7/8/2017 Performance indicators - Shell Annual Report 2016

PERFORMANCE INDICATORS

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Key performance indicators

Total shareholder return

2016: 38.7% (2015: -29.9%)

Total shareholder return (TSR) is the difference between the share price at the beginning of the year and the
share price at the end of the year (each averaged over 30 days), plus gross dividends delivered during the
calendar year (reinvested quarterly), expressed as a percentage of the share price at the beginning of the year
(averaged over 30 days). The data used are a weighted average in dollars for A and B shares. The TSRs of
major publicly traded oil and gas companies can be compared directly, providing a way to determine how we are
performing in relation to our industry peers.

Cash flow from operating activities ($ billion)

2016: 21 (2015: 30)

Cash flow from operating activities is the total of all cash receipts and payments associated with our sales of oil,
gas, chemicals and other products. The components that provide a reconciliation from income for the period are
listed in the “Consolidated Statement of Cash Flows”. This indicator reflects our ability to generate cash to
service and reduce our debt and for distributions to shareholders and investments. See “Liquidity and capital
resources”.

Project delivery
2016: 94% (2015: 82%)

Project delivery reflects our capability to complete major projects on time and within budget on the basis of
targets set in our annual Business Plan. The set of projects reflected in this indicator consists of at least 20 Shell-
operated capital projects that are in the execution phase (post final investment decision).

Production available for sale (thousand boe/d)

2016: 3,668 (2015: 2,954)

Production is the sum of all average daily volumes of unrefined oil and natural gas produced for sale by Shell
subsidiaries and Shell’s share of those produced for sale by joint ventures and associates. The unrefined oil
comprises crude oil, natural gas liquids, synthetic crude oil and bitumen. The gas volume is converted into
equivalent barrels of oil to make the summation possible. Changes in production have a significant impact on our
cash flow. See “Summary of results”.

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LNG liquefaction volumes (million tonnes)

2016: 30.9 (2015: 22.6)

Liquefied natural gas (LNG) liquefaction volumes is a measure of the operational performance of our Integrated
Gas business and LNG market demand. See “Integrated Gas”.

Refinery and chemical plant availability

2016: 90.3% (2015: 89.3%)

Refinery and chemical plant availability is the weighted average of the actual uptime of plants as a percentage of
their maximum possible uptime. The weighting is based on the capital employed, adjusted for cash and non-
current liabilities. It excludes downtime due to uncontrollable factors, such as hurricanes. This indicator is a
measure of the operational excellence of our Downstream manufacturing facilities. See “Downstream”.

Total recordable case frequency (injuries per million working hours)

2016: 1.00 (2015: 0.94)

Total recordable case frequency (TRCF) is the number of employees and contract staff injuries requiring medical
treatment or time off for every million hours worked. It is a standard measure of occupational safety. See
“Environment and society”.

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Additional performance indicators

Earnings on a current cost of supplies basis ($ million)

2016: 3,692 (2015: 4,155)

Earnings per share on a current cost of supplies basis ($)

2016: 0.45 (2015: 0.61)

Earnings on a current cost of supplies basis (CCS earnings) is the income for the period, adjusted for the after-
tax effect of oil-price changes on inventory. Segment earnings presented on a current cost of supplies basis is
the earnings measure used by the Chief Executive Officer for the purposes of making decisions about allocating
resources and assessing performance. See “Summary of results” and “Non-GAAP measures reconciliations”.

CCS earnings per share, which is on a diluted basis above, is calculated by dividing CCS earnings attributable to
shareholders (see “Non-GAAP measures reconciliations”) by the average number of shares outstanding over the
year, increased by the average number of dilutive shares related to share-based compensation plans.

Capital investment ($ million)

2016: 79,877 (2015: 28,861)

Capital investment is a measure used to make decisions about allocating resources and assessing performance.
It is defined as capital expenditure and investments in joint ventures and associates as reported in the

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“Consolidated Statement of Cash Flows” plus exploration expense, excluding exploration wells written off, new
finance leases and other adjustments. In 2016, capital investment also included the respective amount for the
acquisition of BG Group plc. See “Liquidity and capital resources” and “Non-GAAP measures reconciliations”.

Return on average capital employed

2016: 3.0% (2015: 1.9%)

Return on average capital employed (ROACE) is defined as annual income, adjusted for after-tax interest
expense, as a percentage of average capital employed during the year. Capital employed is the sum of total
equity and total debt. ROACE measures the efficiency of our utilisation of the capital that we employ and is a
common measure of business performance. See “Summary of results” and “Non-GAAP measures
reconciliations”.

Gearing
2016: 28.0% (2015: 14.0%)

Gearing is defined as net debt (total debt less cash and cash equivalents) as a percentage of total capital (net
debt plus total equity) at December 31. It is a measure of the degree to which our operations are financed by
debt. See “Liquidity and capital resources”.

Employees (thousand)
2016: 92 (2015: 93)

The employee number indicator is the annual average full-time employee equivalent of the total number of
people on full-time or part-time employment contracts with Shell subsidiaries, including our share of employees
of joint operations. It excludes employees working for Shell’s joint ventures and associates. See “Our people”.

Proved oil and gas reserves (million boe)

2016: 13,248 (2015: 11,747)

Proved oil and gas reserves are the total estimated quantities of oil and gas from Shell subsidiaries and Shell’s
share from joint ventures and associates that geoscience and engineering data demonstrate, with reasonable
certainty, to be recoverable in future years from known reservoirs, at December 31, under existing economic
conditions, operating methods and government regulations. Gas volumes are converted into barrels of oil
equivalent (boe) using a factor of 5,800 standard cubic feet per barrel. Reserves are crucial to an oil and gas
company, since they constitute the source of future production. Reserves estimates are subject to change due to
a wide variety of factors, some of which are unpredictable. See “Summary of results”, “Oil and gas information”
and “Supplementary information – oil and gas (unaudited)”.

Operational spills of more than 100 kilograms

2016: 71 (2015: 108)

The operational spills indicator is the number of incidents in respect of activities where we are the operator in
which 100 kilograms or more of oil or oil products were spilled as a result of those activities. See “Environment
and society”.

TM
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Refining Energy Intensity Index (EIITM) (indexed to 2002

2016: 95.4 (2015: 95.4)

The Energy Intensity Index (EIITM), as described in Solomon Associates Refinery Comparative Performance
Analysis Methodology 2014, is a benchmark to compare energy efficiency of fuel refineries and paraffinic base
oil plants. The Solomon EIITM is defined as the energy consumed by a refinery divided by the energy standard
for the specific individual refinery configuration. See “Environment and society”.

Direct greenhouse gas emissions (million tonnes of CO2 equivalent)

2016: 70 (2015: 72)

Direct greenhouse gas emissions from facilities operated by Shell, expressed in carbon dioxide (CO2)
equivalent. See “Environment and society”.

Number of operational Tier 1 process safety events

2016: 39 (2015: 51)

A Tier 1 process safety event is an unplanned or uncontrolled release of any material, including non-toxic and
non-flammable materials, from a process with the greatest actual consequence resulting in harm to members of
our workforce or a neighbouring community, damage to equipment, or exceeding a threshold quantity as defined
by the API Recommended Practice 754 and IOGP Standard 456. See “Environment and society”.

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