Royal Dutch Shell Increases Sales but Misses Estimates on Earnings

Royal Dutch Shell (NYS: RDS.A) reported earnings on Feb. 2. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Royal Dutch Shell beat expectations on revenue and missed expectations on earnings per share.

Compared to the prior-year quarter, revenue grew and GAAP earnings per share shrank.

Gross margins increased, operating margins grew, and net margins dropped.

Revenue details
Royal Dutch Shell tallied revenue of $115.58 billion. The two analysts polled by S&P Capital IQ foresaw revenue of $103.81 billion. Sales were 18% higher than the prior-year quarter's $100.71 billion.


Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.

EPS details
Non-GAAP EPS came in at $1.56. The earnings estimates compiled by S&P Capital IQ predicted $1.83 per share on the same basis. GAAP EPS of $1.04 for Q4 were 6.3% lower than the prior-year quarter's $1.11 per share.


Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 17.0%, 180 basis points better than the prior-year quarter. Operating margin was 10.2%, 230 basis points better than the prior-year quarter. Net margin was 5.5%, 120 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $76.39 billion. On the bottom line, the average EPS estimate is $2.65.

Next year's average estimate for revenue is $446.27 billion. The average EPS estimate is $9.15.

Investor sentiment

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Royal Dutch Shell is outperform, with an average price target of $80.91.

How did Royal Dutch Shell treat you during the oil spike in 2008 and the subsequent bust? More importantly, what are you doing to prepare for the next spike that some experts believe another spike may be just around the corner? Prepare yourself with a well-positioned energy stock we profile in "The Only Energy Stock You'll Ever Need." Click here for instant access to this free report.

At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story