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[WP] Exxon Mobil posts record profits (again and again)

Discussion in 'BBS Hangout: Debate & Discussion' started by ymc, Feb 1, 2008.

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  1. ymc

    ymc Member

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    Looks like the best lobby money investment ever! :rolleyes: :cool: :p :eek: :eek: :( :confused: :mad:

    http://www.washingtonpost.com/wp-dyn/content/article/2007/02/01/AR2007020100714.html?hpid=topnews

    Exxon Mobil Posts Record Profits

    By JOHN PORRETTO
    The Associated Press
    Friday, February 1, 2008; 10:26 AM

    HOUSTON -- Exxon Mobil Corp. on Friday posted the largest annual profit by a U.S. company _ $40.6 billion _ as the world's biggest publicly traded oil company benefited from historic crude prices at year's end.

    Exxon also set a U.S. record for the biggest quarterly profit, posting net income of $11.7 billion for the final three months of 2007, beating its own mark of $10.71 billion in the fourth quarter of 2005.

    The previous record for annual profit was $39.5 billion, which Exxon Mobil made in 2006.

    The eye-popping results weren't a surprise given record prices for a barrel of oil at the end of 2007. For much of the fourth quarter, they hovered around $90 a barrel, more than 50 percent higher than a year ago.

    Crude prices reached an all-time trading high of $100.09 on Jan. 3 but have fallen about 10 percent since.

    The record profit for the October-December period amounted to $2.13 a share versus $1.76 a share in 2006. Year-ago net income was $10.25 billion.

    Also extraordinary was Exxon Mobil's revenue, which rose 30 percent in the fourth quarter to $116.6 billion from $90 billion a year ago.

    For the year, sales rose to $404.5 billion _ the most ever for the Irving, Texas-based company _ from the $377.64 billion it posted in 2006.

    In a statement, Exxon Mobil Chairman Rex Tillerson said the company continued to meet the world's energy needs through its "globally diverse resource base."

    "Our long-term investment program, in projects often far from major consuming nations, continued to provide resources essential to the increasingly interdependent global energy supply network," Tillerson said.

    Exxon Mobil produces about 3 percent of the world's oil.

    Its shares fell 37 cents to $86.03 in morning trading after rising as high as $87.86 earlier in the session.

    Higher commodity prices in the quarter were clearly evident from earnings at Exxon Mobil's exploration and production arm, known as the upstream. Income rose 32 percent to $8.2 billion from $6.2 billion a year ago.

    On an oil-equivalent basis, production increased nearly 1 percent from the fourth quarter of 2006. Excluding the expropriation of its Venezuelan assets last year, divestments and other factors, production rose nearly 3 percent.

    Refining and marketing, or downstream, earnings were $2.3 billion, up from nearly 2 billion in the year-ago quarter, as improved refining operations offset lower U.S. refining margins.

    In the U.S., downstream earnings were off sharply from a year ago _ $622 million in the most-recent quarter versus $945 million in 2006.

    Refining margins _ the difference between the cost of crude and what the company makes on refined products such as gasoline _ have been squeezed in recent months as spiking oil prices outpaced increases in gasoline prices and other refined products.

    Already, ConocoPhillips has said record oil prices at the end of 2007 helped it post a 37 percent increase in fourth-quarter profit, even as it produced less crude and natural gas than a year earlier. Its fourth-quarter net income rose to $4.37 billion versus $3.2 billion a year earlier.

    ConocoPhillips is the nation's third-largest integrated oil company behind Exxon Mobil and Chevron Corp.

    Chevron reporrted separately Friday its profit rose 29.2 percent in the fourth quarter, as surging prices for crude oil offset weak results from its refining business. It earned $4.88 billion, or $2.32 per share, from $3.77 billion, or $1.74 per share, a year earlier. Revenue rose 29 percent to $61.41 billion from $47.75 billion.

    On Thursday, Royal Dutch Shell PLC, Europe's largest oil company, reported fourth-quarter profit rose 60 percent to $8.47 billion on asset sales and higher oil prices. What's more, the Anglo-Dutch company said full-year net profit was a company record $31.3 billion, up 23 percent from the prior year.
     
    #1 ymc, Feb 1, 2008
  2. bigtexxx

    bigtexxx Member

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    Good for them. They're a great American company with hard working employees who have delivered great value to their shareholders. Are you made that they made a bunch of money? Sounds communist to me
     
    #2 bigtexxx, Feb 1, 2008
  3. pgabriel

    pgabriel Educated Negro

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    to be fair you have to look at the margins. I posted about their income last summer and it was quickly pointed out to me that even though the revenue increased, so did costs and almost by the same percentages, so margins remained the same. they are making more money on higher prices but their costs also do go up.

    having said that, I hadn't looked at their margins.
     
    #3 pgabriel, Feb 1, 2008
  4. F.D. Khan

    F.D. Khan Member

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    Anybody here have a 401k? Odds are you are all owners of exxon-mobil

    Rejoice!
     
    #4 F.D. Khan, Feb 1, 2008
  5. ymc

    ymc Member

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    They do know how to play the game. Too bad it is in the expense of other Americans and Iraqis... :mad:
     
    #5 ymc, Feb 1, 2008
  6. DonkeyMagic

    DonkeyMagic Member
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    considering demand is as high as ever, prices are as high as ever and the dollar is weak...its not totally unexpected.

    but its hard to fault a business for being big and good, which they are.
     
    #6 DonkeyMagic, Feb 1, 2008
  7. El_Conquistador

    El_Conquistador King of the D&D, The Legend, #1 Ranking

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    With high prices, companies like Exxon-Mobil are the ones we should be encouraging to go out and find more supplies to drive down prices. The profit incentive does that. Exxon does not set oil prices. Exxon helps lower them in fact, by finding and developing more oil. We need them most at times like this. This is free market capitalism at work, people.

    Exxon should be treated as an extension of US foreign policy, in my opinion. Oil and energy will be the #1 geopolitical and economic issue of the next 10 years. Since the US does not have a national oil company, like many oil rich nations do, we must encourage our private sector companies to succeed.
     
    #7 El_Conquistador, Feb 1, 2008
    Last edited: Feb 1, 2008
  8. ymc

    ymc Member

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    If they can maintain the margin with a higher revenue, they are doing a really good job. It is harder to make $100M out of $1B versus $100 out of $1000. :cool:
     
    #8 ymc, Feb 1, 2008
  9. pgabriel

    pgabriel Educated Negro

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    this post makes no sense
     
    #9 pgabriel, Feb 1, 2008
  10. bigtexxx

    bigtexxx Member

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    probably went over your head
     
    #10 bigtexxx, Feb 1, 2008
  11. Mr. Clutch

    Mr. Clutch Member

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    Their stock isn't going up because they are unlikely to repeat this performance as the economy slows.
     
    #11 Mr. Clutch, Feb 1, 2008
  12. Mr. Clutch

    Mr. Clutch Member

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    From the Wall Street Journal- "Refining margins in the U.S. have slumped as companies have been unable to pass on record oil costs to consumers..."

    So they arent exactly flecing US consumers. Most of their strength was in international markets.
     
    #12 Mr. Clutch, Feb 1, 2008
  13. pgabriel

    pgabriel Educated Negro

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    high oil prices don't justify oil companies becoming an extension of foreign policy

    and secondly to sing the praises of capitalism and then turn around and say our oil companies should be part of government policy is an oxymoron.
     
    #13 pgabriel, Feb 1, 2008
  14. DFWRocket

    DFWRocket Member

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    As I was reading the article I kept wondering how much they spent to make that much. That would've been my first question had I wrote the article. Makes the whole thing sorta incomplete. You've got to see the profit margin before you can really make an assessment of their financial statement.

    ps...take a look at the profit margin on things like name-brand clothes and X-boxes sometime. You'll find a new meaning for "Fleecing the customer".
     
    #14 DFWRocket, Feb 1, 2008
  15. ymc

    ymc Member

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    #15 ymc, Feb 1, 2008
  16. rodrick_98

    rodrick_98 Member

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    shoes and cds too no?

    i believe between 7% and 8% profit margin is what exxon had back in '06. i wouldn't be surprised if the '07 profit margin is right around that same amount.

    edit:
    first Q 05 - http://archive.mailtribune.com/archive/2005/0429/biz/stories/04biz.htm

    first Q 06 - http://www.usatoday.com/money/industries/energy/2006-04-27-xom_x.htm



    so they have improved to earning 11 cents per dollar spent rather than 9 or 10 cents.
     
    #16 rodrick_98, Feb 1, 2008
    Last edited: Feb 1, 2008
  17. Baqui99

    Baqui99 Member

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    The hope is that XOM plows back its cash flow into more E&P activities, chasing every drop of oil and gas onshore and offshore. We heard from one of the higher ups in the XOM treasury group last semester, and he was pretty adamant that they're going to continue to invest heavily in new projects such as the FPS off the Angolan coast.
     
    #17 Baqui99, Feb 1, 2008
  18. rodrick_98

    rodrick_98 Member

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    how about a new refinery or 10?
     
    #18 rodrick_98, Feb 1, 2008
  19. pgabriel

    pgabriel Educated Negro

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    I understand that, they don't need the government involved to encourage them. obviously companies are going to keep drilling with oil prices this high. I'm not worried
     
    #19 pgabriel, Feb 1, 2008
  20. Baqui99

    Baqui99 Member

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    Because there are too many restrictions (environmental and regulatory) on building a new refinery. Well, that and the fact that refining margins aren't that great right now. XOM would get a better ROI doing upstream projects than downstream.
     
    #20 Baqui99, Feb 1, 2008
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