30th Jul 2026 07:55
(Alliance News) - Shell reports consensus-topping second quarter profit, as well as a new share buyback, Rolls-Royce ups its guidance and Lloyds maintains its 2026 view, but sets out its ambition through to 2030.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called down 0.5% at 10,852.61
GBP: higher at USD1.3339 (USD1.3284 at previous London equities close)
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ECONOMICS
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Donald Trump has said Andy Burnham told him that he was going to "open up North Sea oil". Speaking in the White House, the US president said if the UK prime minister followed through on his commitment the UK was "going to be a wealthy country". Trump also again warned that immigration is "killing" Britain, with "people coming from all over the world and just camping out". Following the phone call between the two leaders on Burnham's first day in office, Downing Street would not be drawn on any potential future plans for North Sea drilling after Trump talked up a change in policy under Burnham. The US president, a vocal supporter of fossil fuels, has long championed the move as he has railed against "windmills".
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BROKER RATINGS
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Berenberg raises Rio Tinto to 'buy' (hold) - price target 8,600 (8,100) pence
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COMPANIES - FTSE 100
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Oil major Shell says second quarter profit more than doubles, on higher realised prices, and it announces the launch of a USD3.0 billion buyback. Shell says it is the "19th quarter in a row of announcing at least USD3 billion buybacks". "Shell's operational performance enabled very strong results during another quarter of severe disruption in global energy markets, as we worked hard to provide critical energy supplies and products to our customers," Chief Executive Officer Wael Sawan says. Pretax profit in the second quarter of 2026 jumps to USD15.75 billion from USD5.98 billion a year prior, with total revenue climbing 45% to USD96.35 billion from USD66.44 billion. Adjusted earnings soar to USD9.84 billion from USD4.26 billion. On-quarter, adjusted earnings rise from USD6.92 billion. "Adjusted earnings, compared with the first quarter 2026, reflected higher realised prices, higher LNG trading and optimisation, favourable tax movements, higher Chemicals margins and higher crude and oil products trading and optimisation. These were partly offset by lower volumes, mainly due to the impact of the Middle East conflict on Qatari volumes, and lower Lubricants margins," Shell says. Adjusted earnings beat consensus of USD8.92 billion. Shell says the new USD3.0 billion buyback is to be completed by the third quarter results. It also notes "USD1.2 billion of share buybacks that were not undertaken during the previous programme". Shell's second quarter dividend amounts to USD0.3906, unchanged on-quarter, and up from USD0.3580 a year prior.
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Jet engine maker Rolls-Royce hails a "strong first half performance" and it lifts its annual guidance. Revenue in the first six months of 2026 rises 21% to GBP11.45 billion from GBP9.49 billion, though pretax profit slumps 60% to GBP1.93 billion from GBP4.84 billion. The prior year was boosted by a GBP679 million gain on a disposal. Operating profit, which strips out this item, rises 17% to GBP2.42 billion from GBP2.07 billion. Underlying operating profit is up 46% to GBP2.53 billion, from GBP1.73 billion. "Our transformation continues to deliver, and we are demonstrating that Rolls-Royce is now a very different company to that of the past. We have unlocked new growth opportunities across the Group and created a resilient and diversified portfolio, with three strong businesses that can respond to changes in the external environment with agility and pace," CEO Tufan Erginbilgic says. "A strong start to the year enables us to raise our guidance for 2026 despite the conflict in the Middle East." Rolls-Royce now expects to deliver underlying operating profit of GBP4.7 billion to GBP4.9 billion and free cash flow of GBP3.8 billion to GBP4.0 billion for the full-year. Its profit guidance was previously ranged at GBP4.0 billion to GBP4.2 billion, and the cash flow goal was GBP3.6 billion to GBP3.8 billion. Rolls-Royce lifts its interim dividend to 6.0p from 4.5p. It adds: "We have completed GBP1.4 billion of the planned GBP2.5 billion share buyback for 2026 to date, part of our multi-year buyback programme totalling GBP7 billion-GBP9 billion across 2026 to 2028."
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Lloyds Banking Group has backed its annual targets, and it announces a further GBP1.0 billion share buyback. The lender also sets out longer-term goals in its "accelerate 2030" strategy, which it says will deliver "stronger sustainable returns, with substantial earnings growth". In the second quarter of 2026, pretax profit amounts to GBP2.27 billion, up 14% from GBP1.99 billion a year prior. Net income improves 9.7% to GBP4.96 billion from GBP4.52 billion. Net income beats consensus of GBP4.95 billion, with pretax profit beating a GBP2.10 billion forecast. Underlying net interest income alone rises 10% to GBP3.71 billion from GBP3.36 billion a year prior, and Lloyds reiterates its aim of achieving an annual outcome "greater than GBP14.9 billion", improving from 2025's GBP13.64 billion. It still expects a return on tangible equity of greater than 16%, beating 2025's 12.9%. Chief Executive Charlie Nunn says: "We are successfully completing our 2022 to 2026 strategy, focusing on customer experience, pivoting the group to growth and laying the foundations for our exciting new strategy. We have strengthened our market leadership, built our digital and AI capabilities, and enhanced our cost and capital leadership, while remaining on track to deliver our 2026 financial targets. This ensures the group is well placed to launch our new strategy, accelerate 2030, from a position of strength. Building on our leadership position we will accelerate through reimagined customer experiences, increased group connectivity, and a productivity step-change, all enabled by pioneering technology. Our strategy will allow us to unlock the next phase of growth and sustainable value creation for our shareholders." Lloyds targets a RoTE of around 20% in 2030 and 18% in 2028. For the 2027 to 2030 period, it sizes up a "mid-single-digit net income compound annual growth rate and high-single-digit underlying other operating income compound annual growth rate". Lloyds lifts its interim dividend by 30% to 1.58 pence per share. "Alongside, the board has announced its intention to implement a further ordinary share buyback programme of up to GBP1.0 billion, in addition to the GBP1.75 billion programme announced in the full year 2025 results," it adds.
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COMPANIES - FTSE 250
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Packaging firm Mondi reports a swing to a half-year loss with geopolitical tensions causing supply chain strife and driving "higher input costs". Mondi's pretax loss in the first half of 2026 amounts to EUR240 million, swinging from profit of EUR247 million, but revenue edges up 1.7% to EUR3.98 billion from EUR3.91 billion. "During the first half of 2026, we made good progress in delivering actions to strengthen Mondi’s performance, cash generation and competitiveness, supported by the strength of our quality product offering, high service levels and the agility and commitment of our people. We took strong pricing actions, maintained cost discipline, progressed our plant network optimisation programme and continued to drive operational excellence across the business," CEO Andrew King says. "Heightened geopolitical tensions in the Middle East caused supply chain disruptions and contributed to higher input costs. Our teams acted quickly to protect operational continuity, support customers and implement price increases across our packaging and paper products. Trading momentum improved through the first half and we enter the second half with higher packaging paper prices, supported by good order books. We expect higher wood costs across Central and Eastern Europe and we continue to manage volatile energy related input costs." Mondi lowers its half-year dividend to 9.42 cents, one-third of the prior year's full year ordinary dividend, down from 23.33 cents a year prior.
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Pets at Home has left its outlook unchanged, after "an encouraging start" to its new financial year. The pet care retailer's group consumer revenue in the first quarter to July 16 rises 3.9% to GBP614 million. The measure encompasses its total revenue, including consumer sales made by joint venture vet practices. "We have made an encouraging start to FY27, trading in line with expectations and clear further signs that our retail turnaround plan is gaining traction. Retail saw stronger momentum, with all categories delivering sales and volume growth, while our Vet Group continued to grow ahead of the market. We remain focused on delivering better value, stronger execution and more convenient pet care for customers, while building a more resilient and profitable business," CEO James Bailey says.
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OTHER COMPANIES
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Recruiter Robert Walters says its half-year performance was in line with expectations. It reports a pretax loss of GBP6.8 million for the first six months of the year, narrowing from GBP10.2 million a year prior, with revenue up 7.7% to GBP433.7 million from GBP402.8 million. "We delivered a first half financial performance in-line with our expectations, an encouraging result given the backdrop of heightened global uncertainty," CEO Toby Fowlston says. Robert Walters expects an annual outturn at the upper end of current market expectations. The market view ranges from an operating loss of GBP14.2 million to GBP8.1 million. The operating loss in the first half narrows to GBP4.5 million from GBP7.8 million.
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By Eric Cunha, Alliance News news editor
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Related Shares:
Rio TintoRobert WaltersPets at homeMondiLloydsRolls-RoyceShell