HOUSTON – Exxon Mobil Corp on Friday reported a 56% droop in second-quarter revenue, lacking Wall Avenue bets and becoming a member of rivals harm by a pointy drop in vitality costs and decrease gas margins.
Second-quarter outcomes from oil majors have tumbled from large income booked a yr in the past after Russia’s invasion of Ukraine despatched oil and fuel costs hovering.
Chevron Corp, Shell and TotalEnergies have reported revenue falls of 48%, 56% and 49%, respectively.
Shares of Exxon and Chevron have been down lower than 1% in pre-market buying and selling within the absence of constructive surprises.
“Outcomes got here in barely weaker than anticipated throughout earnings and money stream,” RBC analyst Biraj Borkhataria wrote in a observe. “We’d count on Exxon to underperform the peer group right now”.
Borkhataria mentioned Friday’s full outcomes from Chevron, which had posted its predominant numbers on Sunday, have been impartial.
Internet revenue was $7.88 billion, or 1.94 cents per share versus a document $17.85 billion a yr earlier. Wall Avenue was anticipating $2.01 per share, Refinitiv Eikon information confirmed.
But excluding final yr’s document second quarter, Exxon posted its strongest end result for the months of April to June in additional than a decade, helped by value cuts and the sale of much less worthwhile belongings.
“That’s fairly quarter for us,” Chief Monetary Officer Kathryn Mikells advised Reuters. Final yr apart, she famous: “You would need to return to the second quarter of 2011 to seek out the final time we produced this stage of earnings within the second quarter.”
Benchmark Brent crude costs averaged $80 a barrel, down from $110 a yr earlier. Costs for liquefied pure fuel (LNG) fell to $11.75 per million British thermal items (mmBtu) from round $33.
“Decrease pure fuel realizations and trade refining margins adversely impacted earnings,” Exxon mentioned in its earnings assertion.
“Business margins declined sequentially from a powerful first quarter on weaker diesel margins as Russian provide considerations eased,” the corporate mentioned, pointing to earnings in Power Merchandise of $2.3 billion, down $1.9 billion from the primary quarter.
Serving to offset that was a bounce in earnings in Chemical Merchandise to $828 million from $371 million within the first quarter helped by decrease feed prices, it mentioned.
Exxon’s oil manufacturing stands at 3.7 million barrels of oil equal per day (boed) yr thus far, according to the corporate’s annual goal, Mikells mentioned.
Outcomes have been helped by higher output within the U.S. Permian basin, which delivered 622,000 boed within the quarter, and in Guyana, the place Exxon plans to extend manufacturing by 5% to 400,000 boed by yr finish.
Capital and exploration spending was $6.2 billion within the second quarter and $12.5 billion for the primary half of 2023, according to the corporate’s full-year steering of $23 billion to $25 billion, the corporate mentioned.
The corporate has achieved cumulative structural value financial savings of $8.3 billion from 2019 ranges, nearing its $9 billion goal.
Exxon earlier this month mentioned it could purchase fuel pipeline firm Denbury Inc for $4.9 billion to speed up its vitality transition enterprise with carbon seize and storage (CCS) operations.
The oil large distributed about $8 billion in money to shareholders within the second quarter together with about $3.7 billion in dividends.
“We’re very comfy total with our capital allocation strategy,” Mikells mentioned. “So we’re dedicated to persevering with that balanced strategy.”
(Reporting by Sabrina Valle; modifying by Sonali Paul and Jason Neely)
