Updates On Three LSE Listed Energy Majors: Royal Dutch Shell Plc, BP Plc and BHP Group Plc

Royal Dutch Shell Plc

Royal Dutch Shell Plc is a multinational Oil & Gas major. In 2018 it was the world’s third-largest company in terms of revenue and the largest in Europe. The company is vertically integrated and active in all three streams of the Oil & Gas Industry. Its activities include exploration, production, refining, transportation, distribution and marketing, petrochemicals power generation and trading. The company is also engaged in renewable energy initiatives like biofuels, energy-kite systems and green hydrogen production.

The company is listed on the London Stock Exchange, the New York Stock Exchange and at Euronext Amsterdam. At the London Stock Exchange, the shares of the company are traded with the ticker name RDS. At the New York Stock Exchange and the Euronext Amsterdam stock exchange also, it trades with the same ticker name. The shares of the company are a component of the FTSE 100 index.

News Update (RDS)

On 1 August 2019 the company came out with its interim financial results for the period ended 30 June 2019. Total revenues and other incomes of the company are down by 6.76 per cent, and income attributable to Royal Dutch Shell Plc shareholders are down by 24.52 per cent for the half-year January – June 2019 over the corresponding previous half-year period January – June 2018.

Financial Updates from company’s Half-yearly Result Statement (RDS)

The company for the six-month period ended 30 June 2019 declared total revenue and other income of $177.499 billion whereas for the corresponding six-month period ended 30 June 2018 the total revenue and other income were $190.382 billion. The income before taxation of the company for the half-year period ending 30 June 2019 was $14.323 billion while for the half-year period ending 30 June 2018 income before taxation was $17.977 billion. Income attributable to Royal Dutch Shell Plc shareholders for the six-month period ended 30 June 2019 was $8.999 billion while for the six-month period ended 30 June 2018 Income attributable to Royal Dutch Shell Plc shareholders was $11.923 billion. The Diluted Earnings per share of the company for the half-year period ending 30 June 2019 was $1.10 per share whereas for the half-year period ending 30 June 2018 the Diluted Earnings per share of the company was $1.42 per share.

Source – Company’s Half-yearly report published on 01 August 2019

Stock Price performance of (RDS) at the London stock exchange (YTD)

(Comparative chart of RDS and FTSE 100 index, Source – Thomson Reuters)

The stock price of Royal Dutch Shell Plc had been performing in consonance with the FTSE 100 index since 1 January 2019, with slight underperformance registered from the month of January 2019 to May 2019. Since mid of July 2019 a downward trend in share price of RDS is being witnessed. This trend continues till the time of preparation of this report on 4 September 2019.

Stock performance at the London stock exchange over the past 5 days till 04 September 2019 (RDS)

Price Chart as on 04 September 2019, before the market close (Source: Thomson Reuters)

On 04 September 2019, at the time of writing of the report (before the market close, GMT 08.38 AM), RDS shares were trading on the London Stock Exchange at GBX 2286.00. The prices of the stock over the past five days have been on a sideward movement since 29 August 2019. In trading in the latter half of 3 September 2019, the prices have fallen and continue to do so into early trading on 4 September 2019.

The stock has a 52-week High of GBX 2811.38 and a 52-week low of GBX 2209.50. The total market capitalization of the Company was £182.11 billion.

Outlook (RDS)

The company’s revenues for the half-year period January – June 2019 has fallen due to the challenging macroeconomic condition in refining and chemicals space coupled by falling gas prices. The company during this period was able to start its Appomattox oil rig in the Gulf of Mexico and its LNG terminal at Prelude.

BP Plc

BP Plc is a United Kingdom based multinational Oil and gas company active in all three streams (upstream, midstream and downstream) of the industry. According to Fortune Magazine’s Global 500 list of the world’s largest companies by revenue, BP Plc stands at the seventh rank. Other than its traditional Oil & Gas verticals, the company now has started to invest in renewable energy verticals like wind energy, solar energy and biofuels.

The company’s shares are listed on the London Stock Exchange, the Frankfurt Stock Exchange and at the New York Stock Exchange. At the London stock Exchange, the stocks of the company trade with the ticker name BP, at the New York Stock Exchange with the ticker name BP and at the Frankfurt Stock Exchange with the ticker name BPE. The shares of the company are components of the FTSE 100 index.

News Update (BP)

The company on 30 July 2019 came out with its interim results for the half-year period ended 30 June 2019. The total revenues and other incomes were down 3.35 per cent and the profit for the period is down 9.27 per cent for the January- June 2019 period against the half-year period of January- June 2018.

Financial Updates from company’s Half-yearly Result Statement (BP)

The company for the half-year period ending 30 June 2019 reported revenue of $141.154 billion while for half-year period ending 30 June 2018 the revenues were $146.050 billion. The profit for the period for the six-month period ending 30 June 2019 was $4.903 billion against the profit for the period for the six-month period ending 30 June 2018 of $5.404 billion. The diluted earnings per share attributable to BP shareholders for the half-year period ending 30 June 2019 was 23.35 cents while for the half-year period ending 30 June 2018 the diluted earnings per share attributable to BP shareholders was 26.27 cents.

Source – Company Half-yearly report published on 30 July 2019.

Stock Price performance of (BP) at the London stock exchange (YTD)

(Comparative chart of BP and FTSE 100 index, Source – Thomson Reuters)

The share price of BP Plc had been moving in consonance with the FTSE 100 index since 1 January 2019 till July 2019. Since July 2019 the prices have started falling and have started to underperform the index. As of 4 September 2019, this trend continues.

Stock performance at the London stock exchange over the past 5 days till 04 September 2019 (BP)

Price Chart as on 04 September 2019, before the market close (Source: Thomson Reuters)

On 04 September 2019, at the time of writing of the report (before the market close, GMT 09.55 AM), BP shares were trading on the London Stock Exchange at GBX 505.90. The share price of BP Plc from 29 August 2019 till mid-day of 3 September 2019 had been on a sideways movement. In trading in the latter half  3 September 2019, the prices had fallen; however they have recovered in early trading on 4 September 2019.

The stock has a 52- week High of GBX 603.60, and a 52-week low of GBX 481.35. The total market capitalization of the Company was £102.30 billion.

Outlook

The major reason for the fall in revenue of the company for the half year period ending 30 June 2019 is the weak international gas prices. The fortunes of the company will improve once the gas prices firm up.

BHP Group Plc

BHP Group Plc is a multinational mining, mineral exploration and petroleum company. The company is Anglo-Australian with its headquarters in Melbourne, Australia. The company’s mining operations are in Australia, North America and South America while its petroleum operations are located in the United States, Australia, Trinidad & Tobago and Algeria.

The company’s shares are listed for trading on the London Stock Exchange with ticker name BHP, at the New York Stock Exchange with ticker name BBL and at the Australian Stock Exchange with the ticker name BHP. The shares of the company are components of the FTSE 100 index.

News Update (BHP)

The company on 20 August 2019 came out with the results for the financial year 2018-10 period ending on 30 June 2019. The company’s attributable profits are up 124 percent and earnings per share are up 130 percent for the year ended 30 July 2019 over the attributable profit and earnings per share for the year ended 30 July 2018.

Financial Updates from company’s Annual Result Statement (BHP)

The company for the financial year ending 30 June 2019 announced revenue of $44.288 billion over revenue of $43.129 billion for the financial year ending 30 June 2018. The profits after taxation from continued and discontinued operation for the 12-month period ending 30 June 2109 was $9.185 billion whereas for 12-month period ending 30 June 2108, profits after taxation from the continued and discontinued operation were $4.823 billion. Diluted earnings per share from continuing operations for the financial year ending 30 June 2019 was 166.5 cents per ordinary share while for the financial year ending 30 June 2018 Diluted earnings per share from continuing operations were 124.6 cents per ordinary share.

Source – Company’s Annual report published on 20 August 2019.

Stock Price performance of (BHP) at the London stock exchange (YTD)

(Comparative chart of BHP and FTSE 100 index, Source – Thomson Reuters)

The share price of BHP Group Plc had been moving in consonance with the FTSE 100 index since 1 January 2019 with minor dips registered between periods February2019 to May 2019 and mid of May 2019 to August 2019. The stock price continued to outperform the index till the time of preparation of this report on 4 September 2019.

Stock performance at the London stock exchange over the past 5 days till 04 September 2019 (BHP)

Price Chart as on 04 September 2019, before the market close (Source: Thomson Reuters)

On 04 September 2019, at the time of writing of the report (before the market close, GMT 11.10 AM), BHP shares were trading on the London Stock Exchange at GBX 1772.20. The share prices of BHP Group Plc from 29 August 2019 till mid-day of 3 September 2019 had been on an uptrend. The prices fell slightly on 3 September 2019 but have recovered in the early trade of 4 September 2019.

The stock has a 52-week High of GBX 2078.5, and a 52-week low of GBX 1391.99. The total market capitalization of the company was £97.02 billion.

 Outlook (BHP)

The company’s geographical as well as diversification in different business sectors like mining and petroleum has ensured that its risks are mitigated. While other Oil and Gas companies have suffered because of low international gas prices BHP Group Plc has continued to perform throughout the financial year 2018-19.

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