Exxon misses on Q1 profit despite big gains in Guyana
Earnings of US$8.22 billion for the first quarter ended March 31 were off 29% compared to adjusted profit of US$11.62 billion a year earlier
Exxon Mobil on Friday missed analysts’ estimates with a 28% year-on-year drop in first quarter profits as weaker refining margins and lower natural gas prices offset volume gains.
The largest U.S. oil company, which is in the process of closing a US$60 billion deal for top shale oil producer Pioneer Natural Resources posted first-quarter earnings of US$8.22 billion, or US$2.06 per share, compared to an US$11.43 billion net profit a year ago.
The stock was down 2% in pre-market trading to US$118.50 after reporting a profit per share of US$2.06, 6% shy of Wall Street analysts’ consensus for US$2.20 per share, LSEG estimates showed.
Earnings from oil and gas production fell 14% on lower natural gas prices and refining tumbled 67% on weaker margins and investment and tax costs. The chemicals business, however, was a standout, with earnings more than doubling on lower input costs and higher margins, the company said.
Earnings of US$8.22 billion for the first quarter ended March 31 were off 29% compared to adjusted profit of US$11.62 billion a year earlier.
But the results were the second highest for a first quarter in the past decade, behind the year-ago period, said Chief Financial Officer Kathryn Mikells. The miss was due in part to tax and inventory balance sheet adjustments, she said.
“Every quarter, we have some pluses and minuses associated with these one-off items”, she said. “Sometimes they are favorable, this time they were unfavorable.”
Global oil prices were largely flat against a year ago while natural gas prices fell sharply. U.S. gas futures traded 20% lower at the end of the quarter compared to a year-earlier.
Results were boosted by lower costs and higher volumes from Exxon’s Guyana operations. Hess a day earlier flagged the increase in output in the South American country with a 70% year-over-year output gain.
Exxon’s capital spending last quarter was the lowest in seven quarters and its streamlining of operations expanded what it calls structural cost savings by $400 million.
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