Shell posted a significant increase of income in the third quarter of 2016, but remains reserved amid difficult circumstances, the Anglo-Dutch oil and gas company announced on Tuesday.
The income attributable to shareholders in Q3 rose by 119 percent from a loss of 7.416 billion euros (about 8.16 billion U.S. dollars) last year to an income of 1.375 billion euros this year.
The earnings on a current cost of supplies basis (CCS), excluding identified items, were 2.792 billion euros in the third quarter, an increase of 18 percent compared to the 2.376 billion euros in the same period last year.
"Shell delivered better results this quarter, reflecting strong operational and cost performance," Shell CEO Ben van Beurden said in a press release, adding "But lower oil prices continue to be a significant challenge across the business, and the outlook remains uncertain."
Shell continues to reshape the company, save costs and reduce investments in 2016.
"Our investment plans and portfolio actions are focused firmly on reshaping Shell into a world-class investment case at all points in the oil-price cycle, through stronger returns and improved free cash flow per share," Van Beurden added, noting "We are making good progress towards this aim in spite of current challenging market conditions."
On Feb. 15, 2016, Shell completed the acquisition of the British oil and gas company BG Group. "The integration of Shell and BG is now essentially done and has been completed well ahead of plan," Van Beurden said. "It's been an important catalyst for the significant and lasting changes we are making to the company's working practices, cost structure and portfolio," Beurden added.
The CCS earnings benefited from increased production volumes mainly from BG assets and lower operating expenses. This was partly offset by the decline in oil, gas and LNG prices. The oil and gas production for the third quarter also profited from the BG acquisition with an increase of 25 percent compared with the third quarter of 2015. (1 euro = 1.10 U.S. dollars)
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