Exxon Profit Falls On Shrinking Margins; Results Top Estimates

(RTTNews) - Oil and natural gas giant Exxon Mobil Corp. (XOM) reported Thursday a profit for the third quarter that declined 18 percent from last year, as higher production was partially offset by weaker refining margins.

However, earnings per share and quarterly revenues topped analysts' expectations.

"Production of oil and natural gas increased from a year earlier as new projects were brought on line and maintenance-related downtime decreased," Chairman Rex Tillerson said.

"Significantly weaker refining margins as a result of increased industry capacity negatively impacted ExxonMobil's Downstream earnings."

The Irving, Texas-based world's largest energy company reported net income of $7.87 billion or $1.79 per share for the third quarter, sharply lower than $9.57 billion or $2.09 per share in the prior-year quarter.

On average, 21 analysts polled by Thomson Reuters expected the company to report earnings of $1.77 per share in the quarter. Analysts' estimates typically exclude one-time items.

Total revenues and other income for the quarter declined to $112.37 billion from $115.14 billion in the same quarter last year, but topped six Wall Street analysts' consensus estimate of $107.39 billion.

Upstream earnings for the quarter increased 12 percent from the year-ago quarter to $6.71 billion, reflecting higher liquids and natural gas realizations.

Oil production grew 1.5 percent from last year, or about 13,000 barrels per day.

Downstream or refining and marketing, earnings plunged to $592 million from $3.19 billion in the prior-year quarter, hurt by weaker margins, primarily in refining.

Chemical segment earnings increased to $1.03 billion from last year's $790 million, due primarily to higher commodity margins. During the quarter, the company's petroleum product sales increased to 6.25 million metric tons from last year's 5.95 million metric tons.

Capital and exploration expenditures increased 15 percent to $10.55 billion from last year.

"The Corporation distributed $5.8 billion to shareholders in the third quarter through dividends and share purchases to reduce shares outstanding," Tillerson added.

In Thursday's regular trading session, XOM is currently trading at $89.73, up $0.92 or 1.04% on a volume of 0.40 million shares. In the past 52-week period, the stock has been trading in a range of $84.70 to $95.49.