Royal Dutch Shell Plc: 1st Quarter 2013 Unaudited Results

          Royal Dutch Shell Plc: 1st Quarter 2013 Unaudited Results

PR Newswire

THE HAGUE, The Netherlands, May 2, 2013

THE HAGUE, The Netherlands, May 2, 2013 /PRNewswire/ --

Royal Dutch Shell's first quarter 2013 earnings, on a current cost of supplies
(CCS) basis (see Note 1), were $8.0 billion compared with $7.7 billion for the
first quarter 2012.

First quarter 2013 CCS earnings excluding identified items (see page 6) were
$7.5 billion compared with $7.3 billion for the first quarter 2012, an
increase of 3%.

Basic CCS earnings per share excluding identified items for the first quarter
2013 increased by 2% versus the same quarter a year ago.

Cash flow from operating activities for the first quarter 2013 was $11.6
billion. Excluding working capital movements, cash flow from operating
activities for the first quarter 2013 was $11.5 billion.

Capital investment for the first quarter 2013 was $8.8 billion. Net capital
investment (see Note 1) for the quarter was $8.2 billion.

Total dividends distributed in the quarter were some $2.7 billion, of which
$0.8 billion were settled under the Scrip Dividend Programme. During the first
quarter some 16.1 million shares were bought back for cancellation for a
consideration of some $0.5 billion.

Gearing at the end of the first quarter 2013 was 9.1%.

A first quarter 2013 dividend has been announced of $0.45 per ordinary share
and $0.90 per American Depositary Share ("ADS"), an increase of 5% compared
with the first quarter 2012.

Comparative information in this Report has been restated following the
adoption of revised IAS 19 Employee Benefits on January 1, 2013, with
retrospective effect (see Note 2). Comparative information was not restated
for other accounting policy changes (see Note 1) for which the impacts are not
significant, including the adoption of IFRS 11 Joint Arrangements on January
1, 2013, which results in certain previously equity-accounted entities now in
effect being proportionately consolidated.

    Summary OF unaudited results
                   $ million                             Quarters
                                            Q1 2013 Q4 2012[1] Q1 2012[1] %[2]

    Income attributable to shareholders       8,176      6,728      8,737  -6
    Current cost of supplies (CCS)
    adjustment for Downstream                  (225)       623     (1,060)
    CCS earnings                              7,951      7,351      7,677  +4
    Less: Identified items[3]                   431      1,712        380
    CCS earnings excluding identified items   7,520      5,639      7,297  +3
    Of which:
    Upstream                                  5,648      4,401      6,270
    Downstream                                1,848      1,190      1,122
    Corporate and Non-controlling interest       24         48        (95)

    Cash flow from operating activities      11,559      9,913     13,439 -14

    Basic CCS earnings per share ($)           1.26       1.17       1.23  +2
    Basic CCS earnings per ADS ($)             2.52       2.34       2.46
    Basic CCS earnings per share excl.
    identified items ($)                       1.19       0.90       1.17  +2
    Basic CCS earnings per ADS excl.
    identified items ($)                       2.38       1.80       2.34

    Dividend per share ($)                     0.45       0.43       0.43  +5
    Dividend per ADS ($)                       0.90       0.86       0.86

    [1] Restated for accounting policy change (see Note 2)
    [2] Q1 on Q1 change
    [3] See page 6

Royal Dutch Shell Chief Executive Officer Peter Voser commented:

"Our industry continues to see significant energy price volatility as a
result of economic and political developments. Oil prices have fallen recently
but Shell is implementing a long-term, competitive and innovative strategy
against this volatile backdrop."

"Shell's underlying CCS earnings were $7.5 billion for the quarter, a 2%
increase in CCS earnings per share from the first quarter of 2012. These
results were underpinned by Shell's growth projects, an improvement in
downstream profitability, and were delivered despite a difficult security
environment in Nigeria."

"Our profits pay for Shell's dividends and investment in new projects to
ensure affordable and reliable energy supplies for our customers, and to add
value for our shareholders."

"Shell is investing for profitable growth, whilst maintaining strong capital
discipline. We are developing some 30 new projects and maturing a series of
further opportunities for investment. So far this year, we've seen the growth
impact of recent start ups and we took four final investment decisions in
petrochemicals, deepwater, and LNG."

"We continue to take a dynamic approach to portfolio" continued Voser. "Asset
sales - $0.6 billion in the first quarter and over $21 billion in the last
three years - improve our capital efficiency and can bring in strategic
partners. We use selective acquisitions to refresh our opportunity set."

Voser commented "We distributed $11 billion of dividends over the last year,
the highest in our industry, and today we confirm a 5% rise in our dividend to
$0.45 per share."

He concluded "Dividends are Shell's main route for returning cash to
shareholders. Our improving cash flow also enables us to accelerate our share
buyback programme, this year so far we have repurchased some $1.2 billion of
shares by the end of April. In the current environment we would expect to more
than offset the scrip dividend issue this year, and we are determined to
implement the policy to offset dilution over the business cycle. This
underlines our commitment to shareholder returns."

First quarter 2013 portfolio developments

Upstream

In Canada, the first debottlenecking project for the Athabasca Oil Sands
Project (Shell interest 60%) was completed. The project is expected to add
some 10 thousand barrels per day ("b/d") of capacity.

In Nigeria, Shell took the final investment decision for the development of
the deep-water project Erha North Phase 2 (Shell interest 44%), part of oil
mining lease 133, located over 100 kilometres off the Nigerian coast. The
project is expected to produce some 60 thousand barrels of oil equivalent per
day ("boe/d") of mainly oil at peak production and improve utilisation of the
existing Erha floating production, storage and offloading ("FPSO") vessel.

In Oman, the Amal Steam enhanced oil recovery project (Shell interest 34%) was
brought on stream. The project is expected to ramp up over a number of years
and produce some 20 thousand b/d of oil at peak production.

Shell entered into an agreement to acquire part of Repsol S.A.'s LNG portfolio
outside of North America, including supply positions in Peru and Trinidad &
Tobago, for a cash consideration of $4.4 billion. Under the terms of the
agreement, Shell will assume finance lease obligations of the businesses
acquired, predominantly reflecting leases for LNG ship charters, provisionally
estimated at $1.8 billion. The acquisition is expected to add some 7.2 million
tonnes per annum ("mtpa") of LNG volumes through long-term offtake agreements,
including 4.2 mtpa of equity LNG plant capacity. The transaction, which has an
effective date of October 1, 2012, is expected to close in the second half of
2013 or early 2014, subject to regulatory approvals and other conditions
precedent.

In the United Kingdom, Shell completed the acquisition of an additional 5.9%
interest in the offshore Schiehallion field, increasing Shell's interest to
55%. Shell also completed the acquisition of additional interests in the Beryl
area fields and SAGE infrastructure, lifting Shell's production in the Beryl
area fields from 9 thousand boe/d to 20 thousand boe/d. Further investment in
Schiehallion and Beryl is expected to extend the production life of the
fields.

In the United States, Shell and Kinder Morgan affiliates announced their
intent to form a company to develop a natural gas liquefaction plant in two
phases at the existing Elba Island LNG terminal to export LNG. The total
project is expected to have a liquefaction capacity of approximately 2.5 mtpa.
Shell will own 49% of the entity and subscribe to 100% of the liquefaction
capacity. The agreement is subject to corporate and regulatory approvals.

In North America, Shell took the final investment decision for two 0.25 mtpa
natural gas liquefaction units (Shell interest 100%) in Louisiana, United
States and Ontario, Canada. These units will form the basis of two new LNG
transport corridors in the Gulf Coast and Great Lakes regions, fuelling marine
vessels and heavy-duty trucking fleets.

Upstream divestment proceeds totalled some $0.4 billion for the first quarter
2013 and included proceeds from the divestment of a 5% interest in the Prelude
floating LNG project to CPC Corporation as announced in 2012, reducing Shell's
interest in the project to 67.5%.

During the first quarter 2013, Shell participated in the Kentish Knock South-1
gas discovery (Shell interest 50%) offshore Western Australia. As part of its
global exploration programme Shell added new acreage positions during the
first quarter 2013, including liquids-rich acreage positions in Canada,
offshore positions in Norway and the United Kingdom North Sea, along with
successful bidding results in the Gulf of Mexico, United States. Shell also
signed a production sharing contract ("PSC") for tight gas in the Yuzivska
area in the Ukraine and, in China, Shell received government approval for the
tight gas PSC for the Fushun-Yongchuan block in the Sichuan basin.

Downstream

In Singapore, Shell announced the final investment decisions for additional
capacity at its Jurong Island petrochemicals facility. The investments (Shell
interest 100%) are expected to add 140 thousand tonnes per annum ("tpa") of
high-purity ethylene oxide capacity, 140 thousand tpa of ethoxylation capacity
and more than 100 thousand tpa of polyols capacity.

Downstream divestment proceeds totalled some $0.1 billion for the first
quarter 2013 and included proceeds from the divestment of Shell's interest in
a pipeline business in the United States, Shell's LPG business in Vietnam and
the majority of Shell's shareholding in its downstream business in Uganda.

In April, Shell announced that its 120 thousand b/d Geelong refinery in
Australia is for sale and that it is considering the sale of selected
downstream marketing businesses in Italy.

Also in April, Shell finalised an agreement with TravelCenters of America in
the United States to develop a nationwide network of LNG fuelling centres for
heavy-duty road transport customers at up to 100 existing sites.

Key features of the FIRST quarter 2013

First quarter 2013 CCS earnings (see Note 1) were $7,951 million, 4% higher
than for the same quarter a year ago.

First quarter 2013 CCS earnings excluding identified items (see page 6) were
$7,520 million compared with $7,297 million for the first quarter 2012, an
increase of 3%.

Basic CCS earnings per share increased by 2% versus the same quarter a year
ago.

Basic CCS earnings per share excluding identified items increased by 2%
compared with the first quarter 2012.

Cash flow from operating activities for the first quarter 2013 was $11.6
billion, compared with $13.4 billion in the same quarter last year. Excluding
working capital movements, cash flow from operating activities for the first
quarter 2013 was $11.5 billion, compared with $12.7 billion in the same
quarter last year.

Net capital investment (see Note 1) for the first quarter 2013 was $8.2
billion. Capital investment for the first quarter 2013 was $8.8 billion and
divestment proceeds were $0.6 billion.

Total dividends distributed in the first quarter 2013 were some $2.7 billion
of which $0.8 billion were settled by issuing some 25.6 million A shares under
the Scrip Dividend Programme for the fourth quarter 2012.

Under our share buyback programme some 16.1 million B shares were bought back
for cancellation during the first quarter 2013 for a consideration of some
$0.5 billion.

Return on average capital employed (see Note 9) on a reported income basis was
13.0% at the end of the first quarter 2013.

Gearing was 9.1% at the end of the first quarter 2013 versus 10.5% at the end
of the first quarter 2012 (see Note 2).

Oil and gas production for the first quarter 2013 was 3,559 thousand boe/d.
Excluding the impact of divestments, PSC price effects and security impacts
onshore Nigeria, first quarter 2013 production was 2% higher than in the same
period last year.

Equity LNG sales volumes of 5.15 million tonnes for the first quarter 2013
were broadly similar to the same quarter a year ago.

Oil products sales volumes were 1% higher than for the first quarter 2012.
Chemicals sales volumes for the first quarter 2013 decreased by 11% compared
with the same quarter a year ago.

Supplementary financial and operational disclosure for the first quarter 2013
is available at http://www.shell.com/investor.

Summary of identified items

Earnings for the first quarter 2013 reflected the following items, which in
aggregate amounted to a net gain
of $431 million (compared with a net gain of $380 million in the first quarter
2012), as summarised in the table below:

Upstream earnings included a net gain of $173 million, mainly reflecting the
revaluation of a deferred tax asset of $199 million and net divestment gains
of $107 million, both predominantly related to Australia, partly offset by the
net impact of fair value accounting of commodity derivatives and certain gas
contracts of $103 million. Earnings for the first quarter 2012 included a net
gain of $453 million.

Downstream earnings included a net charge of $160 million, mainly reflecting
impairments of $155 million, predominantly in Australia, and the net impact of
fair value accounting of commodity derivatives of $30 million, partly offset
by net divestment gains of $24 million. Earnings for the first quarter 2012
included a net gain of $198 million.

Corporate and Non-controlling interest earnings included a net gain of $418
million, mainly reflecting a tax credit of $407 million related to prior
years. Earnings for the first quarter 2012 included a net charge of $271
million.

    Summary OF IDENTIFIED ITEMS
                     $ million                          Quarters
                                                 Q1 2013   Q4 2012   Q1 2012
    Segment earnings impact of identified items:
    Upstream                                         173    1,801     453
    Downstream                                      (160)     (89)    198
    Corporate and Non-controlling interest           418        -    (271)
    Earnings impact                                  431    1,712     380

These identified items are shown to provide additional insight into segment
earnings and income attributable to shareholders. From the first quarter 2013
onwards, identified items include the full impact on Shell's CCS earnings of
the following items:

Divestment gains and losses

Impairments

Fair value accounting of commodity derivatives and certain gas contracts (see
Note 8)

Redundancy and restructuring

Further items may be identified in addition to the above. Prior period
comparatives have not been restated.

Earnings BY BUSINESS segment

    upstream
                      $ million                             Quarters
                                                  Q1 2013 Q4 2012 Q1 2012  %[2]

    Upstream earnings excluding identified
    items[1]                                        5,648   4,401   6,270  -10
    Upstream earnings[1]                            5,821   6,202   6,723  -13

    Upstream cash flow from operating activities    9,705   6,165   8,788  +10

    Upstream net capital investment                 7,370   9,323   3,772  +95

    Liquids production available for sale
    (thousand b/d)                                  1,640   1,640   1,682   -2
    Natural gas production available for sale
    (million scf/d)                                11,132  10,288  10,844   +3
    Total production available for sale (thousand
    boe/d)                                          3,559   3,414   3,552    -

    Equity LNG sales volumes (million tonnes)        5.15    5.49    5.17    -


    [1] Fourth quarter 2012 and first quarter 2012 comparatives restated
        for accounting policy change (see Note 2).
    [2] Q1 on Q1 change

First quarter Upstream earnings excluding identified items were $5,648 million
compared with $6,270 million
a year ago. Identified items were a net gain of $173 million, compared with a
net gain of $453 million for
the first quarter 2012 (see page 6).

Compared with the first quarter 2012, Upstream earnings excluding identified
items benefited from the ramp-up of Pearl GTL, increased trading
contributions, higher gas realisations and tax credits. These items were more
than offset by lower liquids realisations, higher depreciation, increased
operating and exploration expenses, as well as lower earnings from LNG
ventures.

Global liquids realisations were 7% lower than for the first quarter 2012. In
Canada, synthetic crude oil realisations were 8% lower than for the same
period last year. Global natural gas realisations were 8% higher than for the
same quarter a year ago, with a 19% increase in the Americas and a 6% increase
outside the Americas.

First quarter 2013 production was 3,559 thousand boe/d compared with 3,552
thousand boe/d a year ago. Liquids production decreased by 2% and natural gas
production increased by 3% compared with the first quarter 2012. Excluding the
impact of divestments, PSC price effects and security impacts onshore Nigeria,
first quarter 2013 production was 2% higher than for the same period last
year.

New field start-ups and the continuing ramp-up of fields, in particular Pearl
GTL in Qatar, Eagle Ford in the United States and Pluto LNG in Australia,
contributed some 175 thousand boe/d to production for the first quarter 2013,
which more than offset the impact of field declines.

Equity LNG sales volumes of 5.15 million tonnes were broadly similar compared
with the same quarter a year ago, reflecting the contribution from Pluto LNG,
which was offset by lower volumes from Nigeria LNG due to reduced feedgas
supply.

    DOWNSTREAM
                      $ million                             Quarters
                                                  Q1 2013 Q4 2012 Q1 2012  %[2]

    Downstream CCS earnings excluding identified
    items[1]                                        1,848   1,190   1,122  +65
    Downstream CCS earnings[1]                      1,688   1,101   1,320  +28

    Downstream cash flow from operating
    activities                                        365   4,303   3,208  -89

    Downstream net capital investment                 820   1,471     786   +4

    Refinery processing intake (thousand b/d)       2,890   2,804   2,782   +4

    Oil products sales volumes (thousand b/d)       6,004   6,367   5,960   +1

    Chemicals sales volumes (thousand tonnes)       4,143   4,620   4,679  -11

    [1] Fourth quarter 2012 and first quarter 2012 comparatives restated
        for accounting policy change (see Note 2).
    [2] Q1 on Q1 change

First quarter Downstream earnings excluding identified items were $1,848
million compared with $1,122 million for the first quarter 2012. Identified
items were a net charge of $160 million, compared with a net gain of $198
million for the first quarter 2012 (see page 6).

Compared with the first quarter 2012, Downstream earnings excluding identified
items benefited from higher realised refining margins, reflecting the industry
environment and Shell's operating performance, as well as increased
contributions from trading and marketing. Chemicals earnings were higher as a
result of improved realised margins. Adverse currency exchange rate effects,
increased depreciation and higher taxation impacted Downstream earnings.

Oil products sales volumes increased by 1% compared with the same period a
year ago, as a result of higher trading volumes and an accounting policy
change (see Note 1b), partly offset by lower marketing volumes.

Chemicals sales volumes decreased by 11% compared with the same quarter last
year, mainly as a result of an
accounting policy change (see Note 1b) and lower trading volumes. Chemicals
manufacturing plant availability decreased to 92% from 94% for the first
quarter 2012, as a result of higher planned maintenance.

Refinery intake volumes were 4% higher compared with the same quarter last
year, mainly as a result of an accounting policy change (see Note 1b).
Refinery availability decreased to 91% from 94% for the first quarter 2012, as
a result of higher planned maintenance.

    CORPORATE AND Non-controlling interest
                 $ million                                    Quarters
                                                      Q1 2013 Q4 2012 Q1 2012

    Corporate and Non-controlling interest excluding
    identified items[1]                                  24      48    (95)
    Of which:
    Corporate[1]                                         88      82    (30)
    Non-controlling interest                            (64)    (34)   (65)

    Corporate and Non-controlling interest[1]           442      48   (366)
    [1] Fourth quarter 2012 and first quarter 2012 comparatives restated
        for accounting policy change (see Note 2).

First quarter Corporate results and Non-controlling interest excluding
identified items were $24 million, compared with a loss of $95 million in the
same period last year. Identified items for the first quarter of 2013 were a
net gain of $418 million, compared with a net charge of $271 million for the
first quarter of 2012 (see page 6).

Compared with the first quarter of 2012, Corporate results excluding
identified items reflected lower net interest expense and higher tax credits.
In the first quarter 2013, adverse currency exchange rate effects impacted
earnings by $20 million, compared with favourable currency exchange rate
effects of $185 million in the same period last year.

FORTHCOMING EVENTS

Second quarter 2013 results and second quarter 2013 dividend are scheduled to
be announced on August 1, 2013. Third quarter 2013 results and third quarter
2013 dividend are scheduled to be announced on October 31, 2013. The Annual
General Meeting will be held on May 21, 2013.

UNAUDITED CONDENSED CONSOLIDATED
INTERIM FINANCIAL STATEMENTS

    CONSOLIDATED Statement of income
                  $ million                             Quarters
                                                    Q4 2012     Q1 2012
                                          Q1 2013  Restated[1] Restated[1] %[2]
    Revenue                               112,810     118,047     119,920
    Share of profit of equity-accounted
    investments                             2,303       2,127       2,940
    Interest and other income                 401       2,437         914
    Total revenue and other income        115,514     122,611     123,774
    Purchases                              86,603      93,350      94,069
    Production and manufacturing expenses   6,458       7,319       6,038
    Selling, distribution and
    administrative expenses                 3,587       3,698       3,659
    Research and development                  294         416         294
    Exploration                               648       1,167         362
    Depreciation, depletion and
    amortisation                            4,225       3,835       3,402
    Interest expense                          401         379         552
    Income before taxation                 13,298      12,447      15,398  -14
    Taxation                                5,072       5,691       6,546
    Income for the period                   8,226       6,756       8,852   -7
    Income attributable to
    non-controlling interest                   50          28         115
    Income attributable to Royal Dutch
    Shell plc shareholders                  8,176       6,728       8,737   -6
    [1] Restated for accounting policy change (see Note 2).
    [2] Q1 on Q1 change.

    earnings per share
                      $                              Quarters
                                                    Q4 2012     Q1 2012
                                          Q1 2013  Restated[1] Restated[1]

    Basic earnings per share               1.30      1.07        1.40
    Diluted earnings per share             1.29      1.07        1.40


    [1] Restated for accounting policy change (see Note 2).

    SHARES[1]
                        Million                             Quarters
                                                     Q1 2013  Q4 2012  Q1 2012
    Weighted average number of shares as the basis
    for:
    Basic earnings per share                         6,308.9  6,282.8  6,229.4
    Diluted earnings per share                       6,313.7  6,289.2  6,239.1

    Shares outstanding at the end of the period      6,340.2  6,305.9  6,273.8


    [1] Royal Dutch Shell plc ordinary shares of EUR0.07 each.

Notes 1 to 7 are an integral part of these Condensed Consolidated Interim
Financial Statements

    Consolidated Statement of Comprehensive Income
                    $ million                             Quarters
                                                         Q4 2012     Q1 2012
                                               Q1 2013  Restated[1] Restated[1]

    Income for the period                        8,226       6,756       8,852
    Other comprehensive income:
    Items that may be reclassified to income
    in later periods:
    - Currency translation differences          (1,652)         36       1,625
    - Unrealised gains/(losses) on securities       31        (683)       (105)
    - Cash flow hedging gains/(losses)              13         101        (450)
    - Share of other comprehensive loss of
    equity-accounted investments                   (56)       (179)       (109)
    Total                                       (1,664)       (725)        961
    Items that are not reclassified to income
    in later periods:
    - Retirement benefits remeasurements         1,436      (2,500)        (29)
    Total                                        1,436      (2,500)        (29)
    Other comprehensive income/(loss) for the
    period                                        (228)     (3,225)        932
    Comprehensive income for the period          7,998       3,531       9,784
    Comprehensive income attributable to
    non-controlling interest                        25          46         158
    Comprehensive income attributable to Royal
    Dutch Shell plc shareholders                 7,973       3,485       9,626


    [1] Restated for accounting policy change (see Note 2).

Notes 1 to 7 are an integral part of these Condensed Consolidated Interim
Financial Statements

    CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                         Equity attributable to Royal Dutch
                               Shell plc shareholders
                              Shares
                       Share  held in  Other   Retained         Non-controlling  Total
        $ million     capital  trust  reserves earnings  Total     interest     equity
    At January 1,
    2013[1]               542 (2,287)  (3,752)  180,246 174,749      1,433      176,182
    Comprehensive
    income
    for the period          -      -     (203)    8,176   7,973         25        7,998
    Capital
    contributions
    from, and other
    changes
    in,
    non-controlling
    interest                -      -        -         -       -         (4)          (4)
    Dividends paid          -      -        -    (2,752) (2,752)       (21)      (2,773)
    Scrip
    dividends[2]            2      -       (2)      844     844          -          844
    Repurchases of
    shares[3]              (1)     -        1    (1,104) (1,104)         -       (1,104)
    Shares held in
    trust:
    net
    sales/(purchases)
    and dividends
    received                -  1,030        -        36   1,066          -        1,066
    Share-based
    compensation            -      -     (603)     (367)   (970)         -         (970)
    At March 31, 2013     543 (1,257)  (4,559)  185,079 179,806      1,433      181,239

    At January 1,
    2012[1]               536 (2,990)  (1,961)  162,895 158,480      1,486      159,966
    Comprehensive
    income for the
    period[1]               -      -      889     8,737   9,626        158        9,784
    Capital
    contributions
    from, and other
    changes
    in,
    non-controlling
    interest                -      -        -        48      48        (75)         (27)
    Dividends paid          -      -        -    (2,670) (2,670)       (24)      (2,694)
    Scrip
    dividends[2]            3      -       (3)      999     999          -          999
    Repurchases of
    shares[3]               -      -        -      (627)   (627)                   (627)
    Shares held in
    trust:
    net
    sales/(purchases)
    and dividends
    received                -  1,013        -        44   1,057          -        1,057
    Share-based
    compensation            -      -     (135)     (439)   (574)         -         (574)
    At March 31,
    2012[1]               539 (1,977)  (1,210)  168,987 166,339      1,545      167,884

    [1] Restated for accounting policy change (see Note 2).
    [2] Under the Scrip Dividend Programme some 25.6 million A shares,
        equivalent to $0.8 billion, were issued during the first quarter 2013 and
        some 27.5 million A shares, equivalent to $1.0 billion, were issued during
        the first quarter 2012.
    [3] Includes shares committed to repurchase and repurchases subject to
        settlement at the end of the quarter.

Notes 1 to 7 are an integral part of these Condensed Consolidated Interim
Financial Statements

    CONDENSED CONSOLIDATED balance sheet
                                                    $ million
                                                     Dec 31, 2012 March 31, 2012
                                    March 31, 2013     Restated[1]   Restated[1]

    Assets
    Non-current assets:
    Intangible assets                        4,456        4,470          4,545
    Property, plant and equipment          180,244      172,293        155,239
    Equity-accounted investments            34,478       38,350         39,534
    Investments in securities                4,878        4,867          5,454
    Deferred tax                             4,641        4,288          4,874
    Retirement benefits                      3,502        2,301          3,624
    Trade and other receivables              9,052        8,991         10,061
                                           241,251      235,560        223,331

    Current assets:
    Inventories                             31,531       30,781         34,163
    Trade and other receivables             66,598       65,403         78,798
    Cash and cash equivalents               17,614       18,550         15,024
                                           115,743      114,734        127,985

    Total assets                           356,994      350,294        351,316

    Liabilities
    Non-current liabilities:
    Debt                                    27,329       29,921         29,116
    Trade and other payables                 4,170        4,175          4,542
    Deferred tax                            11,490       10,312         11,289
    Retirement benefits                     15,091       15,290         13,986
    Decommissioning and other
    provisions                              18,054       17,435         16,010
                                            76,134       77,133         74,943

    Current liabilities:
    Debt                                     8,461        7,833          5,657
    Trade and other payables                73,301       72,839         85,360
    Taxes payable                           14,386       12,684         14,113
    Retirement benefits                        376          402            408
    Decommissioning and other
    provisions                               3,097        3,221          2,951
                                            99,621       96,979        108,489

    Total liabilities                      175,755      174,112        183,432

    Equity attributable to Royal
    Dutch Shell plc shareholders           179,806      174,749        166,339

    Non-controlling interest                 1,433        1,433          1,545
    Total equity                           181,239      176,182        167,884

    Total liabilities and equity           356,994      350,294        351,316
    [1] Restated for accounting policy change (see Note 2).

Notes 1 to 7 are an integral part of these Condensed Consolidated Interim
Financial Statements

    CONDENSED CONSOLIDATED statement of cash flows
                    $ million                             Quarters
                                                           Q4 2012     Q1 2012
                                              Q1 2013     Restated[1] Restated[1]

    Cash flow from operating activities
    Income for the period                        8,226       6,756       8,852
    Adjustment for:
    - Current taxation                           4,892       5,966       5,479
    - Interest expense (net)                       357         324         499
    - Depreciation, depletion and
    amortisation                                 4,225       3,835       3,402
    - Net gains on sale of assets                 (213)     (2,083)       (524)
    - Decrease in working capital                   34         994         770
    - Share of profit of equity-accounted
    investments                                 (2,303)     (2,127)     (2,940)
    - Dividends received from
    equity-accounted investments                 1,242       2,655       2,582
    - Deferred taxation, retirement benefits,
    decommissioning and

    other provisions                               (11)       (422)        953
    - Other                                         27         553        (408)
    Net cash from operating activities
    (pre-tax)                                   16,476      16,451      18,665

    Taxation paid                               (4,917)     (6,538)     (5,226)

    Net cash from operating activities          11,559       9,913      13,439

    Cash flow from investing activities
    Capital expenditure                         (7,862)    (10,674)     (6,456)
    Investments in equity-accounted
    investments                                   (372)       (217)     (1,298)
    Proceeds from sales of assets                  382       1,513       2,372
    Proceeds from sales of equity-accounted
    investments                                    154         415          57
    Proceeds from sales/(purchases) of
    securities (net)                                20         (30)        (40)
    Interest received                               36          53          48
    Net cash used in investing activities       (7,642)     (8,940)     (5,317)

    Cash flow from financing activities
    Net (decrease)/increase in debt with
    maturity period

    within three months                            133        (467)       (453)
    Other debt: New borrowings                     180       1,813         610
    Repayments                                  (2,185)       (278)     (2,967)
    Interest paid                                 (158)       (283)       (454)
    Change in non-controlling interest              (7)         25          10
    Cash dividends paid to:
    - Royal Dutch Shell plc shareholders        (1,908)     (1,634)     (1,671)
    - Non-controlling interest                     (21)        (26)        (24)
    Repurchases of shares                         (545)       (453)          -
    Shares held in trust: net
    sales/(purchases) and dividends received       (10)        (43)        205
    Net cash used in financing activities       (4,521)     (1,346)     (4,744)

    Currency translation differences relating
    to cash and

    cash equivalents                              (332)         84         354
    Increase/(decrease) in cash and cash
    equivalents                                   (936)       (289)      3,732

    Cash and cash equivalents at beginning of
    period                                      18,550      18,839      11,292

    Cash and cash equivalents at end of
    period                                      17,614      18,550      15,024
    [1] Restated for accounting policy change (see Note 2).

Notes 1 to 7 are an integral part of these Condensed Consolidated Interim
Financial Statements

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. Basis of preparation

These Condensed Consolidated Interim Financial Statements ("Interim
Statements") of Royal Dutch Shell plc and its subsidiaries (collectively known
as Shell) have been prepared in accordance with IAS 34 Interim Financial
Reporting and on the basis of the same accounting principles as, and should be
read in conjunction with, the Annual Report and Form 20-F for the year ended
December 31, 2012 (pages 103 to 108) as filed with the U.S. Securities and
Exchange Commission, except as described below:

a.Revised IAS 19 Employee Benefits was adopted on January 1, 2013, with
    retrospective effect (see Note 2).
b.IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements and
    revised standards IAS 27 Separate Financial Statements and IAS 28
    Investments in Associates and Joint Ventures were adopted on January 1,
    2013. The standards reinforce the principles for determining when an
    investor controls another entity and in certain cases amend the accounting
    for arrangements where an investor has joint control. The impact of the
    changes on the accounting for Shell's interests is not significant; the
    major investments affected are listed in Note 7.
c.IFRS 13 Fair Value Measurement was adopted on January 1, 2013, with
    prospective effect. The standard affects nearly all instances where assets
    and liabilities are currently recognised at fair value, primarily by
    refining the measurement concept to represent an asset or liability's exit
    value. The standard also introduces certain additional considerations to
    the measurement process and additional disclosures have been provided
    where considered material (see Note 6). The impact of the changes for
    Shell is not significant.

The financial information presented in the Interim Statements does not
constitute statutory accounts within the meaning of section 434(3) of the
Companies Act 2006. Statutory accounts for the year ended December 31, 2012
were published in Shell's Annual Report and a copy was delivered to the
Registrar of Companies in England and Wales. The auditors' report on those
accounts was unqualified, did not include a reference to any matters to which
the auditors drew attention by way of emphasis without qualifying the report
and did not contain a statement under sections 498(2) or 498(3) of the
Companies Act 2006.

The Interim Statements are unaudited.

Segment information

Segment earnings are presented on a current cost of supplies basis (CCS
earnings). On this basis, the purchase price of volumes sold during the period
is based on the current cost of supplies during the same period after making
allowance for the tax effect. CCS earnings therefore exclude the effect of
changes in the oil price on inventory carrying amounts.

Net capital investment is defined as capital expenditure as reported in the
Condensed Consolidated Statement of Cash Flows, adjusted for: proceeds from
disposals; exploration expense excluding exploration wells written off;
investments in equity-accounted investments; and leases and other items.

CCS earnings and net capital investment information are the dominant measures
used by the Chief Executive Officer for the purposes of making decisions about
allocating resources and assessing performance.

2. Accounting for defined benefit plans

Revised IAS 19 Employee Benefits (IAS 19R) was adopted on January 1, 2013,
with retrospective effect; comparative information is therefore restated.

The revised standard requires immediate recognition of actuarial gains and
losses arising in connection with defined benefit plans through other
comprehensive income (see page 11). Previously, Shell applied the corridor
method of accounting under which amounts falling inside the corridor remained
unrecognised, while amounts falling outside it were recognised (amortised) in
income over a number of years. For the periods presented in this Report, the
elimination of this amortisation is approximately offset by lower interest
being recognised in income under the IAS 19R "net interest" approach. Under
this approach, interest income from defined benefit plan assets is determined
based on the same discount rate as applied to measure plan obligations, rather
than on an expected rate of return reflecting the plan's investment portfolio.

The following table sets out the impact of the change on relevant lines in the
Condensed Consolidated Balance Sheet, on gearing, and on the return on capital
employed (ROACE, see Note 9) for the twelve months ending at the respective
balance sheet date.

    $ million                  Dec 31, 2012                    Mar 31, 2012
                                Effect of                       Effect of
                        As      accounting              As     accounting
                    previously    policy            previously   policy
                      stated     change   Restated   stated      change   Restated
    Non-current
    assets
    Deferred tax      4,045        243     4,288      4,666        208     4,874
    Retirement
    benefits         12,575    (10,274)    2,301     11,816     (8,192)    3,624

    Non-current
    liabilities
    Deferred tax     15,590     (5,278)   10,312     15,887     (4,598)   11,289
    Retirement
    benefits          6,298      8,992    15,290      6,064      7,922    13,986

    Total equity
    Other
    reserves         10,021    (13,773)   (3,752)    10,024    (11,234)   (1,210)
    Retained
    earnings        180,218         28   180,246    169,061        (74)  168,987

    Gearing[1]          9.2%       0.6%      9.8%       9.9%       0.6%     10.5%

    ROACE              12.7%       0.9%     13.6%      15.4%       0.7%     16.1%

    [1] Net debt (total debt less cash and cash equivalents) as a
        percentage of total capital (net debt plus total equity).

The effect of the accounting policy change at January 1, 2012 was to reduce
Accumulated other comprehensive income (within Other reserves) by $10,945
million, Retained earnings by $92 million and Total equity by $11,037 million.

Income for the first quarter 2012 increased by $18 million of which Upstream
segment earnings increased by $17 million and Downstream segment earnings
increased by $1 million. Income for the fourth quarter 2012 increased by $57
million of which Upstream segment earnings increased by $24 million,
Downstream segment earnings increased by $27 million and Corporate segment
earnings increased by $6 million. Basic and diluted earnings per share for the
fourth quarter 2012 increased by $0.01. There was no impact on net cash from
operating activities.

3. Information by business segment

                $ million                          Quarters
                                             Q1 2013     Q1 2012[1]
    Third-party revenue
    Upstream                                  12,376        11,990
    Downstream                               100,409       107,918
    Corporate                                     25            12
    Total third-party revenue                112,810       119,920

    Inter-segment revenue
    Upstream                                  12,142        13,451
    Downstream                                   243           212
    Corporate                                      -             -

    Segment earnings
    Upstream                                   5,821         6,723
    Downstream                                 1,688         1,320
    Corporate                                    491          (264)
    Total segment earnings                     8,000         7,779

    [1] Restated for accounting policy change (see Note 2).

                     $ million                                 Quarters
                                                        Q1 2013     Q1 2012[1]
    Total segment earnings                               8,000         7,779
    Current cost of supplies adjustment:
    Purchases                                              113         1,195
    Taxation                                               (28)         (342)
    Share of profit of equity-accounted
    investments                                            141           220
    Income for the period                                8,226         8,852

    [1] Restated for accounting policy change (see Note 2).

4. Share capital

Issued and fully paid

                                                            Sterling deferred
                           Ordinary shares of EUR0.07 each       shares
      Number of shares            A                B          of GBP1 each
    At January 1, 2013       3,772,388,687   2,617,715,189        50,000
    Scrip dividends             25,586,312               -             -
    Repurchases of shares                -     (16,080,000)            -
    At March 31, 2013        3,797,974,999   2,601,635,189        50,000

Nominal value

                                            Ordinary shares
           $ million               A               B             Total
    At January 1, 2013            321             221             542
    Scrip dividends                 2               -               2
    Repurchases of shares           -              (1)             (1)
    At March 31, 2013             323             220             543

    The total nominal value of sterling deferred shares is less than $1 million.

At Royal Dutch Shell plc's Annual General Meeting on May 22, 2012, the Board
was authorised to allot ordinary shares in Royal Dutch Shell plc, and to grant
rights to subscribe for or to convert any security into ordinary shares in
Royal Dutch Shell plc, up to an aggregate nominal amount of €147 million
(representing 2,100 million ordinary shares of €0.07 each), and to list such
shares or rights on any stock exchange. This authority expires at the earlier
of the close of business on August 22, 2013 and the end of the Annual General
Meeting to be held in 2013, unless previously renewed, revoked or varied by
Royal Dutch Shell plc in a general meeting.

5. Other reserves

                                                                Accumulated
                                   Share     Capital    Share      other
                        Merger    premium   redemption  plan   comprehensive
       $ million      reserve[1] reserve[1] reserve[2] reserve    income      Total
    At January 1,
    2013[3]              3,423        154         63   2,028       (9,420)   (3,752)
    Other
    comprehensive
    loss
    attributable to
    Royal Dutch
    Shell plc
    shareholders             -          -          -       -         (203)     (203)
    Scrip dividends         (2)         -          -       -            -        (2)
    Repurchases of
    shares                   -          -          1       -            -         1
    Share-based
    compensation             -          -          -    (603)           -      (603)
    At March 31,
    2013                 3,421        154         64   1,425       (9,623)   (4,559)

    At January 1,
    2012[3]              3,432        154         60   1,571       (7,178)   (1,961)
    Other
    comprehensive
    income
    attributable to
    Royal Dutch
    Shell plc
    shareholders[3]          -          -          -       -          889       889
    Scrip dividends         (3)         -          -       -            -        (3)
    Share-based
    compensation             -          -          -    (135)           -      (135)
    At March 31,
    2012[3]              3,429        154         60   1,436       (6,289)   (1,210)

    [1] The merger reserve and share premium reserve were established as a
        consequence of Royal Dutch Shell plc becoming the single parent company
        of Royal Dutch Petroleum Company and The "Shell" Transport and Trading
        Company, plc, now The Shell Transport and Trading Company Limited, in
        2005.
    [2] The capital redemption reserve was established in connection with
        repurchases of shares of Royal Dutch Shell plc.

    [3] Restated for accounting policy change (see Note 2).

6. Derivative contracts

The table below provides the carrying amounts of derivatives contracts held,
disclosed in accordance with IFRS 13 Fair Value Measurement (see Note 1c).

                                                  March                      March
                    $ million                  31, 2013    Dec 31, 2012   31, 2012
    Included within:

    Trade and other receivables - non-current   1,426        1,881           1,808
    Trade and other receivables - current       8,443        9,192          17,469

    Trade and other payables - non-current        609          658             901
    Trade and other payables - current          8,530        9,145          17,285

7. Major investments in joint ventures and associates

Of the major investments in joint ventures and associates listed in the Annual
Report and Form 20-F for the year ended December 31, 2012 (page 117), Aera,
Deer Park and Saudi Aramco Shell Refinery have been assessed as joint
operations under IFRS 11 Joint Arrangements (see Note 1b) and are no longer
accounted for using the equity method as from January 1, 2013.

8. Impacts of accounting for derivatives

In the ordinary course of business Shell enters into contracts to supply or
purchase oil and gas products, and also enters into derivative contracts to
mitigate resulting economic exposures (generally price exposure). Derivative
contracts are carried at period-end market price (fair value), with movements
in fair value recognised in income for the period. Supply and purchase
contracts entered into for operational purposes are, by contrast, recognised
when the transaction occurs (see also below); furthermore, inventory is
carried at historical cost or net realisable value, whichever is lower.

As a consequence, accounting mismatches occur because: (a) the supply or
purchase transaction is recognised in a different period; or (b) the inventory
is measured on a different basis.

In addition, certain UK gas contracts held by Upstream are, due to pricing or
delivery conditions, deemed to contain embedded derivatives or written options
and are also required to be carried at fair value even though they are entered
into for operational purposes.

The accounting impacts of the aforementioned are reported as identified items
in this Report.

9. Return on average capital employed

Return on average capital employed (ROACE) measures the efficiency of Shell's
utilisation of the capital that it employs and is a common measure of business
performance. In this calculation, ROACE is defined as the sum of income for
the current and previous three quarters, adjusted for after-tax interest
expense, as a percentage of the average capital employed for the same period.
Capital employed consists of total equity, current debt and non-current debt.
The tax rate is derived from calculations at the published segment level.

10. Liquidity and capital resources

Net cash from operating activities for the first quarter 2013 was $11.6
billion compared with $13.4 billion for the same period last year.

Total current and non-current debt increased to $35.8 billion at March 31,
2013 from $34.8 billion at March 31, 2012 while cash and cash equivalents
increased to $17.6 billion at March 31, 2013 from $15.0 billion at March 31,
2012. No new debt was issued under the US shelf registration programme or
under the euro medium-term note programme during the first quarter of 2013.

Net capital investment for the first quarter 2013 was $8.2 billion, of which
$7.4 billion was invested in Upstream and $0.8 billion in Downstream. Net
capital investment for the same period of 2012 was $4.6 billion, of which $3.8
billion was invested in Upstream and $0.8 billion in Downstream.

Dividends of $0.45 per share are announced on May 2, 2013 in respect of the
first quarter. These dividends are payable on June 27, 2013. In the case of B
shares, the dividends will be payable through the dividend access mechanism
and are expected to be treated as UK-source rather than Dutch-source. See the
Annual Report and Form 20-F for the year ended December 31, 2012 for
additional information on the dividend access mechanism.

Under the Scrip Dividend Programme shareholders can increase their
shareholding in Shell by choosing to receive new shares instead of cash
dividends. Only new A shares will be issued under the Programme, including to
shareholders who currently hold B shares.

CAUTIONARY STATEMENT

All amounts shown throughout this Report are unaudited.

The companies in which Royal Dutch Shell plc directly and indirectly owns
investments are separate entities. In this document "Shell", "Shell group" and
"Royal Dutch Shell" are sometimes used for convenience where references are
made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the
words "we", "us" and "our" are also used to refer to subsidiaries in general
or to those who work for them. These expressions are also used where no useful
purpose is served by identifying the particular company or companies.
"Subsidiaries", "Shell subsidiaries" and "Shell companies" as used in this
document refer to companies over which Royal Dutch Shell plc either directly
or indirectly has control. Companies over which Shell has joint control are
generally referred to "joint ventures" and companies over which Shell has
significant influence but neither control nor joint control are referred to as
"associates". In this document, joint ventures and associates may also be
referred to as "equity-accounted investments". The term "Shell interest" is
used for convenience to indicate the direct and/or indirect (for example,
through our 23% shareholding in Woodside Petroleum Ltd.) ownership interest
held by Shell in a venture, partnership or company, after exclusion of all
third-party interest.

This document contains forward-looking statements concerning the financial
condition, results of operations and businesses of Royal Dutch Shell. All
statements other than statements of historical fact are, or may be deemed to
be, forward-looking statements. Forward-looking statements are statements of
future expectations that are based on management's current expectations and
assumptions and involve known and unknown risks and uncertainties that could
cause actual results, performance or events to differ materially from those
expressed or implied in these statements. Forward-looking statements include,
among other things, statements concerning the potential exposure of Royal
Dutch Shell to market risks and statements expressing management's
expectations, beliefs, estimates, forecasts, projections and assumptions.
These forward-looking statements are identified by their use of terms and
phrases such as "anticipate", "believe", "could", "estimate", "expect",
"goals", "intend", "may", "objectives", "outlook", "plan", "probably",
"project", "risks", "schedule", "seek", "should", "target", "will" and similar
terms and phrases. There are a number of factors that could affect the future
operations of Royal Dutch Shell and could cause those results to differ
materially from those expressed in the forward-looking statements included in
this document, including (without limitation): (a) price fluctuations in crude
oil and natural gas; (b) changes in demand for Shell's products; (c) currency
fluctuations; (d) drilling and production results; (e) reserves estimates; (f)
loss of market share and industry competition; (g) environmental and physical
risks; (h) risks associated with the identification of suitable potential
acquisition properties and targets, and successful negotiation and completion
of such transactions; (i) the risk of doing business in developing countries
and countries subject to international sanctions; (j) legislative, fiscal and
regulatory developments including regulatory measures addressing climate
change; (k) economic and financial market conditions in various countries and
regions; (l) political risks, including the risks of expropriation and
renegotiation of the terms of contracts with governmental entities, delays or
advancements in the approval of projects and delays in the reimbursement for
shared costs; and (m) changes in trading conditions. All forward-looking
statements contained in this document are expressly qualified in their
entirety by the cautionary statements contained or referred to in this
section. Readers should not place undue reliance on forward-looking
statements. Additional risk factors that may affect future results are
contained in Royal Dutch Shell's Form 20-F for the year ended December 31,
2012 (available at http://www.shell.com/investor and http://www.sec.gov).
These risk factors also expressly qualify all forward-looking statements
contained in this document and should be considered by the reader. Each
forward-looking statement speaks only as of the date of this document, May 2,
2013. Neither Royal Dutch Shell plc nor any of its subsidiaries undertake any
obligation to publicly update or revise any forward-looking statement as a
result of new information, future events or other information. In light of
these risks, results could differ materially from those stated, implied or
inferred from the forward-looking statements contained in this document.

We may have used certain terms, such as resources, in this document that
United States Securities and Exchange Commission (SEC) strictly prohibits us
from including in our filings with the SEC. U.S. Investors are urged to
consider closely the disclosure in our Form 20-F, File No 1-32575, available
on the SEC website http://www.sec.gov. You can also obtain this form from the
SEC by calling 1-800-SEC-0330.

The information in this Report reflects the unaudited consolidated financial
position and results of Royal Dutch Shell plc.
Company No. 4366849, Registered Office: Shell Centre, London, SE1 7NA,
England, UK.

Contacts:

Investor Relations:
International,+31(0)70-377-4540

North America, +1-713-241-1042

Media:

International, +44(0)207-934-5550

USA, +1-713-241-4544

SOURCE Royal Dutch Shell plc
 
Press spacebar to pause and continue. Press esc to stop.