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(Alliance News) - Royal Dutch Shell PLC, one of the world's largest oil and gas producers, on Thursday promised to become net carbon neutral by 2050 at the latest.
The Anglo-Dutch major said its ambition is to be net zero on all the emissions from the manufacture of all its products by 2050 at the latest. It said it was accelerating its net carbon footprint ambition to be in line with the Paris Agreement on Climate Change's aim to limit the world's average temperature rise to 1.5 degrees Celsius.
Shell also said it will "pivot towards serving businesses and sectors that by 2050 are also net-zero emissions".
"With the COVID-19 pandemic having a serious impact on people's health and our economies, these are extraordinary times. Yet even at this time of immediate challenge, we must also maintain the focus on the long term," said Chief Executive Officer Ben van Beurden.
"Society's expectations have shifted quickly in the debate around climate change. Shell now needs to go further with our own ambitions."
Shell 'A' shares were up 1.4% early Thursday in London.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.9% at 5,645.49
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Hang Seng: down 0.4% at 24,057.36
Nikkei 225: closed down 1.3% at 19,290.20
DJIA: closed down 445.41 points, 1.9%, at 23,504.35
S&P 500: closed down 2.2% at 2,783.36
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GBP: firm at USD1.2513 (USD1.2493)
EUR: flat at USD1.0904 (USD1.0903)
Gold: firm at USD1,722.47 per ounce (USD1,720.22)
Oil (Brent): firm at USD27.90 a barrel (USD27.68)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday's Key Economic Events still to come
0930 BST UK Bank of England publishes quarterly Bank Liabilities Survey
0930 BST UK BoE Credit Conditions Survey
1100 CEST EU industrial production
0830 EDT US initial jobless claims
1030 EDT US EIA weekly natural gas storage report
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The coronavirus lockdown in the UK will be extended for another three weeks, the government is expected to announce amid renewed warnings that it is still too soon to start easing the restrictions. Ministers will meet on Thursday morning to agree to prolong the social distancing controls announced on March 23, amid signs the epidemic in the UK is beginning to peak. The Cabinet meeting comes after the number of people who have died in hospital after testing positive for Covid-19 reached almost 13,000, with growing concern over increasing deaths in care homes. Downing Street said the three-week review of the lockdown regulations will go ahead as planned in line with the coronavirus legislation. However, ministers and officials have repeatedly made clear there is no prospect of any imminent relaxation. According to the latest figures, 12,868 patients have died in hospital after testing positive for coronavirus in the UK as of 5pm on Tuesday, up by 761 from the previous day. However, England's chief medical officer, Chris Whitty, warned of a possible "bounce" in the numbers when the next set of figures are released due to delays in reporting deaths over the Easter weekend.
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Retail sales in the UK fell at their fastest pace on record in March, during what was a month of contrasts in consumer behaviour. According to the British Retail Consortium-KPMG monitor, sales plummeted by 4.3% annually in March, against a decrease of 1.8% in March 2019. In February, sales had climbed 0.1% year-on-year. "This is the worst decline recorded since our monitor began in January 1995, excluding distortions," BRC said. March was when the UK government implemented a lockdown in a bid to halt the spread of Covid-19. Before the March 23 lockdown, retail sales had climbed 12% as shoppers in the UK stockpiled in fear of future shortages due to the pandemic. After the lockdown measures were introduced, sales slumped 27% year-on-year. BRC Chief Executive Helen Dickinson said: "The closure of non-essential shops led to deserted high streets and high double-digit declines in sales which even a rise in online shopping could not compensate for." Online Non-Food sales surged by 19% annually in March, compared to growth of 2.5% in the year prior.
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US President Donald Trump vowed to unveil plans to reopen the world's top economy, following cautious moves in Europe, claiming the US had "passed the peak" of the coronavirus crisis despite a record daily death toll. The global death toll has topped 133,000 with more than two million infected, according to an AFP tally – with nearly 2,600 dying in the past 24 hours in the US alone. But a bullish Trump told reporters his "aggressive strategy" against the virus was working and that "the data suggests that nationwide we have passed the peak on new cases". He promised swift "guidelines" on reopening parts of the country, suggesting less-affected states could ease restrictions before May 1.
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German's consumer price inflation rate in March was in line with provisional estimates, according to figures released by Destatis. Germany's consumer price index rose 1.4% year-on-year in March, compared to 1.7% growth both in January and February. On a monthly basis, inflation was 0.1% higher. Both March figures were unchanged from provisional estimates. The prices of goods were up 1.3% year-on-year in March, which was a slower-than-average pace, Destatis said. This was mainly due to a decrease of energy product prices by 0.9%.
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BROKER RATING CHANGES
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BARCLAYS RAISES RBS TO 'EQUAL WEIGHT' ('UNDERWEIGHT') - TARGET 130 (190) PENCE
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UBS RAISES AUTO TRADER GROUP TO 'BUY' ('NEUTRAL') - TARGET 510 (560) PENCE
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JEFFERIES CUTS HIKMA PHARMACEUTICALS TO 'HOLD' ('BUY') - TARGET 2325 (2390) PENCE
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COMPANIES - FTSE 100
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easyJet said its first-half performance was strong prior to Covid-19 disruption, with the airline anticipating a narrowed interim loss. The low-cost airline said it expects to post a headline pretax loss between GBP185 million to GBP205 million for the six months to March 31, which would be improved on a loss of GBP275 million a year ago. easyJet's fleet was fully grounded on March 30. Revenue for the period was up 1.6% to GBP2.38 billion, with seat capacity down 7.6%. Airline revenue per seat at constant currency is expected to have increased by 10%, continuing the strong momentum seen in the first quarter. There can be no certainty as to when commercial flights will restart. easyJet said it is working through different demand scenarios for re-starting flying, which could be done with as little as two weeks' notice. Amid a tussle with easyJet's founder and biggest shareholder Stelios Haji-Ioannou regarding a multiple plane purchase from Airbus, easyJet noted that it has no ability to terminate its contract by force majeure and the level of direct OEM support for the operation of its existing fleet would "increase in cost significantly" if it did attempt to cancel the deal. Given continued uncertainty, easyJet said it is not possible to provide guidance for the remainder of its financial year. "However we continue to take every step necessary to reduce cost, conserve cash burn, enhance liquidity, protect the business and ensure it is best positioned for a return to flying," said easyJet.
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Events and publishing firm Informa noted the Covid-19 pandemic has become "progressively deeper and more far-reaching" than first predicted. The impact on its events-related business has "intensified significantly" since the initial disruption early in the first quarter in mainland China, with no events of any scale scheduled to take place in April. This reduced level of activity is now expected to stretch through the second quarter and much of the third quarter, with a gradual and phased recovery from the third quarter into the final three months of the year. The "anchor" of the group remains "the resilient and predictable" subscriptions-related businesses, which has continued to grow well. In order to help Informa weather Covid-19, it has decided to temporarily suspend dividend payments, has completed its application for eligibility to issue commercial paper under the Bank of England's Covid Corporate Finance Facility, and is launching a share placing of up to 19.9% of new equity.
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Barratt Developments reiterated that all financial guidance has been suspended due to Covid-19. Between March 23 and April 12, the housebuilder delivered 1,349 home completions. Its total forward sales are 12,376 homes, worth GBP2.89 billion. "Our experienced board remains focused on taking the right actions and planning for the future, so that when appropriate to do so, we can re-start our sales centres, construction sites and offices safely and are well-placed to continue to deliver the high quality homes the country needs," said Barratt.
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Pest control firm Rentokil Initial reported a 4.4% rise in revenue to GBP634.1 million in the first quarter to March 31, with ongoing revenue up 5.8%. The same figures were up 5.8% and 7.2%, respectively, at constant exchange rates. It said it Pest Control and Hygiene services both have been designated as essential services during the Covid-19 lockdowns, but Hygiene is suffering from customers closing their own businesses.
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COMPANIES - FTSE 250
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Ashmore said assets under management declined in the third quarter. The emerging markets-focused asset manager said assets under management fell 22% to USD76.8 billion at the end of March from USD98.4 billion at the end of 2019. This reflected a negative investment performance of USD18.0 billion and net outflows of USD3.6 billion. "Investment performance was negative in all investment themes as a result of the sharp, severe fall in global markets from mid-February. As investors sought to raise dollar liquidity by the widespread selling of risk assets, including in Emerging Markets, Ashmore's value-based strategies underperformed their benchmarks," Ashmore explained.
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Homewares and soft furnishings retailer Dunelm said its online business is now fully operational, and it has received confirmation from the Bank of England that it is eligible to access funding under the Covid Corporate Financing Facility. After a phased restart of its online business, it is now fully operational and Dunelm said it has been able to serve a "high level" of customer demand. Recent online order levels have been "significantly higher" than those seen prior to Covid-19. Its physical stores remain closed, in line with government guidance. In preparation for re-opening, Dunelm is working on changes to store operations that will help ensure employee and customer safety. On its financial position, Dunelm said it is eligible to access funding under the Covid Corporate Financing Facility. "The board is confident that the group has access to sufficient liquidity, even in the event of a prolonged store closure period. Currently, we would only anticipate the need to issue paper under the CCFF scheme in the event that our stores remain closed for a period greater than six months," Dunelm said.
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COMPANIES - INTERNATIONAL
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Vinci reported a reduction in air traffic in each month of the first quarter of 2020 amid coronavirus. The Paris-headquartered company develops, finances, builds and provides everyday operation of 45 airports worldwide. It said passenger numbers at its airports fell by 5.0% in February - after a robust performance in January, with 2.1% growth - due to reduced demand in Asia. Things got much worse in March, with traffic down 56%, Vinci said, amid the introduction of travel restrictions in many countries in order to limit the spread of the Covid-19 pandemic. The same trend is being seen at the beginning of April, the company said. Overall, the number of passengers fell by 21% in the first quarter of 2020, with a total of 45.3 million passengers handled at the 45 airports in the Vinci's network.
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Thursday's Shareholder Meetings
Verona Pharma
China New Energy
African Oil & Gas
Global Ports Holdings
Simigon
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By Tom Waite; thomaslwaite@alliancenews.com
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