Oppenheimer Reviews Royal Dutch Shell Earnings

In a report published Friday, analysts at Oppenheimer maintained their Perform rating on

. The company reported its 1Q15 earnings above the consensus but below the 1Q14 levels and sequentially flat. The positive surprise on the earnings was driving by higher revising margins, robust trading results and a lower effective UK income tax rate. These factors also helped to offset, to some extent, the sharp decline in upstream income, which in turn was driven by lower oil and gas prices and decreased production. The company witnessed its highest unit profit in Asia. "Dividends are Shell's main route to return cash to shareholders, and the high yield makes the stock attractive for certain income investors. However, in response to the sharp drop in oil prices, Shell is now taking actions to preserve financial flexibility, including freezing dividends," the analysts said. Oppenheimer expects the company to write-off additional North American shale assets following the weak operating results.