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Exxon Mobil earns $10.4 billion in quarter
By STEVE QUINN
Associated Press
Posted: July 27, 2006
Dallas - The Exxon Mobil profit machine clocked in at $4.7 million per hour in the April-June period as soaring oil prices and higher output boosted its performance by 36% from a year ago.
The company's $10.4 billion second-quarter profit, announced Thursday, was the second best quarterly performance ever for a publicly traded company, drawing praise from Wall Street and ire from some politicians.
Royal Dutch Shell PLC accelerated its second-quarter earnings even faster, posting net income of $7.3 billion, an increase of 40% from the year before.
Crude-oil prices are hovering near $75 a barrel, and analysts do not foresee a sharp drop anytime soon given the world's rising appetite for fuel and supply threats in the Middle East, Africa and beyond, which pump fear into the market.
As long as the global economy keeps chugging along, analysts say the industry can expect more record-breaking profits throughout the remainder of the year.
"The rising tide lifts all boats," Oppenheimer & Co. analyst Fadel Gheit said.
But the oil and gas industry's profit surge comes as motorists in the U.S. pay an average of $3 a gallon at the pump and as Washington lawmakers consider opening to drilling areas of the Gulf of Mexico currently off-limits - both of which have generated political backlash.
Rep. Edward Markey (D-Mass.) said Thursday that American consumers have been "tipped upside down and have (had) their savings shaken out of their pockets at the gas pump."
Kenneth Cohen, Exxon Mobil Corp.'s vice president of public affairs, said such criticism is misplaced.
"Sometimes I feel like they are trying to run against us as opposed to their opponents," he said.
Exxon Mobil, the world's largest publicly traded oil company, understands the climate outside its Irving, Texas, headquarters is one of concern for how gas price volatility affects family budgets, Cohen added.
"What are we doing about it?" he said. "We are investing at record levels."
Across the globe, energy-intensive businesses such as shippers and chemical manufacturers are feeling the pinch from higher prices, although oil exporting nations, particularly in the Middle East, are experiencing rapid economic growth.
Boosting production
Exxon Mobil said it pumped 6% more oil and natural gas than it did during the same quarter a year earlier.
Other major oil companies reported big numbers for the quarter this week as well.
BP PLC said its quarterly profit rose 30% to $7.3 billion. ConocoPhillips said its earnings rose 65% to $5.18 billion. Chevron Corp. reports its second-quarter results today.
These five were expected to earn an estimated $33.6 billion, or a 32% boost, according to analysts surveyed by Thomson Financial. But the first four have already reported earnings of more than $30 billion - a jaw-dropping surprise even for optimistic Wall Street analysts.
Exxon Mobil executives said their success was based on a pretty simple formula: Produce more fuel, and command higher prices for it.
"We continue to see demand growth year over year," Henry Hubble, Exxon's vice president of investor relations, told analysts. "We're selling everything we can make."
Exxon Mobil's second-quarter earnings amounted to $1.72 per share, compared with a profit of $7.64 billion, or $1.20 per share, a year ago.
The results came in behind Exxon Mobil's record profit of $10.71 billion set in the fourth quarter of 2005.
Revenue rose to $99.03 billion from $88.57 billion in the prior-year quarter. That was short of Exxon Mobil's record third-quarter revenue of $100.72 billion - which also stands as record revenue generated by any U.S. public company in a quarter.
Its shares fell 13 cents to close at $66.47 on the New York Stock Exchange after reaching an all-time high of $67.65 earlier in the session.
Congress has been urging the big oil companies to put more of their profits toward boosting the supply of energy for consumers. And this week the Senate sought to help out the industry by working on an election-year bill that would open a large area of the central Gulf of Mexico to oil and gas drilling.
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By STEVE QUINN
Associated Press
Posted: July 27, 2006
Dallas - The Exxon Mobil profit machine clocked in at $4.7 million per hour in the April-June period as soaring oil prices and higher output boosted its performance by 36% from a year ago.
The company's $10.4 billion second-quarter profit, announced Thursday, was the second best quarterly performance ever for a publicly traded company, drawing praise from Wall Street and ire from some politicians.
Royal Dutch Shell PLC accelerated its second-quarter earnings even faster, posting net income of $7.3 billion, an increase of 40% from the year before.
Crude-oil prices are hovering near $75 a barrel, and analysts do not foresee a sharp drop anytime soon given the world's rising appetite for fuel and supply threats in the Middle East, Africa and beyond, which pump fear into the market.
As long as the global economy keeps chugging along, analysts say the industry can expect more record-breaking profits throughout the remainder of the year.
"The rising tide lifts all boats," Oppenheimer & Co. analyst Fadel Gheit said.
But the oil and gas industry's profit surge comes as motorists in the U.S. pay an average of $3 a gallon at the pump and as Washington lawmakers consider opening to drilling areas of the Gulf of Mexico currently off-limits - both of which have generated political backlash.
Rep. Edward Markey (D-Mass.) said Thursday that American consumers have been "tipped upside down and have (had) their savings shaken out of their pockets at the gas pump."
Kenneth Cohen, Exxon Mobil Corp.'s vice president of public affairs, said such criticism is misplaced.
"Sometimes I feel like they are trying to run against us as opposed to their opponents," he said.
Exxon Mobil, the world's largest publicly traded oil company, understands the climate outside its Irving, Texas, headquarters is one of concern for how gas price volatility affects family budgets, Cohen added.
"What are we doing about it?" he said. "We are investing at record levels."
Across the globe, energy-intensive businesses such as shippers and chemical manufacturers are feeling the pinch from higher prices, although oil exporting nations, particularly in the Middle East, are experiencing rapid economic growth.
Boosting production
Exxon Mobil said it pumped 6% more oil and natural gas than it did during the same quarter a year earlier.
Other major oil companies reported big numbers for the quarter this week as well.
BP PLC said its quarterly profit rose 30% to $7.3 billion. ConocoPhillips said its earnings rose 65% to $5.18 billion. Chevron Corp. reports its second-quarter results today.
These five were expected to earn an estimated $33.6 billion, or a 32% boost, according to analysts surveyed by Thomson Financial. But the first four have already reported earnings of more than $30 billion - a jaw-dropping surprise even for optimistic Wall Street analysts.
Exxon Mobil executives said their success was based on a pretty simple formula: Produce more fuel, and command higher prices for it.
"We continue to see demand growth year over year," Henry Hubble, Exxon's vice president of investor relations, told analysts. "We're selling everything we can make."
Exxon Mobil's second-quarter earnings amounted to $1.72 per share, compared with a profit of $7.64 billion, or $1.20 per share, a year ago.
The results came in behind Exxon Mobil's record profit of $10.71 billion set in the fourth quarter of 2005.
Revenue rose to $99.03 billion from $88.57 billion in the prior-year quarter. That was short of Exxon Mobil's record third-quarter revenue of $100.72 billion - which also stands as record revenue generated by any U.S. public company in a quarter.
Its shares fell 13 cents to close at $66.47 on the New York Stock Exchange after reaching an all-time high of $67.65 earlier in the session.
Congress has been urging the big oil companies to put more of their profits toward boosting the supply of energy for consumers. And this week the Senate sought to help out the industry by working on an election-year bill that would open a large area of the central Gulf of Mexico to oil and gas drilling.
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