Shell profits soar to £18bn

 

Oil giant Royal Dutch Shell today reported profits of 28.6 billion US dollars (£18.1 billion) for 2011, a jump of 54 per cent on a year ago.

The improvement for the Anglo-Dutch firm came despite its below-expectations performance in the final quarter of the year, when trading was impacted by a squeeze on refining margins and lower American natural gas prices.

It still made profits of 6.5 billion US dollars (£4.1 billion) in the fourth quarter, which represented a 13 per cent rise on a year ago, after crude oil prices remained close to the 100 US dollars a barrel mark.

Shell has outshone its troubled rival BP in recent years and today underlined its confidence by promising dividend growth for the first time since 2009.

It said its three-year strategic plan, which was first outlined in early 2010, had built the foundations for growth through a company-wide restructuring and by refocusing its efforts on emerging growth markets.

The company, which saw production decline 3 per cent last year, is planning investment in major projects worth 30 billion US dollars (£19 billion) in 2012 and said its outlook was boosted by more than 60 new projects and options.

There will also be six billion US dollars (£3.8 billion) of investment in Shell's "heartlands" during this year, including extending the life of its operations in the UK North Sea and South East Asia.

Chief executive Peter Voser said: "Shell's strategy is innovative and competitive. Our improving financial position creates an opportunity to increase both our dividends and investment levels."

He said the planned return to dividend growth in 2012 showed the company's confidence that "there is more to come from Shell".

His comments come a month after Shell angered unions when it scrapped its final salary pension scheme for new recruits, meaning that not a single employer in the FTSE 100 Index offers the retirement package.

Unite general secretary Len McCluskey said: "Shell reminds us of the moral bankruptcy of the corporate elite. The company is needlessly closing its final salary scheme while posting colossal profits.

"This is predatory capitalism in action. Shell is one of the world's richest and most powerful corporations. It can afford to keep the final salary scheme open to new entrants.

"Rather than provide security to its future staff and still make a profit, it has chosen greed. Shell is not alone, Unilever is needlessly slashing its employees' pension benefits when there is no financial reason for doing so. Unions are the only force to stand in their way as governments do nothing to rein in their power."

PA

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