The X factor.
Exxon Mobil’s Q3 profit increased by 41%, coming in slightly ahead of consensus, driven by higher oil prices and improved refining margins. Earnings came in at $2.13 per share, up from $1.44 a year earlier and a penny better than the $2.12 analysts were looking for. Revenue came in at $125.33 billion, ahead of the consensus estimate of $113.56 billion.
The top line beat was driven by higher oil prices as crude futures traded roughly 18% higher than the prior year and Brent crude was up about 48%. That said, Exxon has spent a record $26.7 billion in the first nine months of the year as it looks to increase its shale gas production, specifically in North America. The company purchased XTO Energy last year and has steadily been adding to its land holdings in shale fields such as the Marcellus. While hefty supplies have kept natural gas prices low, Exxon did realize an improvement in realized natural gas prices in Q3.
Exploration and production earnings grew 54% due to the higher prices of oil and gas, which was partially offset by a production decline of 4%. In its refining and distribution business, earnings increased by 36% driven by stronger refining margins. The company returned $5.5 billion to shareholders through the repurchase of 72 million shares, $5 billion of which was allocated to reduce the number of shares outstanding.
Exxon Mobil (XOM : NYSE : US$81.88), Net Change: 0.81, % Change: 1.00%, Volume: 34,941,321
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