Shareholder distributions in 2013, including dividends announced and share buy-backs, totalled $16 billion, underscoring Shell’s commitment to shareholder returns.
The first quarter 2014 dividend was increased by over 4%, to an annualised level of some $11.8 billion, and first quarter 2014 share buy-backs of B shares were $1.2 billion.
Shell intends to continue with share buy-backs, subject to share price considerations and the capital requirements of the Group. The expectation is that buy-backs will offset prior dilution created by scrip dividends by the end of 2015, with approximately 135 million ordinary shares currently outstanding, as well as shares from any uptake on the Programme related to the dividend in the first quarter of 2014.
It has recently been less attractive for Shell to buy-back A shares rather than B shares due to Dutch dividend withholding tax effects. Cancellation of the Programme is anticipated to remove the Dutch dividend withholding tax costs for Shell on A shares being bought back. Accordingly, Shell will continue to opt for the line of stock for buy-backs that is the least expensive on an “all-in” basis, and it is anticipated that Shell will now be able to buy-back A shares again.
As a result of the Programme cancellation, no scrip dividend will be offered for Shell’s second quarter 2014 interim dividend, to be announced on 31 July 2014. The first quarter 2014 Interim Dividend, payable on 26 June 2014, is not affected and provides eligible shareholders with a choice to receive that dividend in cash or in shares via the Programme.
Eligible shareholders who have previously elected to receive new shares under the Programme will automatically receive dividends in cash from the second quarter 2014 Interim Dividend onwards. Shareholders are reminded that cash dividends on A shares and B shares will be paid in Euro and Pound Sterling respectively, unless shareholders elect to receive the alternative currency.
