Shell (SHEL) Q4 2023 earnings summary

Executive summary

• Q4 Adjusted Earnings were $7.3B and CFFO was $12.6B, supported by strong LNG trading and optimisation.

• FY Adjusted Earnings were $28.25B and CFFO was $54.2B; shareholder distributions totaled $23B, or 42% of CFFO.

Financial highlights

• Q4 revenue was $78.7B; income attributable to shareholders was $474M, Adjusted EBITDA $16.3B and free cash flow $6.9B.

• FY revenue was $316.6B; attributable income was $19.36B, Adjusted EBITDA $68.5B and free cash flow $36.46B.

• FY Adjusted Earnings fell from $39.87B in 2022; CFFO declined from $68.4B and Adjusted EBITDA from $84.3B.

• Q4 cash capital expenditure was $7.1B; FY cash capital expenditure was $24.4B, versus $24.8B in 2022.

• Q4 included $3.9B of net impairment charges and reversals; identified items were a net loss of $6.0B.

Outlook and guidance

• Cash capital expenditure guidance is $22–25B p.a. in 2024 and 2025; 2023 capex of $24.4B was at the lower end of the prior $23–27B range.

• Structural cost reduction target is $2–3B by end-2025; $1B was achieved in 2023 versus 2022.

• Targets include price-normalised FCF growth above 6% p.a. through 2030 and price-normalised FCF per share growth above 10% p.a. through 2025.

• Integrated Gas and Upstream target more than 500 kboe/d of new peak production by 2025; projects on stream in 2023 represented over 200 kboe/d.

• Q1 2024 guidance: Integrated Gas production 930–990 kboe/d and LNG liquefaction 7.0–7.6 MT; Upstream production 1,730–1,930 kboe/d.