July 26th, 2007 05:37 EST
Exxon Mobil Corporation Estimated Second Quarter 2007 Results
"ExxonMobil`s second quarter net income was $10,260 million. Earnings per share were up 6% from the second quarter of 2006. Lower natural gas realizations were mostly offset by higher refining, marketing and chemical margins. Record first half net income of $19,540 million increased by 4% versus 2006 and 12% on an earnings per share basis over the first half of 2006.
"ExxonMobil continued to actively invest in the second quarter, spending $5.0 billion on capital and exploration projects. For the first half of 2007, spending on capital and exploration projects was $9.3 billion.
"The Corporation distributed a total of $9.0 billion to shareholders in the second quarter through dividends of $2.0 billion and share purchases to reduce shares outstanding of $7.0 billion, an increase of 14% versus the second quarter of 2006."
SECOND QUARTER HIGHLIGHTS
- Net income was $10,260 million. Earnings per share were up 6% to $1.83 reflecting the reduced number of shares outstanding.
- Cash flow from operations and asset sales was approximately $12.5 billion, including asset sales of $1.2 billion.
- Spending on capital and exploration projects was $5.0 billion.
- Excluding cumulative entitlement and divestment impacts, as well as OPEC quota effects, liquids production increased by 5%.
- ExxonMobil completed drilling the longest measured depth extended-reach drilling well in the world. Located on Sakhalin Island offshore Eastern Russia, the record-setting well achieved a total measured depth of 37,016 feet or over seven miles.
Second Quarter 2007 vs. Second Quarter 2006
Upstream earnings were $5,953 million, down $1,181 million from the second quarter of 2006 primarily reflecting lower gas realizations, lower gains on asset sales and the absence of prior period tax items.
On an oil-equivalent basis, production decreased by 1% from the second quarter of 2006. Excluding the cumulative impact of entitlements and divestments, as well as OPEC quota effects, production was up nearly 4%.
Liquids production of 2,668 kbd (thousands of barrels per day) was 34 kbd lower. Mature field decline was partly offset by increased production from projects in Russia and Qatar. Excluding cumulative entitlement and divestment effects, as well as OPEC quota impacts, liquids production increased by 5%.
Second quarter natural gas production was 8,711 mcfd (millions of cubic feet per day) compared with 8,754 mcfd last year. The impact of mature field decline and lower European demand was offset by higher volumes from projects in Qatar, Canada and Malaysia and the absence of planned maintenance activity in 2006. Excluding cumulative entitlement and divestment effects natural gas production increased by nearly 1%.
Earnings from U.S. Upstream operations were $1,222 million, $422 million lower than the second quarter of 2006. Non-U.S. Upstream earnings were $4,731 million, down $759 million from 2006.
Downstream earnings were $3,393 million, up $908 million from the second quarter of 2006, driven by higher refining and marketing margins and the sale of the Ingolstadt refinery in Germany. Petroleum product sales were 6,974 kbd, 86 kbd lower than last year`s second quarter.
U.S. Downstream earnings were $1,745 million, up $391 million from the second quarter of 2006. Non-U.S. Downstream earnings of $1,648 million were $517 million higher.
Chemical earnings were $1,013 million, up $173 million from the second quarter of 2006 due to improved margins. Prime product sales of 6,897 kt (thousands of metric tons) in the second quarter of 2007 were up 42 kt from the prior year.
Corporate and financing expenses of $99 million were flat with 2006.
During the second quarter of 2007, Exxon Mobil Corporation purchased 99 million shares of its common stock for the treasury at a gross cost of $8.1 billion. These purchases included $7.0 billion to reduce the number of shares outstanding, with the balance used to offset shares issued in conjunction with the company`s benefit plans and programs. Shares outstanding were reduced from 5,633 million at the end of the first quarter to 5,546 million at the end of the second quarter. Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.
First Half 2007 vs. First Half 2006
Net income of $19,540 million ($3.45 per share) was a record and increased $780 million from 2006.
FIRST HALF HIGHLIGHTS
- Net income was a record $19,540 million, an increase of 4%.
- Earnings per share increased by 12% due to strong earnings and the reduction in the number of shares outstanding.
- Cash flow from operations and asset sales was approximately $27.3 billion, including $1.7 billion from asset sales.
- The Corporation distributed a total of $17.8 billion to shareholders in 2007 through dividends and share purchases to reduce shares outstanding, an increase of $2.9 billion versus 2006.
- Capital and exploration expenditures were $9.3 billion.
- Excluding cumulative entitlement and divestment impacts, as well as OPEC quota effects, liquids production increased by 6%.
Upstream earnings were $11,994 million, a decrease of $1,523 million from 2006 due to lower liquids and natural gas realizations and lower gains from asset sales.
On an oil-equivalent basis, production decreased 2% from last year. Excluding cumulative entitlement and divestment effects, as well as OPEC quota impacts, production increased by 2%.
Liquids production of 2,707 kbd increased by 7 kbd from 2006. Higher production from projects in West Africa and Russia was partly offset by mature field decline. Excluding cumulative entitlement and divestment effects, as well as OPEC quota impacts, liquids production increased 6%.
Natural gas production of 9,409 mcfd decreased 549 mcfd from 2006. Lower volumes from mature field decline and lower European demand were partly offset by projects in Qatar, Canada and Malaysia.
Earnings from U.S. Upstream operations for 2007 were $2,399 million, a decrease of $525 million. Earnings outside the U.S. were $9,595 million, $998 million lower than 2006.
Downstream earnings were $5,305 million, an increase of $1,549 million from 2006 reflecting stronger worldwide refining and marketing margins and the sale of the Ingolstadt refinery in Germany. Petroleum product sales of 7,085 kbd decreased from 7,118 kbd in 2006.
U.S. Downstream earnings were $2,584 million, up $551 million. Non-U.S. Downstream earnings were $2,721 million, $998 million higher than last year.
Chemical earnings were $2,249 million, up $460 million from 2006 driven by higher margins. Prime product sales were 13,702 kt, down 69 kt from 2006.
Corporate and financing expenses were $8 million, a decrease of $294 million, mainly due to favorable tax items.
Gross share purchases in 2007 were $16.0 billion which reduced shares outstanding by 3.2%.
Estimates of key financial and operating data follow.
ExxonMobil will discuss financial and operating results and other matters on a webcast at 10 a.m. Central time on July 26, 2007. To listen to the event live or in archive, go to our website at "exxonmobil.com."
Statements in this release relating to future plans, projections, events or conditions are forward-looking statements. Actual results, including project plans and related expenditures, resource recoveries, timing and capacities, could differ materially due to changes in long-term oil or gas prices or other market conditions affecting the oil and gas industry; political events or disturbances; reservoir performance; the outcome of commercial negotiations; potential liability resulting from pending or future litigation; wars and acts of terrorism or sabotage; changes in technical or operating conditions; and other factors discussed under the heading "Factors Affecting Future Results" on our website and in Item 1A of ExxonMobil`s 2006 Form 10-K. We assume no duty to update these statements as of any future date.
Consistent with previous practice this press release includes both net income and earnings excluding special items. Earnings that exclude special items are a non-GAAP financial measure and are included to help facilitate comparisons of base business performance across periods. A reconciliation to net income is shown in Attachment II. The release also 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 sales proceeds together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities. Calculation of this cash flow is shown in Attachment II. Further information on ExxonMobil`s frequently used financial and operating measures is contained on pages 32 and 33 in the 2006 Form 10-K and is also available through the Investor Information section of our website at "exxonmobil.com."