| ROYAL DUTCH SHELL PLC 3RD QUARTER 2021 UNAUDITED RESULTS |
| SUMMARY OF UNAUDITED RESULTS | ||||||||||||||||||||||||||
| Quarters | $ million | Nine months | ||||||||||||||||||||||||
| Q3 2021 | Q2 2021 | Q3 2020 | %¹ | Reference | 2021 | 2020 | % | |||||||||||||||||||
| (447) | 3,428 | 489 | -113 | Income/(loss) attributable to shareholders | 8,640 | (17,666) | +149 | |||||||||||||||||||
| (988) | 2,634 | 177 | -138 | CCS earnings attributable to shareholders | Note 2 | 5,992 | (15,443) | +139 | ||||||||||||||||||
| 4,130 | 5,534 | 955 | -25 | Adjusted Earnings² | A | 12,898 | 4,453 | +190 | ||||||||||||||||||
| 13,460 | 13,623 | 7,998 | Adjusted EBITDA (CCS basis) | A | 38,656 | 28,159 | ||||||||||||||||||||
| 16,025 | 12,617 | 10,403 | +27 | Cash flow from operating activities | 36,935 | 27,818 | +33 | |||||||||||||||||||
| (3,804) | (2,946) | (2,833) | Cash flow from investing activities | (7,339) | (7,871) | |||||||||||||||||||||
| 12,221 | 9,671 | 7,571 | Free cash flow | G | 29,596 | 19,947 | ||||||||||||||||||||
| 4,840 | 4,383 | 3,737 | Cash capital expenditure | C | 13,197 | 12,324 | ||||||||||||||||||||
| 8,359 | 8,470 | 8,095 | -1 | Operating expenses | F | 26,264 | 25,137 | +4 | ||||||||||||||||||
| 8,696 | 8,505 | 7,854 | +2 | Underlying operating expenses | F | 25,924 | 23,958 | +8 | ||||||||||||||||||
| 2.9% | 3.2% | (4.9)% | ROACE (Net income basis) | D | 2.9% | (4.9)% | ||||||||||||||||||||
| 6.1% | 4.9% | 3.9% | ROACE on an Adjusted Earnings plus Non-controlling interest (NCI) basis | D | 6.1% | 3.9% | ||||||||||||||||||||
| 57,492 | 65,735 | 73,463 | Net debt | E | 57,492 | 73,463 | ||||||||||||||||||||
| 25.6% | 27.7% | 31.4% | Gearing | E | 25.6% | 31.4% | ||||||||||||||||||||
| 3,068 | 3,254 | 3,081 | -6 | Total production available for sale (thousand boe/d) | 3,269 | 3,392 | -4 | |||||||||||||||||||
| (0.06) | 0.44 | 0.06 | -114 | Basic earnings per share ($) | 1.11 | (2.27) | +149 | |||||||||||||||||||
| 0.53 | 0.71 | 0.12 | -25 | Adjusted Earnings per share ($) | B | 1.66 | 0.57 | +191 | ||||||||||||||||||
| 0.24 | 0.24 | 0.1665 | — | Dividend per share ($) | 0.6535 | 0.4865 | +34 | |||||||||||||||||||
1. Q3 on Q2 change.
2. Adjusted Earnings is defined as income/(loss) attributable to shareholders plus cost of supplies adjustment (see Note 2) and excluding identified items (see Reference A).
Third quarter 2021 income attributable to Royal Dutch Shell plc shareholders was a loss of $0.4 billion, which included non-cash charges of $5.2 billion due to the fair value accounting of commodity derivatives and post-tax impairment charges of $0.3 billion, partly offset by net gains on sale of assets of $0.3 billion.
Adjusted Earnings for the quarter were $4.1 billion. Cost of supplies adjustment attributable to Royal Dutch Shell plc shareholders for the third quarter 2021 was negative $0.5 billion. Hurricane Ida impacted our operations, with an aggregate adverse impact of around $0.4 billion on Adjusted Earnings.
Cash flow from operating activities for the third quarter 2021 was $16.0 billion, which included positive impacts of $4.0 billion from commodity derivatives partly offset by negative working capital movements of $1.4 billion. Cash flow from investing activities for the quarter was an outflow of $3.8 billion, mainly driven by capital expenditure and partly offset by proceeds from sale of property, plant and equipment and businesses.
Compared with the second quarter 2021, current quarter Adjusted Earnings reflected comparative adverse one-off tax impacts, lower production volumes partly due to the impact of Hurricane Ida, and comparative lower contributions from trading and optimisation. This was partly offset by higher oil, LNG and gas prices.
At the end of the third quarter 2021, net debt was $57.5 billion, compared with $65.7 billion at the end of the second quarter 2021, mainly driven by free cash flow generation in the quarter, partly offset by dividends and share buybacks. Gearing was 25.6% at the end of the third quarter 2021, compared with 27.7% at the end of the second quarter 2021, mainly driven by net debt reduction.
Dividends declared to Royal Dutch Shell plc shareholders for the quarter amount to $0.24 per share. During the quarter, $1.0 billion of share buybacks were completed out of a total target of $2 billion in the second half of 2021. Additional shareholder distributions of $7 billion related to the Permian sale to start in 2022, post deal completion.