Slide 1: Fourth Quarter and Full Year 2015 Results
FOURTH QUARTER AND FULL YEAR 2015 RESULTS ROYAL DUTCH SHELL PLC 4 FEBRUARY 2016 Copyright of Royal Dutch Shell plc 4 February, 2016 1
Slide 2: Ben van Beurden, Chief Executive Officer
BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 4 February, 2016 2
Slide 3: Definitions & Cautionary Note
DEFINITIONS & CAUTIONARY NOTE NOT FOR RELEASE, PRESENTATION, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISIDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION. The information set out in this presentation is not intended to form
Slide 4: Summary
SUMMARY Q4 2015 results underpinned by Downstream and Integrated Gas Underlying CCS earnings $1.8 billion; CFFO $5.4 billion; Q415 dividend $0.47 per share Industry downturn Pulling financial levers to improve competitive position BG transaction on-track: expected effective date 15th Febru
Slide 5: HSSE Performance
HSSE PERFORMANCE Goal Zero on safety Spills - operational Injuries – TRCF/million working hours million working hours Volume in thousand tonnes TRCF Working hours (RHS) Energy intensity – refineries Process safety Energy Intensity Index (EEITM) Number of incidents HSSE priority Tier 1 incidents Ti
Slide 6: Financial Performance
FINANCIAL PERFORMANCE Earnings + ROACE Cash flow $ billion % $ billion $ billion Upstream Corporate/Other CFFO CFFI Free cash flow (RHS) Downstream ROACE (RHS) Dividend, buyback + gearing $ billion Gearing % range Integrated business + results Performance drive Balance sheet strength Dividend
Slide 7: Industry Downturn: Shell Response
INDUSTRY DOWNTURN: SHELL RESPONSE Strong balance sheet Asset sales Deliver new projects Gearing 14% >$20 billion 2014-15 completed; Shell + BG $30 billion 2016-18, Shell + BG growth projects Restructure portfolio Reduce operating costs Reduce capital investment Oil products, shales, 2015 Shell: -$4
Slide 8: Spending Reduction
SPENDING REDUCTION Operating costs (Shell) Capital investment (Shell + BG) Shell BG $ billion $ billion -45% -15% Supply chain + contractors Project re-phasing / deferral Headcount reduction 2015+ Supply chain savings ~10,000 Shell + BG Dilutions + exits Divestments 2015 delivery: op
Slide 9: Significant Reduction in Project Flow
SIGNIFICANT REDUCTION IN PROJECT FLOW OPTIONS TO FURTHER REDUCE SPEND 2013 2014 2015 2016 2017+ Heavy oil Carmon Creek Shales Shales Deep water Appomattox Vito Bonga South West Integrated Gas Arrow Greenfield LNG Elba LNG Browse LNG US GTL Wheatstone LNG Abadi redesign MLNG Dua JVA LNG
Slide 10: Asset Sales Delivery
ASSET SALES DELIVERY Asset sales + MLP 2014-2015 announcements $ billion $ billion Upstream – Shales 3.2 – Nigeria 3.2 – Woodside 3.0 – Wheatstone 1.5 – BC-10 dilution 1.2 – other 1.2 Total Upstream 13.3 Downstream + – Australia 2.6 Corporate – MLP 1.6 – LPG France 0.5 – other 2.5 Total Downstream a
Slide 11: Deliver New Upstream Projects
DELIVER NEW UPSTREAM PROJECTS SHELL PORTFOLIO Production (excludes BG) Shell-operated started up kboe per day (Shell share) million tonnes per annum 2014-15 Mars B Sabah gas KBB Bonga NW Bonga Main ph3 Cardamom Erha North ph2 Gumusut-Kakap Corrib Petai 2016-17 2
Slide 12: Restructuring and Downstream Performance Improvement
RESTRUCTURING AND DOWNSTREAM PERFORMANCE IMPROVEMENT Improving footprint Stronger results from smaller portfolio Million barrels/day $/barrel Million barrels/day Earnings in $ billion Cash flow in $ billion + ROACE in % -20% -30% +18% Refining capacity Marketing volumes Oil Products Cash flow (RHS)
Slide 13: BG Transaction
BG TRANSACTION 8 April 2015 27 & 28 January 2016 4 May 2016 BG acquisition announced Shell + BG General meetings Q1 results: Shell + BG 14 December 2015 15 February 2016 7 June 2016 Pre-conditions satisfied Expected effective date Capital markets day 10 months from announcement to completion 17
Slide 14: Commitment to Deliver Our Promises: Shell + BG
COMMITMENT TO DELIVER OUR PROMISES: SHELL + BG Synergies Asset sales Capital Growth investment $3.5 billion ~$30 billion ~$33 billion in LNG + deep water 2018 2016-2018 2016 combined acceleration Reduce exploration Shell programmes Improved free cash flow enhances future dividend +
Slide 15: Shell + BG Capital Investment
SHELL + BG CAPITAL INVESTMENT $ billion Shales + heavy oil Longer-term potential Simpler more focused company Deep water + Integrated Gas New scale + running room Focus + phased growth Predictable + structured growth funnel Conventional oil + gas High-grading + selective growth Assessi
Slide 16: Simon Henry, Chief Financial Officer
SIMON HENRY CHIEF FINANCIAL OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 4 February, 2016 16
Slide 17: Q4 2015 Financial Highlights
Q4 2015 FINANCIAL HIGHLIGHTS Earnings Q4 2014 to Q4 2015 $ billion Q4 Q4 2014 2015 $ billion Environment Choice UPSTREAM 1.7 0.5 DOWNSTREAM (CCS) 1.6 1.5 CORPORATE & MINORITIES (0.0) (0.2) CCS NET EARNINGS 3.3 1.8 CCS EARNINGS, $ PER SHARE 0.52 0.29 CASH FROM OPERATIONS 9.6 5.4 ROACE (%) 10.2 4.8 SH
Slide 18: SEC Proved Reserves Position
SEC PROVED RESERVES POSITION PRELIMINARY RESULTS 2015 Reserves performance Reserves performance Billion boe 2015 RRR -20% 2013-15 RRR 48% Reserves life at end 2015 ~10.5 years SEC proved reserves Avg 3- (billion boe) 2013 2014 2015 yr Production 1.2 1.2 1.1 1.2 SEC proved reserves1 13.9 13.1 1
Slide 19: LNG Markets + Performance
LNG MARKETS + PERFORMANCE Industry regasification capacity 2015 developments Million tonnes per annum Resilient results in lower oil price environment Progress with LNG marketing ~4 mtpa new sales agreements New 3rd party offtake secured Asia North & South America Oceania Europe Africa Globa
Slide 20: Cash Flow Management + Track Record
CASH FLOW MANAGEMENT + TRACK RECORD $ billion Priorities for cash $97 $87 $52 1. Debt reduction 2. Dividends 3. Buybacks + capital investment 5-year average 3-year average 2015 2011-2015 2013-2015 Cash flow from operations Cash used in investing activities Average oil price Cash dividend and buyback
Slide 21: Increased Financial Transparency: Q1 2016
INCREASED FINANCIAL TRANSPARENCY: Q1 2016 Results include BG from expected effective date 15th February 2016 New reporting segmentation for Q1 ’16 Today Q1’16 UPSTREAM UPSTREAM Integrated Gas INTEGRATED GAS DOWNSTREAM DOWNSTREAM Oil Products Oil Products Chemicals Refining & Trading; Marketing Chemi
Slide 22: Ben van Beurden, Chief Executive Officer
BEN VAN BEURDEN CHIEF EXECUTIVE OFFICER ROYAL DUTCH SHELL PLC Copyright of Royal Dutch Shell plc 4 February, 2016 22
Slide 23: Shell Track Record: Financial Performance
SHELL TRACK RECORD: FINANCIAL PERFORMANCE Cash flow from operations Free cash flow $ billion $ billion 2015 2015 Shell Peer group ROACE - underlying % Driving competitive performance Competitive financial data as published. Free cash flow: cash flow from operations less cash used in investing acti
Slide 24: Summary
SUMMARY Q4 2015 results underpinned by Downstream and Integrated Gas Underlying CCS earnings $1.8 billion; CFFO $5.4 billion; Q415 dividend $0.47 per share Industry downturn Pulling financial levers to improve competitive position BG transaction on-track: expected effective date 15th Febru
Slide 25: Questions & Answers Fourth Quarter 2015 Results
QUESTIONS & ANSWERS FOURTH QUARTER 2015 RESULTS ROYAL DUTCH SHELL PLC 4 FEBRUARY 2016 Copyright of Royal Dutch Shell plc 4 February, 2016 25
Slide 26: Fourth Quarter and Full Year 2015 Results
FOURTH QUARTER AND FULL YEAR 2015 RESULTS ROYAL DUTCH SHELL PLC 4 FEBRUARY 2016 Copyright of Royal Dutch Shell plc 4 February, 2016 26
Slide 27: Q1 2016 Outlook
Q1 2016 OUTLOOK Q1 – Q1 OUTLOOK New reporting segmentation BG from expected effective date 15th February 2016 Upstream Q1-Q1 outlook (Shell excluding BG) Divestment impact: ~-15 kboe/d Netherlands gas (NAM) curtailment & underground storage: ~-40 kboe/d PSC expiry: ~-20 kboe/d Maintena
Slide 28: Sensitivities
SENSITIVITIES Brent: (Shell 2015) $10/bbl Brent +/- ~$3.3 billion earnings per annum Henry Hub: (Shell 2015) $1/mmbtu +/- ~$250 million earnings per annum Tax liability foreign exchange impact to earnings (non-cash; after tax): (Shell 2015) Australian dollar: 0.01ct change AUD/USD: ~$60 mill
Slide 29: Upstream Results 2015
UPSTREAM RESULTS 2015 Earnings Q4 2014 to Q4 2015 Earnings 2014 to 2015 $ billion $ billion Earnings on CCS basis, excluding identified items Copyright of Royal Dutch Shell plc 4 February, 2016 29
Slide 30: Oil + Gas Production 2015
OIL + GAS PRODUCTION 2015 Production Q4 2014 to Q4 2015 Production 2014 to 2015 million boe per day million boe per day ~0% 3.25 3.25 ~1% 3.00 3.21 3.00 3.08 2.95 2.75 2.75 Copyright of Royal Dutch Shell plc 4 February, 2016 30
Slide 31: Downstream Results 2015
DOWNSTREAM RESULTS 2015 Earnings Q4 2014 to Q4 2015 Earnings 2014 to 2015 $ billion $ billion Copyright of Royal Dutch Shell plc 4 February, 2016 31