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Shell New Zealand Profit Up

Shell New Zealand Profit Up: Triple Bottom Line Reporting The Way Of The Future

In launching its inaugural Triple Bottom Line report , the Shell New Zealand group of companies announced a profit of $178.3 million for the 2000 year (1999: $146.1 million), which represented a 17.4% return on its New Zealand assets. At the same time, Shell also made public the extent of its significant activities and performance during the year in the areas of Social and Environmental responsibility. Taken together, the Shell Review 2000 strives to demonstrate Shell New Zealand’s commitment to living its Sustainable Development aspirations, Shell New Zealand Chairman Ed Johnson said.

“Shell’s overall excellent financial result was due in large part to the Company’s diversified portfolio of interests in New Zealand, unique in the Industry. Shell’s current investments include Upstream Oil and Gas, Chemicals, Forestry and equity investments in a range of other companies from Road Construction to Fast Food, in addition to its more easily identified petrol station network,” Mr Johnson said.
Shell’s combined Retail and Commercial Oil Products (OP) businesses had a difficult year in 2000, reflecting the fiercely competitive local marketplace for fuels coupled with the large oil and product price rises it experienced over the year. OP produced a net profit of $62.4 million in 2000 (1999: $64.1 million), a sluggish 8.2% return on assets.
“While this OP result was disappointing, it was not unexpected, and Shell has been able to maintain market leadership on the Retail side of the business through proactive fuel discounting and special promotions to ensure Shell’s customers are offered the most competitive prices possible.”

Mr Johnson said however, that those higher international prices for oil and gas coupled with increased volume demand for its products accounted for an excellent performance by Shell’s Exploration and Production (E&P) side of the business. E&P contributed a profit of $113.8 million (1999: $78.1 million).

“This E&P result also reflects the fact that Shell New Zealand is now the country’s largest and most efficient producer and marketer of oil and gas.

“With the Fletcher Challenge Energy (FCE) acquisition now completed, Shell’s E& P business is set for a further boost and we expect E & P‘s future performance to be even better as planned new investment progressively comes into production.

This year’s Triple Bottom Line report also includes big strides made in the other important aspects of Shell’s local activities.

“Shell has continued to play a leading role in the New Zealand community in a variety of ways. We have added considerable value to the New Zealand economy and community, with $21.7 million paid in employee remuneration, $409.5 million collected by the Government in taxes and levies and a further $53.2 million retained by the Company for asset replacement - all money that goes back into the local economy,” Mr Johnson said.

“As well Shell has continued to be a major sponsor of both the World Wide Fund for Nature (WWF) and Barnardo’s amongst many others, along with championing several sustainable development projects, as part of Shell’s commitment to searching for renewable energy resources and further promoting sustainable development.

“Shell is committed to Triple Bottom Line reporting. We are not just interested in making a profit, although that is critically important for today and the future. We also have a committed focus on valuing people and our planet on an equal footing with the financial wealth we create as a New Zealand commercial enterprise.

“Shell intends to have future Shell Review’s independently audited to ensure that we are meeting the objectives of triple bottom line reporting, as well as the principles and values under which Shell operates. These core business principles are honesty, integrity and respect for people. Shell New Zealand embraces these principles and applies them in all areas of our business operations,” Mr Johnson said.

ENDS

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