Exxon Mobil Beats On Earnings While Sales Fall Short

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Exxon-Mobile-nWith oil below $50 a barrel no one expected Exxon Mobil to grow sales or earnings in the fourth quarter.

Investors though were apparently struggling to determine what to make of a report which showed the company slightly missing Wall Street’s already low revenue expectations but handily beating analysts’ earnings forecast.

The stock hovered near Friday’s closing price of $87.42 in the first hour of pre-market trading following the release, at times slipping into the red. Shortly before the opening bell Exxon appeared poised to open in the green, up 0.8% to over $88. Exxon shares are down about 5% year-over-year.

The oil giant reported $87.3 billion in fourth quarter revenue, down 21% from a year earlier and somewhat short of Wall Street’s call for $87.6 billion in sales. Net income was also down 21% to $6.6 billion or $1.56 per share.

On the income front, however, Exxon beat Street expectation for just $1.34 of per share earnings. Improved margins from its chemical business partially offset the potentially lethal combination of sharply lower commodity prices — crude oil sank 40% during the fourth quarter — and a planned boost in maintenance costs.

Oil-equivalent production declined 3.8% from a year earlier, largely due to the expiration of an Abu Dhabi onshore concession.

“ExxonMobil’s results illustrate the value of our proven business model that integrates upstream, downstream, and chemical businesses,” said CEO Rex Tillerson in a company statement on the quarter and full year. “Our balanced portfolio uniquely positions ExxonMobil to deliver superior results throughout the commodity price cycle.”

For the full year Exxon reported $411.9 billion in revenue, down 6%. Earnings per share were up from $7.37 in 2013 to $7.60 last year. The company produced 4 million oil-equivalent barrels per day in 2014.

Exxon did not provide forward guidance in its initial release but said it expects to buy back $1 billion worth of shares in the first quarter of 2015. The company made $3 billion in share repurchases in the first quarter of 2014.


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