Exxon Cites Record Full-Year Earnings of $44B, Up 8% from 2007
"ExxonMobil's full year 2008 earnings excluding special items were a record $44,060 million, up 8% from 2007," said Chairman Rex W. Tillerson. "Earnings per share excluding special items were up 16% reflecting the benefit of the share purchase program. Net income of $45,220 million in 2008 was also a record, up 11% from 2007. Net income included an after-tax special gain of $1,620 million from the sale of a natural gas transportation business in Germany and after-tax special charges of $460 million related to the Valdez litigation.
"ExxonMobil's financial strength continued to support its disciplined capital investment approach in the midst of a growing global economic slowdown. Capital and exploration project spending increased to $26.1 billion in 2008, up 25% from 2007. Through these investments we continued to demonstrate our long-term focus throughout the business cycle.
"The Corporation distributed a total of $40.1 billion to shareholders in 2008, up 12% or $4.4 billion from 2007. This reflects a 13% increase in per share dividends versus 2007 and an overall reduction in shares outstanding of 7.5%.
"ExxonMobil’s fourth quarter earnings excluding special items were $7,820 million, a decrease of 33% from the fourth quarter of 2007. Weaker crude oil prices, higher operating expenses, lower chemical volumes and the impact of the Gulf Coast hurricanes were partly offset by higher downstream margins."
FOURTH QUARTER HIGHLIGHTS
Upstream earnings were $5,634 million, down $2,570 million from the fourth quarter of 2007. Lower crude oil realizations reduced earnings approximately $3.2 billion while higher natural gas prices increased earnings about $500 million.
On an oil-equivalent basis, production decreased 3% from the fourth quarter of 2007. Excluding the impacts of lower entitlement volumes, OPEC quota effects and divestments, production was down about 1%.
Liquids production totaled 2,472 kbd (thousands of barrels per day), down 45 kbd from the fourth quarter of 2007. Excluding the impacts of lower entitlement volumes, OPEC quota effects and divestments, liquids production was up 1%, as increased production from projects in west Africa and the North Sea and lower maintenance activity more than offset field decline.
Fourth quarter natural gas production was 9,849 mcfd (millions of cubic feet per day), down 565 mcfd from 2007. New production volumes from project additions in the North Sea, Qatar and Malaysia were more than offset by field decline and lower European demand.
Earnings from U.S. Upstream operations were $699 million, $576 million lower than the fourth quarter of 2007. Non-U.S. Upstream earnings were $4,935 million, down $1,994 million from last year.
During the fourth quarter of 2008, Exxon Mobil Corporation purchased 119 million shares of its common stock for the treasury at a gross cost of $8.8 billion. These purchases included $8.0 billion to reduce the number of shares outstanding, with the balance used to offset shares issued in conjunction with the company's benefit plans and programs. Shares outstanding were reduced from 5,087 million at the end of the third quarter to 4,976 million at the end of the fourth quarter. Share purchases to reduce shares outstanding are currently anticipated to equal $7.0 billion through the first quarter of 2009. Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.
Full Year 2008 vs. Full Year 2007
Net income of $45,220 million ($8.69 per share) was a record and increased $4,610 million from 2007. Net income for 2008 included an after-tax special gain of $1,620 million from the sale of a natural gas transportation business in Germany and after-tax special charges of $460 million related to the Valdez litigation. Excluding these impacts, 2008 earnings increased by $3,450 million.
FULL YEAR HIGHLIGHTS
Upstream earnings, excluding the gain related to the sale of the German natural gas transportation business, were a record $33,782 million, up $7,285 million from 2007. Record high crude oil and natural gas realizations increased earnings approximately $11.8 billion. Lower sales volumes reduced earnings about $3.7 billion. Higher taxes and increased operating costs decreased earnings approximately $1.5 billion, partially offset by favorable foreign exchange.
On an oil-equivalent basis, production decreased 6% from last year. Excluding the impacts of lower entitlement volumes, the Venezuela expropriation and divestments, production was down about 3%.
Liquids production of 2,405 kbd decreased 211 kbd from 2007. Excluding the impacts of lower entitlement volumes, the Venezuela expropriation and divestments, liquids production was down about 3%, as new volumes from project additions, mainly in Africa, were more than offset by field decline.
Natural gas production of 9,095 mcfd decreased 289 mcfd from 2007. Higher volumes from North Sea, Malaysia and Qatar projects and higher European demand were more than offset by field decline.
Earnings from U.S. Upstream operations for 2008 were $6,243 million, an increase of $1,373 million. Earnings outside the U.S., excluding the gain related to the sale of the German natural gas transportation business, were $27,539 million, $5,912 million higher than 2007.
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