Oil major Shell has reduced its first-quarter dividend as revenue decreased by 28% to $60.0bn.
Its dividend has been cut from $0.47 per share (Q1 2019) to $0.16 (Q1 2020), representing a 66% decline.
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The oil major’s earnings for the quarter this year fell by 46% compared to the same period last year (Q1 2019), down from $5.3bn to $2.9bn.
Royal Dutch Shell Board chair Chad Holliday commented: “Shareholder returns are a fundamental part of Shell’s financial framework. However, given the risk of a prolonged period of economic uncertainty, weaker commodity prices, higher volatility and uncertain demand outlook, the board believes that maintaining the current level of shareholder distributions is not prudent.
“Following the announcement not to continue with the next tranche of the share buyback programme, the board has also decided to reduce the first quarter 2020 dividend and reset to 16 US cents per share.
“As conditions allow, the board will continue to evaluate our capital allocation priorities between ongoing investment in our business, maintaining a strong balance sheet and increasing returns to shareholders which remains our ambition.”
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By GlobalDataShell said last month that it would suspend its share buyback programme to ‘reinforce the financial strength and resilience’ of the business during the pandemic.
This month, Royal Dutch Shell took a final investment decision (FID) to develop the first phase of a A$10bn ($6.4bn) Surat Gas Project in Queensland, Australia.
