Shell Plc · LSE:SHEL
Shell — Royal Dutch Shell — Q4 2020 Earnings Presentation
18 slides from Shell's earnings presentation, Feb 4, 2021
Slide 1: Fourth Quarter Results
FOURTH QUARTER / RESULTS STRONG OPERATIONAL DELIVERY IN AN EXTRAORDINARY YEAR Royal Dutch Shell ple February 4, 2021 #MakeTheFuture
Slide 2: Jessica Uhl, Chief Financial Officer
Jessica Uhl CHIEF FINANCIAL OFFICER Welcome everyone to our fourth quarter 2020 and full year results presentation. 2020 was an extraordinary year. With the COVID pandemic, the economic downturn, dislocations in commodity prices, with at one point, for the first time in history, a negative oil price
Slide 3: 2020: Strong Operational Delivery in an Extraordinary Year
2020 / STRONG OPERATIONAL DELIVERY IN AN EXTRAORDINARY YEAR 2020 / No work-related fatalities in Shel-operated ventures and fewer ACTUALS injuries than in 2019 $5 billion ADJUSTED EARNINGS / Cared for people, customers and communities CASH FLOW FROM $34 billion SHIFTOWIERC / Industry-leading cash fl
Slide 4: A Compelling Investment Case
~~ A COMPELLING INVESTMENT CASE GROWTH PILLAR: TRANSITION PILLAR: UPSTREAM PILLAR: THE FUTURE OF ENERGY ENABLING OUR STRATEGY FUNDING OUR STRATEGY 7 Marketing /Power / Hydrogen / Biofuels J Integrated Gas _/ Chemicals & Products / Focus Upstream- 9 core positions 1 $19 to 22 billion Cash capex in th
Slide 5: 2020 Portfolio Highlights: Accelerating Our Strategy
| 2020 / PORTFOLIO HIGHLIGHTS — ACCELERATING OUR STRATEGY GROWTH PILLAR: TRANSITION PILLAR: UPSTREAM PILLAR: THE FUTURE OF ENERGY ENABLING OUR STRATEGY FUNDING OUR STRATEGY / First power from Borssele offshore wind farm / Strengthening leading LNG position with Final / Final Investment Decision on M
Slide 6: Significant moves in Refining, Integrated Gas and Upstream
Take Refining, for example. In total, we made significant moves with six of our refineries in the year, either exiting, divesting or repurposing them to align our assets with the future of energy. We are also working on opportunities to address carbon emissions that are difficult to avoid. A good ex
Slide 7: Marketing: Strong Financial Delivery in Challenging Market Conditions
~~ MARKETING / STRONG FINANCIAL DELIVERY IN CHALLENGING MARKET CONDITIONS Growing profitability in Retail and Lubricants Adapting our customer proposition Adjusted Earnings, $ billion Supporting our / 299% of Retail sites and Lubricants plants remained open 3 aon in 2020, serving customers’ essentia
Slide 8: Portfolio resilience and cost discipline
From Upstream and our Transition Businesses to our Growth Businesses, our portfolio showed great resilience last year and while we focused on our customers and operations, we also remained disciplined on cost.
Slide 9: 2020: Delivering on Cash Preservation Measures
| 2020 / DELIVERING ON CASH PRESERVATION MEASURES / Exceeded cash preservation targets set in March 2020: $33 billion -12% $37 billion / Underlying opex of $33 billion in 2020, down by $4.5 billion, from $37 billion in 2019, against a reduction target Vs. 2019 of $3 to $4 billion / Cash capex decisi
Slide 10: Capex reduction and working capital
In fact, we reduced it by more than $7 billion, with rigorous capital discipline, with capital efficiency and by stopping or re-phasing projects. We also optimised our working capital by revising payment terms and inventory levels. Let me now turn to the fourth quarter. 10
Slide 11: Q4 2020: Strong Cash Flow Generation
' Q4 2020 / STRONG CASH FLOW GENERATION PROVING FINANCIAL RESILIENCE Q4 2020 average Brent price: $44/bbl Cash flow from operations Cathleen seal $6.6 billion / Negative working capital movements of $0.3 billion, CFFO of $6.3 billion / $0.9 billion organic free cash flow Free cash flow $0.9 billion
Slide 12: Key factors behind financial performance
Let us now go through some of the key factors behind our financial performance in the quarter. 12
Slide 13: Q4 2020 Financial Highlights: Adjusted Earnings
| Q4 2020 / FINANCIAL HIGHLIGHTS: ADJUSTED EARNINGS Integrated Gas Upstream Oil Products Refining & Trading Marketing Chemicals Corporate Non-controlling interest Adjusted Earnings Adjusted Earnings, $ per share ROACE (%) Q oya1 Dutch Shot | February 4, 2021 Adjusted Earnings Q4 2019 to Q4 2020 $ bi
Slide 14: Q4 2020 Financial Highlights: Cash Flow
| Q4 2020 / FINANCIAL HIGHLIGHTS: CASH FLOW ae ea856 719820207) cero excusing working capital a4 2019 to G4 2020 Integrated Gas 35 2.2 fies Upstream 4.0 20 » Oil Products 2.5 1.2 10 ee (2.5) (0.5) Chemicals (0.0) 08 8 Corporate 03 01 @ | 18 Cash flow from operations 10.3 6.3 : CFFO excl. working cap
Slide 15: 2020: Strong Operational Delivery in an Extraordinary Year
| 2020 / STRONG OPERATIONAL DELIVERY IN AN EXTRAORDINARY YEAR / No workrelated fatalities in Shel-operated ventures and fewer injuries than in 2019 / Cared for people, customers and communities / Industry-leading cash flow from operations / Underlying opex reduced by $4 billion / Cash capex reduced
Slide 16: 16
16
Slide 17: Upcoming Events - H1 2021
UPCOMING EVENTS - H1 2021 11 February 25 February 15 April 29 April May (TBD) 18 May 26 May Strategy Day LNG Outlook & Integrated Gas Strategy ESG Update QI 2021 results Pre AGM engagement Annual General Meeting Upstream Investor Day 17
Slide 18: Thank you / Definitions & Cautionary Note
Thank you for your interest in Royal Dutch Shell plc. Please understand that an investment in Royal Dutch Shell ple securities carries with it the risk that you could sustain losses as a result of your investment. Therefore, an investment in Royal Dutch Shell ple securities may not be appropriate fo