Royal Dutch/Shell Group yesterday painted a bleak picture of business conditions and said it would vacate four national head offices in Europe.
In a speech to be delivered to fund managers in San Francisco early this morning, group chairman, Mr Mark Moody-Stuart said the overall business environment in the second half of 1998 would be significantly worse than in the first half.
"Overall, we expect that the business environment in the second half of the year will be significantly worse than in the first half," he said.
Moody Stuart said the group would consider whether to write down the value of some of its assets this year and said the low oil price and poor environment meant it would stay well below projections of return on average capital employed (ROACE) of 12 to 12.5 per cent made in May.
The statement initially hit Shell shares hard, although they moved above early lows and analysts noted that there was little surprise in terms of the company's outlook.
By 1230 GMT, Shell Transport shares in London were down 19p, or 5.4 per cent, to 335 3/4p after a low of 322 1/2. In Amsterdam, shares in Royal Dutch were down six guilders, or 6.4 per cent, to 87.30 after touching 83.70.
A Shell spokesman said there would be job losses as a result of its British, Dutch, German and French operations quitting their head offices, but said it was too early to say how many.
