Exxon Mobil Corporation Announces Estimated Third Quarter 2009 Results
IRVING, Texas--(BUSINESS WIRE)-- Exxon Mobil Corporation (NYSE:XOM):
Third Quarter Nine Months
2009 2008 % 2009 2008 %
Earnings Excluding Special Items
$ Millions 4,730 13,380 -65 13,370 36,240 -63
$ Per Common Share
Assuming Dilution1 0.98 2.58 -62 2.74 6.87 -60
Special Items
$ Millions 0 1,450 (140 ) 1,160
Earnings1
$ Millions 4,730 14,830 -68 13,230 37,400 -65
$ Per Common Share
Assuming Dilution1 0.98 2.85 -66 2.71 7.09 -62
Capital and Exploration
Expenditures - $ Millions 6,493 6,853 -5 18,829 19,314 -3
1See Accounting guidance adopted in first quarter 2009
EXXONMOBIL'S CHAIRMAN REX W. TILLERSON COMMENTED:
"Despite ongoing global economic weakness and reduced demand for products, we continued our robust investment program and delivered strong results.
"Our third quarter earnings, excluding special items, were $4.7 billion. While continuing to be impacted by lower commodity prices and weak product margins, we maintained our focus on operational excellence and invested $19 billion through the first three quarters of the year to develop new energy supplies.
"Oil-equivalent production increased by 3% over the third quarter of 2008 with contributions from major start-ups of world-class assets including Qatargas 2, Train 5 and Ras Laffan 3, Train 6 in Qatar.
"We are well-positioned for continued production growth with projects such as QatarGas, RasGas and Gorgon LNG which will contribute additional long plateau production for decades and provide ExxonMobil with a strong foundation.
"ExxonMobil's industry leading financial strength has allowed us to continue to invest across the economic cycle focusing on world class opportunities.
"Our commitment to a disciplined and long term focused investment strategy sets ExxonMobil apart from its competitors.
"In addition to funding our capital and operating programs, we distributed $2.0 billion in dividends and purchased $4.0 billion of ExxonMobil common stock to reduce shares outstanding during the third quarter."
THIRD QUARTER HIGHLIGHTS
-- Earnings excluding special items were $4,730 million, a decrease of 65%
or $8,650 million from the third quarter of 2008.
-- Earnings per share excluding special items were $0.98, a decrease of
62%.
-- Earnings were down 68% from the third quarter of 2008 which included a
special gain of $1,620 million from the sale of a natural gas
transportation business in Germany and a special charge of $170 million
related to the Valdez punitive damages award. Earnings for the third
quarter of 2009 did not include any special items.
-- Capital and exploration expenditures were $6.5 billion, down 5% from the
third quarter of 2008, reflecting the impacts of a stronger U.S. dollar.
-- Oil-equivalent production increased nearly 3% from the third quarter of
2008. Excluding the impacts of entitlement volumes, OPEC quota effects
and divestments, production was up about 5%.
-- Cash flow from operations and asset sales was approximately $9.0
billion, including asset sales of $0.2 billion.
-- Share purchases of $4.0 billion reduced shares outstanding by 1.2%.
-- Two major liquefied natural gas (LNG) facilities in Qatar - Qatargas 2,
Train 5 and Ras Laffan 3, Train 6 - commenced production. With annual
production capacity of 7.8 million tons each, both trains join Qatargas
2, Train 4 as the largest operating LNG production facilities in the
world.
-- Participants in the Gorgon liquefied natural gas (LNG) project approved
a development plan that will include three LNG processing trains with a
capacity of 5 million tons per year each. The development decision
followed execution of LNG sales and purchase agreements with PetroChina
International Company Limited and Petronet LNG Limited of India for
ExxonMobil's equity share of LNG in the project.
-- Fujian Refining and Petrochemical Company Limited announced the startup
of new chemical units - including an ethylene steam cracker, a
polyethylene unit, a polypropylene unit and aromatics facilities - in
its new fully integrated refining and petrochemical complex in Fujian
Province, China.
-- ExxonMobil announced an alliance with leading biotech company, Synthetic
Genomics Inc., to research and develop next generation biofuels from
photosynthetic algae. If research and development milestones are met,
ExxonMobil expects to spend more than $600 million under the program.
Third Quarter 2009 vs. Third Quarter 2008
Upstream earnings, excluding special items, were $4,012 million down $5,339 million from the third quarter of 2008. Lower crude oil and natural gas realizations accounted for the majority of the decline, reducing earnings approximately $4.9 billion while higher operating costs reduced earnings approximately $300 million.
On an oil-equivalent basis, production increased nearly 3% from the third quarter of 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production was up about 5%.
Liquids production totaled 2,335 kbd (thousands of barrels per day), up 45 kbd from the third quarter of 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was up over 5%, as increased production from projects in the United States and Kazakhstan was partly offset by field decline.
Third quarter natural gas production was 8,129 mcfd (millions of cubic feet per day), up 309 mcfd from 2008. New production volumes from project additions in Qatar and the United States were partly offset by maintenance in Europe.
Earnings from U.S. Upstream operations were $709 million, $1,170 million lower than the third quarter of 2008. Non-U.S. Upstream earnings, excluding special items, were $3,303 million, down $4,169 million from last year.
Downstream earnings of $325 million were down $2,688 million from the third quarter of 2008. Lower refining margins drove the decline, reducing earnings $2.6 billion. Petroleum product sales of 6,301 kbd were 387 kbd lower than last year's third quarter, mainly reflecting asset sales and lower demand.
The U.S. Downstream recorded a loss of $203 million, down $1,181 million from the third quarter of 2008. Non-U.S. Downstream earnings of $528 million were $1,507 million lower than last year.
Chemical earnings of $876 million were $211 million lower than the third quarter of 2008. Weaker margins drove the decline, reducing earnings $170 million. Third quarter prime product sales of 6,356 kt (thousands of metric tons) were 296 kt higher than the prior year primarily due to the absence of last year's hurricane impacts.
Corporate and financing expenses excluding special items were $483 million, up $412 million due mainly to lower interest income.
During the third quarter of 2009, Exxon Mobil Corporation purchased 61 million shares of its common stock for the treasury at a gross cost of $4.2 billion. These purchases included $4.0 billion to reduce the number of shares outstanding, with the balance used to offset shares issued in conjunction with the company's benefit plans and programs. Shares outstanding were reduced from 4,806 million at the end of the second quarter to 4,747 million at the end of the third quarter. Share purchases to reduce shares outstanding are currently anticipated to equal $2.0 billion in the fourth quarter of 2009. Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.
First Nine Months 2009 vs. First Nine Months 2008
Earnings of $13,230 million ($2.71 per share) decreased $24,170 million from 2008. Excluding special items, earnings for the first nine months of 2009 were $13,370 million, a decrease of $22,870 million from 2008.
FIRST NINE MONTHS HIGHLIGHTS
-- Earnings excluding special items were $13,370 million, down 63%.
-- Earnings per share excluding special items decreased 60% to $2.74,
reflecting lower earnings and the continued reduction in the number of
shares outstanding.
-- Earnings were down 65% from 2008. Earnings for 2009 included a special
charge of $140 million for interest related to the Valdez punitive
damages award. Earnings for 2008 included a special gain of $1,620
million from the sale of a natural gas transportation business in
Germany and special charges of $460 million related to the Valdez
punitive damages award.
-- Oil equivalent production remained essentially flat with the same period
in 2008. Excluding the impacts of entitlement volumes, OPEC quota
effects and divestments, production was up 1%.
-- Cash flow from operations and asset sales was approximately $21.0
billion, including $1.1 billion from asset sales.
-- The Corporation distributed a total of $22.0 billion to shareholders in
the first nine months of 2009 through dividends and share purchases to
reduce shares outstanding.
-- Dividends per share of $1.24 increased 8%.
-- Capital and exploration expenditures were $18.8 billion, down 3% versus
2008 due to the stronger U.S. dollar.
Upstream earnings, excluding special items, were $11,327 million, down $16,821 million from 2008. Lower crude oil and natural gas realizations decreased earnings approximately $15.8 billion while higher operating costs reduced earnings about $1.0 billion.
On an oil-equivalent basis, production was essentially flat compared to the same period in 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production was up 1%.
Liquids production of 2,385 kbd remained flat with 2008. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was up over 2%, as new volumes from project additions in west Africa and the United States, and lower maintenance activity, were partly offset by field decline.
Natural gas production of 8,778 mcfd decreased 64 mcfd from 2008. Higher volumes from Qatar were more than offset by field decline.
Earnings from U.S. Upstream operations for 2009 were $1,882 million, a decrease of $3,662 million. Earnings outside the U.S. excluding special items were $9,445 million, down $13,159 million.
Downstream earnings of $1,970 million were $3,767 million lower than 2008. Weaker margins decreased earnings approximately $2.8 billion. Lower volumes and refinery optimization due to weaker demand reduced earnings about $500 million while higher operating costs resulted in a $300 million decline in earnings. Petroleum product sales of 6,407 kbd decreased from 6,761 kbd in 2008, mainly reflecting asset sales and lower demand.
U.S. Downstream earnings were $134 million, down $1,535 million. Non-U.S. Downstream earnings were $1,836 million, $2,232 million lower than last year.
Chemical earnings of $1,593 million decreased $1,209 million from 2008. Weaker margins reduced earnings by approximately $500 million while lower volumes reduced earnings about $400 million. Unfavorable foreign exchange effects decreased earnings by $200 million. Prime product sales of 18,150 kt were down 1,206 kt from 2008.
Corporate and financing expenses excluding special items were $1,520 million, up $1,073 million mainly due to lower interest income.
Gross share purchases through the first nine months of 2009 were $17.3 billion, reducing shares outstanding by 4.6%.
Estimates of key financial and operating data follow.
ExxonMobil will discuss financial and operating results and other matters on a webcast at 10 a.m. Central time on October 29, 2009. To listen to the event live or in archive, go to our website at exxonmobil.com.
Cautionary statement
Statements in this release relating to future plans, projections, events or conditions are forward-looking statements. Actual results, including project plans, costs, timing, and capacities; capital and exploration expenditures; and share purchase levels, could differ materially due to factors including: changes in long-term oil or gas prices or other market or economic conditions affecting the oil and gas industry; completion of repair projects as planned; unforeseen technical difficulties; political events or disturbances; reservoir performance; the outcome of commercial negotiations; wars and acts of terrorism or sabotage; changes in technical or operating conditions; and other factors discussed under the heading "Factors Affecting Future Results" on our website and in Item 1A of ExxonMobil's 2008 Form 10-K. We assume no duty to update these statements as of any future date. 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.
Frequently used terms
Consistent with previous practice, this press release includes both earnings excluding special items and earnings per share excluding special items. Both are non-GAAP financial measures and are included to help facilitate comparisons of base business performance across periods. Reconciliation to net income attributable to ExxonMobil is shown in Attachment II. The release also includes cash flow from operations and asset sales. Because of the regular nature of our asset management and divestment program, we believe it is useful for investors to consider sales proceeds 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. Further information on ExxonMobil's frequently used financial and operating measures and other terms is contained under the heading "Frequently Used Terms" available through the Investors section of our website at exxonmobil.com.
Accounting guidance adopted in first quarter 2009
Effective January 1, 2009, ExxonMobil adopted the authoritative guidance on consolidation as it relates to noncontrolling interests. The guidance changed the accounting and reporting for minority interests, which were recharacterized as noncontrolling interests and classified as a component of equity. The guidance required retrospective adoption of the presentation and disclosure requirements for existing minority interests. All other requirements will be applied prospectively. The adoption of the accounting guidance did not have a material impact on the Corporation's financial statements.
References to total corporate earnings mean net income attributable to ExxonMobil (U.S. GAAP) from the income statement. Unless otherwise indicated, references to earnings, special items, earnings excluding special items, Upstream, Downstream, Chemical and Corporate and Financing segment earnings, and earnings per share are ExxonMobil's share after excluding amounts attributable to noncontrolling interests.
Effective January 1, 2009, ExxonMobil adopted the authoritative guidance for earnings per share as it relates to determining whether instruments granted in share-based payment transactions are participating securities. The guidance required that all unvested share-based payment awards that contain nonforfeitable rights to dividends should be included in the basic Earnings Per Share (EPS) calculation. Prior-year EPS numbers have been adjusted retrospectively on a consistent basis with 2009 reporting. This guidance did not affect the consolidated financial position or results of operations.
Attachment I
EXXON MOBIL CORPORATION
THIRD QUARTER 2009
(millions of dollars, unless noted)
Third Quarter Nine Months
2009 2008 2009 2008
Earnings / Earnings Per Share1
Total revenues and other income 82,260 137,737 220,745 392,663
Total costs and other deductions 73,056 111,044 196,174 323,065
Income before income taxes 9,204 26,693 24,571 69,598
Income taxes 4,333 11,327 11,052 31,155
Net income including noncontrolling interests 4,871 15,366 13,519 38,443
Net income attributable to noncontrolling 141 536 289 1,043
interests
Net income attributable to ExxonMobil (U.S. 4,730 14,830 13,230 37,400
GAAP)
Earnings per common share (dollars) 0.98 2.86 2.72 7.13
Earnings per common share
- assuming dilution (dollars) 0.98 2.85 2.71 7.09
Other Financial Data
Dividends on common stock
Total 2,011 2,063 6,031 6,040
Per common share (dollars) 0.42 0.40 1.24 1.15
Millions of common shares outstanding
At September 30 4,747 5,087
Average - assuming dilution1 4,803 5,178 4,878 5,278
ExxonMobil share of equity at September 30 107,265 125,286
ExxonMobil share of capital employed at 120,351 138,185
September 30
Income taxes 4,333 11,327 11,052 31,155
Sales-based taxes 6,805 9,327 18,927 27,297
All other taxes 9,729 11,856 27,442 35,760
Total taxes 20,867 32,510 57,421 94,212
ExxonMobil share of income taxes of
equity companies 515 870 1,616 2,763
1See Accounting guidance adopted in first quarter 2009
Attachment II
EXXON MOBIL CORPORATION
THIRD QUARTER 2009
(millions of dollars)
Third Quarter Nine Months
2009 2008 2009 2008
Earnings (U.S. GAAP)
Upstream
United States 709 1,879 1,882 5,544
Non-U.S. 3,303 9,092 9,445 24,224
Downstream
United States (203 ) 978 134 1,669
Non-U.S. 528 2,035 1,836 4,068
Chemical
United States 315 257 477 643
Non-U.S. 561 830 1,116 2,159
Corporate and financing (483 ) (241 ) (1,660 ) (907 )
Net income attributable to ExxonMobil 4,730 14,830 13,230 37,400
Special Items
Upstream
United States 0 0 0 0
Non-U.S. 0 1,620 0 1,620
Downstream
United States 0 0 0 0
Non-U.S. 0 0 0 0
Chemical
United States 0 0 0 0
Non-U.S. 0 0 0 0
Corporate and financing 0 (170 ) (140 ) (460 )
Corporate total 0 1,450 (140 ) 1,160
Earnings Excluding Special Items
Upstream
United States 709 1,879 1,882 5,544
Non-U.S. 3,303 7,472 9,445 22,604
Downstream
United States (203 ) 978 134 1,669
Non-U.S. 528 2,035 1,836 4,068
Chemical
United States 315 257 477 643
Non-U.S. 561 830 1,116 2,159
Corporate and financing (483 ) (71 ) (1,520 ) (447 )
Corporate total 4,730 13,380 13,370 36,240
Cash flow from operations and asset sales(billions of
dollars)
Net cash provided by operating activities 8.8 14.4 19.9 49.2
(U.S. GAAP)
Sales of subsidiaries, investments and 0.2 2.6 1.1 4.2
property, plant and equipment
Cash flow from operations and asset sales 9.0 17.0 21.0 53.4
Attachment III
EXXON MOBIL CORPORATION
THIRD QUARTER 2009
Third Quarter Nine Months
2009 2008 2009 2008
Net production of crude oil
and natural gas liquids,
thousands of barrels daily (kbd)
United States 373 340 383 364
Canada/South America 267 283 272 287
Europe 350 397 381 431
Africa 666 639 694 637
Asia Pacific/Middle East 494 510 474 506
Russia/Caspian 185 121 181 158
Worldwide 2,335 2,290 2,385 2,383
Natural gas production available for sale,
millions of cubic feet daily (mcfd)
United States 1,260 1,163 1,257 1,256
Canada/South America 646 634 643 649
Europe 2,551 2,768 3,452 3,713
Africa 16 33 21 32
Asia Pacific/Middle East 3,510 3,135 3,263 3,086
Russia/Caspian 146 87 142 106
Worldwide 8,129 7,820 8,778 8,842
Oil-equivalent production (koebd)1 3,690 3,593 3,848 3,857
1 Gas converted to oil-equivalent at 6 million cubic feet = 1 thousand
barrels
Attachment IV
EXXON MOBIL CORPORATION
THIRD QUARTER 2009
Third Quarter Nine Months
2009 2008 2009 2008
Refinery throughput (kbd)
United States 1,751 1,592 1,773 1,720
Canada 417 468 414 448
Europe 1,542 1,647 1,540 1,603
Asia Pacific 1,349 1,328 1,321 1,363
Other 293 319 293 316
Worldwide 5,352 5,354 5,341 5,450
Petroleum product sales (kbd)
United States 2,462 2,437 2,525 2,523
Canada 412 452 411 439
Europe 1,607 1,736 1,615 1,721
Asia Pacific 1,292 1,338 1,328 1,356
Other 528 725 528 722
Worldwide 6,301 6,688 6,407 6,761
Gasolines, naphthas 2,593 2,622 2,556 2,641
Heating oils, kerosene, diesel 1,851 2,063 2,009 2,073
Aviation fuels 553 640 541 625
Heavy fuels 596 602 585 639
Specialty products 708 761 716 783
Worldwide 6,301 6,688 6,407 6,761
Chemical prime product sales,
thousands of metric tons (kt)
United States 2,525 2,248 7,087 7,505
Non-U.S. 3,831 3,812 11,063 11,851
Worldwide 6,356 6,060 18,150 19,356
Attachment V
EXXON MOBIL CORPORATION
THIRD QUARTER 2009
(millions of dollars)
Third Quarter Nine Months
2009 2008 2009 2008
Capital and Exploration Expenditures
Upstream
United States 858 1,000 2,602 2,334
Non-U.S. 4,049 4,277 11,576 12,295
Total 4,907 5,277 14,178 14,629
Downstream
United States 396 421 1,156 1,198
Non-U.S. 435 423 1,138 1,377
Total 831 844 2,294 2,575
Chemical
United States 66 123 237 345
Non-U.S. 681 598 2,098 1,739
Total 747 721 2,335 2,084
Other 8 11 22 26
Worldwide 6,493 6,853 18,829 19,314
Exploration expenses charged to income
included above
Consolidated affiliates
United States 60 45 155 144
Non-U.S. 434 353 1,178 924
Equity companies - ExxonMobil share
United States 0 0 0 0
Non-U.S. 7 6 9 13
Worldwide 501 404 1,342 1,081
Attachment VI
EXXON MOBIL CORPORATION
EARNINGS
$ Millions $ Per Common Share1,2
2005
First Quarter 7,860 1.23
Second Quarter 7,640 1.21
Third Quarter 9,920 1.58
Fourth Quarter 10,710 1.72
Year 36,130 5.74
2006
First Quarter 8,400 1.38
Second Quarter 10,360 1.72
Third Quarter 10,490 1.77
Fourth Quarter 10,250 1.77
Year 39,500 6.64
2007
First Quarter 9,280 1.63
Second Quarter 10,260 1.83
Third Quarter 9,410 1.71
Fourth Quarter 11,660 2.14
Year 40,610 7.31
2008
First Quarter 10,890 2.03
Second Quarter 11,680 2.24
Third Quarter 14,830 2.86
Fourth Quarter 7,820 1.55
Year 45,220 8.70
2009
First Quarter 4,550 0.92
Second Quarter 3,950 0.82
Third Quarter 4,730 0.98
1 Computed using the average number of shares outstanding during each
period.
The sum of the four quarters may not add to the full year.
2 See Accounting guidance adopted in first quarter 2009
Source: Exxon Mobil Corporation
Released October 29, 2009