COVID-19: Shell’s Q1 net income falls by 46%; cuts dividend for 1st time since WWII
- Oil company, Shell, has revealed shareholders would receive a fraction of their dividends due to the effect of the coronavirus
- This is the first time the company has announced such a move since the Second World War
- It added that its net income fell by 46% to $2.9 billion (£2.3 billion) for the First Quarter of 2020
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Energy giant, Shell, has announced a cut in dividend for the first time since the Second World War.
It also revealed it recorded a 46% fall in its net income to $2.9 billion (£2.3 billion) for the First Quarter of 2020.
The reason for the situation is the outbreak of coronavirus and its impact on businesses all over the world.
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Per a report by myjoyonline.com, the company also announced a suspension of the next tranche of its share buyback programme.
According to Shell’s Chief Executive Officer, Ben van Beurden, there could be a “continued deterioration in the macroeconomic outlook”.
He added that the company was, therefore, taking the necessary steps to boost its resilience and underpin the strength of its balance sheet.
YEN.com.gh understands that the company is cutting its quarterly dividends by two-thirds, from 47 cents to 16 cents, beginning from the First Quarter of 2020.
Shell is also reducing activities at its refinery business by up to 40% in response to the decline in demand for oil.
YEN.com.gh earlier reported that oil prices have fallen by another 16% and led to fears over storage.
Information available shows that West Texas Intermediate (WTI), which is the benchmark for the United States of America (USA), slipped 16.12%, or $2.06, to trade at $10.72 per barrel.
It has also been gathered that the international benchmark, Brent crude, traded 5.45% lower at $18.90 per barrel.
READ ALSO: Drop in Brent crude prices has affected Ghana's oil production - IES
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