ExxonMobil Earnings Rise 50 Percent to $4 Billion on Solid Business Performance
Mobil Corporation (XOM):
Cash flow from operations and asset sales exceeds dividends and net
investments(1) for the fourth-consecutive quarter
Company makes fifth Guyana discovery; captures 12 high-potential
blocks offshore Brazil
Hurricane Harvey reduces earnings by an estimated $160 million, or 4
cents per share
(Dollars in millions, except per share data)
Earnings Per Common Share
Exxon Mobil Corporation announced estimated third quarter 2017 earnings
of $4 billion, or $0.93 per diluted share, compared with $2.7 billion a
year earlier as commodity prices improved and performance in the
Upstream and Downstream strengthened. Impacts related to Hurricane
Harvey reduced earnings by an estimated 4 cents per share.
"A 50 percent increase in earnings through solid business performance
and higher commodity prices is a step forward in our plan to grow
profitability," said Darren Woods, chairman and chief executive officer.
"For the fourth-consecutive quarter, we generated cash flow from
operations and asset sales that more than covered our dividends and net
investments in the business."
Upstream earnings rose to $1.6 billion as commodity prices increased.
Building on its recent success in deepwater exploration, such as the
Turbot discovery in Guyana, ExxonMobil added 12 offshore blocks in
Brazil, capturing acreage with high resource potential and competitive
Downstream results increased to $1.5 billion, despite Hurricane Harvey
impacts and the absence of favorable asset management gains of
$380 million in the prior year from the sale of Canadian retail assets.
These results were achieved as the company worked quickly to safely
bring refineries back online following the storm and to restore product
Chemical earnings were $1.1 billion, down slightly from a year ago on
lower commodity margins and hurricane impacts, partially offset by
volume growth. During the quarter the company enhanced its position to
capture growing demand in Asia by completing the purchase of an
aromatics plant in Singapore.
(1)Includes additions to property, plant and
equipment and net investments / advances
Third Quarter 2017 Highlights
Earnings of $4 billion increased 50 percent from the third quarter of
Earnings per share assuming dilution were $0.93.
Cash flow from operations and asset sales increased 33 percent to $8.4
billion, including proceeds associated with asset sales of $854
Capital and exploration expenditures were $6 billion, including an
aromatics plant acquisition in Singapore.
Oil-equivalent production was 3.9 million barrels per day, up 2
percent from the prior year. Excluding entitlement effects and
divestments, oil-equivalent production remained at 2 percent higher
than the prior year.
The corporation distributed $3.3 billion in dividends to shareholders.
Dividends per share of $0.77 increased 2.7 percent compared to the
third quarter of 2016.
The company acquired an interest in 12 blocks offshore Brazil during
the last bid round completed during the quarter. The bid resulted in
the addition of 2 million high-potential acres with competitive fiscal
The company completed the Turbot-1 exploration well offshore Guyana.
The well encountered 75 feet (23 meters) of high-quality, oil-bearing
sandstone, and represents ExxonMobils fifth discovery to date in the
ExxonMobil signed a production sharing contract for Block 59 located
190 miles (305 kilometers) offshore Suriname. The deepwater block has
an area of 2.8 million acres and significantly expands the
corporations operated acreage in the Guyana-Suriname basin.
During the quarter, ExxonMobil announced it added 22,000 acres since
May to its Permian Basin portfolio through a series of acquisitions
and acreage trades. Located in the Delaware and Midland Basins, the
new acreage adds over 400 million oil-equivalent barrels to the
companys existing Permian Basin resource base of 6 billion
ExxonMobil completed the acquisition of one of the worlds largest
aromatics facilities, located in Singapore, from Jurong Aromatics
Corporation Pte Ltd. The acquisition will provide operational and
logistical synergies between the plant and ExxonMobils integrated
refining and petrochemical complex, as well as increase ExxonMobil
Singapores aromatics production to over 3.5 million metric tons per
Third Quarter 2017 vs. Third Quarter 2016
Upstream earnings were $1.6 billion in the third quarter of 2017, up
$947 million from the third quarter of 2016. Higher liquids and gas
realizations increased earnings by $860 million. Higher volume and mix
effects increased earnings by $20 million. All other items increased
earnings by $70 million as lower expenses were partly offset by
unfavorable foreign exchange effects.
On an oil-equivalent basis, production increased 2 percent from the
third quarter of 2016. Liquids production totaled 2.3 million barrels
per day, up 69,000 barrels per day as lower downtime and higher project
volumes were partly offset by field decline. Natural gas production was
9.6 billion cubic feet per day, down 16 million cubic feet per day from
2016 as field decline and lower demand were partly offset by project
ramp-up, primarily in Australia, and work programs.
U.S. Upstream results were a loss of $238 million in the third quarter
of 2017, compared to a loss of $477 million in the third quarter of
2016. Non-U.S. Upstream earnings were $1.8 billion, up $708 million from
the prior year.
Downstream earnings were $1.5 billion, up $303 million from the third
quarter of 2016. Higher refining margins increased earnings by
$1 billion. Volume and mix effects decreased earnings by $160 million.
All other items decreased earnings by $550 million, reflecting the
absence of favorable asset management gains of $380 million in the prior
year from the sale of Canadian retail assets and higher expenses related
to Hurricane Harvey. Petroleum product sales of 5.5 million barrels per
day were 43,000 barrels per day lower than last years third quarter.
Earnings from the U.S. Downstream were $391 million, up $166 million
from the third quarter of 2016. Non-U.S. Downstream earnings of
$1.1 billion were $137 million higher than prior year.
Chemical earnings of $1.1 billion were $79 million lower than the third
quarter of 2016. Weaker margins decreased earnings by $200 million.
Volume and mix effects increased earnings by $120 million. Third quarter
prime product sales of 6.4 million metric tons were 313,000 metric tons
or 5 percent higher than the prior year, despite Hurricane Harvey
U.S. Chemical earnings of $403 million were $31 million lower than the
third quarter of 2016. Non-U.S. Chemical earnings of $689 million were
$48 million lower than prior year.
Corporate and financing expenses were $221 million for the third quarter
of 2017, down $149 million from the third quarter of 2016 mainly due to
favorable impacts from the resolution of long-standing tax items.
First Nine Months 2017 Highlights
Earnings of $11.3 billion increased 84 percent from $6.2 billion in
Earnings per share assuming dilution were $2.66.
Cash flow from operations and asset sales was $24.4 billion, including
proceeds associated with asset sales of $1.7 billion.
Capital and exploration expenditures were $14.1 billion, down 3
percent from 2016.
Oil-equivalent production was 4 million barrels per day, down 1
percent from the prior year. Excluding entitlement effects and
divestments, oil-equivalent production was up 1 percent from the prior
The corporation distributed $9.7 billion in dividends to shareholders.
First Nine Months 2017 vs. First Nine Months 2016
Upstream earnings were $5 billion, up $4.2 billion from 2016. Higher
realizations increased earnings by $4.1 billion. Unfavorable volume and
mix effects decreased earnings by $300 million. All other items
increased earnings by $380 million, primarily due to lower expenses
partly offset by unfavorable tax items in the current year.
On an oil-equivalent basis, production of 4 million barrels per day was
down 1 percent compared to 2016. Liquids production of 2.3 million
barrels per day decreased 65,000 barrels per day as field decline and
lower entitlements were partly offset by increased project volumes and
work programs. Natural gas production of 10.1 billion cubic feet per day
increased 106 million cubic feet per day from 2016 as project ramp-up,
primarily in Australia, was partly offset by field decline.
U.S. Upstream results were a loss of $439 million in 2017, compared to a
loss of $1.8 billion in 2016. Earnings outside the U.S. were
$5.4 billion, up $2.8 billion from the prior year.
Downstream earnings of $4 billion increased $1.1 billion from 2016.
Stronger refining and marketing margins increased earnings by
$1.3 billion, while volume and mix effects increased earnings by $110
million. All other items decreased earnings by $290 million, mainly
reflecting the absence of the Canadian retail assets sale. Petroleum
product sales of 5.5 million barrels per day were 26,000 barrels per day
higher than 2016.
U.S. Downstream earnings were $1 billion, an increase of $206 million
from 2016. Non-U.S. Downstream earnings were $3 billion, up $867 million
from the prior year.
Chemical earnings of $3.2 billion decreased $495 million from 2016.
Weaker margins decreased earnings by $320 million. Volume and mix
effects increased earnings by $70 million. All other items decreased
earnings by $250 million, primarily due to higher expenses from
increased turnaround activity and new business growth. Prime product
sales of 18.6 million metric tons were up 22,000 metric tons from the
first nine months of 2016.
U.S. Chemical earnings were $1.4 billion, down $111 million from 2016.
Non-U.S. Chemical earnings of $1.8 billion were $384 million lower than
Corporate and financing expenses were $954 million in 2017 compared to
$1.4 billion in 2016, with the decrease mainly due to favorable impacts
from the resolution of long-standing tax items.
During the first nine months of 2017, Exxon Mobil Corporation purchased
6 million shares of its common stock for the treasury at a gross cost of
$496 million. These shares were acquired to offset dilution in
conjunction with the companys 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. The company also
issued a combined 96 million shares of common stock during the first
quarter to complete the acquisition of InterOil Corporation and the
acquisition of entities that own oil and gas properties located
primarily in the Permian Basin.
As part of its annual planning and budgeting cycle which is completed in
the fourth quarter each year, the corporation develops crude and natural
gas price outlooks as well as estimates of future costs and other
factors necessary to complete its plan. Managements price outlook and
other factors, including factors such as operating costs, resource
productivity, and capital efficiency, are re-assessed when facts and
circumstances warrant but no less often than annually. To the extent any
impairment testing may be required, management uses assumptions that are
reasonable in relation to these factors in developing estimates of
future cash flows. An asset group would be impaired if its estimated
undiscounted cash flows were less than the assets carrying value, and
impairment would be measured by the amount by which the carrying value
exceeds fair value. Development of future undiscounted cash flow
estimates requires significant management judgment, particularly in
cases where an assets life is expected to extend decades into the
future, and an important component of the estimate is managements
outlook on prices and other factors as noted above.
The corporation has identified emerging trends such as increasing
estimates of available natural gas supplies and ongoing reductions in
costs of supply for natural gas. In the fourth quarter of 2017, the
corporation will incorporate the impacts of these trends and the
resulting lower price outlook in its annual planning and budgeting
cycle. Once complete, the corporation expects to perform an impairment
assessment for its North American natural gas asset groups utilizing the
information developed as part of the planning and budgeting process. It
is not practicable at this time to estimate the impact these trends
would have on the undiscounted cash flows for individual asset groups or
any resulting impairment charges. However these trends are likely to
place the corporations North American natural gas asset groups at risk
for potential impairment. The corporation will complete its analysis of
relevant factors as discussed above and perform any necessary impairment
testing in connection with the preparation of the corporations year-end
financial statements for inclusion in its 2017 Form 10-K.
ExxonMobil will discuss financial and operating results and other
matters during a webcast at 8:30 a.m. Central Time on October 27, 2017.
To listen to the event or access an archived replay, please visit www.exxonmobil.com.
Statements relating to future plans, projections, events or
conditions are forward-looking statements. Future results, including
project plans, costs, timing, and capacities; efficiency gains; capital
and exploration expenditures; production rates; resource recoveries; the
impact of new technologies; potential impairment charges; and share
purchase levels, could differ materially due to factors including:
changes in oil, gas or petrochemical prices or other market or economic
conditions affecting the oil, gas or petrochemical industries, 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 and outcome of commercial negotiations; the
results of research programs; changes in technical or operating
conditions; actions of competitors; and other factors discussed under
the heading "Factors Affecting Future Results" in the "Investors"
section of our website and in Item 1A of ExxonMobils 2016 Form 10-K. We
assume no duty to update these statements as of any future date.
Frequently Used Terms and Non-GAAP Measures
This press release 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
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 the resource base and other quantities of oil, natural gas
or condensate 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 ExxonMobils 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
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 ExxonMobils share after excluding amounts attributable to
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.
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
(millions of dollars, unless noted)
Earnings / Earnings Per Share
Total revenues and other income
Total costs and other deductions
Income before income taxes
Net income including noncontrolling interests
Net income attributable to noncontrolling interests
Net income attributable to ExxonMobil (U.S. GAAP)
Earnings per common share (dollars)
Earnings per common share - assuming dilution (dollars)
Dividends on common stock
Per common share (dollars)
Millions of common shares outstanding
At September 30
Average - assuming dilution
ExxonMobil share of equity at September 30
ExxonMobil share of capital employed at September 30
All other taxes
ExxonMobil share of income taxes of equity companies
Corporate and financing
Net income attributable to ExxonMobil
Cash flow from operations and asset sales (billions of
Net cash provided by operating activities
Proceeds associated with asset sales
Cash flow from operations and asset sales
Net production of crude oil, natural gas liquids, bitumen and
synthetic oil, thousand barrels per day (kbd)
Canada / South America
Australia / Oceania
Natural gas production available for sale, million cubic feet per
Canada / South America
Australia / Oceania
Oil-equivalent production (koebd)(1)
(1)Gas converted to oil-equivalent at 6 million cubic feet = 1
Refinery throughput (kbd)
Petroleum product sales (kbd)
Heating oils, kerosene, diesel
Chemical prime product sales, thousand metric tons (kt)
Capital and Exploration Expenditures
Exploration expenses charged to income included above
Equity companies - ExxonMobil share
$ Per Common Share(1)
(1) Computed using the average number of shares
outstanding during each period.
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SOURCE: Exxon Mobil Corporation
Media Relations, 972-444-1107