Royal Dutch Shell joins the profits party

By Fred Pals  |   2008-8-1  |     NEWSPAPER EDITION

ROYAL Dutch Shell Plc, Europe's biggest oil company, said yesterday that second-quarter profit climbed 33 percent on record oil prices and pledged to increase investment spending to revive production growth.

Net income rose to US$11.56 billion, or US$1.87 a share, from US$8.67 billion, or US$1.38, a year earlier, The Hague-based company said.

Excluding gains or losses from holding inventories and one-time items, profit was US$7.83 billion, which did not include additional fair value adjustments of $750 million.

The median estimate of 11 analysts surveyed by Bloomberg News was for a profit of US$8.3 billion.

Shell joined Eni SpA and Repsol YPF SA, the biggest Italian and Spanish oil companies, in reporting higher earnings yesterday after United States oil futures climbed above US$140 a barrel for the first time in June.

Chief Executive Officer Jeroen van der Veer will spend as much as US$36 billion on acquisitions and drilling this year, described by Shell as "one of the largest investments in the industry" worldwide.

"These are a good set of numbers," Jason Kenney, an Edinburgh-based analyst at ING Wholesale Banking, said in an interview yesterday.