Shell Posts First Loss in 10 Years on Oil Price Drop

Royal Dutch Shell Plc, Europe’s largest oil company, posted its first quarterly loss in 10 years following a record plunge in oil prices, and warned that industry conditions “remain challenging.”

The fourth-quarter net loss was $2.81 billion, or $0.44 a share, compared with a profit of $8.47 billion, or $1.36, a year earlier, The Hague-based Shell said today in a statement. Revenue fell 24 percent to $81.07 billion.
Chief Executive Officer Jeroen Van der Veer boosted the dividend by 11 percent, and said Shell would continue with “competitive and progressive” payouts even as the global recession hurts demand. The company will maintain project investment in a range between $31 billion and $32 billion this year after cutting spending plans last year.

“We were slightly disappointed by the lower than expected exploration and production profitability,” Alexandre Weinberg, a Brussels-based analyst at Petercam SA, said. “This might lead us to foresee a lower free cash flow if hydrocarbon prices were to remain at their current levels.” Weinberg cut the stock to “add” from “buy”.

Bloomberg