Aug 1, 2008 Reuters

Oil company profits soar

Exxon Mobil broke its own record for the highest-ever quarterly profit for a U.S. company on Thursday, but it was lower than Wall Street expected largely due to lost output from Venezuela and Nigeria and lower yields from some oil fields.

The average price of a barrel of oil was slightly less than $125 in the quarter, nearly double last year, which also increased earnings reported by three of Europe's largest oil companies, Royal Dutch Shell, Eni and Repsol.

Exxon's second-quarter net income rose 14 percent to $11.68 billion (5.88 billion pounds), or $2.22 a share, in the quarter.

Exxon Mobile (million $)

  2Q 1H
2008 2007 増減 2008 2007 増減
Upstream  10,012   5,963 +68%  18,797  11,994 +57%
Downstream   1,558   3,393 -54%   2,724   5,305 -49%
Chemical    687   1,013 -32%   1,715   2,249 -24%
Corporate   -577    -99     -666     -8  
Net income  11,680  10,260 +14%  22,570  19,540 +16%


However, after excluding one-time items, Exxon earned $2.27 a share, more than 10 percent below analysts' expectations, according to Reuters Estimates. The miss led to a 4.7 percent slide in Exxon's shares, a major factor in a decline in U.S. stocks on Thursday.

Shell, the world's second-largest non-government controlled oil company by market value, reported a 5 percent rise in second-quarter earnings to $7.9 billion, and said that excluding one-time items, it beat analysts' forecasts.

Shell (million $)

  2Q 1H
2008 2007 増減 2008 2007 増減
Income  11,556   8,667 +33%  20,639  15,948 +29%
CCS Earnings   7,902   7,556 +5%  15,678  14,488 +8%

Shell (million $)

  2Q 1H
2008 2007 増減 2008 2007 増減
Exploration & Production   5,881   3,099 +90%   11,024   6,492 +70%
Gas & Power    625    779 -20%   1,573   1,582 -1%
Oil Sands    351    202 +74%    600    317 +89%
Oil Products   4,539   3,928 +16%   6,906   5,730 +21%
 (CCS base)  (1,075)  (2,936) (-63%)   (2,269)   (4,424) (-49%)
Chemicals    157    626 (-75%)    505   1,153 (-56%)
 (CCS base)   (-142)   (494) (  - )    ( 59)    (974) (-94%)
Corporate    201    177      347    978  
Minority Interest   -198   -144      -316    -304  
 (CCS base)   (-89)   (-131)     (-194)   (-279)  
Total  11,556   8,667 (+33%)   20,639   15,948 (+29%)
 (CCS base)  (7,902)  (7,556) (+5%)  (15,678)  (14,488) (+8%)


Current cost of supplies (CCS) basis
This refers to the net income of a company after taking into account the increase (or decrease) in expenses over the reporting period. It is typically used by commodity reliant businesses.

On this basis, Oil Products and Chemicals segment cost of sales of the volumes sold during the period are based on the cost of supplies during the same period after making allowance for the estimated tax effect, instead of the first-in, first-out (FIFO) method of inventory accounting. Earnings calculated on this basis do not represent an application of the last-in, first-out (LIFO) inventory basis and do not reflect any inventory drawdown effects.

The companies' oil and gas exploration and production units were the main profit drivers because of high oil prices.

But despite billions of dollars in capital spending in the quarter, oil and gas production was sluggish. That, along with weak profit margins from refining, restrained the companies' earnings somewhat.

Western oil companies' output has fallen in recent years and oil producing countries now prefer to award their richest fields to their own national oil companies.

"The problem is that all these companies have no place to go to drill and no place to put their money," said Oppenheimer analyst Fadel Gheit. "Access to resources is closing very, very fast."

Exxon's oil and gas production fell 8 percent from a year earlier, mostly due to the loss of assets taken over by Venezuela, a labour strike in Nigeria, and contracts that give host countries a larger share of production as oil prices rise.

Shell said output fell 1.6 percent in the second quarter to 3.126 million barrels of oil equivalent per day (boepd) compared to the same quarter last year, while Repsol's production fell 19.7 percent to 335,000 boepd in the first half.

The enormous profits drew criticism from politicians because of the high gasoline prices being paid by consumers.

U.S. presidential candidate
Barack Obama termed Exxon's earnings "outrageous" and called for an end to the "tyranny of oil."

"The first part of my plan is a $1,000 dollars emergency energy rebate that would go out to families this fall to cover not only rising prices of gas, but also home fuel," says Obama.

Obama says the economy is in trouble, but another round of stimulus checks would only increase the federal debt.

"That's why I'm proposing that we pay for the rebate by taxing the windfall oil profits of companies like Exxon Mobile."

That made a big hit with the crowd in St. Petersburg, but a spokesman for the oil industry says it'll cut into oil exploration.

"The money that Exxon Mobile and other oil and natural gas companies earn on their sales are plowed back into long term investments into the county's energy future," says Tupper Hull from the Western States Petroleum Association.

"We are making very large profits, I know that," Shell Chief Executive Jeroen van der Veer told reporters on a conference call. "But we are making very large investments," he said, referring to investments in exploration and production.

Eni SpA posted a 4.4 percent rise in second-quarter adjusted net profit, below analysts' forecasts, as higher taxes weighed on its results.

Eni said second-quarter production was 1.77 million boepd, up 2.1 percent from the year before, and added that based on lower oil prices output would rise 2 percent in 2008, compared to an earlier forecast of 3.7 percent.

Adjusted net profit strips out gains from changes in the value of inventories and non-recurring items.

Repsol YPF said its first-half adjusted net profit rose 15 percent to 1.883 billion euros (1.4 billion pounds), well ahead of analysts' forecasts, because of high oil prices.

Downstream refining and marketing profits fell sharply at most of the companies, as crude processing margins tightened, and retailers found it hard to pass on full price increases to motorists.

Exxon's downstream profits dropped about 54 percent and Shell's downstream results fell 70 percent. Eni said refining and marketing profits fell 23 percent in the quarter, while Repsol's downstream profits fell 2 percent in the first half.

新日本石油 (億円)

  売上高 営業損益 経常損益 当期損益
08/1Q 20.372 1,016 1,013 587
07/1Q 15,758 793 880 527
増減 +29% +28% +15% +11%

在庫影響を除いた経常利益は87 億円(前年同期比251 億円の減益)となりました。

日本経済新聞 2009/7/27

石油メジャー 新エネ投資削減  シェル・BP 業績回復を最優先