ExxonMobil profits jump, operations disappoint
ExxonMobil reported a - terly earnings Friday due to the impact of the US tax reform, but the company’s share price fell sharply due to disappointing operational results.
Net income was $8.4 billion, up nearly 400 percent from the yearago result, boosted by a one-time $5.9 billion gain from the revaluation of deferred taxes following US tax reform. Higher oil prices also lifted results.
Revenues rose nearly 18 percent to $66.5 billion.
However, oil and gas production fell three percent or 130,000 barrels per day.
And despite the big increase in share excluding the one-time impact of the tax reform translated to 88 cents, below the $1.04 expected
Analysts hit out at ExxonMobil over the weak oil and gas production output, as well as underperformance in downstream and chemicals businesses.
The results “were weak across the board, with misses in every segment,” said a note from JPMorgan Chase said in a note, which also pointed out that the company did not announce any new share repurchases as some had expected.
Shares of ExxonMobil slumped 5.3 percent to $84.32 in morning trading, making it the biggest loser in the Dow.
Chevron profits surge
Chevron, the second-biggest US oil company after ExxonMobil, also reported a jump in fourthquarter earnings courtesy of tax reform and higher oil prices.
up from just $415 million in the same period of the prior year. The of $2 billion due to the tax reform.
The company, which cut back capital spending and laid off some staff during a two-year industry downturn due to low oil prices, announced it was boosting its quarterly dividend by four cents to $1.12 per share.
“We achieved our objective of deliberate actions to reduce capital
ExxonMobil saw a nearly five-fold increase in earnings in the fourth quarter because of a huge non- cash benefit from US tax reform, as well as higher oil prices, the company reported February 2. expenditures, lower our cost strucoil giants signaled greater opture, start and ramp-up projects, timism during their earnings and conclude planned asset sales. reports this week. Higher commodity prices helped “2017 was a dynamic year for as well,” said Chevron chief executhe oil and gas sector that marked tive Michael Wirth. another step on the road to recov
“These improvements give ery for our industry,” said Hallius the confidence to increase burton chief executive Jeff Miller the dividend.” after the company reported results
Nevertheless, Chevron shares late last month. fell 4.0 percent to $120.59. “I am optimistic about what I
After about two years under see in 2018. Commodity prices pressure, oil prices have stabilized are supportive of increasing activand are now trading well above ity in North America and I am $60 a barrel. encouraged by the increase in
Oil services companies that tender activity and the positive depend on capital budgets from discussions we are having with ExxonMobil, Chevron and other our international customers.