Shell is a global vertically integrated energy and petrochemical company operating in more than 70 countries. The company operates in the following segments: Integrated Gas , Upstream , Marketing (including Mobility, Lubricants, Sectors& Decarbonisation), Chemicals and Products, Renewables and Energy solutions. LNG sales volumes were 66.0 million tonnes in 2022 compared with 64.2 million tonnes in 2021. Shell is the leading LNG supplier globally. Shell operates 105k EV charge points. Shell is focusing on investments in renewables and gas, targeting zero emissions by 2050.
Shell, formerly The Royal Dutch Shell, is an international energy and petrochemical company. It is engaged in the exploration, production, refining, and marketing of oil, natural gas, chemical products, and LNG. The company operates in several segments: Integrated Gas, Upstream, Marketing, Chemicals and Products, Renewables and Energy Solutions, and Corporate. The Integrated Gas segment includes liquefied natural gas and the conversion of natural gas into gas-to-liquid fuels. The Upstream segment includes the exploration and production of crude oil, natural gas, and NGL. The Marketing segment comprises the Mobility, Lubricants, and Sectors and Decarbonisation businesses. The company operates oil refineries and produces chemicals using its own feedstock. The Renewables and Energy Solutions segment include Shell’s Integrated Power activities.
The global energy market remains under the influence of the Ukraine-Russia conflict resulting in a reduced supply of Russian gas and oil to Europe; Chinese lockdowns doe to COVID; increasing inflation; and a strong US dollar. World oil demand is now forecast at 101.8mb/d in 2023, according to IEA. Crude oil product deliveries to the US, UK, EU, Japan, and South Korea were cut by 2.2mb/d since the beginning of the war, with two-thirds of volumes rerouted to other markets. The LNG demand is forecast to reach 700mt by 2040 vs 360 in 2020. The Ukraine-Russia war may accelerate the LNG demand growth, in particular in the EU.
- Royal Dutch Shell is a global oil and gas major with a vertically integrated product range and wide geographical operations
- Shell is one of the leading global LNG operators, presented in rapidly growing Asian and European markets
- Shell has a large pipeline of renewable projects, targeting the transition towards a zero-emission economy by 2050
- The company improved its financial position to provide a sustainable capex for future development and for shareholder payouts
- Shell operates globally and presents in key growing markets as a producer and retailer, getting a better margin from sales vs smaller competitors
- Shell is exposed to volatile energy demand and rapidly changing energy prices
- The energy transition could lead to a fall in prices for conventional fuel, also affecting natural gas and LNG prices on a 5-10 year horizon
- Supply chain disruptions in the EV segment and solar panels may push back the investments in renewables
- High volatility of energy prices affected the financial results in 2022, however, the market will be gradually stabilised after new trading flows are established, pushing down the price for oil
- Macro environment and geopolitics affect demand for fuel prices and potential production. Slow-down of economic growth and raising inflation to influence the demand/supply balance contributing to energy and chemicals' price volatility
- Cost inflation acceleration may result in long payback periods for new investments
- The company operates in 70 countries with different political, legal, and fiscal regimes and may be exposed to negative political, macro, and FX trends
- The company's ability to execute large exploration and production projects affects the future reserves base and production
| Company | RIC | Market Capitalization, $mn | Last reporting year | P/E Fwd 1Y | P/E Fwd 2Y | EV/EBITDA 1Y fwd | EV/EBITDA 2Y fwd | EV/Revenues 1y fwd | EV/Revenues 2y fwd |
|---|---|---|---|---|---|---|---|---|---|
| Shell PLC | SHEL.L | 209,988 | 2022-12-31 | 6.3 | 6.5 | 3.5 | 3.8 | 0.7 | 0.8 |
| TotalEnergies SE | TTEF.PA | 152,918 | 2022-12-31 | 5.4 | 5.8 | 3.1 | 3.5 | 0.7 | 0.7 |
| BP PLC | BP.L | 117,445 | 2022-12-31 | 5.8 | 6.0 | 3.3 | 3.5 | 0.6 | 0.7 |
| Equinor ASA | EQNR.OL | 94,272 | 2022-12-31 | 5.8 | 6.1 | 1.3 | 1.5 | 0.6 | 0.7 |
| Eni SpA | ENI.MI | 50,747 | 2022-12-31 | 4.5 | 4.9 | 2.7 | 2.8 | 0.6 | 0.6 |
| Repsol SA | REP.MC | 21,794 | 2022-12-31 | 4.3 | 5.3 | 2.2 | 2.6 | 0.4 | 0.4 |
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|---|---|---|
| Revenue | 305,179 | 388,379 | 344,877 | 180,543 | 261,504 | 381,314 | 367,819 | 361,335 | 355,505 |
| Growth | 27% | -11% | -48% | 45% | 46% | -4% | -2% | -2% | |
| EBITDA | 39,690 | 52,722 | 57,556 | 29,518 | 54,195 | 79,913 | 74,681 | 70,174 | 67,504 |
| EBITDA margin | 13.0% | 13.6% | 16.7% | 16.3% | 20.7% | 21.0% | 20.3% | 19.4% | 19.0% |
| Net income | 12,977 | 23,352 | 15,842 | -21,680 | 20,101 | 42,309 | 33,788 | 30,555 | 28,496 |
| Net margin | 4.3% | 6.0% | 4.6% | -12.0% | 7.7% | 11.1% | 9.2% | 8.5% | 8.0% |
| Net debt | 65,473 | 50,340 | 78,800 | 76,184 | 52,229 | 43,705 | 43,705 | 43,705 | 43,705 |
| MktCap | 242,376 | 139,850 | 171,306 | 216,214 | 216,214 | 216,214 | 216,214 |
Historical Multiples
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|---|
| EV/Revenue | 0.9 | 1.2 | 0.9 | 0.7 | 0.7 | 0.7 | 0.7 |
| EV/EBITDA | 5.6 | 7.3 | 4.1 | 3.3 | 3.5 | 3.7 | 3.9 |
| P/E | 15.3 | -6.5 | 8.5 | 5.1 | 6.4 | 7.1 | 7.6 |
