Transaction in Own Shares
- None.
- None.
Insights
Share buybacks, such as the one conducted by Shell plc, can be a signal of management's belief that the company's stock is undervalued. From a financial perspective, reducing the number of outstanding shares can improve earnings per share (EPS), as the same amount of earnings is distributed over a smaller share base. This can lead to a higher stock price, benefiting existing shareholders. However, it's important to consider the opportunity cost of such capital allocation decisions. The funds used for share repurchases could alternatively be invested in the business for growth or used to pay down debt, which might offer different returns. The impact of the buyback on Shell's financial metrics, such as its debt-to-equity ratio and return on equity, should be monitored to assess the long-term effects of this strategy.
The context of the share buyback within the energy sector is also noteworthy. As the industry faces transitions towards renewable energy and potential regulatory changes, Shell's decision to buy back shares might reflect a strategy to optimize capital structure and return value to shareholders amidst such transitions. It's also indicative of the company's current cash flow position and capital expenditure plans. Investors should consider how this buyback aligns with Shell's broader strategic initiatives, including investments in sustainable energy sources and how it positions the company against its peers in the evolving energy landscape.
The legal framework governing share buybacks is complex, especially for a company like Shell plc, which is subject to both EU and UK market regulations post-Brexit. Compliance with the Market Abuse Regulation (MAR) and the detailed disclosure of trades executed by Goldman Sachs International ensures transparency and fair market practices. This compliance is crucial to maintain investor confidence and avoid legal repercussions. Investors should be aware that the regulatory environment can influence the timing, structure and size of share buyback programs and any changes to these regulations could impact Shell's ability to conduct future buybacks.
Transaction in Own Shares
January 19, 2024
• • • • • • • • • • • • • • • •
Shell plc (the 'Company') announces that on 19 January 2024 it purchased the following number of Shares for cancellation.
Aggregated information on Shares purchased according to trading venue:
| Date of Purchase | Number of Shares purchased | Highest price paid | Lowest price paid | Volume weighted average price paid per share | Venue | Currency |
| 19/01/2024 | 426,173 | LSE | GBP | |||
| 19/01/2024 | - | - | - | - | Chi-X (CXE) | GBP |
| 19/01/2024 | - | - | - | - | BATS (BXE) | GBP |
| 19/01/2024 | - | - | - | - | XAMS | EUR |
| 19/01/2024 | - | - | - | - | CBOE DXE | EUR |
| 19/01/2024 | - | - | - | - | TQEX | EUR |
These share purchases form part of the on- and off-market limbs of the Company's existing share buy-back programme previously announced on 2 November 2023.
In respect of this programme, Goldman Sachs International will make trading decisions in relation to the securities independently of the Company for a period from 2 November 2023 up to and including 26 January 2024.
The on-market limb will be effected within certain pre-set parameters and in accordance with the Company's general authority to repurchase shares on-market. The off-market limb will be effected in accordance with the Company's general authority to repurchase shares off-market pursuant to the off-market buyback contract approved by its shareholders and the pre-set parameters set out therein. The programme will be conducted in accordance with Chapter 12 of the Listing Rules and Article 5 of the Market Abuse Regulation 596/2014/EU dealing with buy-back programmes ("EU MAR") and EU MAR as "onshored" into UK law from the end of the Brexit transition period (at 11:00 pm on 31 December 2020) through the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020), and as amended, supplemented, restated, novated, substituted or replaced by the Financial Services Act, 2021 and relevant statutory instruments (including, The Market Abuse (Amendment) (EU Exit) Regulations (SI 2019/310)), from time to time ("UK MAR") and the Commission Delegated Regulation (EU) 2016/1052 (the "EU MAR Delegated Regulation") and the EU MAR Delegated Regulation as "onshored" into UK law from the end of the Brexit transition period (at 11:00 pm on 31 December 2020) through the European Union (Withdrawal) Act 2018 (as amended by the European Union (Withdrawal Agreement) Act 2020), and as amended, supplemented, restated, novated, substituted or replaced by the Financial Services Act, 2021 and relevant statutory instruments (including, The Market Abuse (Amendment) (EU Exit) Regulations (SI 2019/310)), from time to time.
In accordance with EU MAR and UK MAR, a breakdown of the individual trades made by Goldman Sachs International on behalf of the Company as a part of the buy-back programme is detailed below.
Enquiries:
Media International: +44 (0) 207 934 5550
Media Americas: +1 832 337 4335
LEI number of Shell plc: 21380068P1DRHMJ8KU70
Classification: Acquisition or disposal of the issuer's own shares
Attachment
FAQ
How many shares did Shell plc purchase for cancellation on January 19, 2024?
Who made the trading decisions for the share buy-back program?
What was the highest price paid for the shares purchased by Shell plc?
What regulations will Shell plc follow for the share buy-back program?
What is the volume-weighted average price paid per share by Shell plc?
