The Wall Street Journal: Shell Annual Report: Co Vows To Regain Trust Of Shareholders
DOW JONES NEWSWIRES
May 28, 2004 3:12 a.m.
LONDON -- Royal Dutch/Shell Group (RD, SC), humbled by a reserves scandal that saw four top executives dismissed, said in its delayed annual report Friday that "rebuilding credibility" and "regaining trust" would be key priorities going forward.
But, it also stressed that its core exploration and production and refining and marketing businesses are in good shape and that the company is engaged in several new development projects that augured well for the future.
"Shell remains a sound and profitable business and I firmly believe that we have real strengths on which to grow our business, and rebuild our reputation," said Jeroen van der Veer, chairman of the Anglo-Dutch oil major.
Net earnings of Shell - which comprises Royal Dutch Petroleum Co. (RD) and
Shell Transport & Trading PLC (SC) - nudged $12.5 billion in 2003, a 29% rise
from $9.72 billion in 2002.
Both sets of figures, as well as 2001's net profit, were restated earlier this week following an updating of the company's accounting practices. For 2003, net profit was restated lower by $203 million or 1.6%.
The annual report reaffirmed that Shell’s proven reserves of oil and natural gas have been clipped by 4.47 billion barrels of oil equivalent, or some 23% from the last time it reported such levels in Dec. 31, 2002.
The report said that former chairman, Philip Watts, dismissed in March for his handling of the reserves debacle, received a salary of GBP843,021 in 2003. But, he was stripped of an annual bonus, stock options and almost 430,000 shares conditionally award as part of a performance scheme.
Former Chief Financial Officer Judy Boynton, who stepped aside last month, received a salary of GBP381,833 in 2003, but was also deprived of a bonus, stock options and performance shares, the annual report said.
Head of exploration and production, Walter van de Vijver, fired at the same time as Watts, earned EUR842,500 in salary in 2003, but also had his bonus, options and performance shares rescinded.
Severance packages for Watts and van de Vijver are still being negotiated, a Shell spokesman said Friday.
Van der Veer, the current chairman earned EUR1.12 million in salary last year, the annual report said.
Publication of the report was delayed two months as the company sought to calculate the financial impact of its reserves reappraisal and deal with wholesale changes to its management ranks.
Company Web site: http://www.shell.com
-By Michael Wang, Dow Jones Newswires, +44-20-7842-9386; michael.wang@dowjones.com
CORRECTION: Two Shell Execs Haven't Lost Performance Shrs
DOW JONES NEWSWIRES
May 28, 2004 3:46 a.m.
Former Chief Financial Officer Judy Boynton, who stepped aside last month, received a salary of GBP381,833 in 2003, but was also deprived of a bonus and stock options, the annual report said.
Head of exploration and production, Walter van de Vijver, fired at the same time as Watts, earned EUR842,500 in salary in 2003, but also had his bonus and options rescinded.
Boynton and van de Vijver haven't had their performance shares confiscated.
(In an item published at 0712 GMT, the ownership of the performance shares was misstated.)