(CercleFinance.com) – Shell shares fell sharply on Monday morning on the London Stock Exchange following the announcement by the energy company of significant asset write-downs for the fourth quarter.
During an activity update published in the morning, the group declared that it planned to recognize charges for impairment losses of between 2.5 and 4.5 billion dollars in its results for the three last months of the year.
Shell explains that these provisions – which will have no impact on cash flow – are mainly attributable to macroeconomic and external developments, but also to portfolio choices, linked in particular to its petrochemical assets in Singapore.
In a reaction note, UBS analysts mention a ‘mixed’ publication revealing elements likely to weigh on cash flow (operating cash flow or ‘CFFO’), an indicator closely monitored by investors.
The energy giant has in fact specified that it plans a disbursement of around 900 million dollars over the quarter linked to the entry into force of the CO2 tax in Germany and the American standard program on biofuels.
Following these announcements, Shell shares lost 1.9% on Monday at the start of the session, showing the second biggest drop in the FTSE 100 index.
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