Hi, I’m Wael Sawan and I am pleased to present you for the first time
as Shell’s CEO.
Today alongside Sinead, we’ll be
presenting Shell's fourth quarter and full year results.
I'd like to start by thanking Ben for his leadership over the last nine years
and for building the strong foundations that I now inherit.
We have a world class organisation with exceptional people,
a leading portfolio and the right strategy, all of which
I believe position as very well for the future.
2022 was a year in which energy security was front and centre.
The world mobilised.
We saw policy progress with fit for 55 in Europe
and the introduction of the Inflation Reduction Act in the US.
This is evidence of moving from ambition into action.
Despite this progress, the energy system still faces huge challenges
and it continues to need bold, decisive actions
by companies, governments and society at large.
The world requires a secure supply of affordable energy
and at the same time needs this energy to be increasingly low-carbon.
To make the transition to a net-zero emissions energy system.
In short,
the world needs a balanced energy transition.
Moving too fast by dismantling the current energy system
before the new system is ready could worsen the situation.
But moving too slowly could waste precious time and lose the momentum
to build the necessary solutions for low-carbon energy at scale.
However, this transition will not be linear and will play out with different
solutions needed at different times in different places across the world.
We at Shell will do our part.
We will invest with discipline
where we have differentiated capabilities.
We aim to deliver the oil and gas that the world sorely needs today,
while also leveraging our unparalleled customer reach to develop the scalable
and profitable low-carbon products that are urgently needed.
Shell, under my leadership, will work to be
the trusted partner of choice as the world's energy systems transition.
For our customers, governments and investors.
By doing so, we aim to deliver competitive returns
and create significant shareholder value over the coming years.
Now let's look at our
Q4 and full year results and financial framework.
And for that, let me hand over to Sinead.
Thank you Wael.
By continuing to provide the energy
our customers need, we have again produced strong results.
Our safety performance was impressive.
We made good progress in both personal and process safety year on year.
We also made good progress on carbon.
By the end of 2022
we were more than half way towards achieving our target reduction of 50%
by 2030 for scope one and two emissions.
Moving to our financial performance.
Our Adjusted Earnings
for the fourth quarter were $9.8 billion,
with strong contributions from our Integrated Gas business
and we generated $22.4 billion of cash flow from operations,
including a positive inflow of $10.4 billion of working capital.
These strong
quarterly results helped us to achieve our highest ever full year results with
Adjusted Earnings of some $40 billion, more than double those of last year
and around $17 billion higher than in 2014
when Brent prices were similar.
We delivered the full year cash flow
from operations of over $68 billion
And our organic free cash flow
was around $48 billion.
In 2022,
our financials were impacted by additional taxes of around $2.3 billion
Of this, around $1.5 billion
related to the EU solidarity contributions in the Netherlands, Germany
and Italy with cash outflows expected in 2023 and 2024.
For the UK Energy Profit Levy,
the impact is some $900 million.
And now on to our financial framework.
Our strong performance over
the year has allowed us to enhance our distributions to shareholders.
Our total shareholder distributions for the year were around $26 billion
in excess of 35% of our 2022 cash flow from operations.
And today we have announced a new $4 billion share buyback programme,
which we expect to complete by the time of our Q1 results announcement
as planned.
We have also increased our dividend per share by 15%
in the fourth quarter
Demonstrating discipline,
our total cash capital expenditure for 2022 was $25 billion and our outlook
for 2023 is to maintain the $23 to
$27 billion range, absorbing inflation.
Our credit metrics ambition remains.
We intend to continue to reduce our net debt
as part of our robust financial framework.
Finally, we will continue to target shareholder distributions
of at least 20 to 30% of our cash flow from operations.
And now I'll hand back to Wael.
As you've heard our results
for 2022 were strong in what was a volatile external environment.
So what do we expect to see for 2023?
The balance between global energy supply and demand remains extremely tight.
Small changes on either side can have a significant impact, so
volatility and uncertainty will continue to be the watchwords in 2023.
And how will Shell respond to that?
With confidence
and the direction of our strategy and the strength of our businesses
and with discipline and a focus on value.
We've worked hard over the years to strengthen our portfolio.
We have a clear strategy in Powering Progress.
Our focus now is to further operationalise and profitably deliver this strategy.
We will build from our strengths where we will prioritise
value over volume while reducing carbon emissions.
In Upstream, we will continue to proudly deliver energy that the world needs
while driving strong results with our high-graded portfolio
and integrated gas, we will leverage and extend our world leading LNG position.
And in marketing, we will build on the robust performance
that we have seen in recent years.
Performance will be top of mind in every area of show.
We aim to demonstrate progress at pace, not through words but through results.
And we will continue to simplify our organisation.
One example of this is the more aligned and focused
senior leadership structure that we announced earlier this week.
With fewer roles and greater accountabilities,
simplifying decision making. By building on our strengths, focusing on performance
and simplification, we intend to deliver compelling shareholder returns.
Shell is already a great company and we are determined to be a great investment.
And to give you more insights on how we plan to do this.
Join us in New York for our Capital Markets Day in June.
Thank you.