According to Reuters, cited financial results released on Thursday, indicate Shell (NYSE:SHEL) has added an additional £1.2 billion (roughly $1.5 billion) to its U.K. energy retail business this year to help it withstand the volatility in power prices that led to the demise of several rival power utilities, including Bulb.
Since the end of 2021, energy prices in the UK have been going up and down a lot. This is because of a shortage of natural gas, which was made worse when Russia cut off supplies to Europe after its invasion of Ukraine in February.
The report states that in 2021, Shell’s (NYSE:SHEL) U.K. energy retail division reported an operational loss of £102.4M, compared to a loss of £83.6M in 2020.
Shell (NYSE:SHEL) extended £680 million in working capital credit to its UK unit “to cover its short-term working capital needs” through the end of 2019.
The cash infusion was hardly significant for Shell’s (NYSE:SHEL) overall profit, which reached a record $30B in the first nine months of 2022.
Shell Stock up Amidst Posting Solid Q3 Results
Shell recorded $95.75 billion in sales, up 59.5% annually. The main reasons why the CFFO for Q3 2022 is $12.5 billion are lower adjusted EBITDA compared to Q2 2022 and working capital losses.
robust performance in a tough economic environment, with gas prices going up and crude oil prices going down compared to Q2 2022.
In Q3 2022, adjusted earnings will be $9.5 billion, and adjusted EBITDA will be $21.5 billion. The company also announced a new share buyback program that will result in an extra $4 billion in dividends.
In other news, Shell Plc and Exxon Mobil Corp announced Thursday that the sale of a California oil production joint venture had been delayed until the first quarter of 2019 due to approvals from US regulators.
In September, the German asset manager IKAV decided to pay $4 billion for the Shell-Exxon company Aera Energy, which supplies about 25% of California’s oil output. The businesses have been selling off older homes to concentrate on wealthier assets.
Featured Image: Unsplash @ Keming Tan