LONDON (Reuters) – Shell will increase its dividend and share buyback plan while keeping oil output stable until 2030, as part of its chief executive’s efforts to regain investor confidence.
The oil major said ahead of a conference with investors in New York later in the day that it was increasing the level of the overall distribution to shareholders from 30% to 40% of cash flow, against an increase from 20% to 30% previously.
This includes a 15% increase in the dividend and share buyback to $5 billion (4.63 billion euros) from the second quarter, up from $4 billion in recent quarters.
The announcements come amid efforts by Chief Executive Wael Sawan to boost the stock market performance of Shell, shunned by investors despite its record $40 billion profit last year.
The group was worried about moving away from oil and gas at a time of soaring energy prices, as returns from its growing renewable and low-carbon energy businesses remain lackluster.
On the London Stock Exchange, the title Shell took 0.57% to 27.30 euros at 08:50 GMT.
“Performance, discipline and simplification will be our guiding principles,” Wael Sawan, who took office in January, said in a statement.
“We will invest in the models that work, meaning those that offer the best returns and take advantage of our strengths,” he added.
(Reporting Ron Bousso and Shadia Nasralla; Lina Golovnya, editing by Kate Entringer)
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