FTSE 100 giant Shell has today reported a 15 per cent jump in earnings before interest, tax, deprecation and amortisation (EBITDA) for the first quarter.
In its trading update for the three months to the end of March, the company said adjusted EBITDA rose from $16.3bn (£13bn) in the fourth quarter of 2023 to $18.7bn (£14.9bn) in the first quarter of 2024.
However, this figure was lower than the $21.4bn (£17bn) reported for the same period in 2023.
Shell paid out $5bn (£4bn) to shareholders during the first quarter, a combination of both dividends (£1.8bn) and share buybacks (£2.2bn)). Today, the group laid out plans to return a further $3.5bn (£2.8bn) of repurchases following the completion of the $3.5bn (£2.8bn) buyback initiated in the fourth quarter of last year.
Total shareholder distributions in the fourth quarter amounted to $6.2bn (£4.9bn).
The company said these results: “Reflected lower operating expenses, higher margins from crude and oil products trading and optimisation, and higher refining margins, partly offset by lower LNG trading and optimisation margins, and unfavourable tax movements in comparison to the fourth quarter 2023.”
Shell reported a free cash flow for the period of $9.8bn (£7.8bn), only slightly below the $9.9bn ( £7.9bn) reported in the first quarter of 2023.
Its strong free cash flow allowed the group to reduce gearing further during the period. Gearing fell from 18.8 per cent at the end of 2023 to 17.7% at the end of March.
The company ended the period with net debt of $40.5bn (£32.3). The lower debt level reflected: “Free cash flow, partly offset by share buybacks, cash dividends paid to Shell plc shareholders, interest payments, and lease additions.”
Over the coming year the group said it expected to spend $22bn (£17.5) to $25bn (£19.9bn) on capital projects – in line with the goals laid out at the company’s capital markets event last year.