Q2 2026 Shell PLC Earnings Call Transcript

Jul 30, 2026 / 01:30 PM GMT

Release Date Price: €38.81 (+0.69%)

Transcript

Key Points

Positve

Shell PLC (SHEL) delivered a very strong set of financial results in Q2 2026, supported by robust operational performance across all businesses.
The company is making excellent progress on its $5-7 billion structural cost reduction target, already halfway there and pushing to reach the top end of the range.
The integrated gas business had an exceptional quarter, successfully managing the loss of Middle East volumes by optimizing the portfolio and achieving near-record third-party LNG volumes.
The downstream business achieved a remarkable 102% refinery utilization rate, driven by a successful integration of trading and optimization with asset operations.
The company is adding layers of absolute free cash flow growth through projects like ARC (closing soon) and the potential LNG Canada Phase 2 FID, expected before year-end.
The trading and supply business is performing at the top end of its 2-4% ROCE range, benefiting from current market volatility and providing a key competitive advantage.

Negative

The company's distribution run rate is currently below its 40-50% payout ratio commitment, raising questions about future shareholder returns.
The Middle East conflict has caused significant disruptions, with the Pearl GTL Train 2 facility not expected to restart until Q1 2027 and LNG volumes from Qatar still constrained.
European gas storage levels are very low (near 50%), creating a tight market and potential supply challenges for the upcoming winter.
The low-carbon business still has a significant portion of capital employed that is not yet generating acceptable returns, with some projects like CCS and Holland Hydrogen One not expected to show returns until 2027.
The company faces ongoing cost inflation of 5-6% in its supply chain, particularly for deepwater rigs, which could pressure capital expenditure guidance.
Chemical spreads are beginning to soften in Q3, and the downstream business faces a more challenging environment with less volatility and the loss of Pearl GTL feedstock volumes.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

SHEL.L - Shell PLC
Q2 2026 Shell PLC Earnings Call
Jul 30, 2026 / 01:30PM GMT

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Presentation
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Unidentified_1 [1]
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Thank you for joining us today. We hope that after watching this presentation, you've seen how Shell delivered a very strong set of results through the strength of our portfolio and the quality of our execution.

Now Sinead and I will be answering your questions. So please, could we have just one or two questions each so that everyone has the opportunity.

And with that, could we take the first question, please, Jake?

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Unidentified_2 [2]
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Our first caller is Biraj Borgattaria from RBC.

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