Oil company Shell will reduce its debts and pay more profit distribution to investors. The move is striking because earlier this year the company lowered the profit distribution, the dividend, for the first time since World War II.
CEO Ben van Beurden says that Shell wants to invest more in technologies for the future and at the same time wants to be an interesting investment for investors. The profit distribution will increase by 4 percent this quarter and the company intends to increase the distribution in the coming years.
This year, Shell’s share price has fallen drastically, by more than 60 percent. Yesterday, the Shell share price dipped below 10 euros for the first time since the early 1990s. After this morning’s announcement, the stock rose about 5 percent on the stock exchange.
Profitable again
Shell made the announcement when announcing the quarterly figures. This shows that the company made a profit in the past quarter after significant losses earlier this year. At the bottom of the line, 489 million dollars remained, 416 million euros. Last year, Shell made a profit of 5.9 billion dollars in the same quarter.
In the third quarter, the oil price was significantly higher than in the second quarter and demand for oil recovered somewhat. Demand was still far behind that of a year ago.
In recent weeks, the oil price has been falling again. Due to the new outbreak of the corona virus and new measures by governments, there is less demand for fuel and economic recovery seems to be slowing down.
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