FORM 6-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
The Securities Exchange Act of 1934
For February 2011
For February 2011
Commission File Number: 1-32575
Royal Dutch Shell plc
(Exact name of registrant as specified in its charter)
England and Wales
(Jurisdiction of incorporation or organization)
30, Carel van Bylandtlaan, 2596 HR The Hague
The Netherlands
Tel No: (011 31 70) 377 9111
(Address of principal executive officers)
Tel No: (011 31 70) 377 9111
(Address of principal executive officers)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form
20-F or Form 40-F.
Form 20-F þ Form 40-F o
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(1):
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(7):
Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
Yes o No þ
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b):82-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Royal Dutch Shell plc
(Registrant)
(Registrant)
By:
|
/s/ Michiel Brandjes
|
|||
| Name: Michiel Brandjes | ||||
| Title: Company Secretary |
Date:
February 3, 2011
4TH QUARTER AND FULL YEAR 2010 UNAUDITED RESULTS
• Royal Dutch Shell’s fourth quarter 2010 earnings, on a current cost of supplies
(CCS) basis, were $5.7 billion compared to $1.2 billion a year ago. Basic CCS earnings
per share increased to $0.93 from $0.19 in the fourth quarter 2009.
• Fourth quarter 2010 CCS earnings, excluding identified items (see page 5), were
$4.1 billion compared to $2.8 billion in the fourth quarter 2009.
• Full year 2010 earnings, on a current cost of supplies (CCS) basis, were $18.6
billion compared to $9.8 billion a year ago. Basic CCS earnings per share increased by
90% versus a year ago.
• Cash flow from operating activities, excluding net working capital movements, for
the fourth quarter 2010 was $6.2 billion, compared to $4.4 billion in the same quarter
last year. On the same basis, full year 2010 cash flow from operating activities was
$33.3 billion compared to $23.8 billion in 2009.
• Net capital investment for the quarter was $1.5 billion. Total cash dividends paid
to shareholders during the fourth quarter 2010 were $2.0 billion. Some 18.3 million
class A Ordinary shares, equivalent to $0.6 billion, were issued under the Scrip
Dividend Programme for the third quarter 2010.
• Gearing at the end of 2010 was 17.1%.
• A fourth quarter 2010 dividend has been announced of $0.42 per ordinary share,
unchanged from the US dollar dividend per share for the same period in 2009. The first
quarter 2011 dividend is expected to be declared at $0.42 per share.
SUMMARY OF UNAUDITED RESULTS
| Quarters | $ million | Full year | ||||||||||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | %1 | 2010 | 2009 | % | ||||||||||||||||||||||
| 5,097 | 3,153 | 2,536 | Upstream |
15,935 | 8,354 | |||||||||||||||||||||||
| 411 | 325 | (1,762 | ) | Downstream |
2,950 | 258 | ||||||||||||||||||||||
| 188 | 43 | 403 | Corporate and Non-controlling interest |
(242 | ) | 1,192 | ||||||||||||||||||||||
| 5,696 | 3,521 | 1,177 | +384 | CCS earnings |
18,643 | 9,804 | +90 | |||||||||||||||||||||
| 1,094 | (58 | ) | 784 | Estimated CCS adjustment for Downstream |
1,484 | 2,714 | ||||||||||||||||||||||
| 6,790 | 3,463 | 1,961 | +246 | Income attributable to shareholders |
20,127 | 12,518 | +61 | |||||||||||||||||||||
| 0.93 | 0.57 | 0.19 | +389 | Basic CCS earnings per share ($) |
3.04 | 1.60 | +90 | |||||||||||||||||||||
| 0.18 | (0.01 | ) | 0.13 | Estimated CCS adjustment per share ($) |
0.24 | 0.44 | ||||||||||||||||||||||
| 1.11 | 0.56 | 0.32 | +247 | Basic earnings per share ($) |
3.28 | 2.04 | +61 | |||||||||||||||||||||
| 5,456 | 9,016 | 5,660 | -4 | Cash flow from operating activities |
27,350 | 21,488 | +27 | |||||||||||||||||||||
| 0.89 | 1.47 | 0.92 | -3 | Cash flow from operating activities per share ($) |
4.46 | 3.51 | +27 | |||||||||||||||||||||
| 0.42 | 0.42 | 0.42 | — | Dividend per share ($) |
1.68 | 1.68 | — | |||||||||||||||||||||
| 1 | Q4 on Q4 change | |
The information in these quarterly and full year results reflect the consolidated financial position and results of Royal Dutch
Shell plc (“Royal Dutch Shell”). All amounts shown throughout this report are unaudited. Company No. 4366849, Registered
Office: Shell Centre, London, SE1 7NA, England, UK
Royal Dutch Shell plc 2
Royal Dutch Shell Chief Executive Officer Peter Voser commented:
“Our 2010 earnings increased substantially from 2009 levels, driven by improving industry
fundamentals, and Shell’s production growth and cost performance. Our 2010 oil and natural
gas production volumes were 3.3 million boe/d, an increase of 5%. LNG sales volumes
increased by 25%, with continued growth in Downstream. Fourth quarter and full year 2010
earnings were supported by higher oil prices and chemicals margins. However, our earnings
were impacted by weak refining margins, pressure on certain regional natural gas prices,
and volatility in Downstream marketing margins as a result of rising oil prices.
In 2010 Shell made good progress on implementing strategy, improving near-term performance,
delivering a new wave of production growth, and maturing the next generation of growth
options for shareholders.
Shell has a strong focus on continuous improvement, reducing costs, enhancing Shell’s
operating performance, and rebalancing the portfolio for profitable growth. Underlying
costs declined by $2 billion in 2010 compared to 2009, bringing the total underlying cost
reduction to some $4 billion for 2009 and 2010 combined, a reduction of some 10%.
Disposals of $7 billion of non-core assets in 2010 bring total asset sales in the last 5
years to some $30 billion. Year-end balance sheet gearing was 17.1%, comfortably within
Shell’s 0-30% target range. We have delivered our 2010-11 asset sales targets ahead of
schedule. For 2011, asset sales proceeds could reach some $5 billion, including some $2
billion of proceeds from transactions announced in 2010.”
Turning to growth delivery, Voser commented: “Shell’s industry-leading investment programme
is laying down firm foundations for our shareholders and our customers in the future. In
2010 we started up 6 key projects in Upstream and Downstream. In Qatar, in early 2011, we
achieved first offshore gas production at the Qatargas 4 LNG facility. Major construction
is complete, on schedule, at the Pearl Gas-to-Liquids (GTL) plant, and commissioning for
start-up is underway as planned.
These projects underpin Shell’s targets for an 11% increase from 2009 to 2012 oil and
natural gas production, and enhancement of the Downstream portfolio. This growth will drive
a 50-80% increase in cashflow from operations from 2009 to 2012, measured at $60-$80 oil
prices. These are ambitious targets, but we are on track,” said Voser.
“Shell has made good progress on generating longer-term growth during 2010. Shell took two
final investment decisions in 2010 for deepwater projects, the Mars B project in the Gulf
of Mexico, USA and BC-10 Phase 2 project in Brazil.
Shell made $7 billion of acquisitions, and invested $3 billion in exploration activities in
2010. The acquisition of East Resources takes our resources potential in North America
tight gas to some 40 tcfe. In partnership with PetroChina, we purchased Arrow Energy, an
Australian coal bed methane and LNG player, and entered into new tight gas and coal bed
methane acreage in China. Shell and its partners signed contracts to develop the giant
Majnoon and West Qurna fields in Iraq. Shell’s explorers made 8 discoveries in 2010, in
particular the Appomatox discovery in the Gulf of Mexico, with more than 250 million boe
resources potential. In Downstream, we progressed a marketing and biofuels joint venture
with Cosan in Brazil, and a new 2 million tonnes per year petrochemicals project in Qatar.”
Voser commented: “We continue to invest for medium-term growth to create value for our
shareholders. I expect 2011 net capital investment of some $25-27 billion, including a $1.6
billion investment for the Cosan joint venture. Dividend will be $0.42 per share for the
fourth quarter 2010 and is expected to be $0.42 per share for the first quarter 2011. In
2010 Shell declared dividends of $10.2 billion, the largest in our sector, underlining our
commitment to shareholder returns.”
Voser concluded: “We are making good progress against our targets, and there is more to
come from Shell.”
Royal Dutch Shell plc 3
FOURTH QUARTER 2010 PORTFOLIO DEVELOPMENTS
Upstream
In Australia, Shell sold 29.18% of its interest in Woodside, or 10.0% of Woodside’s issued
capital, for a total price of $3.2 billion, reducing Shell’s share in the company to
24.27%.
In Norway, production started on the Gjoa field (Shell share 12%), with a production
capacity of 107 thousand barrels of oil equivalent per day (boe/d).
In Russia, Shell signed a protocol on strategic global cooperation with Gazprom
establishing basic guidelines for the companies’ broader collaboration in both the Upstream
and Downstream businesses.
In the USA, Shell completed, in January 2011, the sale of a group of predominately mature
tight gas fields in South Texas producing some 200 million cubic feet of gas equivalent per
day (Shell share), for approximately $1.8 billion.
Also in the USA, Shell agreed to sell its interest in six Gulf of Mexico oil and gas fields
for $450 million. These fields are predominately mature and produce some 18 thousand boe/d
(Shell share).
During the fourth quarter 2010, Shell participated in 3 exploration discoveries, 2 in
Brazil and 1 in Brunei. During 2010, Shell participated in 8 exploration discoveries and 6
successful appraisals, in Australia, Brazil, Brunei, the US Gulf of Mexico and North
America gas. Shell also increased its overall acreage position, completing acquisitions of
new exploration licences in China, Egypt, Greenland, Qatar, Russia, Tunisia and the USA.
Downstream
In Finland and Sweden, Shell sold the majority of its refining and marketing businesses,
including Shell’s 100% owned 87 thousand bbl/d Gothenburg Refinery.
Shell also completed the sale of its Downstream businesses in Gibraltar, Panama, Costa Rica
and Laos in separate transactions.
In Qatar, Shell and Qatar Petroleum signed a Memorandum of Understanding to jointly study
the development of a major petrochemicals complex that would include a mono-ethylene glycol
plant of up to 1.5 million tonnes per annum and other olefin derivatives to yield over 2
million tonnes of finished products.
In Germany, Shell announced, in January 2011, negotiations with potential buyers for the
base oil manufacturing and associated refining facilities of its 100% owned Harburg
refinery (105 thousand bbl/d capacity), with the intention to convert the remaining
portions of the refinery into a distribution terminal for oil products.
Royal Dutch Shell plc 4
KEY FEATURES OF THE FOURTH QUARTER AND FULL YEAR 2010
| • | Fourth quarter 2010 CCS earnings were $5,696 million, 384% higher than in the same quarter a year ago. Full year 2010 CCS earnings were $18,643 million, 90% higher than in 2009. |
| • | Fourth quarter 2010 CCS earnings, excluding identified items (see page 5), were $4,110 million compared to $2,774 million in the fourth quarter 2009. Full year 2010 CCS earnings, excluding identified items (see page 5), were $18,073 million compared to $11,553 million in 2009. |
| • | Fourth quarter 2010 reported earnings were $6,790 million compared to $1,961 million in the same quarter a year ago. Full year 2010 reported earnings were $20,127 million compared to earnings of $12,518 million in 2009. |
| • | Basic CCS earnings per share increased by 389% versus the same quarter a year ago. Full year 2010 basic CCS earnings per share increased by 90% compared to 2009. |
| • | Cash flow from operating activities for the fourth quarter 2010 was $5.5 billion, compared to $5.7 billion in the same quarter last year. Excluding net working capital movements, cash flow from operating activities in the fourth quarter 2010 was $6.2 billion, compared to $4.4 billion in the same quarter last year. |
| Full year 2010 cash flow from operating activities was $27.4 billion compared to $21.5 billion in 2009. Excluding net working capital movements, full year 2010 cash flow from operating activities was $33.3 billion compared to $23.8 billion in 2009. |
| • | Total cash dividends paid to shareholders during the fourth quarter 2010 were $2.0 billion, bringing the total for the full year 2010 to $9.6 billion. During the fourth quarter 2010, some 18.3 million class A Ordinary shares, equivalent to $0.6 billion, were issued under the Scrip Dividend Programme for the third quarter 2010. |
| • | Capital investment for the fourth quarter 2010 was $6.2 billion. Net capital investment (capital investment, less divestment proceeds) for the fourth quarter 2010 was $1.5 billion, bringing the total for the full year 2010 to $23.7 billion. |
| • | Return on average capital employed (ROACE) at the end of the fourth quarter 2010, on a reported income basis, was 11.5%. |
| • | Gearing was 17.1% at the end of 2010 versus 15.5% at the end of 2009. |
Upstream
| • | Oil and gas production for the fourth quarter 2010 was 3,496 thousand boe/d, 5% higher than in the fourth quarter 2009. Full year 2010 oil and gas production was 3,314 thousand boe/d, 5% higher than in 2009. |
| Production for the fourth quarter 2010 excluding the impact of divestments, production sharing contracts (PSC) pricing effects and OPEC quota restrictions was 8% higher compared to the fourth quarter 2009 (7% for the full year 2010 compared to last year). |
| Production in the fourth quarter increased by some 160 thousand boe/d (170 thousand boe/d for the full year 2010) from new field start-ups and the continuing ramp-up of fields, more than offsetting the impact of field declines. |
| • | LNG sales volumes of 4.39 million tonnes in the fourth quarter 2010 were 11% higher than in the same quarter a year ago. Full year 2010 LNG sales volumes were 16.76 million tonnes compared to 13.40 million tonnes in 2009, an increase of 25%. |
Downstream
| • | Oil Products sales volumes were 6% higher than in the fourth quarter 2009. Chemical product sales volumes in the fourth quarter 2010 increased by 10% compared to the fourth quarter 2009. |
| Full year 2010 Oil Products sales volumes were 5% higher than in 2009. Full year 2010 Chemical product sales volumes increased by 13% compared to 2009. |
| • | Oil Products refinery availability was 92% compared to 93% in the fourth quarter 2009 (92% for the full year 2010 versus 93% in 2009). Chemicals manufacturing plant availability was unchanged from the fourth quarter 2009 at 95% (94% for the full year 2010 versus 92% in 2009). |
Supplementary financial and operational disclosure for the fourth quarter and full year 2010
is available at www.shell.com/investor.
Royal Dutch Shell plc 5
SUMMARY OF IDENTIFIED ITEMS
Earnings in the fourth quarter 2010 reflected the following items, which in aggregate
amounted to a net gain of $1,586 million (compared to a net charge of $1,597 million in the
fourth quarter 2009), as summarised in the table below:
| • | Upstream earnings included a net gain of $1,657 million reflecting divestment gains which were partly offset by charges related to the mark-to-market valuation of certain gas contracts, the estimated fair value accounting of commodity derivatives (see Note 3), write-offs and provisions. Earnings for the fourth quarter 2009 included a net charge of $226 million. |
| • | Downstream earnings included a net charge of $71 million reflecting charges related to write-offs and provisions, which were partly offset by divestment gains. Earnings for the fourth quarter 2009 included a net charge of $1,335 million. |
| • | Corporate earnings and Non-controlling interest for the fourth quarter 2009 included a charge of $36 million. |
SUMMARY OF IDENTIFIED ITEMS
| Quarters | $ million | Full year | ||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
Segment earnings impact of identified items: |
||||||||||||||||||||
| 1,657 | (284 | ) | (226 | ) | Upstream |
1,493 | (134 | ) | ||||||||||||
| (71 | ) | (1,128 | ) | (1,335 | ) | Downstream |
(923 | ) | (1,682 | ) | ||||||||||
| — | — | (36 | ) | Corporate and Non-controlling interest |
— | 67 | ||||||||||||||
| 1,586 | (1,412 | ) | (1,597 | ) | CCS earnings impact |
570 | (1,749 | ) | ||||||||||||
These identified items generally relate to events with an impact of more than $50
million on Royal Dutch Shell’s earnings and are shown to provide additional insight into
its reported earnings, CCS earnings and income attributable to shareholders. Further
additional comments on the business segments are provided in the section ‘Earnings by
Business Segment’ on page 6 and onwards.
Royal Dutch Shell plc 6
EARNINGS BY BUSINESS SEGMENT
UPSTREAM
| Quarters | $ million | Full year | ||||||||||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | %1 | 2010 | 2009 | % | ||||||||||||||||||||||
| 5,097 | 3,153 | 2,536 | +101 | Upstream earnings |
15,935 | 8,354 | +91 | |||||||||||||||||||||
| 5,596 | 6,139 | 5,983 | -6 | Upstream cash flow from operations |
24,872 | 19,935 | +25 | |||||||||||||||||||||
| 522 | 9,554 | 5,947 | -91 | Net capital investment |
21,222 | 22,326 | -5 | |||||||||||||||||||||
| 1,741 | 1,709 | 1,703 | +2 | Crude oil production (thousand b/d) |
1,709 | 1,680 | +2 | |||||||||||||||||||||
| 10,184 | 7,823 | 9,379 | +9 | Natural gas production available for sale (million scf/d) |
9,305 | 8,483 | +10 | |||||||||||||||||||||
| 3,496 | 3,058 | 3,320 | +5 | Barrels of oil equivalent (thousand boe/d) |
3,314 | 3,142 | +5 | |||||||||||||||||||||
| 4.39 | 4.26 | 3.96 | +11 | LNG sales volumes (million tonnes) |
16.76 | 13.40 | +25 | |||||||||||||||||||||
| 1 | Q4 on Q4 change |
Fourth quarter Upstream earnings were $5,097 million compared to $2,536 million a year
ago. Earnings included a net gain of $1,657 million related to identified items, compared
to a net charge of $226 million in the fourth quarter 2009 (see page 5).
Upstream earnings, excluding the impact of identified items, compared to the fourth quarter
2009 reflected improved realised crude oil and natural gas prices and increased production
volumes, and lower depreciation and exploration well write-off expenses. These were
partially offset by increased production taxes and lower trading contributions. Earnings
also reflected increased LNG sales volumes and improved realised LNG prices, which were
partly offset by lower dividends from an LNG venture.
In the Americas, Upstream earnings reflected the effect of improved realised crude oil
prices and increased natural gas production volumes. These were more than offset by the
significant impacts of lower realised natural gas prices, higher tax expenses, lower
trading contributions and higher operating expenses, mainly related to the ramp-up of the
Jack Pine Mine at the Athabasca Oil Sands Project (AOSP), ahead of the planned start-up of
the expansion of the Scotford Upgrader in 2011.
Global liquids realisations were 15% higher than in the fourth quarter 2009. Global gas
realisations were 8% higher than in the same quarter a year ago. In the Americas, gas
realisations decreased by 12%, whereas outside the Americas, gas realisations increased by
12%.
Fourth quarter 2010 production was 3,496 thousand boe/d compared to 3,320 thousand boe/d a
year ago. Crude oil production was up 2% and natural gas production was up 9% compared to
the fourth quarter 2009. In Nigeria, Shell’s share of Shell Petroleum Development Nigeria
Company (SPDC) joint venture production increased by some 115 thousand boe/d driven by the
ramp-up of new projects and improved security conditions.
Production, compared to the fourth quarter 2009, increased by some 160 thousand boe/d from
new field start-ups and the continuing ramp-up of fields over the past 12 months, more than
offsetting field declines.
LNG sales volumes of 4.39 million tonnes were 11% higher than in the same quarter a year
ago, mainly from increased volumes from the Sakhalin II LNG project and Nigeria LNG.
Full year Upstream earnings were $15,935 million compared to $8,354 million in 2009.
Earnings included a net gain of $1,493 million related to identified items, compared to a
net charge of $134 million in the full year 2009 (see page 5).
Royal Dutch Shell plc 7
Upstream earnings compared to the full year 2009 reflected the significant impact of higher
realised crude oil and natural gas prices, increased production volumes and lower
depreciation and exploration well write-off expenses. These were partly offset by higher
production taxes and lower trading contributions. In addition, earnings reflected increased
LNG sales volumes and improved LNG realised prices.
Global liquids realisations were 32% higher than in the full year 2009. Global gas
realisations were 2% higher than a year ago. In the Americas, gas realisations increased by
13% and outside the Americas, gas realisations were in line with the full year 2009.
Full year 2010 production increased by 5% to 3,314 thousand boe/d from 3,142 thousand boe/d
a year ago. Crude oil production was up 2% and natural gas production increased by 10%
compared to the full year 2009 production. In Nigeria, Shell’s share of Shell Petroleum
Development Nigeria Company (SPDC) joint venture production increased by some 120 thousand
boe/d driven by the ramp-up of new projects and improved security conditions.
Production, compared to the full year 2009, increased by some 170 thousand boe/d from new
field start-ups and the continuing ramp-up of fields in 2010, more than offsetting field
declines.
LNG sales volumes of 16.76 million tonnes were 25% higher than in 2009. Volumes mainly
reflected the ramp-up in sales volumes from the Sakhalin II LNG project and increased
volumes from Nigeria LNG.
Royal Dutch Shell plc 8
DOWNSTREAM
| Quarters | $ million | Full year | ||||||||||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | %1 | 2010 | 2009 | % | ||||||||||||||||||||||
| 411 | 325 | (1,762 | ) | — | Downstream CCS earnings |
2,950 | 258 | — | ||||||||||||||||||||
| 1,117 | (61 | ) | 810 | Estimated CCS adjustment |
1,498 | 2,796 | ||||||||||||||||||||||
| 1,528 | 264 | (952 | ) | — | Downstream earnings |
4,448 | 3,054 | +46 | ||||||||||||||||||||
| (348 | ) | 1,953 | 2,243 | — | Downstream cash flow from operations |
1,961 | 4,056 | -52 | ||||||||||||||||||||
| 991 | 701 | 1,208 | -18 | Net capital investment |
2,358 | 6,232 | -62 | |||||||||||||||||||||
| 3,201 | 3,292 | 2,986 | +7 | Refinery plant intake (thousand b/d) |
3,197 | 3,067 | +4 | |||||||||||||||||||||
| 6,670 | 6,385 | 6,296 | +6 | Oil Products sales volumes (thousand b/d) |
6,460 | 6,156 | +5 | |||||||||||||||||||||
| 5,297 | 5,333 | 4,835 | +10 | Chemicals sales volumes (thousand tonnes) |
20,653 | 18,311 | +13 | |||||||||||||||||||||
| 1 | Q4 on Q4 change |
Fourth quarter Downstream CCS earnings were $411 million compared to a loss of $1,762
million in the fourth quarter 2009. Earnings included a net charge of $71 million related
to identified items, compared to a net charge of $1,335 million in the fourth quarter 2009
(see page 5).
Downstream CCS earnings compared to the fourth quarter 2009 reflected higher Oil Products
marketing earnings, improved refining contributions and higher Chemicals earnings.
Oil Products marketing CCS earnings improved compared to the fourth quarter 2009, mainly
reflecting higher retail, lubricants and B2B earnings, lower operating expenses and
increased trading contributions. Compared to the third quarter 2010, earnings declined
mainly as a result of the impact of rising oil prices on marketing margins.
Oil Products sales volumes increased by 6% compared to the same quarter last year.
Excluding the impact of divestments, sales volumes increased by 8%.
Refining CCS results remained under pressure but improved compared to the fourth quarter
last year, benefiting from higher realised refining margins globally, higher refinery plant
intake volumes and lower operating expenses. Compared to the third quarter 2010, results
declined mainly reflecting increased downtime at major refining facilities, including at
the catalytic crackers, concentration of planned maintenance activities and currency
exchange rate impacts. Refinery availability was 92% compared to 93% in the fourth quarter
2009.
Chemicals CCS earnings compared to the fourth quarter 2009 reflected improved realised
chemicals margins, higher chemicals sales volumes, higher income from equity-accounted
investments and lower operating expenses.
Chemicals sales volumes increased by 10% compared to the same quarter last year, mainly due
to the start-up of the Shell Eastern Petrochemicals Complex in Singapore. Chemicals
manufacturing plant availability was unchanged from the fourth quarter 2009 at 95%.
Full year Downstream CCS earnings were $2,950 million compared to $258 million in 2009.
Earnings included a net charge of $923 million related to identified items, compared to a
net charge of $1,682 million in the full year 2009 (see page 5).
Downstream CCS earnings compared to the full year 2009 reflected higher Oil Products
marketing earnings, improved refining contributions and higher Chemicals earnings.
Oil Products marketing CCS earnings improved compared to a year ago, mainly reflecting
higher retail and lubricants earnings, and lower operating expenses, which were partly
offset by lower B2B earnings and reduced trading contributions.
Royal
Dutch Shell plc 9
Oil Products sales volumes increased by 5% compared to 2009. Excluding the impact of
divestments, sales volumes increased by 6%.
Refining CCS results improved from the full year 2009, benefiting from higher realised
refining margins globally and higher refinery plant intake volumes, mainly in the Asia
Pacific region. Refinery availability was 92% compared to 93% in the full year 2009.
Chemicals CCS earnings compared to the full year 2009 reflected improved realised chemicals
margins, higher chemicals sales volumes, higher income from equity-accounted investments
and lower operating expenses.
Chemicals sales volumes increased by 13% compared to the full year 2009, mainly due to
start-up of the Shell Eastern Petrochemicals Complex in Singapore. Chemicals manufacturing
plant availability increased to 94% from 92% in the full year 2009.
CORPORATE AND NON-CONTROLLING INTEREST
| Quarters | $ million | Full year | ||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
| 231 | 148 | 427 | Corporate |
91 | 1,310 | |||||||||||||||
| (43 | ) | (105 | ) | (24 | ) | Non-controlling interest |
(333 | ) | (118 | ) | ||||||||||
| 188 | 43 | 403 | Corporate and Non-controlling interest |
(242 | ) | 1,192 | ||||||||||||||
Fourth quarter Corporate earnings and Non-controlling interest were $188 million
compared to $403 million for the same period last year. Earnings for the fourth quarter
2009 included a charge of $36 million related to an identified item (see page 5).
Corporate earnings for the fourth quarter 2010 reflected a lower net interest result which
was partly offset by higher tax credits and higher currency exchange gains compared to the
same period in 2009.
Full year Corporate earnings and Non-controlling interest were a loss of $242 million
compared to earnings of $1,192 million for the full year 2009. Earnings for the full year
2009 included net gains of $67 million related to identified items (see page 5).
Corporate earnings for the full year 2010 reflected a significantly lower net interest
result and lower currency exchange gains, which were partly offset by higher tax credits
compared to 2009.
FORTHCOMING EVENTS
A Shell strategy update is planned for March 15, 2011. First quarter 2011 results and first
quarter 2011 dividend are scheduled to be announced on April 28, 2011. Second quarter 2011
results and second quarter 2011 dividend are scheduled to be announced on July 28, 2011.
Third quarter 2011 results and third quarter 2011 dividend are scheduled to be announced on
October 27, 2011.
Royal
Dutch Shell plc 10
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED STATEMENT OF INCOME
| Quarters | $ million | Full year | ||||||||||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | %1 | 2010 | 2009 | % | ||||||||||||||||||||||
| 100,714 | 90,712 | 81,075 | Revenue |
368,056 | 278,188 | |||||||||||||||||||||||
| 1,979 | 1,020 | 1,767 | Share of profit of equity-accounted investments |
5,953 | 4,976 | |||||||||||||||||||||||
| 2,832 | 1,010 | 577 | Interest and other income3 |
4,143 | 1,965 | |||||||||||||||||||||||
| 105,525 | 92,742 | 83,419 | Total revenue and other income |
378,152 | 285,129 | |||||||||||||||||||||||
| 78,138 | 70,278 | 60,879 | Purchases |
283,176 | 203,075 | |||||||||||||||||||||||
| 7,294 | 6,052 | 7,382 | Production and manufacturing expenses |
24,458 | 25,301 | |||||||||||||||||||||||
| 4,301 | 3,701 | 5,532 | Selling, distribution and administrative expenses |
15,528 | 17,430 | |||||||||||||||||||||||
| 422 | 203 | 331 | Research and development |
1,019 | 1,125 | |||||||||||||||||||||||
| 646 | 610 | 669 | Exploration |
2,036 | 2,178 | |||||||||||||||||||||||
| 3,236 | 6,196 | 3,748 | Depreciation, depletion and amortisation |
15,595 | 14,458 | |||||||||||||||||||||||
| 227 | 317 | 4 | Interest expense |
996 | 542 | |||||||||||||||||||||||
| 11,261 | 5,385 | 4,874 | +131 | Income before taxation |
35,344 | 21,020 | +68 | |||||||||||||||||||||
| 4,405 | 1,820 | 2,863 | Taxation |
14,870 | 8,302 | |||||||||||||||||||||||
| 6,856 | 3,565 | 2,011 | +241 | Income for the period |
20,474 | 12,718 | +61 | |||||||||||||||||||||
| 66 | 102 | 50 | Income attributable to non-controlling interest |
347 | 200 | |||||||||||||||||||||||
| 6,790 | 3,463 | 1,961 | +246 | Income attributable to Royal Dutch Shell plc
shareholders |
20,127 | 12,518 | +61 | |||||||||||||||||||||
| (1,094 | ) | 58 | (784 | ) | Estimated CCS adjustment for Downstream |
(1,484 | ) | (2,714 | ) | |||||||||||||||||||
| 5,696 | 3,521 | 1,177 | +384 | CCS earnings |
18,643 | 9,804 | +90 | |||||||||||||||||||||
BASIC EARNINGS PER SHARE
| Quarters | Full year | |||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
| 1.11 | 0.56 | 0.32 | Earnings per share ($)
|
3.28 | 2.04 | |||||||||||||||
| 0.93 | 0.57 | 0.19 | CCS earnings per share ($)
|
3.04 | 1.60 | |||||||||||||||
DILUTED EARNINGS PER SHARE
| Quarters | Full year | |||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
| 1.10 | 0.56 | 0.32 | Earnings per share ($) |
3.28 | 2.04 | |||||||||||||||
| 0.93 | 0.57 | 0.19 | CCS earnings per share ($) |
3.04 | 1.60 | |||||||||||||||
SHARES2
| Quarters | Millions | Full year | ||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
Weighted average number of shares as the basis for: |
||||||||||||||||||||
| 6,137.3 | 6,132.6 | 6,124.3 | Basic earnings per share
|
6,132.6 | 6,124.9 | |||||||||||||||
| 6,147.4 | 6,138.3 | 6,132.0 | Diluted earnings per share
|
6,139.3 | 6,128.9 | |||||||||||||||
| 6,154.2 | 6,132.0 | 6,122.3 | Shares outstanding at the end of the period
|
6,154.2 | 6,122.3 | |||||||||||||||
| 1 | Q4 on Q4 change. | |
| 2 | Royal Dutch Shell plc ordinary shares of €0.07 each. | |
| 3 | Other income includes dividend income, net gains on sale of assets and net foreign exchange effects on financing activities. |
Royal
Dutch Shell plc 11
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
| Ordinary | Shares | Non- | ||||||||||||||||||||||||||
| share | held in | Other | Retained | controlling | Total | |||||||||||||||||||||||
| $ million | capital | trust | reserves | earnings | Total | interest | equity | |||||||||||||||||||||
At December 31, 2009 |
527 | (1,711 | ) | 9,982 | 127,633 | 136,431 | 1,704 | 138,135 | ||||||||||||||||||||
Income for the period |
— | — | — | 20,127 | 20,127 | 347 | 20,474 | |||||||||||||||||||||
Other comprehensive income |
— | — | 4 | — | 4 | 42 | 46 | |||||||||||||||||||||
Capital contributions
from and other changes in
non-controlling interest |
— | — | — | 283 | 283 | 69 | 352 | |||||||||||||||||||||
Dividends declared |
— | — | — | (10,196 | ) | (10,196 | ) | (395 | ) | (10,591 | ) | |||||||||||||||||
Scrip dividend1 |
2 | — | (2 | ) | 612 | 612 | — | 612 | ||||||||||||||||||||
Shares held in trust: net
sales/(purchases) and
dividends
received2 |
— | (1,078 | ) | — | 1,521 | 443 | — | 443 | ||||||||||||||||||||
Share-based compensation |
— | — | 110 | 199 | 309 | — | 309 | |||||||||||||||||||||
At December 31, 2010 |
529 | (2,789 | ) | 10,094 | 140,179 | 148,013 | 1,767 | 149,780 | ||||||||||||||||||||
| Ordinary | Shares | Non- | ||||||||||||||||||||||||||
| share | held in | Other | Retained | controlling | Total | |||||||||||||||||||||||
| $ million | capital | trust | reserves | earnings | Total | interest | equity | |||||||||||||||||||||
At December 31, 2008 |
527 | (1,867 | ) | 3,178 | 125,447 | 127,285 | 1,581 | 128,866 | ||||||||||||||||||||
Income for the period |
— | — | — | 12,518 | 12,518 | 200 | 12,718 | |||||||||||||||||||||
Other comprehensive income |
— | — | 6,623 | — | 6,623 | 52 | 6,675 | |||||||||||||||||||||
Capital contributions
from and other changes in
non-controlling interest |
— | — | — | 3 | 3 | 62 | 65 | |||||||||||||||||||||
Dividends paid |
— | — | — | (10,526 | ) | (10,526 | ) | (191 | ) | (10,717 | ) | |||||||||||||||||
Shares held in trust: net
sales/(purchases) and
dividends received |
— | 156 | — | — | 156 | — | 156 | |||||||||||||||||||||
Share-based compensation |
— | — | 181 | 191 | 372 | — | 372 | |||||||||||||||||||||
At December 31, 2009 |
527 | (1,711 | ) | 9,982 | 127,633 | 136,431 | 1,704 | 138,135 | ||||||||||||||||||||
| 1 | During the fourth quarter 2010 some 18.3 million class A Ordinary shares, equivalent to $0.6 billion, were issued under the Scrip Dividend Programme for the third quarter 2010. The fair value of the shares issued in connection with the Scrip Dividend Programme is reflected in retained earnings. | |
| 2 | The historical cumulative amount of dividends received on shares held in trust is reflected in retained earnings with effect from the fourth quarter 2010. |
Royal
Dutch Shell plc 12
CONDENSED CONSOLIDATED BALANCE SHEET
| $ million | ||||||||||||
| Dec 31, 2010 | Sept 30, 2010 | Dec 31, 2009 | ||||||||||
Assets |
||||||||||||
Non-current assets: |
||||||||||||
Intangible assets
|
5,039 | 5,171 | 5,356 | |||||||||
Property, plant and equipment
|
142,705 | 139,863 | 131,619 | |||||||||
Equity-accounted investments
|
33,414 | 34,015 | 31,175 | |||||||||
Investments in securities
|
3,809 | 3,968 | 3,874 | |||||||||
Deferred tax
|
5,361 | 5,372 | 4,533 | |||||||||
Pre-paid pension costs
|
10,368 | 10,383 | 10,009 | |||||||||
Other
|
8,970 | 8,909 | 9,158 | |||||||||
| 209,666 | 207,681 | 195,724 | ||||||||||
Current assets: |
||||||||||||
Inventories
|
29,348 | 28,922 | 27,410 | |||||||||
Accounts receivable
|
70,102 | 62,769 | 59,328 | |||||||||
Cash and cash equivalents
|
13,444 | 11,282 | 9,719 | |||||||||
| 112,894 | 102,973 | 96,457 | ||||||||||
Total assets
|
322,560 | 310,654 | 292,181 | |||||||||
Liabilities |
||||||||||||
Non-current liabilities: |
||||||||||||
Debt
|
34,381 | 35,148 | 30,862 | |||||||||
Deferred tax
|
13,388 | 13,179 | 13,838 | |||||||||
Retirement benefit obligations
|
5,924 | 6,048 | 5,923 | |||||||||
Other provisions
|
14,285 | 14,352 | 14,048 | |||||||||
Other
|
4,250 | 4,696 | 4,586 | |||||||||
| 72,228 | 73,423 | 69,257 | ||||||||||
Current liabilities: |
||||||||||||
Debt
|
9,951 | 9,932 | 4,171 | |||||||||
Accounts payable and accrued liabilities
|
76,550 | 65,980 | 67,161 | |||||||||
Taxes payable
|
10,306 | 13,431 | 9,189 | |||||||||
Retirement benefit obligations
|
377 | 397 | 461 | |||||||||
Other provisions
|
3,368 | 3,046 | 3,807 | |||||||||
| 100,552 | 92,786 | 84,789 | ||||||||||
Total liabilities
|
172,780 | 166,209 | 154,046 | |||||||||
Equity attributable to Royal Dutch Shell plc shareholders
|
148,013 | 142,744 | 136,431 | |||||||||
Non-controlling interest
|
1,767 | 1,701 | 1,704 | |||||||||
Total equity
|
149,780 | 144,445 | 138,135 | |||||||||
Total liabilities and equity
|
322,560 | 310,654 | 292,181 | |||||||||
Royal Dutch Shell plc 13
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
| Quarters | $ million | Full year | ||||||||||||||||||
| Q4 2010 | Q3 2010 | Q4 2009 | 2010 | 2009 | ||||||||||||||||
Cash flow from operating activities: |
||||||||||||||||||||
| 6,856 | 3,565 | 2,011 | Income for the period |
20,474 | 12,718 | |||||||||||||||
Adjustment for: |
||||||||||||||||||||
| 4,515 | 3,545 | 3,409 | - Current taxation |
16,384 | 9,297 | |||||||||||||||
| 186 | 264 | 390 | - Interest (income)/expense |
842 | 1,247 | |||||||||||||||
| 3,236 | 6,196 | 3,748 | - Depreciation, depletion and amortisation |
15,595 | 14,458 | |||||||||||||||
| (2,344 | ) | (681 | ) | (415 | ) | - Net (gains)/losses on sale of assets |
(3,276 | ) | (781 | ) | ||||||||||
| (754 | ) | 937 | 1,253 | - Decrease/(increase) in net working capital |
(5,929 | ) | (2,331 | ) | ||||||||||||
| (1,979 | ) | (1,020 | ) | (1,767 | ) | - Share of profit of equity-accounted investments |
(5,953 | ) | (4,976 | ) | ||||||||||
| 2,064 | 1,486 | 1,691 | - Dividends received from equity-accounted investments |
6,519 | 4,903 | |||||||||||||||
| (468 | ) | (1,941 | ) | (938 | ) | - Deferred taxation and other provisions |
(1,934 | ) | (1,925 | ) | ||||||||||
| (696 | ) | (86 | ) | (421 | ) | - Other |
(10 | ) | (1,879 | ) | ||||||||||
| 10,616 | 12,265 | 8,961 | Cash flow from operating activities (pre-tax) |
42,712 | 30,731 | |||||||||||||||
| (5,160 | ) | (3,249 | ) | (3,301 | ) | Taxation paid |
(15,362 | ) | (9,243 | ) | ||||||||||
| 5,456 | 9,016 | 5,660 | Cash flow from operating activities |
27,350 | 21,488 | |||||||||||||||
Cash flow from investing activities: |
||||||||||||||||||||
| (5,571 | ) | (9,609 | ) | (7,506 | ) | Capital expenditure |
(26,940 | ) | (26,516 | ) | ||||||||||
| (110 | ) | (1,179 | ) | (653 | ) | Investments in equity-accounted investments |
(2,050 | ) | (2,955 | ) | ||||||||||
| 1,286 | 666 | 520 | Proceeds from sale of assets |
3,325 | 1,325 | |||||||||||||||
| 3,380 | 44 | 1,146 | Proceeds from sale of equity-accounted investments |
3,591 | 1,633 | |||||||||||||||
| (16 | ) | (37 | ) | (37 | ) | (Additions to)/proceeds from sale of securities |
(34 | ) | (105 | ) | ||||||||||
| 34 | 51 | 96 | Interest received |
136 | 384 | |||||||||||||||
| (997 | ) | (10,064 | ) | (6,434 | ) | Cash flow from investing activities |
(21,972 | ) | (26,234 | ) | ||||||||||
Cash flow from financing activities: |
||||||||||||||||||||
| 248 | 3,232 | (816 | ) | Net
(decrease)/increase in debt with maturity period within three months |
4,647 | (6,507 | ) | |||||||||||||
| 120 | 199 | 461 | Other debt: New borrowings |
7,849 | 19,742 | |||||||||||||||
| (388 | ) | (491 | ) | (477 | ) | Repayments |
(3,240 | ) | (2,534 | ) | ||||||||||
| (108 | ) | (307 | ) | (292 | ) | Interest paid |
(1,312 | ) | (902 | ) | ||||||||||
| 66 | (3 | ) | 20 | Change in non-controlling interest |
381 | 62 | ||||||||||||||
Dividends paid to: |
||||||||||||||||||||
| (1,998 | ) | (2,583 | ) | (2,613 | ) | - Royal Dutch Shell plc shareholders |
(9,584 | ) | (10,526 | ) | ||||||||||
| (38 | ) | (168 | ) | (27 | ) | - Non-controlling interest |
(395 | ) | (191 | ) | ||||||||||
Shares held in trust: |
||||||||||||||||||||
| 17 | (34 | ) | (43 | ) | - Net sales/(purchases) and dividends received |
187 | 27 | |||||||||||||
| (2,081 | ) | (155 | ) | (3,787 | ) | Cash flow from financing activities |
(1,467 | ) | (829 | ) | ||||||||||
| (216 | ) | 477 | 5 | Currency
translation differences relating to cash and cash equivalents |
(186 | ) | 106 | |||||||||||||
| 2,162 | (726 | ) | (4,556 | ) | (Decrease)/increase in cash and cash equivalents |
3,725 | (5,469 | ) | ||||||||||||
| 11,282 | 12,008 | 14,275 | Cash and cash equivalents at beginning of period |
9,719 | 15,188 | |||||||||||||||
| 13,444 | 11,282 | 9,719 | Cash and cash equivalents at end of period |
13,444 | 9,719 | |||||||||||||||
Royal Dutch Shell plc 14
EXPLANATORY NOTES
1. Basis of preparation
The quarterly and full year financial report and tables of Royal Dutch Shell plc and its
subsidiaries (collectively known as “Shell”) are prepared on the basis of the same
accounting principles as, and should be read in conjunction with, the Annual Report on
Form 20-F for the year ended December 31, 2009 (pages 101 to 106) as filed with the US
Securities and Exchange Commission.
With effect from January 1, 2010, acquisitions and divestments are accounted for in
accordance with revised IFRS 3 Business Combinations and IAS 27 Consolidated and
Separate Financial Statements. The revised standards apply with prospective effect to
the acquisition of a business or for certain types of transactions involving an
additional investment or a partial disposal, requiring for example the recognition in
income of certain transaction costs, the recognition at fair value of contingent
consideration payable and the re-measurement of existing interests held or retained. The
exact impact depends on the individual transaction concerned, with potentially different
amounts being recognised in the Consolidated Financial Statements than would previously
have been the case.
With effect from the fourth quarter 2010, Downstream 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 estimated current cost of supplies during
the same period after making allowance for the estimated tax effect. CCS earnings thus
exclude the effect of changes in the oil price on inventory carrying amounts. CCS
earnings have become the dominant measure used by the Chief Executive Officer for the
purposes of making decisions about allocating resources to the segment and assessing its
performance.
The information for the period ended December 31, 2010 does not comprise statutory
accounts as defined in section 435 of the Companies Act 2006. Statutory accounts for the
year ended December 31, 2009 were approved by the Board of Directors and delivered to
the Registrar of Companies. The report of the auditors 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 any
statement under sections 498(2) or (3) of the Companies Act 2006.
2. Return on average capital employed (ROACE)
ROACE is defined as the sum of the current and previous three quarters’ income adjusted
for interest expense, after tax, divided by the average capital employed for the period.
3. Impacts of Accounting for Derivatives
IFRS requires derivative instruments to be recognised in the financial statements at
fair value. Any change in the current period between the period-end market price and the
contract settlement price is recognised in income where hedge accounting is either not
permitted or not applied to these contracts.
The physical crude oil and related products held by the Downstream business as inventory
are recorded at historical cost or net realisable value, whichever is lower, as required
under IFRS. Consequently, any increase in value of the inventory over cost is not
recognised in income until the sale of the commodity occurs in subsequent periods.
In the Downstream business, the buying and selling of commodities includes transactions
conducted through the forward markets using commodity derivatives to reduce economic
exposure. Some derivatives are associated with a future physical delivery of the
commodities.
Differences in the accounting treatment for physical inventory (at cost or net
realisable value, whichever is lower) and derivative instruments (at fair value) have
resulted in timing differences in the recognition of gains or losses between reporting
periods.
Similarly, earnings from long-term contracts held in the Upstream business are
recognised in income upon realisation. Associated commodity derivatives are recognised
at fair value as of the end of each quarter.
These differences in accounting treatment for long-term contracts (on an accrual basis)
and derivative instruments (at fair value) have resulted in timing differences in the
recognition of gains or losses between the reporting periods.
The aforementioned timing differences for Downstream and Upstream are reported as
identified items in the quarterly results and are estimates derived from the overall
portfolio of derivatives.
Certain UK gas contracts held by Upstream contain embedded derivatives or written
options, for which IFRS requires recognition at fair value, even though they are entered
into for operational purposes. The impact of the mark-to-market calculation is reported
as an identified item in the quarterly results.
Royal Dutch Shell plc 15
CAUTIONARY STATEMENT
All amounts shown throughout this Report are unaudited.
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 in which Royal Dutch Shell either directly or indirectly has
control, by having either a majority of the voting rights or the right to exercise a
controlling influence. The companies in which Shell has significant influence but not
control are referred to as “associated companies” or “associates” and companies in which
Shell has joint control are referred to as “jointly controlled entities”. In this
document, associates and jointly controlled entities are also referred to as
“equity-accounted investments”. The term “Shell interest” is used for convenience to
indicate the direct and/or indirect (for example, through our 24% shareholding in
Woodside Petroleum Ltd.) 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’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’,
‘‘objectives’’, ‘‘outlook’’, ‘‘probably’’, ‘‘project’’, ‘‘will’’, ‘‘seek’’, ‘‘target’’,
‘‘risks’’, ‘‘goals’’, ‘‘should’’, “scheduled” 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) reserve 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
potential litigation and regulatory effects arising from recategorisation of reserves;
(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
factors that may affect future results are contained in Royal Dutch Shell’s Annual
Report and Form 20-F for the year ended December 31, 2009 (available at
www.shell.com/investor and www.sec.gov). These factors also should be considered by the
reader. Each forward-looking statement speaks only as of the date of this document,
February 3, 2011. Neither Royal Dutch Shell 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.
The United States Securities and Exchange Commission (SEC) permits oil and gas
companies, in their filings with the SEC, to disclose only proved reserves that a
company has demonstrated by actual production or conclusive formation tests to be
economically and legally producible under existing economic and operating conditions.
We use certain terms in this document that SEC’s guidelines strictly prohibit us from
including in 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 these forms from the SEC by calling
1-800-SEC-0330.
February 3, 2011
Contacts:
| - | Investor Relations: Europe: + 31 (0)70 377 4540; USA: +1 713 241 1042 | |
| - | Media: Europe: + 31 (0)70 377 3600 |