Shell Plc · LSE:SHEL
Shell — Q2 2022 Earnings Presentation
28 slides from Shell's earnings presentation, Jul 28, 2022
Slide 1: Second Quarter 2022 Results
#PoweringProgress SECOND QUARTER 2022 RESULTS DISCIPLINE DELIVERING RESULTS: MORE CASH, MORE RESILIENCE Shell plc July 28, 2022
Slide 2: Definitions & Cautionary Note
DEFINITIONS & CAUTIONARY NOTE “Adjusted Earnings” is the income attributable to Shell plc shareholders for the period, adjusted for the after-tax effect of oil price changes on inventory and for identified items, and excludes earnings attributable to non-controlling interest. In this presentation, “
Slide 3: The Shell Investment Case: Powering Progress
G ENER AT I N G T H E S HEL L I N V ES T M E N T C A S E SHAREHOLDER VALUE Growing value through a dynamic portfolio and disciplined capital allocation POWERING PROGRESS R ES P ECT I NG N A T U R E POWERING LIVES Our strategy to accelerate the Protecting the environment, reducing waste and transitio
Slide 4: Q2 2022 Key Messages
POWERING PROGRESS Q 2 2022 K EY MES S A GES Delivering strong results Energy security and transition Enhanced shareholder distributions Strong performance in a turbulent macro Powering Progress with focused investment in Accelerated shareholder distributions environment energy security and acc
Slide 5: Providing Energy Security, Accelerating Energy Transition
STRATEGY UPDATE PRO V IDIN G EN ERGY S ECU RITY, A CCELERA TIN G EN ERGY TRA N S ITIO N Partnered with Accenture and MoU* signed with Collaboration* with key Japanese LNG Amex GBT for the launch of one ZeroAvia, leader in buyers, Tokyo Gas and Osaka Gas, to of the world’s first and largest hydrogen-
Slide 6: Powering Progress in Action
STRATEGY UPDATE PO WERIN G PRO GRES S IN A CTIO N Renewables & Energy Marketing Integrated Gas Chemicals & Products Upstream Solutions Integrated energy and Delivering the energy of Profitably decarbonising Integrated clean energy A world leader in LNG: chemicals parks delivering today while funding
Slide 7: H1 2022 Outperforming the Macro: Focused Transformation
Brent Henry Hub H1 2022 OUTPERFORMING THE MACRO $/bbl $/MMBtu FO CU S ED TRA N S FO RMA TIO N H1 2013 107.5 3.7 H1 2022 108.1 6.0 Comparing H1 2022 to H1 2013 when Brent price was similar Increased Discipline Better Results Greater Resilience Integrated value delivery 39% lower* 65% increase 32% red
Slide 8: H1 2022 Outperforming the Macro: Enhanced Business Delivery
Brent Henry Hub H1 2022 OUTPERFORMING THE MACRO $/bbl $/MMBtu EN HA N CED BU S IN ES S DELIV ERY H1 2013 107.5 3.7 H1 2022 108.1 6.0 Growing customer-facing businesses, delivering low-carbon products and driving energy transition Marketing Renewables and Energy Solutions Platform for future growth C
Slide 9: Our Progress: Carbon
CARBON O U R PRO GRES S UN PARIS AGREEMENT NET ZERO BY 2050 FROM 1.7 GTPA TO ZERO Strategy aligns with goal to limit the increase in Net-zero emissions energy business by 2050 We believe Shell’s total carbon emissions from the global average temperature to 1.5 degrees including all emissions (Scopes
Slide 10: HSSE Performance
H1 2022 HS S E PERFO RMA N CE Goal Zero on safety Operational spills Injuries (TRCF) per million working hours Million working hours Thousand tonnes # of spills 1.5 800 3 300 2 200 400 1 100 0.5 0 0 0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 H1 2022 2012 2013 2014 2015 2016 2017 2018 2019 2
Slide 11: Volatile Business Environment
MACRO $/MMBtu V O LA TILE BU S IN ES S EN V IRO N MEN T Oil and Gas Prices Shell Indicative Refining and Chemical Margins $/bbl $/MMBtu $/bbl $/tonne Brent JCC-3 Henry Hub (RHS) EU TTF (RHS) Indicative Refining margin Indicative Chemical margin (RHS) 140 45 35 400 40 120 30 35 300 100 25 30 200 80 2
Slide 12: Strong Results in Volatile Times
Q2 2022 FINANCIAL RESULTS Q2 2022 average Brent price: S TRO N G RES U LTS IN V O LA TILE TIMES $114/bbl Income attributable to Shell plc Includes post-tax net impairment reversals of $4.3 billion following the revision of oil and gas $18.0 billion shareholders prices Compared to Q1 2022, reflec
Slide 13: Shell Adjusted Earnings and Cash Conversion
Q2 2022 FINANCIAL RESULTS S HELL A DJU S TED EA RN IN GS A N D CA S H CO N V ERS ION Adjusted Earnings Q1 2022 to Q2 2022 Cash conversion Q2 2022 $ billion $ billion (4.2) 14 28 working capital movement 12 0.4 24 5.3 1.1 0.9 1.5 0.0 (0.0) (0.7) 10 20 (0.7) 1.1 5.8 (3.3) 8 (0.3) 16 (2.0) 0.6 6 12 23.
Slide 14: Strong Results Across All Segments
Q2 2022 FINANCIAL RESULTS Additional information available in S TRO N G RES U LTS A CRO S S A LL S EGMEN TS the Q2 2022 Quarterly Press Release Adjusted Earnings Adjusted EBITDA CFFO $ billion Q2 2022 Q1 2022 Q2 2022 Q1 2022 Q2 2022 Q1 2022 Integrated Gas 3.8 4.1 6.5 6.3 8.2 6.4 Upstream 4.9 3.5 11.
Slide 15: Integrated Business Model Delivering Resilient EBITDA and Cash
CASH POTENTIAL IN TEGRA TED BU S IN ES S MO DEL DELIV ERIN G RES ILIEN T EBITDA A N D CA S H Adjusted EBITDA Track record of strong CFFO $ billion $ billion 25 60 50 20 40 15 30 10 20 5 10 0 0 Growth Transition Upstream Peer range Shell Shell plc | July 28, 2022 Left graph: excludes Corporate 15 Rig
Slide 16: Accelerated Shareholder Distributions and Net Debt Reduction
Q2 2022 FINANCIAL RESULTS A CCELERA TED S HA REHO LDER DIS TRIBU T I O N S A N D N ET DEBT REDU CTIO N Cash dividends and Share buybacks Net debt Q1 2022 to Q2 2022 $ billion $ billion 60 8 7 (22.9) (0.2) 6 2.1 40 1.1 5 7.4 (0.8) 4 7.0 48.5 4.2 46.4 3 20 2 1 0 0 Cash dividends* Buybacks** *Dividends
Slide 17: Stepping Up Shareholder Distributions
CAPITAL ALLOCATION S TEPPIN G U P S HA REHO LDER DIS TRIBU T IO N S $8.5 billion share buyback programme announced for H1 2022 H1 2022 Q3 2022 completed, including $5.5 billion from the Permian asset sale proceeds Shareholder announcements announcements distributions $6 billion share buyback pro
Slide 18: Continuing Portfolio Focus and High-Grading
DIVESTMENTS CO N TIN U IN G PO RTFO LIO FO CU S A N D HIGH-GRA D IN G Shell Neft Gasnor Salym Fredericia refinery Duvernay shales PCK Schwedt refinery Sakhalin-2 Puget Sound Permian Mobile refinery Egypt Western Desert Deer Park refinery OML 17 Malampaya Nigeria onshore Completed divestments in 2021
Slide 19: Progressing Removal of Russian Hydrocarbons from Supply Chain
PROGRESSING REMOVAL OF RUSSIAN HYDROCARBONS FROM SUPPLY CHAIN DECISIVE ACTION IN FAST-EVOLVING GEOPOLITICAL ENVIRONMENT CONTINUED CARE FOR STAFF IN IMPACTED COUNTRIES Phased unwinding of supply Stopped all spot purchases of Russian crude, liquefied natural gas Announced intent to: Main assets in R
Slide 20: Marketing Major Projects
MA RK ETIN G MA JO R PRO JECTS Shell Shell- Project Country Products share % operated Under construction – Start-up 2022-2023 Shell Bovarius USA 100 Renewable Fuels – RNG Shell Galloway USA 100 Renewable Fuels – RNG Varennes Carbon LanzaJet USA 15.4 Renewable Fuels Biofuels Plant Rotterdam Recyc
Slide 21: Integrated Power and Hydrogen Portfolio and Projects
IN TEGRA TED PO WER A N D HYDRO GEN PO RTFO LIO A N D PRO JECTS UK NL Norway Spain France Germany Project Country Shell share % Capacity, MW Project Type Renewable generation – Capacity under construction and/or committed for sale Gangarri Australia 100 120 Solar Crosswind NL 80 760 Offshore wind Si
Slide 22: Building a Hydrogen Economy
RENEWABLES AND ENERGY SOLUTIONS BU ILDIN G A HYDRO GEN ECO N O MY SHELL HYDROGEN REFUELLING Building Value Chains at Scale, leveraging Shell’s Capabilities STATIONS DATA Holland Hydrogen I 200 MW Electrolyser FID announced in CENTRES July 2022 Europe’s largest renewable hydrogen plant which will
Slide 23: Carbon Capture and Storage and Nature-Based Projects
CA RBO N CA PTU RE A N D S TO RA GE A N D N A TU RE-BA S ED PRO JECTS Northern Lights Shell CO2 captured Shell- Announced projects Country Technology share % and/or stored, mtpa operated Centre Mongstad CCS projects – Under construction Northern Lights (Phase 1) Norway 33.3% 1.5 JV CCS projects – Pr
Slide 24: Integrated Gas Portfolio & Major Projects
IN TEGRA TED GA S PO RTFO LI O & MA JO R PRO JECTS Peak LNG Shell Shell- Project Country production capacity share % operated kboe/d mtpa Under construction – Start-up 2022-2023 Arrow - Surat Gas Australia 50 backfill Gorgon - Jansz Australia 25 backfill Oman Gas Oman 53 120 LNGC Dragon Sakhalin G
Slide 25: Chemicals and Products Portfolio & Major Projects
CHEMICA LS A N D PRO DU CTS PO RTFO LI O & MA JO R PRO JECTS Shell Products Shell- Project Country share % operated Construction complete – Start-up 2022 Pennsylvania Petrochemicals USA 100 1.5 mtpa polyethylene Complex Under construction – Start-up 2023+ Mossmorran Rotterdam Moerdijk energy effic
Slide 26: Upstream Portfolio & Major Projects
U PS TREA M PO RTFO LIO & MA JO R PRO JECTS Shell Peak production Shell- Project Country share % kboe/d operated Under construction – Start-up 2022-2023 Mero 2 [A] Brazil 19.3 180 Timi Malaysia 75 50 Pierce post Depressurisation UK 93 30 UK UK 50 45 Penguins Redevelopment Kazakhstan Vito USA 6
Slide 27: Upcoming Events and Useful Links
Upcoming events: Useful links: Oct 6, 2022 Strategy Day 2021 Shell Insights: Marketing Business Update Annual and Quarterly Databook Oct 27, 2022 Shell Energy Transition Strategy Q3 2022 results Nigeria briefing notes 2021 ESG performance data Simplified Share Structure War in Ukraine: Shell’s Respo
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