Shell PLC (SHEL) Q2 2025 Earnings Call

Investor webinar replay

Replay transcript excerpt

Welcome everyone and thank you for joining. Today, Sinead and I will present Shell's second quarter results for 2025. Starting first with the broader external context, the macro continued to be challenging on multiple fronts. Against the backdrop of geopolitical and economic uncertainty, we saw knock-on effects on both physical trade flows as well as commodity prices and margins more broadly. In spite of this, we delivered a robust set of results with strong operational performance while continuing to further our strategy and progress against the key targets outlined at our capital markets day in March. Let's start with cost, where we have demonstrated once again that we will deliver what we say. In the first half of 2025, we achieved some $800 million in structural cost reductions. This brings the total since 2022 to $3.9 billion, putting us firmly on track for our target of $5 to $7 billion by the end of 2028. What I'm particularly encouraged by is the fact that the majority of these savings come from what we call non-portfolio reductions, essentially changing the way we work as opposed to costs that are taken out as part of divestments or other portfolio choices. We have delivered efficiencies throughout our operations, in maintenance activities, across our supply chains, and in the corporate center. And all of this has resulted in cost takeout of almost $2.5 billion, which is more than 60% of the total structural cost reduction since 2022. Now, let's turn to our portfolio, where we've also made considerable progress delivering on our strategy to strengthen our world-class businesses. A major milestone for us was the startup of LNG Canada, in which Shell has a 40% working interest. Its strategic location on the country's west coast brings feedstock advantages and ...