ExxonMobil beats second-quarter earnings expectations

ExxonMobil announced second-quarter earnings above market forecasts on Friday, with the total coming in at $9.2bn, or $2.14 per share.

That surpassed analysts' expectations for $2.05 per share, according to Trefis.

It generated $10.6bn in cash flow from operating activities during the quarter, with cash flow excluding working capital movements reaching $15.2bn.

ExxonMobil returned $9.5bn to shareholders through $4.3bn in dividends and $5.2bn in share buybacks, aligning with its ongoing commitment to shareholder returns.

Year-to-date earnings totalled $17.5bn, slightly down from $19.3bn in the first half of 2023.

The decrease was put down to lower industry refining margins and natural gas prices, despite modest increases in crude oil prices.

However, the company saw strong production growth from key assets in Guyana, the Permian Basin, and the recently-acquired Pioneer Natural Resources.

ExxonMobil completed the $63bn acquisition of Pioneer in May.

Upstream operations were particularly robust, with year-to-date earnings of $12.7bn, $1.7 billion higher than the same period last year, driven by increased production and higher crude oil realisations.

Second-quarter upstream earnings were $7.1bn, a significant increase from the first quarter, bolstered by record production in Guyana and the Permian Basin.

In contrast, the energy products segment faced challenges, with year-to-date earnings of $2.3bn, down $4.2bn a year earlier due to lower refining margins.

Similarly, the chemical products segment saw a modest increase in earnings to $1.6bn, benefiting from strong product sales and lower feed and energy costs, despite weaker global industry margins.

ExxonMobil’s specialty products segment continued to perform well, with year-to-date earnings of $1.5bn, reflecting strong margins in finished lubricants and structural cost savings.

The company maintained a strong balance sheet, with a debt-to-capital ratio of 14% and a net-debt-to-capital ratio of 6%.

Looking ahead, ExxonMobil declared a quarterly dividend of 95 cents per share, payable on 10 September.

The firm said it also planned to accelerate its share repurchase programme, aiming to repurchase over $19bn of shares in 2024, following completion of the Pioneer acquisition.

Capital and exploration expenditures for the second quarter totaled $7bn, bringing the year-to-date total to $12.9bn, with expectations to reach around $28bn for the full year.

“We delivered our second-highest 2Q earnings of the past decade as we continue to improve the fundamental earnings power of the company,” said chairman and chief executive officer Darren Woods.

“We achieved record quarterly production from our low-cost-of-supply Permian and Guyana assets, with the highest oil production since the Exxon and Mobil merger.

“We also achieved a record in high-value product sales, growing by 10% versus the first half of last year.”

Woods noted that the company closed on its “transformative merger” with Pioneer in “about half the time” of similar deals.

“And we’re continuing to build businesses such as Proxxima, carbon materials and virtually carbon-free hydrogen, with approximately 98% of carbon dioxide removed, that will create value long into the future.”

At 0705 EDT, shares in Exxon Mobil Corporation were up 1.45% in premarket trading in New York, at $118.65.

They had closed down 1.38% on Thursday, ahead of the results, at $116.95.

Reporting by Josh White for Sharecast.com.