10-QPeriod: Q3 FY2019

EXXON MOBIL CORP Quarterly Report for Q3 Ended Sep 30, 2019

Filed November 6, 2019For Securities:XOM

Summary

ExxonMobil's third quarter 2019 report shows a significant year-over-year decline in net income, primarily driven by lower upstream realizations, weaker downstream and chemical margins, and increased expenses. For the three months ended September 30, 2019, net income attributable to ExxonMobil was $3.17 billion, or $0.75 per diluted share, down from $6.24 billion, or $1.46 per diluted share, in the same period of 2018. Despite the quarterly downturn, the company maintained substantial operational cash flow and continued to invest heavily in capital and exploration expenditures, particularly in the U.S. Permian Basin. The company also returned significant capital to shareholders through dividends. Key balance sheet items show an increase in total debt and a corresponding increase in the debt-to-total capital ratio, reflecting recent debt issuances. Investors should note the ongoing challenges in commodity prices and margins impacting profitability, alongside continued strategic investments.

Financial Highlights

43 data points
Beta

Revenue

$63.42B

Net Income

$3.17B

5.0% Net Margin

EPS (Diluted)

$0.75

Total Assets

$359.36B

Cash & Equivalents

$5.35B

Free Cash Flow

$2.79B

Financial Statements
Beta
Revenue$63.42B
SG&A Expenses$2.75B
Operating Expenses$60.33B
Interest Expense$232.00M
Net Income$3.17B
EPS (Basic)$0.75
EPS (Diluted)$0.75
Shares Outstanding (Basic)4.27B

Key Highlights

  • 1Net income for Q3 2019 was $3.17 billion, a decrease from $6.24 billion in Q3 2018, driven by lower upstream realizations and weaker downstream/chemical margins.
  • 2Earnings per diluted share for Q3 2019 were $0.75, down from $1.46 in Q3 2018.
  • 3Total capital and exploration expenditures for the first nine months of 2019 were $22.7 billion, a 25% increase from the prior year, with significant investment in the U.S. Permian Basin.
  • 4Oil-equivalent production increased by 3% year-over-year in Q3 2019, primarily due to higher liquids volumes.
  • 5The company distributed $10.9 billion in dividends to shareholders during the first nine months of 2019.
  • 6Total debt increased to $47.1 billion at the end of Q3 2019 from $37.8 billion at year-end 2018, leading to a debt-to-total capital ratio of 19.3%.
  • 7ExxonMobil is anticipating a gain of approximately $3.5 billion from the sale of its non-operated upstream assets in Norway, expected to close in Q4 2019.

Frequently Asked Questions

The primary reasons for the decrease in net income were lower upstream realizations (prices for oil and gas), weaker margins in the downstream (refining) and chemical businesses, increased operating expenses, and higher scheduled maintenance activities. These factors were partially offset by an increase in upstream production volumes.

ExxonMobil continued to invest heavily in capital and exploration, with $22.7 billion spent in the first nine months of 2019, up 25% from the prior year, driven by growth in the U.S. Permian Basin. Simultaneously, the company distributed $10.9 billion to shareholders through dividends during the same period, demonstrating a commitment to returning capital while investing for future growth.

ExxonMobil's total debt increased to $47.1 billion by the end of the third quarter of 2019, up from $37.8 billion at the end of 2018. This increase reflects the issuance of $7.0 billion in long-term debt during Q3 2019. Consequently, the debt-to-total capital ratio rose to 19.3% from 16.0% at year-end 2018.

Yes, ExxonMobil signed an agreement to sell its non-operated upstream assets in Norway for $4.5 billion, with an expected closing in the fourth quarter of 2019. The company anticipates recognizing a gain of approximately $3.5 billion from this divestiture.