BG Earnings Support Shell's Planned Takeover

Nothing in the quarterly results that would alter equity analysts value estimate of BG or change the likelihood of Shell completing the acquisition

Allen Good 13 May, 2015 | 10:47AM

BG Group (BG.) reported first-quarter earnings Friday that reflected the decline in commodity prices during the quarter but also offered evidence of a turnaround in production growth. At this point, however, overcoming regulatory hurdles and completing the acquisition by Shell in early 2016 are bigger risks for investors than continued operational improvement.

A central component of BG's strategy is flexibility

That said, production did increase slightly, by 1%, as a doubling of Brazilian and Australian volumes offset declines largely in the United Kingdom due to maintenance.

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About Author

Allen Good  Allen Good is a senior stock analyst covering the oil and gas industries.

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