C-Suite Transitions – Ben van Beurden Bids Adieu To Shell After 40 Years

After over 40 years with the company, Chief Executive Officer Ben van Beurden of one of the world’s largest integrated energy companies, Shell (SHEL), announced that he will be retiring at the end of this year. Wael Sawan, the company’s head of gas and renewables, will take over as Ben van Beurden’s successor. As an integrated energy company, Shell operates in the upstream (production of oil and natural gas), midstream (storage and transportation) and downstream (refining and gas stations) segments.

The company also has exposure to renewal and natural energy sources like solar, offshore wind and hydrogen partially because of the big ESG focus over the last several years and partly because the company lost a landmark legal case in The Netherlands that forces it to cut emissions 45% from 2019 levels by the year 2030.

Ben van Beurden joined Shell in 1983 and worked in the Netherlands, Africa, Malaysia, the US and the UK. Prior to becoming CEO in January 2014, he spent 10 years working in Shell’s liquefied natural gas business and ran the company’s chemicals unit. The acquisition of rival BG Group, a deal valued at around to $50 billion that ended up being one of Shell’s largest acquisitions in decades, was the first significant action of his tenure as CEO, which started in 2014.

Ben van Beurden has led the business during some of its most difficult moments. During the pandemic, as oil and gas prices plummeted, he took flak for cutting Shell’s dividend for the first time since World War II. He was also the architect of the company’s strategy to shift from fossil fuels to cleaner sources of energy and attain net-zero carbon emissions by 2050. Recently, Ben van Beurden led Shell to a significant overhaul in its legal structure. As a result, it changed its name to “Royal Dutch” and relocated its headquarters from the Netherlands to London.

Unfortunately Shell’s stock was down during his tenure but the recent increase in oil prices has positioned the company for a brighter future. The company announced and completed an $8.5 billion stock buyback in the first half of 2022 and has announced an additional $6 billion buyback that it plans to complete in Q3 2022. Part of the $8.5 billion buyback was funded by the sale of $5.5 billion worth of Permian Basin assets in the U.S.

Most energy companies are trading at very attractive valuations because investors are wary that a global recession will reduce demand and they expect oil prices to drop from current levels. Shell is no exception, trading at a forward P/E of just 4.23. In Q2 2022, the company reported a 65% year-over-year increase in revenue, generated GAAP net income of $18 billion and reduced net debt to the tune of $2.1 billion to $46.4 billion. I hold a variant perception and think that energy companies are likely to continue doing well for the foreseeable future.

Beginning January 1, 2023, Wael Sawan, head of gas and renewables at SHEL, will replace Ben van Beurden as CEO. Sawan has been a member of the company for more than 25 years, most recently serving as the director of upstream. Ben van Beurden will continue working as an adviser to the board until Jun 30, 2023

Welcome to edition 7 of  C-Suite Transitions, a new weekly series on InsideArbitrage that tracks appointments and departures at publicly traded companies during the prior week. We highlight five appointments and departures each week by picking the largest companies from the full list of management changes.

You can find all the appointments and departures listed below in our  C-Suite Transitions tool.

Appointments

1. Shell plc  (SHEL): $52.36

On September 15, 2022, Shell announced that Wael Sawan will succeed Ben van Beurden as Chief Executive Officer (CEO) at the end of 2022.  Wael’s appointment is effective January 1, 2023, when he will also join Shell’s Board of Directors.

Wael is currently the Director Integrated Gas, Renewables and Energy Solutions, and was previously the Director Upstream. He has worked in Europe, Africa, Asia and the Americas during his 25-year Shell career, and has also held roles in Downstream Retail, and in various commercial and New Business Development projects.

MarketCap: $190.89B Avg. Daily Volume (30 days): 3,618,322,167 Revenue (TTM): $329.59B
Net Income Margin (TTM): 10.97% ROE (TTM): 20.16 Net Debt: $40.97B
P/E: -79.70 Forward P/E: 5.12 EV/EBIDTA (TTM): 3.67
P/S (TTM): 0.61 P/B (TTM): 1.00 52 Week Range: $44.48 – $61.09

2. CSX Corporation (CSX): $29.14

On September 15, 2022, CSX Corporation announced that, as part of a planned succession process, its Board of Directors appointed Joseph R. Hinrichs as the Company’s new President and Chief Executive Officer, and as a member of the Board of Directors, effective September 26, 2022.

 

 

MarketCap: $63.10B Avg. Daily Volume (30 days): 16,740,347 Revenue (TTM): $13.95B
Net Income Margin (TTM): 28.24% ROE (TTM): 50.85% Net Debt: N/A
P/E: 16.45 Forward P/E: 14.77 EV/EBIDTA (TTM): 11.15
P/S (TTM): 4.66 P/B (TTM): 4.81 52 Week Range: $27.51 – $38.39

3. Eversource Energy (ES): $87.83

On September 16, 2022, the Board of Trustees of Eversource Energy elected Joseph R. Nolan, Jr., President and Chief Executive Officer and a Trustee, as Chairman of the Board of Trustees and also appointed Nolan as Chair of the Executive Committee of the Board, effective as of December 31, 2022.

 

 

MarketCap: $30.70B Avg. Daily Volume (30 days): 21,107,710 Revenue (TTM): $10.96B
Net Income Margin (TTM): 12.09 ROE (TTM): 8.98 Net Debt: $21.42B
P/E: 23.07 Forward P/E: 20.58 EV/EBIDTA (TTM): 15.52
P/S (TTM): 2.82 P/B (TTM): 2.06 52 Week Range: $77.07 – $94.63

4. Expedia Group Inc (EXPE): $99.01

On September 14, 2022, Expedia Group announced that Julie Whalen will be Expedia Group’s Executive Vice President and Chief Financial Officer, effective September 26, 2022.

Previously, Julie Whalen  served Williams-Sonoma’s finance organization since joining in 2001, including 10 years as CFO

 

MarketCap: $16.49B Avg. Daily Volume (30 days): 2,261,943 Revenue (TTM): $10.67B
Net Income Margin (TTM): 4.26% ROE (TTM): 14.37% Net Debt: N/A
P/E: N/A Forward P/E: 12.06 EV/EBIDTA (TTM): 15.75
P/S (TTM): 1.52 P/B (TTM): 8.63 52 Week Range: $88.70 – $217.72

5. FirstEnergy Corp. (FE): $41.00

On September 15, 2022, FirstEnergy announced that the Board of Directors of the company has appointed John W. Somerhalder II to serve as Interim President and Chief Executive Officer of the company, effective as of September 16, 2022.

MarketCap: $23.64B Avg. Daily Volume (30 days): 3,814,989 Revenue (TTM): $11.40B
Net Income Margin (TTM): 4.26% ROE (TTM): 11.97% Net Debt: $20.64B
P/E: -6.04 Forward P/E: 16.13 EV/EBIDTA (TTM): 12.01
P/S (TTM): 1.99 P/B (TTM): 2.17 52 Week Range: $34.10 – $47.93

Departures

1. Shell plc  (SHEL): $52.36

On September 15, 2022, Shell announced that Ben van Beurden will step down as Chief Executive Officer (CEO) at the end of 2022, and that his successor will be Wael Sawan. Ben van Beurden will continue working as adviser to the Board until June 30, 2023, after which he will leave the group.

 

MarketCap: $190.89B Avg. Daily Volume (30 days): 3,618,322,167 Revenue (TTM): $329.59B
Net Income Margin (TTM): 10.97% ROE (TTM): 20.16 Net Debt: $40.97B
P/E: -79.70 Forward P/E: 5.12 EV/EBIDTA (TTM): 3.67
P/S (TTM): 0.61 P/B (TTM): 1.00 52 Week Range: $44.48 – $61.09

2. CSX Corporation (CSX): $29.14

On September 15, 2022, CSX Corporation announced that James M. Foote plans to retire as President and Chief Executive Officer, as well as from the Board of Directors, effective September 26, 2022.

 

 

 

MarketCap: $63.10B Avg. Daily Volume (30 days): 16,740,347 Revenue (TTM): $13.95B
Net Income Margin (TTM): 28.24% ROE (TTM): 50.85% Net Debt: N/A
P/E: 16.45 Forward P/E: 14.77 EV/EBIDTA (TTM): 11.15
P/S (TTM): 4.66 P/B (TTM): 4.81 52 Week Range: $27.51 – $38.39

3. American International Group Inc (AIG): $52.29

On September 19, 2022, American International Group announced that in connection with the IPO, effective as of the completion of the IPO on September 19, 2022, Kevin Hogan, President and Chief Executive Officer of Corebridge, no longer serves as Executive Vice President and Chief Executive Officer, Life and Retirement, AIG.

He served AIG for a period of 9 years.

 

MarketCap: $40.61B Avg. Daily Volume (30 days): 4,490,533 Revenue (TTM): $57.49B
Net Income Margin (TTM): 22.11 ROE (TTM): 24.43 Net Debt: $14.93B
P/E: -68.39 Forward P/E: 8.70 EV/EBIDTA (TTM): 3.14
P/S (TTM): 0.79 P/B (TTM): 0.90 52 Week Range: $84.97 – $140.32

4. Eversource Energy (ES): $87.83

On September 16, 2022, the Board of Trustees of Eversource Energy announced that James J. Judge, Executive Chairman of the Board of Trustees, will retire as Executive Chairman of the Board and as a Trustee, effective as of December 31, 2022.

 

 

 

MarketCap: $30.70B Avg. Daily Volume (30 days): 21,107,710 Revenue (TTM): $10.96B
Net Income Margin (TTM): 12.09 ROE (TTM): 8.98 Net Debt: $21.42B
P/E: 23.07 Forward P/E: 20.58 EV/EBIDTA (TTM): 15.52
P/S (TTM): 2.82 P/B (TTM): 2.06 52 Week Range: $77.07 – $94.63

5. Expedia Group Inc (EXPE): $99.01

On September 14, 2022, Expedia Group announced that Julie Whalen will be Expedia Group’s Executive Vice President and Chief Financial Officer, effective September 26, 2022. Eric Hart, current Chief financial Officer, will remain with the company through October 1, 2022.

 

MarketCap: $16.49B Avg. Daily Volume (30 days): 2,261,943 Revenue (TTM): $10.67B
Net Income Margin (TTM): 4.26% ROE (TTM): 14.37% Net Debt: N/A
P/E: N/A Forward P/E: 12.06 EV/EBIDTA (TTM): 15.75
P/S (TTM): 1.52 P/B (TTM): 8.63 52 Week Range: $88.70 – $217.72

If you are reading this article and have not signed up to receive such articles by email, please sign up either for our free, IA Plus or IA Premium service here. If you are an existing subscriber, you can login to the InsideArbitrage.com website to adjust the kinds of articles you receive by email by turning on or turning off specific categories of articles.

Leave A Comment

You must be logged in to post a comment.