LONDON — Royal Dutch Shell, Europe’s largest oil company, disappointed the markets Thursday with fourth-quarter earnings of $5.6 billion after one-time items and inventory changes.
The results were 15 percent above the previous year but well below analysts’ expectation of around $6.3 billion.
Stuart Joyner, an analyst at Investec Securities in London, described the results as “a substantial miss.” Shell’s stock price was down about 1 percent in morning trading in London.
The company’s earnings for the year were $25.1 billion, up 2 percent over 2011.
The disappointment was largely due to lower earnings in Shell’s core exploration and production business, mainly because of weak performance in the Americas, where Shell’s multibillion Alaska drilling program has encountered multiple snafus and delays.
Exploration and production earnings were $4.4 billion compared to $5.1 billion the previous year, with the U.S. exploration and production business reporting a $69 million loss, partly due to low natural gas prices.
In another disappointment Shell estimated that it only replaced 44 percent of the reserves of oil and gas that it produced in 2012. That indicated that the company’s exploration effort, despite increased emphasis and spending in recent years, is still not performing well.
The capital investment forecast for 2013 was increased by 10 percent to $33 billion — another worry for the markets, as it suggests that Shell may be having trouble controlling costs.
On the positive side, Shell’s huge Pearl gas-to-liquids plant in Qatar is now fully operational and adding a hefty 235,000 barrels per day of oil equivalent to Shell’s production for the quarter.
Shell said that it was likely to increase its dividend in the first quarter of 2013 to 45 cents a share, a 4.7 percent increase over the first quarter of 2012.
“Shell is competitive and innovative,” the company’s chief executive, Peter Voser, said in a statement. “We are delivering on a strategy that others can’t easily repeat.”
Shell also had cause for relief on Wednesday when a court in The Hague dismissed most aspects of lawsuits brought against it by Nigerian farmers and fishermen seeking damages for pollution from oil spills in the Niger Delta.
Royal Dutch Shell Posts $5.6 Billion Profit
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Royal Dutch Shell Posts $5.6 Billion Profit
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Royal Dutch Shell Posts $5.6 Billion Profit
