Donate to Remove ads

Got a credit card? use our Credit Card & Finance Calculators

Thanks to Bhoddhisatva,scotia,Anonymous,Cornytiv34,Anonymous, for Donating to support the site

BP and Shell

General discussions about equity high-yield income strategies
ADrunkenMarcus
Lemon Quarter
Posts: 1583
Joined: November 5th, 2016, 11:16 am
Has thanked: 672 times
Been thanked: 478 times

BP and Shell

#473516

Postby ADrunkenMarcus » January 16th, 2022, 1:37 pm

Afternoon all,

I was reading:https://www.common-wealth.co.uk/reports/drilling-down#chapter-2 There is obviously a political argument behind the paper, so interpretations of their conclusions will vary! However they do present some data for FTSE 100 averages, as well as BP and Shell, for 2010-20.

The appendix includes FTSE 100 data (total 2010-20) which shows an average £15.9 billion in pre-tax income, of which: £5 billion went in income taxes; £8.2 billion in dividends; and £2.6 billion in share buybacks.

BP data on the same basis has an average £52 billion in pre-tax income, of which £20.2 billion went in income taxes; £42.6 billion in dividends; and £8.5 billion in share buybacks.

Shell data has £173.4 billion in pre-tax income, of which £74.7 billion went in income taxes; £76.7 billion on dividends; and £19.4 billion in share buybacks.

The extent to which individual companies are paying a large proportion of their income as dividends (or more than their income as dividends) is a key consideration for dividend sustainability. Are they able to sustain dividend payments if they are devoting a smaller proportion of their income to investing in future growth?

Disclosure: Held Shell 1998-2010; held BP 1998-2015.

Best wishes


Mark.

Wasron
2 Lemon pips
Posts: 218
Joined: November 4th, 2016, 5:03 pm
Has thanked: 171 times
Been thanked: 119 times

Re: BP and Shell

#473551

Postby Wasron » January 16th, 2022, 4:37 pm

I have sold both this year.

I still have 10 years to retirement and have redirected the funds into holdings that might provide more growth, rather than slowly pay me back my capital.

Investing in electric charging points is interesting, but not enough for me to continue holding.

As an aside (and probably OT for this board), Halma popped up this week on one of my share screens for the first time in a long while…

Wasron

monabri
Lemon Half
Posts: 8370
Joined: January 7th, 2017, 9:56 am
Has thanked: 1535 times
Been thanked: 3411 times

Re: BP and Shell

#473594

Postby monabri » January 16th, 2022, 6:13 pm

ADrunkenMarcus wrote:
Are they able to sustain dividend payments if they are devoting a smaller proportion of their income to investing in future growth?

Mark.



I've not read the report but how much is the recent(-ish) dividend payout reduction discussed? (ditto BP). In the case of RDSB divi cut from 188cents to 65cents per share.

Charlottesquare
Lemon Quarter
Posts: 1769
Joined: November 4th, 2016, 3:22 pm
Has thanked: 104 times
Been thanked: 560 times

Re: BP and Shell

#481895

Postby Charlottesquare » February 21st, 2022, 3:35 pm

monabri wrote:
ADrunkenMarcus wrote:
Are they able to sustain dividend payments if they are devoting a smaller proportion of their income to investing in future growth?

Mark.



I've not read the report but how much is the recent(-ish) dividend payout reduction discussed? (ditto BP). In the case of RDSB divi cut from 188cents to 65cents per share.


Is it not 89cents, have you missed the fourth quarter, payable in March 2022?

17.35,24,24,24

monabri
Lemon Half
Posts: 8370
Joined: January 7th, 2017, 9:56 am
Has thanked: 1535 times
Been thanked: 3411 times

Re: BP and Shell

#481899

Postby monabri » February 21st, 2022, 4:05 pm

Charlottesquare wrote:
monabri wrote:
ADrunkenMarcus wrote:
Are they able to sustain dividend payments if they are devoting a smaller proportion of their income to investing in future growth?

Mark.



I've not read the report but how much is the recent(-ish) dividend payout reduction discussed? (ditto BP). In the case of RDSB divi cut from 188cents to 65cents per share.


Is it not 89cents, have you missed the fourth quarter, payable in March 2022?

17.35,24,24,24


I believe that the first cut ( the deepest?) was from 188cents to 65.3cents it has been increased a little since then to the figures you mention.

Source dividenddata.co.uk

Image

Charlottesquare
Lemon Quarter
Posts: 1769
Joined: November 4th, 2016, 3:22 pm
Has thanked: 104 times
Been thanked: 560 times

Re: BP and Shell

#481903

Postby Charlottesquare » February 21st, 2022, 4:33 pm

monabri wrote:
Charlottesquare wrote:
monabri wrote:
ADrunkenMarcus wrote:
Are they able to sustain dividend payments if they are devoting a smaller proportion of their income to investing in future growth?

Mark.



I've not read the report but how much is the recent(-ish) dividend payout reduction discussed? (ditto BP). In the case of RDSB divi cut from 188cents to 65cents per share.


Is it not 89cents, have you missed the fourth quarter, payable in March 2022?

17.35,24,24,24


I believe that the first cut ( the deepest?) was from 188cents to 65.3cents it has been increased a little since then to the figures you mention.

Source dividenddata.co.uk

Image


Given their use of cashflow re , capex, debt and share buy backs, whilst cutting from 188 to 89 (with I think 4% growth anticipated) is not great for the dividend hunter it longer term could be far better for the shareholder.

When I got out of shares into investment trusts I sold Shell, in fact the only share I continued to own was Berkshire, however in recent months I have been rebuying Shell on the basis that I suspect its rebased dividends will flow for the rest of my life and with its capex it has a fair chance of morphing into an energy provider for the second half of the 21st century. (Of course I will likely not be here to see if it succeeds)

Charlottesquare
Lemon Quarter
Posts: 1769
Joined: November 4th, 2016, 3:22 pm
Has thanked: 104 times
Been thanked: 560 times

Re: BP and Shell

#481908

Postby Charlottesquare » February 21st, 2022, 5:01 pm

"We also expect to increase our dividend by around 4% for Q1 2022, bringing our quarterly dividend
to $25 US cents per share"

Effectively that means $1.00 per year from April onward.


https://www.shell.com/investors/results ... script.pdf


Return to “High Yield Shares & Strategies - General”

Who is online

Users browsing this forum: No registered users and 5 guests