Im honestly surprised that no one brought this up today, considering how sensitive everyone is about Oil & Fuel prices. :mamoru:
“Exxon’s annual results, up nearly 10% from $36 billion in 2005, set a new benchmark for U.S. corporate profit. Revenue for the year rose 2% to $377.6 billion – flowing in at a rate of more than a billion dollars a day.”
http://www.marketwatch.com/News/Story/Story.aspx?guid=F93B97E5-4B94-4554-9F74-965EBE752B8C}
Exxon Mobil’s net falls, faces more pressure
Momentum carries oil giant past weaker quarter; annual profit is a recordBy Jasmina Kelemen, MarketWatch
Last Update: 4:56 PM ET Feb 1, 2007HOUSTON (MarketWatch) – Exxon Mobil Corp. turned in its biggest profit ever on Thursday, with momentum from last year’s record oil prices powering the world’s No. 1 publicly-traded oil company through a weaker fourth quarter to a staggering $39.5 billion profit for 2006.
Exxon’s annual results, up nearly 10% from $36 billion in 2005, set a new benchmark for U.S. corporate profit. Revenue for the year rose 2% to $377.6 billion – flowing in at a rate of more than a billion dollars a day.
But there were ample signs in Exxon’s report that even the industry’s leader isn’t immune to headwinds like slimmer refining margins and lower natural gas prices when compared with record-high earnings racked up in 2005, the year massive hurricanes devastated the heart of the U.S. gulf oil region.
For the three months ended Dec. 31, Exxon Mobil (XOM exxon mobil corp com reported net earnings of $10.25 billion, or $1.76 a share, down 4% from $10.71 billion, or $1.71 a share, a year earlier. The latest quarter includes a special tax-related gain of $410 million.Adjusted to exclude one-time items, the company earned $9.84 billion, or $1.69 a share, in the latest quarter versus $10.32 billion, or $1.65 a share, a year ago.
Fourth-quarter revenue for the Irving, Texas-based company fell 9% in the latest quarter to $90.03 billion from $99.34 billion a year ago.
Exxon Mobil had more than 6% fewer average common shares outstanding as of Dec. 31 than at the end of 2005.
Analysts expected the company’s bottom line to suffer in the last three months of 2006 but lauded Exxon’s ability to roll with the market’s punches and said a number of recent start-ups will continue to set the industry giant apart from its peers.
“The resilience of Exxon’s earnings will be the focus today,” said Citigroup analyst Doug Leggate in a note to clients. “In a falling commodity environment the mix has remained remarkably resilient,” he said.
“The outlook remains strong, with a raft of new projects and full year benefits of 2006 start-ups set to drive production growth at 5% to 6% annually over the next three years and continues to differentiate Exxon from its peers,” said Leggate.
The industry behemoth produced better-than-expected results across all major business segments and is well positioned with development projects around the world to continue to turn in solid performances, said AG Edwards analyst Bruce Lanni in a note.
The fourth quarter was a tough one for an industry that had enjoyed several years of successive quarterly growth. In addition to the havoc hurricanes played on supply lines, the market went through a costly and disruptive switchover to cleaner-burning ethanol additives from MTBE, driving oil prices to $78 a barrel and pushing gasoline above $3 a gallon in the process.
But the balloon popped and oil and natural gas prices fell sharply toward year’s end, while refining margins – the spread between the price of a barrel of oil and the refined products it yields – narrowed steadily between the third and fourth quarter.
The average benchmark price of oil during the fourth quarter fell nearly $11 a barrel, or 15%, dragging energy-company share prices along with it.
Buffeted by higher exploration costs, lower commodity prices, weaker refining margins, and rising taxes and royalties, former earnings gushers such as Exxon Mobil and Chevron Corp. which reports financial results on Friday, were widely expected to show quarterly drop-offs both sequentially and on a year-over-year basis.
Despite the tougher marketplace, Exxon Mobil’s latest results nevertheless topped Wall Street earnings estimates. Analysts surveyed by Thomson Financial had predicted it would hand in earnings of $1.51 a share.
Exxon Mobil’s shares have fallen 6% since reaching an all-time closing high of $78.73 in early December. The shares, part of the Dow Jones Industrial Average, gained 1.3% to $75.08.
Upstream earnings, generated from Exxon Mobil’s exploration and production segment, totaled $6.22 billion in the latest quarter, down about $818 million from last year, due to lower natural-gas realizations and decreased volumes resulting from lower European demand.
Downstream earnings totaled $1.96 billion, down $430 million from last year, with the company’s lower margins for refining and marketing offsetting benefits from its efforts to efficiently manage inventories.
Chemical-segment earnings excluding items rose to $1.24 billion in the latest quarter, benefiting from improved margins and higher volumes.
Exxon Mobil also said it repurchased 115 million common shares during the fourth quarter at a gross cost of $8.4 billion. Shares outstanding were reduced to 5.73 billion as of Dec. 31
