Shell plc
The company expects to incur non-cash post tax impairments of $1.5 - $2 billion in the quarter, including $0.6 billion - $0.8 billion in Singapore Chemicals & Products assets and $0.6 billion - $1.0 billion in Rotterdam HEFA assets.
Notably, this week, Shell stated that it is temporarily pausing construction at its 820,000 tonnes-per-year biofuels facility in Rotterdam to address project delivery and ensure future competitiveness amid current market conditions.
Outlook Revised: For Integrated Gas, the company updated the production outlook to be 940 - 980 thousand boe/d (vs. 920 - 980 thousand boe/d expected earlier) and LNG liquefaction volumes to 6.8 - 7.2 MT (vs. 6.8 - 7.4 MT prior).
The outlook reflects that Trading and optimisation results are expected to be in line with second-quarter FY23 but lower than first-quarter FY24 due to seasonality.
For Upstream, Shell narrowed production guidance to 1,720 - 1,820 thousand boe/d (vs. 1,630 - 1,830 thousand boe/d earlier), with shares of profit / (loss) of joint ventures and associates expected to be ~$0.2 billion and exploration well-write offs projected to be ~$0.2 billion.
For Marketing, the company lowered the high end of the sales volume guidance, with the revised range at 2,700 - 3,100 thousand b/d (vs. 2,700 - 3,200 projected earlier).
For Chemicals & Products, Shell currently sees refinery utilization of 91% - 95% (vs. 87% - 95% earlier), reflecting planned maintenance activities in North America and Chemicals utilization of 78% - 82% (vs. 72% - 80% prior).
The company projects Chemicals sub-segment adjusted earnings to be close to break-even in second-quarter FY24.
Shell stock has gained around 22% in the last 12 months. Investors can gain exposure to the stock via Direxion Hydrogen ETF
Price Action: SHEL shares are up 1.21% at $73.89 premarket at the last check Friday.
