ExxonMobil (NYSE: XOM)
reported on Friday fourth-quarter earnings down from a year earlier, as
lower natural gas prices and weak chemical and refining margins were
not enough to offset cash flow from asset sales in the quarter.
Exxon’s Q4 earnings
slipped by 5 percent on the year to $5.69 billion, while earnings per
common share assuming dilution dropped by 6 percent to $1.33.
Adjusted earnings per share came in at $0.41, lower than Wall Street expectations of $0.43.
In
Q4, earnings included favorable identified items of about $3.9 billion,
mainly a $3.7 billion gain from the sale of Exxon’s upstream assets in
Norway.
Exxon’s full-year earnings in 2019 also dropped, by 31 percent.
“Our
operations performed well, while short-term supply length in the
downstream and chemicals businesses impacted margins and financial
results,” Exxon’s chairman and chief executive officer Darren W. Woods
said in a statement.
Exxon’s oil-equivalent production in Q4 2019
was flat on Q4 2018, at 4 million barrels per day, the supermajor said,
but noted the ramp-up of development in the Permian shale play, where
production rose by 54 percent from the fourth quarter of last year.
While
the upstream and the cash from the sale of the Norway upstream business
helped Exxon weather the weaker crude oil and natural gas prices, the
chemicals and the downstream businesses didn’t perform well in Q4.
“Industry
fuels margins were significantly lower than third quarter, reflecting
seasonally lower demand and increased supply from reduced industry
maintenance,” Exxon said, while it also flagged further weakening of
chemicals margins from already depressed levels.
The weaker Q4
performance didn’t come as a surprise amid the low commodity prices and
weak profit margins in the chemicals and refining businesses at the end
of last year. Yesterday, Shell also attributed its profit slump in Q4 to weak prices and margins.
After the results release, Exxon’s shares were down 2.6 percent in pre-market trade in New York.
By Tsvetana Paraskova for Oilprice.com
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