Royal Dutch Shell’s 2020 profit dropped to its lowest in at least two decades as the pandemic hit energy consumption, but the company boosted its dividend again in a sign of confidence.
Shell’s annual adjusted earnings dropped to $4.8 billion, down 71 per cent from a year earlier.
Shell’s debt-to-equity ratio rose throughout the year, but the Anglo-Dutch oil company was able to avoid the huge losses of its rivals partly thanks to strong results from its network of more than 45,000 filling stations around the world.
“We are coming out of 2020 with a stronger balance sheet,” chief executive Ben van Beurden said in a statement.
Its fourth-quarter profit was down 87 per cent from a year earlier and below expectations, dragged down by continued weak energy consumption due to the pandemic.
In a sign of confidence Shell said it expected to raise its first-quarter dividend by 4 per cent from the previous quarter.
That would be the second slight increase since Shell slashed its dividend by two-thirds in the first quarter of 2020 in response to the Covid-19 pandemic, the first reduction since the second World War.
Shell’s net debt at the end of the fourth quarter rose about $2 billion on the previous quarter to $75.4 billion, with its gearing – or debt-to-equity ratio – ticking up to 32.3 per cent. – Reuters