02 Feb Shell FY16 profits down following difficult global commodity conditions
Royal Dutch Shell’s (LSE:RDSB) full year profits for 2016 were down 37% year-on-year to US$7.185 billion, while its capital spending total was also reduced to $26.9 billion as the company followed a policy of cost-cutting.
However, according to its fourth quarter results Europe’s largest oil and gas company performed better than Exxon Mobil (NYSE:XOM), who earlier announced its earnings had halved over 2016.
Furthermore, the company is hopeful that it has turned a corner in the difficult environment following a global commodity downturn, as cashflow increased by 69% in the fourth quarter.
“Our strategy is starting to pay off and in 2017 we will be investing around $25 billion in high quality, resilient projects,” said chief executive officer Ben van Beurden.
“I’m confident 2017 will be another year of progress for Shell to become a world-class investment.
“Looking ahead, we will further focus the portfolio and strengthen the company’s financial framework in 2017,” added Beurden.
Shell’s net debt stood at $73.35 billion, following the sales of stakes in operations in Malaysia, Japan, Canada and the Gulf of Mexico.
The company has announced two major sales this year in plants at the North Sea and in Saudi Arabia, as it chases a $30 billion debt reduction target.