Printer Friendly

SHELL CANADA ANNOUNCES EARNINGS

 CALGARY, Alberta, Jan. 27 /PRNewswire/ -- Shell Canada's (Toronto, Montreal, Vancouver, Calgary: SHC) consolidated earnings in 1992 were $80 million or 72 cents per class "A" common share. This compares to 1991 earnings from continuing operations of $12 million. After including the discontinued coal operations, the 1991 result was a loss of $126 million or $1.12 per share.
 1992 earnings were improved by unusual items and favorable income tax adjustments that net to $75 million after tax. These items were comprised of gains on divestments, charges associated with company- wide restructuring activities, the conversion of the Shellburn refinery and positive income tax adjustments of $63 million. In 1991, the unusual items, which related only to gains on divestments, contributed $33 million after tax.
 Earnings for the fourth quarter of 1992 were $92 million or 83 cents per share. Fourth quarter 1991 earnings from continuing operations were $85 million or 76 cents per share.
 Shell's results continue to reflect a sluggish economy and difficult market conditions. In response to these conditions, the corporation's restructuring strategies were accelerated and intensified with the result that company-wide operating costs were reduced by $136 million over 1991 levels and capital expenditures were reduced by $200 million.
 Cash flow from operations for 1992 was $397 million. In 1991, cash flow from continuing operations was $361 million.
 Capital and exploration expenditures in 1992 were $635 million. Expenditures in 1991 were substantially higher at $988 million. Decreased expenditures in 1992 reflect the reduced spending required for the Caroline development, which will commence production in late February, as well as $156 million of reductions in other projects. Resources' 1992 expenditures of $498 million included $268 million for Caroline. The balance was primarily spent on other natural gas projects. Oil Products' 1992 expenditures of $123 million were mainly in support of restructuring the commercial and retail networks.
 Resources' earnings were $178 million for 1992, compared with $130 million from continuing operations for 1991. The 1992 results include gains from the sale of assets of $67 million after tax, while the comparable amount in 1991 was $33 million. 1992 results also include $34 million of income tax-related benefits. Cost management activities have resulted in reductions of 15 percent in 1992. These savings have been more than offset by lower crude oil volumes due to the sale of non-core assets and lower sulphur prices.
 Oil Products' loss was $7 million for 1992, compared with a $62 million loss for 1991. Before the unusual items of $25 million after tax, associated with converting the Shellburn refinery and the continued restructuring of the retail business, 1992 earnings would have been $18 million. Weak product demand, combined with oversupply, has led to a continuation of intense competition in the retail gasoline markets and consequent reduction in prices. Despite the substantial benefits of restructuring, market forces have continued to prevent the attainment of acceptable levels of profitability.
 1992 results reflect the prospective adoption of the Last-In, First-Out (LIFO) method of inventory valuation, whereas the 1991 accounts were based on the First-In, First-Out (FIFO) method. On a basis comparable to 1991, the 1992 results would not have been materially different.
 Chemicals had a 1992 loss of $1 million compared with a loss of $11 million in 1991. The positive effect of the weak Canadian dollar on export revenues was partially offset by the negative effect of the North American recession. Commodity prices for chemicals continued to remain low in all markets, resulting from international oversupply and poor market conditions worldwide.
 Corporate expenses were $90 million for 1992, compared with $45 million for 1991. The 1992 results include an unusual charge of $30 million after tax, related to restructuring of the workforce and related office facilities, as well as higher net financing charges.
 On Nov. 18, 1992, the directors of Shell Canada Ltd. declared a semi-annual dividend of 45 cents per Class "A" Common Share. The dividends were payable Dec. 15, 1992, to shareholders of record Nov. 30, 1992.
 Shell Canada has taken steps that should result in earnings improvement irrespective of the performance of the economy. Its business plan for 1993 is not dependent upon increases in commodity prices. However, continued industry rationalization and improved economic growth would accelerate progress towards acceptable financial performance.
 SHELL CANADA LTD.
 And Subsidiary Companies
 Financial and Operating Highlights
 (unaudited)
 Fourth Quarter Total Year
 Financial Highlights 1992 1991 1992 1991
 ($ millions)
 Revenues 1,324 1,156 4,547 4,787
 Cash flow from
 continuing operations 161 142 397 361
 Cash from
 operating activities 255 151 494 651
 Earnings from
 continuing operations 92 85 80 12
 Earnings (loss) 92 71 80 (126)
 Per class "A" common share (dollars)
 Earnings from
 continuing operations 0.83 0.76 0.72 0.11
 Earnings (loss) 0.83 0.64 0.72 (1.12)
 Results by segment
 Revenues
 (excluding inter-
 segment sales)
 Resources 170 181 560 605
 Oil products 972 822 3,369 3,504
 Chemicals 143 148 575 642
 Corporate 39 5 43 36
 Total 1,324 1,156 4,547 4,787
 Earnings
 Resources 83 68 178 130
 Oil products 10 12 (7) (62)
 Chemicals 5 (1) (1) (11)
 Corporate (6) 6 (90) (45)
 Total 92 85 80 12
 Capital and
 exploration expenditures
 Resources 112 225 498 739
 Oil products 32 71 123 227
 Chemicals 1 1 6 5
 Corporate 2 4 8 17
 Total 147 301 635 988
 Fourth Quarter Total Year
 Percent Percent
 Operating Highlights 1992 Change 1992 Change
 Crude oil and natural gas
 liquids produced - gross
 (m3/d) 9,863 -8 9,569 -5
 Natural gas sales from own
 production - gross
 (thousands of m3/d) 20,600 -6 18,900 -3
 Sulphur produced - gross
 (tons/d) 3,957 +3 3,657 +4
 Sulphur sales from own
 production - gross
 (tons/d) 3,882 -11 3,992 +2
 Crude oil processed by
 Shell refineries
 (m3/d) 44,500 +4 41,800 +3
 Petroleum product sales
 (m3/d) 43,000 +16 37,500 +3
 Chemical sales
 (tons/d) 2,668 +2 2,631 -1
 LIFO
 Effective Jan. 1, 1992, Shell adopted the Last-In, First-Out (LIFO) method of inventory valuation. Using this method, current revenues will be matched with the current cost of production, as the cost of purchased crude oil and petroleum products included in the determination of earnings is the most recent cost of these products. Comparative 1991 figures are stated on a First-In, First-Out (FIFO) basis.
 Unusual items
 The following items resulted from transactions or events that do not typify normal business activities.
 Fourth Quarter Total Year
 1992 1991 1992 1991
 ($ millions)
 Gains on divestments(a) 31 39 110 57
 Restructuring expenses(b) -- -- (52) --
 Shellburn conversion and
 retail restructuring(c) -- -- (44) --
 Unusual items before
 income taxes 31 39 14 57
 Unusual items after
 income taxes 17 23 12 33
 (a) Divestment of non-core Resources assets.
 (b) Expenses associated with workforce reduction and related office facilities.
 (c) Write-down and expenses associated with the conversion of the Shellburn refinery to a terminalling operation and costs associated with further restructuring within the retail area.
 -0- 1/27/93
 /CONTACT: Gary Sherkey, manager of investor relations of Shell Canada, 403-691-2175/
 (SHC.)


CO: Shell Canada Ltd. ST: Alberta IN: OIL SU: ERN

MS -- LA038 -- 9978 01/27/93 19:35 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jan 27, 1993
Words:1203
Previous Article:APPLE COMPUTER INC. DECLARES QUARTERLY DIVIDEND
Next Article:PLAZA HOME MORTGAGE ANNOUNCES RECORD 1992 RESULTS; GEOGRAPHIC EXPANSION EXPECTED TO LEAD GROWTH IN 1993
Topics:


Related Articles
SHELL ANNOUNCES ACCOUNTING CHANGES
SHELL CANADA LIMITED ANNOUNCES 1991 FINANCIAL RESULTS
SHELL CANADA LTD. ANNNOUNCES 1991 ANNUAL REPORT
SHELL CANADA LIMITED ANNOUNCES RESULTS
SHELL CANADA LTD. ANNOUNCES RESULTS
SHELL CANADA ANNOUNCES 1993 FIRST QUARTER FINANCIAL RESULTS
SHELL CANADA ANNOUNCES SECOND QUARTER FINANCIAL RESULTS
SHELL CANADA ANNOUNCES COST REDUCTION
SHELL CANADA ANNOUNCES CONSOLIDATED EARNINGS FOR THE FIRST NINE MONTHS OF 1993
SHELL OIL COMPANY ANNOUNCES $500 MILLION INCREASE FOR 1995 CAPITAL AND EXPLORATORY EXPENDITURES

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters