Low oil prices forced the world’s largest energy company down on earnings but it still beat expectations.
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ExxonMobil shares reached a low on Friday of 86.88, down from the last high of 92.86 achieved on 22 January. Shares rose at market opening to 88.00
Expectations for Exxon revenues were $87.43 billion in the quarter, 21% lower than the $110.86 billion reported a year ago in the fourth quarter; actual revenues for fourth quarter were $ 87.27 billion.
Earnings per share came in at $1.56 against expectations for earnings of $1.34 and previous of $1.91 - a decrease of 18 percent.
Lower commodity prices in the Upstream and higher planned maintenance costs in the Downstream were partially offset by improved Chemical margins.
Fourth quarter earnings for Exxon Mobil have fallen foul of the 60% oil price reduction over the last six months but unlike competitors such as BP and Shell, Exxon have not announced job cuts or budget cuts. However, shares have decreased along with investors’ lack of confidence taking market price in the last 6 months from 104.56.
Analysts were pitching any changes to share price to be comparable with the company’s future stance on production output – expecting production levels of 4.14 million barrels a day this quarter compared to 4.22 million barrels a day in the fourth quarter of 2013.
Monday’s fourth-quarter results reported that on an oil-equivalent basis, production of 4.0 million barrels per day was down 4.9% compared to 2013. Whilst liquids production of 2.1 million barrels per day decreased 91,000 barrels per day compared to 2013, and natural gas production of 11.1 billion cubic feet per day decreased 691 million cubic feet per day from 2013.
Fully aware of the economic strain that the oil price reduction has placed on the industry, Rex W. Tillerson, chairman and chief executive of Exxon explained the better-than-expected results of full-year 2014 earnings at $32.5 billion compared with $32.6 billion a year earlier, by reflecting on the strength of its integrated business model in a lower price environment. He said, “ExxonMobil’s results illustrate the value of our proven business model that integrates upstream, downstream, and chemical businesses. Our balanced portfolio uniquely positions ExxonMobil to deliver superior results throughout the commodity price cycle.”
MT4 chart: Exxon
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