REG-Royal Dutch Shell: 4th Quarter and Full Year 2014 Unaudited Results <Origin Href="QuoteRef">RDSa.L</Origin> - Part 2
29/01/2015 07:12
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596 4,425 1,822 Income for the period 14,908 16,526
Adjustment for:
2,330 2,691 4,677 - Current taxation 13,757 18,582
375 377 436 - Interest expense (net) 1,598 1,448
- Depreciation, depletion and
4,991 4,729 5,629 amortisation 24,499 21,509
(972) (78) (87) - Net gains on sale of assets (3,212) (382)
- Decrease/(increase) in working
5,844 1,741 (1,682) capital 6,125 2,988
- Share of profit of joint
(818) (1,512) (2,024) ventures and associates (6,116) (7,275)
- Dividends received from joint
1,531 2,096 1,865 ventures and associates 6,902 7,117
- Deferred taxation, retirement
benefits, decommissioning
(1,603) 689 (938) and other provisions (1,618) (2,701)
1,000 572 1,338 - Other 2,500 2,937
Net cash from operating
13,274 15,730 11,036 activities (pre-tax) 59,343 60,749
(3,666) (2,919) (5,008) Taxation paid (14,299) (20,309)
Net cash from operating
9,608 12,811 6,028 activities 45,044 40,440
Cash flow from investing
activities
(8,718) (7,867) (14,508) Capital expenditure (31,854) (40,145)
Investments in joint ventures and
107 (151) (523) associates (1,426) (1,538)
2,245 3,783 432 Proceeds from sales of assets 9,873 1,212
Proceeds from sales of joint
279 157 109 ventures and associates 4,163 538
(649) (278) 2 Other investments (net) (587) (388)
56 29 37 Interest received 174 175
Net cash used in investing
(6,680) (4,327) (14,451) activities (19,657) (40,146)
Cash flow from financing
activities
Net (decrease)/increase in debt
with maturity period within three
(173) (465) 3,239 months (3,332) 3,126
4,001 442 4,366 Other debt: New borrowings 7,778 9,146
(571) (334) (464) Repayments (4,089) (6,877)
(310) (404) (650) Interest paid (1,480) (1,307)
Change in non-controlling
1,002 0 (60) interest1 989 (51)
Cash dividends paid to:
- Royal Dutch Shell plc
(2,987) (2,994) (1,610) shareholders (9,444) (7,198)
(39) (4) (36) - Non-controlling interest (116) (252)
(971) (770) (996) Repurchases of shares (3,328) (5,000)
Shares held in trust: net
(purchases)/sales and dividends
(29) 48 66 received 232 (565)
Net cash used in financing
(77) (4,481) 3,855 activities (12,790) (8,978)
Currency translation differences
relating to cash and
(271) (395) (14) cash equivalents (686) (170)
Increase/(decrease) in cash and
2,580 3,608 (4,582) cash equivalents 11,911 (8,854)
Cash and cash equivalents at
19,027 15,419 14,278 beginning of period 9,696 18,550
Cash and cash equivalents at end
21,607 19,027 9,696 of period 21,607 9,696
1 Mainly relates to the public offering of limited partner units in Shell
Midstream Partners, L.P.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of preparation
These unaudited Condensed Consolidated Financial Statements of Royal Dutch
Shell plc and its subsidiaries (collectively referred to as Shell) have been
prepared on the basis of the same accounting principles as, and should be read
in conjunction with, the Annual Report and Form 20-F for the year ended
December 31, 2013 (pages 105 to 110) as filed with the U.S. Securities and
Exchange Commission.
The financial information presented in these Condensed Consolidated Financial
Statements does not constitute statutory accounts within the meaning of section
434(3) of the Companies Act 2006. Statutory accounts for the year ended
December 31, 2013 were published in Shell's Annual Report and a copy was
delivered to the Registrar of Companies in England and Wales. The auditors'
report on those accounts was unqualified, did not include a reference to any
matters to which the auditors drew attention by way of emphasis without
qualifying the report and did not contain a statement under sections 498(2) or
498(3) of the Companies Act 2006.
2. Segment information
Segment earnings are presented on a current cost of supplies basis (CCS
earnings). On this basis, the purchase price of volumes sold during the period
is based on the current cost of supplies during the same period after making
allowance for the tax effect. CCS earnings therefore exclude the effect of
changes in the oil price on inventory carrying amounts.
Net capital investment is defined as capital expenditure as reported in the
Condensed Consolidated Statement of Cash Flows, adjusted for: proceeds from
disposals (excluding other investments (net) in the Corporate segment);
exploration expense excluding exploration wells written off; investments in
joint ventures and associates; and leases and other items.
CCS earnings and net capital investment information are the dominant measures
used by the Chief Executive Officer for the purposes of making decisions about
allocating resources and assessing performance.
3. Impacts of accounting for derivatives
In the ordinary course of business Shell enters into contracts to supply or
purchase oil and gas products, and also enters into derivative contracts to
mitigate resulting economic exposures (generally price exposure). Derivative
contracts are carried at period-end market price (fair value), with movements
in fair value recognised in income for the period. Supply and purchase
contracts entered into for operational purposes are, by contrast, recognised
when the transaction occurs (see also below); furthermore, inventory is carried
at historical cost or net realisable value, whichever is lower.
As a consequence, accounting mismatches occur because: (a) the supply or
purchase transaction is recognised in a different period; or (b) the inventory
is measured on a different basis.
In addition, certain UK gas contracts held by Upstream are, due to pricing or
delivery conditions, deemed to contain embedded derivatives or written options
and are also required to be carried at fair value even though they are entered
into for operational purposes.
The accounting impacts of the aforementioned are reported as identified items
in this Report.
4. Return on average capital employed
Return on average capital employed (ROACE) measures the efficiency of Shell's
utilisation of the capital that it employs and is a common measure of business
performance. In this calculation, ROACE is defined as the sum of income for the
current and previous three quarters, adjusted for after-tax interest expense,
as a percentage of the average capital employed for the same period. The rate
used is Shell's effective tax rate for the period. Capital employed consists of
total equity, current debt and non-current debt.
CAUTIONARY STATEMENT
All amounts shown throughout this Report are unaudited. All peak production
figures in Portfolio Developments are quoted at 100% expected production.
The companies in which Royal Dutch Shell plc directly and indirectly owns
investments are separate entities. In this document "Shell", "Shell group" and
"Royal Dutch Shell" are sometimes used for convenience where references are
made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the
words "we", "us" and "our" are also used to refer to subsidiaries in general or
to those who work for them. These expressions are also used where no useful
purpose is served by identifying the particular company or companies.
''Subsidiaries'', "Shell subsidiaries" and "Shell companies" as used in this
document refer to companies over which Royal Dutch Shell plc either directly or
indirectly has control. Companies over which Shell has joint control are
generally referred to as "joint ventures" and companies over which Shell has
significant influence but neither control nor joint control are referred to as
"associates". The term "Shell interest" is used for convenience to indicate the
direct and/or indirect ownership interest held by Shell in a venture,
partnership or company, after exclusion of all third-party interest.
This document contains forward-looking statements concerning the financial
condition, results of operations and businesses of Royal Dutch Shell. All
statements other than statements of historical fact are, or may be deemed to
be, forward-looking statements. Forward-looking statements are statements of
future expectations that are based on management's current expectations and
assumptions and involve known and unknown risks and uncertainties that could
cause actual results, performance or events to differ materially from those
expressed or implied in these statements. Forward-looking statements include,
among other things, statements concerning the potential exposure of Royal Dutch
Shell to market risks and statements expressing management's expectations,
beliefs, estimates, forecasts, projections and assumptions. These
forward-looking statements are identified by their use of terms and phrases
such as ''anticipate'', ''believe'', ''could'', ''estimate'', ''expect'',
''goals'', ''intend'', ''may'', ''objectives'', ''outlook'', ''plan'',
''probably'', ''project'', ''risks'', "schedule", ''seek'', ''should'',
''target'', ''will'' and similar terms and phrases. There are a number of
factors that could affect the future operations of Royal Dutch Shell and could
cause those results to differ materially from those expressed in the
forward-looking statements included in this document, including (without
limitation): (a) price fluctuations in crude oil and natural gas; (b) changes
in demand for Shell's products; (c) currency fluctuations; (d) drilling and
production results; (e) reserves estimates; (f) loss of market share and
industry competition; (g) environmental and physical risks; (h) risks
associated with the identification of suitable potential acquisition properties
and targets, and successful negotiation and completion of such transactions;
(i) the risk of doing business in developing countries and countries subject to
international sanctions; (j) legislative, fiscal and regulatory developments
including regulatory measures addressing climate change; (k) economic and
financial market conditions in various countries and regions; (l) political
risks, including the risks of expropriation and renegotiation of the terms of
contracts with governmental entities, delays or advancements in the approval of
projects and delays in the reimbursement for shared costs; and (m) changes in
trading conditions. All forward-looking statements contained in this document
are expressly qualified in their entirety by the cautionary statements
contained or referred to in this section. Readers should not place undue
reliance on forward-looking statements. Additional risk factors that may affect
future results are contained in Royal Dutch Shell's Form 20-F for the year
ended December 31, 2013 (available at www.Shell.com/investor and www.sec.gov).
These risk factors also expressly qualify all forward-looking statements
contained in this document and should be considered by the reader. Each
forward-looking statement speaks only as of the date of this document, January
29, 2015. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake
any obligation to publicly update or revise any forward-looking statement as a
result of new information, future events or other information. In light of
these risks, results could differ materially from those stated, implied or
inferred from the forward-looking statements contained in this document.
We may have used certain terms, such as resources, in this document that the
United States Securities and Exchange Commission (SEC) strictly prohibits us
from including in our filings with the SEC. U.S. investors are urged to
consider closely the disclosure in our Form 20-F, File No 1-32575, available on
the SEC website www.sec.gov. You can also obtain this form from the SEC by
calling 1-800-SEC-0330.
January 29, 2015
The information in this Report reflects the unaudited consolidated financial
position and results of Royal Dutch Shell plc. Company No. 4366849, Registered
Office: Shell Centre, London, SE1 7NA, England, UK.
Contacts:
- Investor Relations: International + 31 (0) 70 377 4540; North America +1 832
337 2034
- Media: International +44 (0) 207 934 5550; USA +1 713 241 4544
END
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