£25m profit a day: Shell reveals UK record

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The Independent Online

Shell today announced record annual profits for a UK company - £9.3 billion.

Shell today announced record annual profits for a UK company - £9.3 billion.

The figure, which equates to £25 million a day, was achieved after the group benefited from a soaring oil price and strong margins in refining.

The previous UK record of £7.7 billion was set by bank HSBC, although the measures used by the market to judge profitability are different.

Today's earnings figure, which is the measure of profitability used by City analysts, represented a 38% rise on a year earlier. The bottom-line net income figure was 18.54 billion dollars (£9.83 billion), up 48% on 2003.

With oil prices in New York at a peak of $55.17 a barrel in late October, the Anglo-Dutch company saw a 204-per-cent jump in fourth-quarter profits to $5.13 billion (£2.72 billion).

The profits rush is expected to be mirrored by BP next week, although neither UK company can match the $25 billion (£13.27 billion) unveiled on Monday by US-based Esso owner ExxonMobil.

Despite the record profits, Shell's performance was clouded by a further reduction to its oil and gas reserves - the fifth time it has done so in little over a year.

The company said the review of its reserves was now completed and it had reduced proved energy reserves for 2003 by 1.4 billion barrels.

Chief executive Jeroen van der Veer said the company believed it had taken the steps necessary to "close out" the reserves issue.

He added: "2004 was a year of extremes, with the reserves recategorisation on one hand and record net income and cash generation on the other."