Exxon posts $9.1 billion net, down from year-ago, up 15% from 2Q (updated)
27/10/2023 12:16
(Adds more details on earnings, CFO interview from paragraph 8)
By Sabrina Valle
HOUSTON, Oct 27 (Reuters) - Exxon Mobil Corp XOM.N on
Friday posted a $9.1 billion third-quarter profit, about a 54%
drop from record earnings a year ago but up from the prior
quarter as oil prices recovered.
Earnings at the largest U.S. oil producer have benefited
from higher crude oil prices compared to the previous quarter
and demand for gasoline and diesel. Wall Street this month
trimmed its third-quarter outlook after the company pointed to
weaker chemical profits and refining margins.
Exxon's buoyant performance has led to two all-stock deals:
for shale rival Pioneer Natural Resources and for carbon
pipeline operator Denbury, both struck as shares traded near an
all-time record.
Third-quarter profit was $2.25 a share compared with $4.68
in the same quarter a year ago when oil and gas prices climbed
following Russia's invasion of Ukraine.
The latest quarter's results benefited from global oil
prices that averaged $85.92 per barrel in the quarter, from
$77.73 in the second quarter, according to LSEG data.
The results were aided by higher oil and fuel prices, but
damped by Exxon's chemical business, which was hit by higher raw
materials costs. Chemical Products third-quarter earnings were
$249 million, down from $828 million in the second quarter.
Its cash reserves continued to build, up by 10% over the
second quarter's to $33 billion.
"We feel really good about our cash balance," said Chief
Financial Officer Kathryn Mikells said in an interview. "It puts
us in a good position to ultimately ensure we have the
flexibility we need when eventually the commodity cycle turns
against us."
Mikells said the company is keeping unaltered its 3.7
million boepd production target for 2023. It is also on track to
distribute $17.5 billion in buybacks this year.
Exxon in the third quarter achieved a target to reduce its
costs by year end by $9 billion compared to 2019.
Exxon beat a quarter earlier a $9 billion year-end cost
saving target versus 2019. The oil producer also placed its
full-year capital expenditures at the top end of its $23 billion
to $25 billion guidance.
The company has been selling assets around the world as it
focuses on more lucrative projects in the U.S. shale and in
South America Guyana and it recently put its Italy refinery up
for sale.
Exxon also concluded in the third quarter the sale of a
refinery in Thailand and received $900 million in proceeds,
raising asset sales this year to $3.1 billion. Mikells did not
anticipate an acceleration of asset sales following the Pioneer
acquisition.
The U.S. company will more than double its Permian
production to 1.3 million oil equivalent barrels per day (boepd)
after the acquisition is concluded in the first half of next
year.
Higher production from Guyana and the Permian provided a
partial offset to lower crude and natural gas realizations and
divestments, compared with last year.
Excluding identified items, earnings declined $13.3 billion
to $17.2 billion year to date.
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Exxon 3Q profits to climb from last quarter on higher prices
https://www.reuters.com/markets/commodities/exxon-mobil-expects-third-quarter-oil-earnings-grow-2023-10-04
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(Reporting by Sabrina Valle. Editing by Jane Merriman)
((sabrina.valle@tr.com; Twitter: @sabrinavalle;))