Quarter Analysis1

Income attributable to Shell plc shareholders was driven by the same factors as Adjusted Earnings and includes the impact of identified items and a current cost of supplies adjustment of $1.2 billion.

Adjusted Earnings, compared with the fourth quarter 2025, reflected higher contributions from trading and optimisation mainly impacting our Downstream, Renewables and Energy Solutions businesses, higher realised prices, higher refining margins, lower operating expenses and higher Lubricants margins, partly offset by lower volumes.

Identified items in the first quarter 2026 amounted to a net loss of $2.4 billion and included unfavourable movements due to the fair value accounting of commodity derivatives. This compares with identified items in the fourth quarter 2025 which amounted to a net gain of $1.2 billion.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was $6.1 billion, and primarily driven by Adjusted EBITDA, the non-cash cost of supplies adjustment of $1.7 billion (before tax) and net cash inflows related to the timing impact of payments for emission certificates and biofuel programmes of $1.3 billion. These were partly offset by working capital outflows of $11.2 billion and tax payments of $2.3 billion. The working capital outflows mainly reflected the impact of commodity prices on inventory and accounts receivables.

Cash flow from investing activities for the first quarter 2026 was an outflow of $3.1 billion, and included cash capital expenditure of $4.2 billion, partly offset by interest received of $0.4 billion and divestment proceeds of $0.4 billion.

Net debt and Gearing: At the end of the first quarter 2026, net debt was $52.6 billion, compared with $45.7 billion at the end of the fourth quarter 2025. This reflects free cash flow of $2.9 billion, more than offset by lease liability increases of $3.9 billion2, share buybacks of $3.2 billion, cash dividends paid to Shell plc shareholders of $2.1 billion and interest payments of $1.0 billion. Gearing was 23.2% at the end of the first quarter 2026, compared with 20.7% at the end of the fourth quarter 2025, mainly driven by higher net debt.

Shareholder distributions: Total shareholder distributions in the quarter amounted to $5.3 billion, comprising repurchases of shares of $3.2 billion and cash dividends paid to Shell plc shareholders of $2.1 billion. Dividends declared to Shell plc shareholders for the first quarter 2026 amount to $0.3906 per share. Shell has now completed the $3.5 billion of share buybacks announced in the fourth quarter 2025 results announcement. Today, Shell announces a share buyback programme of $3.0 billion which is expected to be completed by the second quarter 2026 results announcement.3

This Unaudited Condensed Financial Report, together with supplementary financial and operational disclosure for this quarter, is available at www.shell.com/investors 4 .

1.All earnings amounts are shown post-tax, unless stated otherwise.

2.Includes a non-cash increase of $3.2 billion in the variable component of shipping leases in the current macro environment. See Note 7 “Other notes to the unaudited Condensed Consolidated Interim Financial Statements” for further details.

3.Given the securities law requirements that apply to Shell plc in connection with its agreement to acquire ARC Resources Ltd. (“ARC”), it will be necessary to suspend the programme from the time of publication of the ARC shareholder circular until the conclusion of the ARC shareholder meeting. Any buybacks not undertaken due to such suspension will be part of the remaining 2026 programmes (subject to Board approval).

4.Not incorporated by reference.

PORTFOLIO DEVELOPMENTS

Integrated Gas

In April 2026, we entered into a definitive agreement to acquire ARC Resources Ltd. (“ARC”), an energy company focused on the Montney shale basin in British Columbia and Alberta, Canada. Under the terms of the agreement, ARC’s shareholders will receive CAD 8.20 in cash and 0.40247 ordinary shares of Shell plc for each ARC share, resulting in an equity value of approximately USD 13.6 billion.1 The boards of both companies have unanimously supported the transaction, which is expected to close in the second half of 2026, subject to ARC shareholder, court and regulatory approvals.

Marketing

In March 2026, we entered into an agreement to sell Jiffy Lube International to an affiliate of Monomoy Capital Partners (Monomoy) for $1.3 billion. As part of the agreement, we entered into a long-term lubricants supply agreement with Monomoy. The transaction is subject to regulatory approvals and closing conditions, and is expected to close in the second half of 2026.

1. Based on Shell’s closing share price at April 24, 2026 of GBP 33.08 and GBP:CAD exchange ratio of 1.8480.

 

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PERFORMANCE BY SEGMENT

Integrated Gas includes natural gas and liquids exploration and extraction. The gas is then processed to produce liquefied natural gas (LNG) or converted into gas-to-liquids (GTL) fuels and other products. The business includes the operation of both upstream and midstream infrastructure necessary to deliver natural gas and its derivatives to market. Integrated Gas also includes the marketing, trading and optimisation of LNG.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items.

Adjusted Earnings, compared with the fourth quarter 2025, reflected the higher realised prices mainly from liquid products (increase of $263 million), partly offset by lower volumes (decrease of $131 million). Trading and optimisation results were in line with the fourth quarter 2025.

Identified items in the first quarter 2026 included unfavourable movements of $634 million due to the fair value accounting of commodity derivatives and gains of $133 million from the sale of assets. These unfavourable movements and gains compare with the fourth quarter 2025 which included favourable movements of $225 million due to the fair value accounting of commodity derivatives. As part of Shell's normal business, commodity derivative contracts are entered into as hedges for mitigation of economic exposures on future purchases, sales and inventory.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was primarily driven by Adjusted EBITDA, partly offset by working capital outflows of $1,121 million, net cash outflows related to derivatives of $819 million, tax payments of $722 million, and a payment relating to a legal case of $635 million.

Total oil and gas production, compared with the fourth quarter 2025, decreased by 4% mainly due to the impact of the Middle East conflict on Qatari volumes. LNG liquefaction volumes increased by 1% mainly due to LNG Canada ramp-up, partly offset by unfavourable weather in Australia.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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Upstream explores for and extracts crude oil, natural gas and natural gas liquids. The segment also includes marketing and transportation of oil, gas and liquids, supported by the infrastructure required to deliver them to market or to process them within Shell's chemicals manufacturing plants and refineries. Upstream activities span deep-water and conventional oil and gas operations.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items.

Adjusted Earnings, compared with the fourth quarter 2025, reflected higher realised prices (increase of $1,149 million) and lower exploration expenses (decrease of $124 million), partly offset by unfavourable tax movements ($183 million) and lower volumes (decrease of $121 million).

Identified items in the first quarter 2026 included gains of $184 million related to the impact of inflationary adjustments in Argentinian peso on a deferred tax position and gains of $88 million related to the impact of the strengthening Brazilian real on a deferred tax position. These gains compare with the fourth quarter 2025 which included gains on the disposal of assets of $2,282 million, mainly related to the incorporation of the Adura joint venture in the UK.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was primarily driven by Adjusted EBITDA, partly offset by working capital outflows of $2,316 million and tax payments of $1,492 million.

Total production, compared with the fourth quarter 2025, decreased mainly due to the impact of the incorporation of the Adura joint venture.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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Marketing includes Mobility, Lubricants, and Sectors and Decarbonisation. Mobility operates our retail network, including electric vehicle charging, convenience retail, and the Wholesale Commercial Fuels business for transport and industry. Lubricants produces, markets and sells products for road transport and machinery in manufacturing, mining, power generation, agriculture and construction. Sectors and Decarbonisation supplies fuels, speciality products and services, including low-carbon energy solutions such as biofuels, to a broad range of commercial customers, including in the aviation, marine and agriculture sectors.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items and a current cost of supplies adjustment of $709 million.

Adjusted Earnings, compared with the fourth quarter 2025, reflected higher Marketing margins (increase of $478 million) and lower operating expenses (decrease of $171 million). Higher margins were supported by trading and optimisation as well as higher Lubricants margins resulting from seasonally higher volumes and improved unit margins. These favourable movements in margins were partly offset by seasonally lower volumes and lower unit margins in Mobility and higher losses in a joint venture.

Identified items in the first quarter 2026 included net impairment charges and reversals of $182 million and favourable movements of $73 million due to the fair value accounting of commodity derivatives. As part of Shell's normal business, commodity derivative contracts are entered into as hedges for mitigation of economic exposures on future purchases, sales and inventory. These net charges and favourable movements compare with the fourth quarter 2025 which included impairment charges of $527 million.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was primarily driven by Adjusted EBITDA, the non-cash cost of supplies adjustment of $950 million (before tax), net inflows related to the timing impact of emission certificates and biofuel programmes of $653 million and dividends (net of share of losses) from joint ventures and associates of $493 million. These were partly offset by working capital outflows of $1,748 million.

Marketing sales volumes (comprising hydrocarbon sales), compared with the fourth quarter 2025, decreased mainly due to seasonality.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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The Chemicals and Products segment includes chemicals manufacturing plants with their own marketing network; and refineries, which turn crude oil and other feedstocks into a range of oil products that are moved and marketed around the world for domestic, industrial and transport use. The segment also includes the pipeline business, and trading and optimisation of crude oil, oil products and petrochemicals.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items and a current cost of supplies adjustment of $557 million.

Adjusted Earnings, compared with the fourth quarter 2025, reflected higher Products margins (increase of $1,523 million), mainly driven by higher contributions from trading and optimisation and higher refining margins. Adjusted Earnings also reflected higher Chemicals margins (increase of $211 million) and lower operating expenses (decrease of $197 million).

In the first quarter 2026, Chemicals had negative Adjusted Earnings of $117 million and Products had positive Adjusted Earnings of $2,042 million.

Identified items in the first quarter 2026 included unfavourable movements of $2,016 million due to the fair value accounting of commodity derivatives that, as part of Shell's normal business, are entered into as hedges for mitigation of economic exposures on future purchases, sales and inventory. These unfavourable movements compare with the fourth quarter 2025, which included impairment charges of $187 million and net losses from the disposal of assets of $127 million.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was primarily driven by working capital outflows of $5,646 million and outflows related to derivatives of $1,887 million. These were partly offset by Adjusted EBITDA, the non-cash cost of supplies adjustment of $763 million (before tax) and net inflows related to the timing impact of payments for emission certificates and biofuel programmes of $600 million.

Refinery utilisation was 99% compared with 95% in the fourth quarter 2025, mainly due to lower maintenance activities in the first quarter 2026.

Chemicals manufacturing plant utilisation was 85% compared with 76% in the fourth quarter 2025, mainly due to lower planned and unplanned maintenance activities in the first quarter 2026.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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1.Physical power sales to third parties; excluding financial trades and physical trade with brokers, investors, financial institutions, trading platforms, and wholesale traders.

2.Physical natural gas sales to third parties; excluding financial trades and physical trade with brokers, investors, financial institutions, trading platforms, and wholesale traders. Excluding sales of natural gas by other segments and LNG sales.

Renewables and Energy Solutions encompasses renewable power generation, marketing, trading, and optimisation of power and pipeline gas. It also includes hydrogen production, commercial carbon capture and storage (CCS) hubs and carbon credits. The business invests in nature-based projects that compensate for carbon emissions and Shell Ventures, which invests in or works with start-ups and other early-stage businesses to help them scale up and grow.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items.

Adjusted Earnings, compared with the fourth quarter 2025, reflected higher margins (increase of $225 million), mainly due to higher trading and optimisation margins.

Most Renewables and Energy Solutions activities were loss-making in the first quarter 2026, these were more than offset by positive Adjusted Earnings from trading and optimisation and energy marketing.

Identified items in the first quarter 2026 included favourable movements of $189 million due to the fair value accounting of commodity derivatives. As part of Shell's normal business, commodity derivative contracts are entered into as hedges for mitigation of economic exposures on future purchases, sales and inventory. These favourable movements compare with the fourth quarter 2025 which included net impairment charges of $156 million.

Adjusted EBITDA was driven by the same factors as Adjusted Earnings.

Cash flow from operating activities for the first quarter 2026 was primarily driven by net cash inflows related to derivatives of $2,358 million and Adjusted EBITDA.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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The Corporate segment covers the non-operating activities supporting Shell. It comprises Shell’s holdings and treasury organisation, headquarters and central functions, self-insurance activities and centrally managed longer-term innovation portfolio. All finance expense, income and related taxes are included in Corporate segment earnings rather than in the earnings of business segments.

Quarter Analysis1

Income/(loss) for the period was driven by the same factors as Adjusted Earnings and includes the impact of identified items.

Adjusted Earnings, compared with the fourth quarter 2025, reflected unfavourable net interest movements ($287 million) and unfavourable tax movements ($176 million), partly offset by lower operating expenses (decrease of $80 million) and favourable foreign exchange rate effects ($42 million).

Adjusted EBITDA was mainly driven by lower operating expenses and favourable foreign exchange rate effects.

Cash flow from operating activities for the first quarter 2026 was primarily driven by working capital outflows of $287 million and Adjusted EBITDA.

1.All earnings amounts are shown post-tax, unless stated otherwise.

 

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OUTLOOK FOR THE SECOND QUARTER 2026

Full year 2025 cash capital expenditure was $21 billion. Our cash capital expenditure for the full year 2026 is expected to be $24 - $26 billion, including ~$4 billion related to the acquisition of ARC Resources Ltd.

Integrated Gas production is expected to be approximately 580 - 640 thousand boe/d. LNG liquefaction volumes are expected to be approximately 6.8 - 7.4 million tonnes. Second quarter 2026 outlook reflects impact of Middle East conflict including Qatar and higher planned maintenance across the portfolio.

Upstream production is expected to be approximately 1,620 - 1,820 thousand boe/d. Second quarter 2026 outlook reflects higher planned maintenance across the portfolio.

Marketing sales volumes are expected to be approximately 2,500 - 2,700 thousand b/d.

Refinery utilisation is expected to be approximately 91% - 99%. Chemicals manufacturing plant utilisation is expected to be approximately 76% - 84%.

Corporate Adjusted Earnings1 were a net expense of $908 million for the first quarter 2026. Corporate Adjusted Earnings are expected to be a net expense of approximately $600 - $800 million in the second quarter 2026.

1.For the definition of Adjusted Earnings and the most comparable GAAP measure please see Reference A.

FORTHCOMING EVENTS

 

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UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1.See Note 2 “Segment information”.

2.See Note 7 “Other notes to the unaudited Condensed Consolidated Interim Financial Statements”.

3.See Note 3 “Earnings per share”.

 

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1. See Note 7 “Other notes to the unaudited Condensed Consolidated Interim Financial Statements”.

 

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1.    See Note 6 “Derivative financial instruments and debt excluding lease liabilities”.

2.    See Note 7 “Other notes to the unaudited Condensed Consolidated Interim Financial Statements”.

 

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1.    See Note 4 “Share capital”.

2.    See Note 5 “Other reserves”.

3.    The amount charged to retained earnings is based on prevailing exchange rates on payment date.

4. Includes shares committed to repurchase under an irrevocable contract and repurchases subject to settlement at the end of the quarter.

 

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1.See Note 7 “Other notes to the unaudited Condensed Consolidated Interim Financial Statements”.

 

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NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. Basis of preparation

These unaudited Condensed Consolidated Interim Financial Statements of Shell plc (“the Company”) and its subsidiaries (collectively referred to as “Shell”) have been prepared in accordance with IAS 34 Interim Financial Reporting as issued

by the International Accounting Standards Board ("IASB") and adopted by the UK, and on the basis of the same accounting principles as those used in the Company's Annual Report and Accounts (pages 229 to 306) for the year ended December 31, 2025, as filed with the Registrar of Companies for England and Wales and as filed with the Autoriteit Financiële Markten (the Netherlands) and Form 20-F (pages 214 to 290) for the year ended December 31, 2025, as filed with the US Securities and Exchange Commission, and should be read in conjunction with these filings.

The financial information presented in the unaudited Condensed Consolidated Interim Financial Statements does not constitute statutory accounts within the meaning of section 434(3) of the Companies Act 2006 (“the Act”). Statutory accounts for the year ended December 31, 2025, were published in Shell's Annual Report and Accounts, a copy of which was delivered to the Registrar of Companies for England and Wales, and in Shell's Form 20-F. The auditor's report on those accounts was unqualified, did not include a reference to any matters to which the auditor 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 Act.

Key accounting considerations, significant judgements and estimates

Future long-term commodity price assumptions, which represent a significant estimate, remained unchanged in the first quarter 2026 (see Note 7). Noting continued volatility in markets, price assumptions remain under review.

The discount rates applied for impairment testing and the discount rate applied to provisions are reviewed on a regular basis. These discount rates applied in the first quarter 2026 remain unchanged compared with 2025.

2. Segment information

Segment earnings are presented on an Adjusted Earnings basis (Adjusted Earnings), which is the earnings measure used by the Chief Executive Officer, who serves as the Chief Operating Decision Maker, for the purposes of making decisions about allocating resources and assessing performance. This aligns with Shell's focus on performance, discipline and simplification.

The Adjusted Earnings measure is presented on a current cost of supplies (CCS) basis and aims to facilitate a comparative understanding of Shell's financial performance from period to period by removing the effects of oil price changes on inventory carrying amounts and removing the effects of identified items. Identified items are in some cases driven by external factors and may, either individually or collectively, hinder the comparative understanding of Shell's financial results from period to period.

ADJUSTED EARNINGS BY SEGMENT

 

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CASH CAPITAL EXPENDITURE BY SEGMENT

Cash capital expenditure is a measure used by the Chief Executive Officer for the purposes of making decisions about allocating resources and assessing performance.

 

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REVENUE BY SEGMENT

Third-party revenue includes revenue from sources other than from contracts with customers, which mainly comprises the impact of fair value accounting of commodity derivatives.

 

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Identified Items

The objective of identified items is to exclude material impacts1 on net income/loss arising from transactions which are typically outside the control of management and are unusual in nature (e.g., infrequent or non-recurring events) or that result in a misalignment between accounting and economic outcomes. Certain transactions that are generally excluded from underlying results within the industry may also be classified as identified items.

Identified items comprise divestment gains and losses, impairment losses and reversals, redundancy and restructuring, fair value accounting effects on commodity derivatives and certain gas contracts, the impact of exchange rate movements and inflationary adjustments on certain deferred tax balances, and other items.

1. For the purpose of identification of items in certain categories materiality thresholds are applied.

1.Fair value accounting of commodity derivatives and certain gas contracts: In the ordinary course of business, Shell enters into contracts to supply or purchase oil and gas products, as well as power and environmental products. Shell also enters into contracts for tolling, pipeline and storage capacity. Derivative contracts are entered into for mitigation of resulting economic exposures (generally price exposure) and these 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, as well as contracts for tolling, pipeline and storage capacity, are, by contrast, recognised when the transaction occurs; 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 contracts 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 are reported as identified items.

2.Other identified items represent other credits or charges that based on Shell management's assessment hinder the comparative understanding of Shell's financial results from period to period.

3.Impact of exchange rate movements and inflationary adjustments on tax balances represents the impact on tax balances of exchange rate movements and inflationary adjustments arising on: (a) the conversion to dollars of the local currency tax base of non-monetary assets and liabilities, as well as recognised tax losses (this primarily impacts the Integrated Gas and Upstream segments); and (b) the conversion of dollar-denominated inter-segment loans to local currency, leading to taxable exchange rate gains or losses (this primarily impacts the Corporate segment).

 

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1. For a detailed description, see the corresponding footnotes to the Q1 2026 identified items table above.

 

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1. For a detailed description, see the corresponding footnotes to the Q1 2026 identified items table above.

The categories of identified items may include after-tax effects of joint ventures and associates, which are fully reported within "Share of profit of joint ventures and associates" in the Consolidated Statement of Income, and are also fully reflected as identified items included within income/(loss) before taxation in the tables above. Identified items related to subsidiaries are consolidated and presented across appropriate lines of the Consolidated Statement of Income.

3. Earnings per share

 

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4. Share capital

At Shell plc’s Annual General Meeting on May 20, 2025, the Board was authorised to allot ordinary shares in Shell plc, and to grant rights to subscribe for, or to convert, any security into ordinary shares in Shell plc, up to an aggregate nominal amount of approximately €140 million (representing approximately 2,007 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 19, 2026, or the end of the Annual General Meeting to be held in 2026, unless previously renewed, revoked or varied by Shell plc in a general meeting.

5. Other reserves

The merger reserve and share premium reserve were established as a consequence of Shell plc (formerly Royal Dutch Shell plc) becoming the single parent company of Royal Dutch Petroleum Company and The “Shell” Transport and Trading Company, p.l.c., now The Shell Transport and Trading Company Limited, in 2005. The merger reserve increased in 2016 following the issuance of shares for the acquisition of BG Group plc. The capital redemption reserve was established in connection with repurchases of shares of Shell plc. The share plan reserve is in respect of equity-settled share-based compensation plans.

6. Derivative financial instruments and debt excluding lease liabilities

As disclosed in the Consolidated Financial Statements for the year ended December 31, 2025, presented in the Annual Report and Accounts and Form 20-F for that year, Shell is exposed to the risks of changes in fair value of its financial assets and liabilities. The fair values of the financial assets and liabilities are defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Methods and assumptions used to estimate the fair values at March 31, 2026, are consistent with those used in the year ended December 31, 2025, though the carrying amounts of derivative financial instruments have changed since that date. The movement of the derivative financial instruments between December 31, 2025 and March 31, 2026 is an increase of $1,972 million for the current assets and an increase of $4,660 million for the current liabilities.

 

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The table below provides the comparison of the fair value with the carrying amount of debt excluding lease liabilities, disclosed in accordance with IFRS 7 Financial Instruments: Disclosures.

1.    Shell issued no debt under the US shelf or under the Euro medium-term note programmes during the first quarter 2026.

2.     Mainly determined from the prices quoted for these securities.

7. Other notes to the unaudited Condensed Consolidated Interim Financial Statements

Consolidated Statement of Income

Interest and other income

Depreciation, depletion and amortisation

Depreciation

On March 18, 2026, an attack on Ras Laffan Industrial City (Qatar) damaged one of the two trains at the Pearl GTL facility, resulting in a limited write‑off recognised within depreciation in the first quarter 2026. It is currently anticipated that the full repair of the damaged train will take around one year.

Impairment

The ongoing conflict in the Middle East has resulted in production shutdowns and export constraints, and delivery under LNG supply contracts has been stopped following declaration of force majeure, due to the blockage of the Strait of Hormuz. No impairment has been identified as a result of these events. Since the start of the conflict, commodity prices and refining margins have been highly volatile; however, the long‑term price assumptions applied in impairment testing have remained unchanged since 2025 (see Note 1). Accordingly, no impairment or impairment reversal has been identified in the first quarter 2026.

 

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Taxation charge/credit

As required by IAS 12 Income Taxes, Shell has applied the exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes.

Consolidated Statement of Comprehensive Income

Currency translation differences

Condensed Consolidated Balance Sheet

Debt

Lease liabilities at March 31, 2026, and December 31, 2025, include vessel leases with index-linked payments. In accordance with IFRS 16, these lease liabilities are remeasured to reflect changes in the relevant index at the balance sheet date. During the first quarter 2026, a significant increase in the underlying index due to the Middle East conflict resulted in an increase in lease liabilities at March 31, 2026, compared with December 31, 2025, of $3,199 million, with a corresponding adjustment to the related right-of-use assets within Property, plant and equipment. Depreciation of the remeasurement of the right-of-use assets is recognised prospectively over the remaining lease term.

Assets classified as held for sale

Assets classified as held for sale and associated liabilities at March 31, 2026, principally relate to Jiffy Lube International and two retail operations in Mexico in Marketing and a working interest in Brazil in Upstream.

The major classes of assets and liabilities classified as held for sale at March 31, 2026, are Property, plant and equipment ($1,062 million; December 31, 2025: $662 million), Intangible assets ($569 million; December 31, 2025: $17 million), Trade and other receivables ($544 million: December 31, 2025: $141 million) and Debt ($788 million; December 31, 2025: $185 million).

 

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Consolidated Statement of Cash Flows

Cash flow from operating activities - Other

Cash flow from operating activities - Other for the first quarter 2026 includes $1,289 million of net inflows (fourth quarter 2025: $838 million net outflows; first quarter 2025: $652 million net inflows) due to the timing of payments relating to emission certificates and biofuel programmes in Europe and North America.

8. Reconciliation of Operating expenses and Total Debt

9. Post-balance sheet events

On April 27, 2026, Shell entered into a definitive agreement to acquire ARC Resources Ltd (“ARC”), an energy company focused on the Montney shale basin in British Columbia and Alberta, Canada. Under the terms of the agreement, ARC’s shareholders will receive CAD 8.20 in cash and 0.40247 ordinary shares of Shell plc for each ARC share, resulting in an equity value of approximately USD 13.6 billion, based on Shell’s closing share price at April 24, 2026 of GBP 33.08 and GBP:CAD exchange ratio of 1.8480. The boards of both companies have unanimously supported the transaction, which is expected to close in the second half of 2026, subject to ARC shareholder, court and regulatory approvals.

 

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ALTERNATIVE PERFORMANCE (NON-GAAP) MEASURES

A. Adjusted Earnings, Adjusted earnings before interest, taxes, depreciation and amortisation (“Adjusted EBITDA”) and Cash flow from operating activities

The “Adjusted Earnings” measure is presented on a current cost of supplies basis and aims to facilitate a comparative understanding of Shell’s financial performance from period to period by removing the effects of oil price changes on inventory carrying amounts and removing the effects of identified items. These items are in some cases driven by external factors and may, either individually or collectively, hinder the comparative understanding of Shell’s financial results from period to period. This measure excludes earnings attributable to non-controlling interest when presenting the total Shell Group result but includes this item when presenting individual segment Adjusted Earnings as set out in the table below.

See Note 2 “Segment information” for the reconciliation of Adjusted Earnings.

We define “Adjusted EBITDA” as “Income/(loss) for the period” adjusted for current cost of supplies; identified items; tax charge/(credit); depreciation, amortisation and depletion; exploration well write-offs and net interest expense. All items include the non-controlling interest component. Management uses this measure to evaluate Shell's performance in the period and over time.

 

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Identified items

The objective of identified items is to exclude material impacts1 on net income/loss arising from transactions which are typically outside the control of management and are unusual in nature (e.g., infrequent or non-recurring events) or that result in a misalignment between accounting and economic outcomes. Certain transactions that are generally excluded from underlying results within the industry may also be classified as identified items.

Identified items comprise divestment gains and losses, impairment losses and reversals, redundancy and restructuring, fair value accounting effects on commodity derivatives and certain gas contracts, the impact of exchange rate movements and inflationary adjustments on certain deferred tax balances, and other items.

See Note 2 “Segment information” for details.

1. For the purpose of identification of items in certain categories materiality thresholds are applied.

B. Adjusted Earnings per share

Adjusted Earnings per share is calculated as Adjusted Earnings (see Reference A), divided by the weighted average number of shares used as the basis for basic earnings per share (see Note 3).

C. Cash capital expenditure

Cash capital expenditure represents cash spent on maintaining and developing assets as well as on investments in the period. Management regularly monitors this measure as a key lever to delivering sustainable cash flows. Cash capital expenditure is the sum of the following lines from the Consolidated Statement of Cash Flows: Capital expenditure, Investments in joint ventures and associates and Investments in equity securities.

See Note 2 “Segment information” for the reconciliation of cash capital expenditure.

D. Capital employed and Return on average capital employed

Return on average capital employed ("ROACE") measures the efficiency of Shell’s utilisation of the capital that it employs.

The measure refers to Capital employed which consists of total equity, current debt, and non-current debt reduced by cash and cash equivalents.

 

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In this calculation, the sum of Adjusted Earnings (see Reference A) plus non-controlling interest (NCI) excluding identified items for the current and previous three quarters, adjusted for after-tax interest expense and after-tax interest income, is expressed as a percentage of the average capital employed excluding cash and cash equivalents for the same period.

E. Net debt and gearing

Net debt is defined as the sum of current and non-current debt, less cash and cash equivalents, adjusted for the fair value of derivative financial instruments used to hedge foreign exchange and interest rate risk relating to debt, and associated collateral balances. Management considers this adjustment useful because it reduces the volatility of net debt caused by fluctuations in foreign exchange and interest rates, and eliminates the potential impact of related collateral payments or receipts. Debt-related derivative financial instruments are a subset of the derivative financial instrument assets and liabilities presented on the balance sheet. Collateral balances are reported under “Trade and other receivables” or “Trade and other payables” as appropriate.

Gearing is a measure of Shell's capital structure and is defined as net debt (total debt less cash and cash equivalents) as a percentage of total capital (net debt plus total equity).

 

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F. Operating expenses and Underlying operating expenses

Operating expenses*

Operating expenses is a measure of Shell’s cost management performance, comprising the following items from the Consolidated Statement of Income: production and manufacturing expenses; selling, distribution and administrative expenses; and research and development expenses.