By Justin Scheck
LONDON-- Royal Dutch Shell PLC said on Thursday that its
second-quarter earnings more than doubled from a year earlier as
the Anglo-Dutch oil and gas group benefited from increased
production of liquid petroleum and higher prices for certain
products.
Shell's quarterly profit on a current-cost-of-supplies basis, a
measure similar to profit reports from U.S. oil companies, was
$5.15 billion, versus $2.39 billion a year earlier. Excluding
one-time items, current-cost-of-supplies profit was $6.13 billion,
up 33% from $4.60 billion a year earlier.
Second-quarter sales were $115.27 billion, up slightly from
$114.35 billion the previous year.
"Our financial performance for the second quarter of 2014 was
more robust than year-ago levels but I want to see stronger, more
competitive results right across the company," Chief Executive Ben
van Beurden said in a statement.
Shell recorded impairment charges of $1.94 billion, largely for
U.S. shale assets, an area where Shell and other big companies have
struggled to profit as smaller companies have sparked a natural-gas
boom. Shell is in the process of restructuring its North American
shale business.
"They've obviously made some bad-value decisions in the past,
and they're getting them out of the system," said Jason Kenney, an
analyst at Banco Santander who covers oil companies. He called the
second-quarter results "encouraging."
Oil and gas production during the quarter was 3.08 million
barrels of oil equivalent a day, about the same as a year
earlier.
Since taking over as CEO in January, Mr. van Beurden has
promised to improve profitability at the sprawling company.
In its exploration-and-production, or upstream, division, Shell
reported earnings of $3.82 billion, up from $1.68 billion a year
earlier. Excluding one-time items such as write-downs, upstream
earnings were $4.72 billion for the quarter, up from $3.53 billion
in the prior period. Shell said the division benefited from
increased production in the U.S. Gulf of Mexico and Iraq, as well
as increased shipments of liquefied natural gas from a facility
Shell bought earlier this year.
Profit in Shell's refining, or downstream, business, was $1.27
billion, up 58% from a year before. Excluding one-time items,
profit was up 15%, to $1.35 billion.
Shell reported a dividend of 94 cents per American depository
share, up 4% from a year earlier.
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