impact of IFRS 93  (138)  88  (50)  (50)   
At January 1, 2018 (as revised)  696  (917)  16,794  177,733  194,306  3,456  197,762   
Comprehensive income/(loss) 
for the period 
1,123  23,352  24,475  383  24,858   
Transfer from other comprehensive income4  (971)  971   
Dividends  (15,675)  (15,675)  (586)  (16,261)   
Repurchases of shares5  (11)  11  (4,519)  (4,519)  (4,519)   
Share-based compensation6, 7  (343)  (342)  693   
Other changes in non-controlling interest  51  51  635  686   
At December 31, 2018  685  (1,260)  16,615  182,606  198,646  3,888  202,534   
At January 1, 2017  683  (901)  11,298  175,566  186,646  1,865  188,511   
Comprehensive income/(loss) for the period  5,851  12,977  18,828  578  19,406   
Dividends  (15,628)  (15,628)  (406)  (16,034)   
Scrip dividends  13  (13)  4,751  4,751  4,751   
Share-based compensation  (16)  (204)  (74)  (294)  (294)   
Other changes in non-controlling interest  53  53  1,419  1,472   
At December 31, 2017  696  (917)  16,932  177,645  194,356  3,456  197,812   
1.    See Note 4 "Share capital". 2.    See Note 5 "Other reserves". 3.    See Note 1 "Basis of preparation". 4.    In accordance with IFRS 9 Financial Instruments, the transfer mainly relates to the sale of Shell's shareholding in Malaysia LNG Tiga Sdn Bhd ($617 million) and the sale of shares in Canadian Natural Resources Limited ($481 million). 5.    The repurchase of shares recognised through retained earnings in the quarter represents the aggregate maximum consideration Shell is contractually bound to under the current tranche of the buyback programme, plus associated stamp duty. 6.    The amendments to IFRS 2 Share-based Payment became effective January 1, 2018. Following adoption of the amendments, components of share-based payments that were previously classified as cash-settled are now classified as equity-settled. This resulted in an increase of $172 million in the share plan reserve within other reserves and a net increase of $125 million in retained earnings. 7.    Includes a reclassification of $503 million between Other reserves and Retained earnings, which relates to the unwinding of expired share options. 
                   

 
CONSOLIDATED STATEMENT OF CASH FLOWS 
  Quarters  $ million  Full year 
  Q4 2018  Q3 2018  Q4 2017    2018  2017 
  5,646  6,041  3,937  Income/(loss) for the period  23,906  13,435 
        Adjustment for:     
  2,804  2,694  1,467  - Current tax  10,475  6,591 
  717  690  817  - Interest expense (net)  2,878  3,365 
  6,244  5,198  5,796  - Depreciation, depletion and amortisation  22,135  26,223 
  145  149  541  - Exploration well write-offs1  449  897 
  (927)  (163)  (1,319)  - Net (gains)/losses on sale and revaluation of non-current assets and businesses  (3,265)  (1,640) 
  (1,351)  (1,000)  (1,034)  - Share of (profit)/loss of joint ventures and associates  (4,106)  (4,225) 
  1,535  1,374  1,647  - Dividends received from joint ventures and associates  4,903  4,998 
  7,694  (1,693)  (1,368)  - (Increase)/decrease in inventories  2,823  (2,079) 
  8,421  (2,722)  (2,544)  - (Increase)/decrease in current receivables1  1,955  (2,577) 
  (7,014)  1,788  2,040  - Increase/(decrease) in current payables1  (1,336)  2,406 
  1,626  560  (140)  - Derivative financial instruments1  799  (1,039) 
  (1,075)  711  167  - Deferred tax, retirement benefits, decommissioning and other provisions1  219  (4,300) 
  454  299  (367)  - Other1  921  (98) 
  (2,898)  (1,834)  (2,365)  Tax paid  (9,671)  (6,307) 
  22,021  12,092  7,275  Cash flow from operating activities  53,085  35,650 
  (7,147)  (5,800)  (5,861)  Capital expenditure  (23,011)  (20,845) 
  (208)  (78)  (202)  Investments in joint ventures and associates  (880)  (595) 
  1,966  231  2,866  Proceeds from sale of property, plant and equipment and businesses  4,366  8,808 
  475  935  221  Proceeds from sale of joint ventures and associates  1,594  2,177 
  221  236  157  Interest received  823  724 
  (619)  394  2,154  Other2  3,449  1,702 
  (5,312)  (4,082)  (665)  Cash flow from investing activities  (13,659)  (8,029) 
  20  (155)  543  Net increase/(decrease) in debt with maturity period within three months  (396)  (869) 
        Other debt:     
  3,189  424  120  - New borrowings  3,977  760 
  (4,680)  (2,260)  (4,103)  - Repayments  (11,912)  (11,720) 
  (926)  (864)  (840)  Interest paid  (3,574)  (3,550) 
  (1)  Change in non-controlling interest  678  293 
        Cash dividends paid to:     
  (3,869)  (3,949)  (2,266)  Royal Dutch Shell plc shareholders  (15,675)  (10,877) 
  (98)  (134)  (97)  - Non-controlling interest  (584)  (406) 
  (2,533)  (1,414)  Repurchases of shares  (3,947) 
  (27)  (2)  (443)  Shares held in trust: net sales/(purchases) and dividends received  (1,115)  (717) 
  (8,919)  (8,355)  (7,080)  Cash flow from financing activities  (32,548)  (27,086) 
  (161)  (11)  83  Currency translation differences relating to cash and cash equivalents  (449)  647 
  7,629  (356)  (387)  Increase/(decrease) in cash and cash equivalents  6,429  1,182 
  19,112  19,468  20,699  Cash and cash equivalents at beginning of period  20,312  19,130 
  26,741  19,112  20,312  Cash and cash equivalents at end of period  26,741  20,312 
             

1.    Prior period comparatives within Cash flow from operating activities have been revised to conform with current year presentation. See Note 7 "Change in presentation of Consolidated Statement of Cash Flows".

2.    Full year 2018 includes $3,307 million from the sale of shares in Canadian Natural Resources Limited, which were received in connection with the oil sands divestment.

Source: EvaluateEnergy® ©2019 EvaluateEnergy Ltd