Shell recorded profits of $18.5 billion in 2004, compared to $12.5 billion in 2003. The 48% single year increase has been attributed by analysts to the significant rise in oil prices over the volatile last 12 months.
The energy company enjoyed an even bigger increase in its fourth quarter figures. In the last three months of the fiscal year, Shell recorded a 134% increase in profits over 2003 levels, with an income of $4.4 billion in the quarter compared to $1.9 billion a year earlier.
However despite the positive financial news, Shell’s value still fell by over one percent on the market, due to the acknowledgement in the city of the inflationary effect on profits of record oil prices and because the company has, for the fifth time, had to reduce its 2003 oil and gas reserves estimates, this time by 1.4 billion barrels.
Meanwhile, Shell continues to move towards merging its UK and Netherlands-based holding companies in order to unify its board. The decision to merge was first announced last October as a bid to improve boardroom control and reinvigorate investor confidence, which waned after last year’s reserve estimate debacle. Shareholders will vote on the merger plans at their April 22 annual general meetings.
