Shell has revealed that profits slid over the first half of the year after a drop in trading profits and lower oil and gas prices hit the energy giant's performance.
The oil major told shareholders that adjusted earnings dropped by 30% to $9.84 billion (£7.4 billion) over the half-year, compared with a year earlier.
Nevertheless, profits in the second quarter were ahead of analyst expectations.
Shell added that income attributable to shareholders was 23% lower due to the effect of lower trading and optimisation margins and decreasing energy prices.
The firm said it was also impacted by a charge of $509 million (£383 million) related to the UK energy profits levy, which took place in the first quarter.
The FTSE 100 company, however, said it would continue to hand significant cash back to its shareholders. It announced a $3.5 billion (£2.6 billion) share buyback for the quarter.
Wael Sawan, chief executive of Shell, said the company generated "robust cash flows reflecting strong operational performance in a less favourable macro environment".
Sawan said that Shell continued to deliver on its strategy by enhancing its deep-water portfolio in Nigeria and Brazil during the period "and achieved a key milestone by shipping the first cargo from LNG (liquified natural gas) Canada.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: “Shell’s second earnings hit a bit of an oil patch, with lower commodity prices, a weaker trading environment and unplanned downtime at its chemical plants all playing their part.
“Shell’s balance sheet is one of its key strengths and investors could start to get nervous if debt continues to rise for any length of time.
“Nonetheless, management has ploughed on with a further buyback […] and there are some signs that financial performance could improve in the third quarter.”
Shares in Shell moved 1.7% higher in early trading.
(PA/London) Note: This article has been edited with the help of Artificial Intelligence.
