• Cash flow reflects durability of the integrated
portfolio amid continued industry volatility
• Strong Chemical results highlight sustainable
competitive advantages
• Advancing attractive new investment opportunities
across the value chain
Exxon Mobil Corporation (NYSE: XOM):
Second Quarter
First Half 2016
2015 % 2016
2015 % Earnings Summary
(Dollars in millions, except per share data) Earnings
1,700
4,190 -59
3,510 9,130 -62 Earnings Per Common Share Assuming
Dilution
0.41 1.00 -59
0.84 2.17 -61 Capital
and Exploration Expenditures
5,158 8,261 -38
10,285
15,965 -36
Exxon Mobil Corporation (NYSE: XOM) announced estimated
second quarter 2016 earnings of $1.7 billion, or $0.41 per
diluted share, compared with $4.2 billion a year earlier. The
results reflect sharply lower commodity prices, weaker refining
margins and continued strength in the Chemical segment.
“While our financial results reflect a volatile industry
environment, ExxonMobil remains focused on business fundamentals,
cost discipline and advancing selective new investments across the
value chain to extend our competitive advantage,” said Rex W.
Tillerson, chairman and chief executive officer. “The corporation
benefits from scale and integration, which provide the financial
flexibility to invest in attractive opportunities and grow
long-term shareholder value.”
During the second quarter, Upstream earnings were $294 million.
Production volumes were essentially unchanged at 4 million
oil-equivalent barrels per day. Liquids production growth from
recent start-ups more than offset the impact of field decline and
downtime events, notably in Canada and Nigeria.
Chemical earnings remained strong at $1.2 billion, reflecting
continued benefits from gas and liquids cracking as well as growing
product demand. The Downstream segment earned $825 million despite
significantly lower global refining margins versus the prior year
quarter.
Capital and exploration expenses were reduced by 38 percent to
$5.2 billion.
During the quarter, the corporation distributed
$3.1 billion in dividends to shareholders.
Second Quarter Highlights
• Earnings of $1.7 billion decreased $2.5 billion, or 59
percent, from the second quarter of 2015.
• Earnings per
share assuming dilution were $0.41.
• Cash flow from
operations and asset sales was $5.5 billion, including proceeds
associated with asset sales of $1 billion.
• Capital and
exploration expenditures were $5.2 billion, down 38 percent from
the second quarter of 2015.
• Oil-equivalent production was
essentially unchanged at 4 million oil-equivalent barrels per day,
with liquids up 1.7 percent and natural gas down 3.6 percent.
• The corporation distributed $3.1 billion in dividends to
shareholders.
• Dividends per share of $0.75 increased 2.7
percent compared with the second quarter of 2015.
•
ExxonMobil announced that drilling results from Liza-2, the second
well in the Stabroek block offshore Guyana, confirmed a world-class
discovery with a recoverable resource between 800 million and 1.4
billion oil-equivalent barrels.
• Production at the Julia
Oil Field in the Gulf of Mexico started ahead of schedule with
project costs under budget. The initial development phase, with a
gross design capacity of 34,000 barrels of oil per day, uses
capital-efficient subsea tie-backs to existing infrastructure and
is located 265 miles southwest of New Orleans in water depths of
more than 7,000 feet.
• The company started production at
Point Thomson, the first company-operated project on Alaska’s North
Slope. At full rate production, the facility is designed to produce
up to 10,000 barrels of natural gas condensate per day and 200
million cubic feet of recycled gas. The recycled gas is re-injected
for future recovery.
• The Taicang, China, lubricants plant
expansion was completed in April, doubling the capacity of the
facility. The expansion includes the addition of automated blending
technology and a new state-of-the-art quality assurance laboratory.
It improves the company’s ability to supply premium lubricant
products to meet long-term demand growth in China.
•
ExxonMobil is expanding its comprehensive slate of polyethylene
products with the introduction of Exceed XP performance polymers.
Developed through advanced catalyst technology, process research,
and applications expertise, Exceed XP is designed to provide
extreme performance in a variety of film applications.
Second Quarter 2016 vs. Second Quarter 2015
Upstream earnings were $294 million in the second quarter
of 2016, down $1.7 billion from the second quarter of 2015.
Lower liquids and gas realizations decreased earnings by
$2.2 billion, while volume and mix effects increased earnings
by $50 million. All other items, including lower expenses, the
absence of a one-time deferred income tax impact related to the tax
rate increase in Alberta, Canada, and favorable foreign exchange
effects increased earnings by $450 million.
On an oil-equivalent basis, production was essentially flat with
the second quarter of 2015. Liquids production totaled
2.3 million barrels per day, up 39,000 barrels per day.
Project ramp-up was partly offset by field decline and downtime
mainly resulting from the Canadian wildfires. Natural gas
production was 9.8 billion cubic feet per day, down
366 million cubic feet per day from 2015 including field
decline and divestment impacts.
U.S. Upstream earnings declined $467 million from the
second quarter of 2015 to a loss of $514 million in the second
quarter of 2016. Non-U.S. Upstream earnings were $808 million,
down $1.3 billion from the prior year.
Downstream earnings were $825 million, down
$681 million from the second quarter of 2015. Weaker refining
margins decreased earnings by $850 million while favorable volume
and mix effects increased earnings by $130 million. All other
items increased earnings by $40 million, including lower
maintenance expenses partly offset by unfavorable foreign exchange
effects. Petroleum product sales of 5.5 million barrels per
day were 237,000 barrels per day lower than the prior year due
in part to asset management activity.
Earnings from the U.S. Downstream were $412 million, flat
with the second quarter of 2015. Non-U.S. Downstream earnings of
$413 million were $681 million lower than last year.
Chemical earnings of $1.2 billion were $29 million
lower than the second quarter of 2015. Margins increased earnings
by $150 million. Volume and mix effects increased earnings by
$70 million. All other items decreased earnings by
$250 million, due to the absence of asset management gains in
the U.S. partly offset by lower expenses. Second quarter prime
product sales of 6.3 million metric tons were
232,000 metric tons higher than the prior year's second
quarter.
U.S. Chemical earnings were $509 million, down
$226 million from the second quarter of 2015 reflecting the
absence of asset management gains. Non-U.S. Chemical earnings of
$708 million were $197 million higher than last year.
Corporate and financing expenses were $636 million for the
second quarter of 2016, compared to $593 million in the second
quarter of 2015.
First Half 2016 Highlights
• Earnings of $3.5 billion decreased 62 percent from $9.1
billion in 2015.
• Earnings per share assuming dilution were
$0.84.
• Cash flow from operations and asset sales was $10.5
billion, including proceeds associated with asset sales of $1.2
billion.
• Capital and exploration expenditures were $10.3
billion, down 36 percent from 2015.
•
Oil-equivalent production was unchanged at 4.1 million
oil-equivalent barrels per day, with liquids up 6.6 percent and
natural gas down 6.7 percent.
•
The corporation distributed $6.2 billion
in dividends to shareholders.
First Half 2016 vs. First Half 2015
Upstream earnings were $218 million, down $4.7 billion
from the first half of 2015. Lower realizations decreased earnings
by $4.9 billion. Favorable volume and mix effects increased
earnings by $20 million. All other items increased earnings by
$180 million, primarily due to lower expenses partly offset by
the absence of asset management gains.
On an oil-equivalent basis, production of 4.1 million
barrels per day was flat compared to the same period in 2015.
Liquids production of 2.4 million barrels per day increased
150,000 barrels per day, with project ramp-up partly offset by
field decline and downtime mainly from the Canadian wildfires.
Natural gas production of 10.2 billion cubic feet per day
decreased 730 million cubic feet per day from 2015 largely due
to regulatory restrictions in the Netherlands, field decline and
divestment impacts.
U.S. Upstream earnings declined $1.2 billion from 2015 to a
loss of $1.3 billion in 2016. Earnings outside the U.S. were
$1.6 billion, down $3.4 billion from the prior year.
Downstream earnings of $1.7 billion decreased
$1.4 billion from 2015. Weaker refining margins decreased
earnings by $1.7 billion, while volume and mix effects
increased earnings by $150 million. All other items increased
earnings by $130 million, mainly reflecting lower maintenance
expense. Petroleum product sales of 5.4 million barrels per
day were 358,000 barrels per day lower than 2015 due in part
to asset management activity.
U.S. Downstream earnings were $599 million, a decrease of
$380 million from 2015. Non-U.S. Downstream earnings were
$1.1 billion, down $1.1 billion from the prior year.
Chemical earnings of $2.6 billion increased $344 million
from 2015. Stronger margins increased earnings by
$380 million. Favorable volume and mix effects increased
earnings by $170 million. All other items decreased earnings
by $210 million, including the absence of asset management
gains in the U.S. partly offset by lower expenses. Prime product
sales of 12.5 million metric tons were up 336,000 metric
tons from 2015.
U.S. Chemical earnings were $1.1 billion, down
$250 million from the first half 2015 reflecting the absence
of asset management gains. Non-U.S. Chemical earnings of
$1.5 billion were $594 million higher than last year.
Corporate and financing expenses were $1 billion in 2016
compared to $1.2 billion in 2015, with the decrease due mainly
to net favorable tax-related items.
During the first half of 2016, Exxon Mobil Corporation purchased
9 million shares of its common stock for the treasury at a
gross cost of $727 million. These shares were acquired to
offset dilution in conjunction with the company’s benefit plans and
programs. The corporation will continue to acquire shares to offset
dilution in conjunction with its benefit plans and programs, but
does not currently plan on making purchases to reduce shares
outstanding.
ExxonMobil will discuss financial and operating results and
other matters during a webcast at 8:30 a.m. Central Time on
July 29, 2016. To listen to the event or access an archived replay,
please visit www.exxonmobil.com.
Cautionary Statement
Statements relating to future plans, projections, events or
conditions are forward-looking statements. Actual financial and
operating results, including project plans, costs, timing, and
capacities; capital and exploration expenditures; resource
recoveries; and share purchase levels, could differ materially due
to factors including: changes in oil or gas prices or other market
or economic conditions affecting the oil and gas industry,
including the scope and duration of economic recessions; the
outcome of exploration and development efforts; changes in law or
government regulation, including tax and environmental
requirements; the impact of fiscal and commercial terms; changes in
technical or operating conditions; and other factors discussed
under the heading "Factors Affecting Future Results" in the
“Investors” section of our website and in Item 1A of ExxonMobil's
2015 Form 10-K. We assume no duty to update these statements as of
any future date.
Frequently Used Terms
This press release includes cash flow from operations and asset
sales, which is a non-GAAP financial measure. Because of the
regular nature of our asset management and divestment program, we
believe it is useful for investors to consider proceeds associated
with the sales of subsidiaries, property, plant and equipment, and
sales and returns of investments together with cash provided by
operating activities when evaluating cash available for investment
in the business and financing activities. A reconciliation to net
cash provided by operating activities is shown in Attachment II.
References to quantities of oil or natural gas may include amounts
that we believe will ultimately be produced, but that are not yet
classified as “proved reserves” under SEC definitions. Further
information on ExxonMobil's frequently used financial and operating
measures and other terms including “prime product sales” is
contained under the heading "Frequently Used Terms" available
through the “Investors” section of our website at
exxonmobil.com.
Reference to Earnings
References to corporate earnings mean net income attributable to
ExxonMobil (U.S. GAAP) from the consolidated income statement.
Unless otherwise indicated, references to earnings, Upstream,
Downstream, Chemical and Corporate and Financing segment earnings,
and earnings per share are ExxonMobil's share after excluding
amounts attributable to noncontrolling interests.
The term “project” as used in this release can refer to a
variety of different activities and does not necessarily have the
same meaning as in any government payment transparency reports.
Exceed XP is a registered trademark of Exxon Mobil Corporation.
Exxon Mobil Corporation has numerous affiliates, many with names
that include ExxonMobil, Exxon, Mobil, Esso, and XTO. For
convenience and simplicity, those terms and terms such as
Corporation, company, our, we, and its are sometimes used as
abbreviated references to specific affiliates or affiliate groups.
Similarly, ExxonMobil has business relationships with thousands of
customers, suppliers, governments, and others. For convenience and
simplicity, words such as venture, joint venture, partnership,
co-venturer, and partner are used to indicate business and other
relationships involving common activities and interests, and those
words may not indicate precise legal relationships.
Estimated Key Financial and Operating Data
Attachment I Exxon Mobil Corporation Second
Quarter 2016 (millions of dollars, unless noted)
Second Quarter First
Half 2016 2015
2016 2015 Earnings /
Earnings Per Share Total revenues and other income
57,694 74,113
106,401 141,731 Total costs and other
deductions
55,298 67,159
102,275 128,142 Income
before income taxes
2,396 6,954
4,126 13,589 Income
taxes
715 2,692
664 4,252 Net income including
noncontrolling interests
1,681 4,262
3,462 9,337 Net
income attributable to noncontrolling interests
(19 )
72
(48 ) 207 Net income attributable to ExxonMobil
(U.S. GAAP)
1,700 4,190
3,510 9,130 Earnings
per common share (dollars)
0.41 1.00
0.84 2.17
Earnings per common share - assuming
dilution (dollars)
0.41 1.00
0.84 2.17
Other Financial
Data Dividends on common stock Total
3,133 3,066
6,187 5,976 Per common share (dollars)
0.75 0.73
1.48 1.42 Millions of common shares outstanding At
June 30
4,147 4,169 Average - assuming dilution
4,178
4,200
4,178 4,205 ExxonMobil share of equity at June
30
170,591 172,668 ExxonMobil share of capital employed at
June 30
216,947 208,781 Income taxes
715 2,692
664 4,252 Sales-based taxes
5,435 5,965
10,250
11,495 All other taxes
7,291 7,595
14,022 14,869
Total taxes
13,441 16,252
24,936 30,616
ExxonMobil share of income taxes of equity
companies
385 755
865 1,716
Attachment II
Exxon Mobil Corporation Second Quarter 2016
(millions of dollars)
Second Quarter
First Half 2016
2015 2016
2015 Earnings (U.S. GAAP) Upstream United
States
(514 ) (47 )
(1,346 ) (99 )
Non-U.S.
808 2,078
1,564 4,985 Downstream United
States
412 412
599 979 Non-U.S.
413 1,094
1,132 2,194 Chemical United States
509 735
1,090 1,340 Non-U.S.
708 511
1,482 888
Corporate and financing
(636 ) (593 )
(1,011
) (1,157 ) Net income attributable to ExxonMobil
1,700 4,190
3,510 9,130
Cash flow
from operations and asset sales (billions of dollars) Net cash
provided by operating activities (U.S. GAAP)
4.5 8.8
9.3 16.8 Proceeds associated with asset sales
1.0 0.6
1.2 1.1 Cash flow from operations and asset sales
5.5
9.4
10.5 17.9
Attachment III
Exxon Mobil Corporation Second Quarter 2016
Second Quarter First
Half 2016 2015
2016 2015
Net production of crude oil, natural gas
liquids, bitumen and synthetic oil, thousand barrels per day
(kbd)
United States
495 468
498 470 Canada / South America
359 364
417 366 Europe
201 199
210 199
Africa
494 522
529 521 Asia
724 685
725
681 Australia / Oceania
57 53
55 47 Worldwide
2,330 2,291
2,434 2,284
Natural gas production available for sale,
million cubic feet per day (mcfd)
United States
3,097 3,153
3,129 3,186 Canada / South
America
257 262
257 286 Europe
1,749 1,718
2,262 2,578 Africa
7 8
5 5 Asia
3,819
4,265
3,806 4,273 Australia / Oceania
833 722
784 645 Worldwide
9,762 10,128
10,243 10,973
Oil-equivalent production (koebd)1
3,957 3,979
4,141 4,113
1 Gas converted to oil-equivalent at 6 million cubic feet = 1
thousand barrels.
Attachment IV Exxon Mobil Corporation
Second Quarter 2016 Second
Quarter First Half
2016 2015
2016 2015 Refinery
throughput (kbd) United States
1,555 1,702
1,578
1,754 Canada
246 373
322 383 Europe
1,462
1,524
1,365 1,499 Asia Pacific
718 539
724 610
Other
171 192
180 192 Worldwide
4,152 4,330
4,169 4,438 Petroleum product sales (kbd) United
States
2,228 2,548
2,223 2,580 Canada
479 486
478 489 Europe
1,561 1,555
1,495 1,546 Asia
Pacific
760 695
763 721 Other
472 453
458 439 Worldwide
5,500 5,737
5,417 5,775
Gasolines, naphthas
2,266 2,376
2,239 2,370
Heating oils, kerosene, diesel
1,752 1,874
1,726
1,934 Aviation fuels
386 404
394 407 Heavy fuels
367 377
376 385 Specialty products
729 706
682 679 Worldwide
5,500 5,737
5,417 5,775
Chemical prime product sales, thousand
metric tons (kt)
United States
2,447 2,401
4,847 4,722 Non-U.S.
3,863 3,677
7,636 7,425 Worldwide
6,310 6,078
12,483 12,147
Attachment V
Exxon Mobil Corporation Second Quarter 2016 (millions
of dollars)
Second Quarter
First Half 2016
2015 2016 2015
Capital and Exploration Expenditures Upstream United States
914 2,095
1,989 4,215 Non-U.S.
3,005 4,651
5,909 8,948 Total
3,919 6,746
7,898 13,163
Downstream United States
227 266
416 561 Non-U.S.
415 361
754 687 Total
642 627
1,170
1,248 Chemical United States
355 570
789 1,000
Non-U.S.
208 258
385 482 Total
563 828
1,174 1,482 Other
34 60
43 72
Worldwide
5,158 8,261
10,285 15,965
Exploration expenses charged to income
included above
Consolidated affiliates United States
35 40
143 77
Non-U.S.
409 329
655 603 Equity companies -
ExxonMobil share United States
- -
- 3 Non-U.S.
5 23
(5 ) 31 Worldwide
449 392
793 714
Attachment VI Exxon
Mobil Corporation Earnings $
Millions $ Per Common
Share1
2012
First Quarter 9,450 2.00 Second Quarter 15,910 3.41 Third Quarter
9,570 2.09 Fourth Quarter 9,950 2.20 Year 44,880 9.70
2013
First Quarter 9,500 2.12 Second Quarter 6,860 1.55 Third Quarter
7,870 1.79 Fourth Quarter 8,350 1.91 Year 32,580 7.37
2014
First Quarter 9,100 2.10 Second Quarter 8,780 2.05 Third Quarter
8,070 1.89 Fourth Quarter 6,570 1.56 Year 32,520 7.60
2015
First Quarter 4,940 1.17 Second Quarter 4,190 1.00 Third Quarter
4,240 1.01 Fourth Quarter 2,780 0.67 Year 16,150 3.85
2016
First Quarter 1,810 0.43 Second Quarter 1,700 0.41
1 Computed using the average number of shares outstanding during
each period.
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