Exxon Mobil reported a 49% decrease in revenues in the third quarter on lower oil prices and higher costs. However, the results were slightly above Wall Street expectations, and stocks were slightly higher in early trading.
Exxon earned $ 3.2 billion in the third quarter, down from $ 6.2 billion in the same period a year ago.
Here's how the energy giant's performance fared relative to Wall Street expectations:
- Adjusted earnings: $ 0.75 per share versus $ 0.65 expected by Refinitive
- Revenue: $ 65.05 billion versus $ 64.79 billion expected by Refinitive
- Upstream Revenue: $ 2.1
- Downstream Revenue: $ 1.23 Billion Compared to $ 1 Billion Expected from FactSet Estimates
- Chemical Revenue: 241 million from $ 223.6 million expected from FactSet estimates
The company spent $ 7.7 billion on capital and exploration expenses, including in the important Permian Basin area. Oil equivalent production increased 3% compared to the previous year, reaching 3.9 million barrels per day. Liquid production and natural gas volume also increased by 4% and 1% respectively.
The biggest spike came from production in the Permian basin, which grew 7% from the second quarter of 2019, and more than 70% year over year.
"We are making good progress with our long-term growth strategy," said Exxon Chairman and CEO Darren Woods. "Permian growth continues to increase fluid production, and we are ahead of the plan for the first oil in Guyana. The value of our position in Guyana was further enhanced this quarter with a further discovery, the fourth this year. We are also making good progress on our advantageous investments in Downstream and Chemical, "he added.
Woods also said Exxon had made progress in disposing of its assets, which the company predicts will generate $ 15 billion in cash by 2025.
"The competitiveness of our portfolio was further enhanced with the divestment of non-strategic assets, and reached almost a third of our $ 20 billion goal of 2021, "he said.
Revenues were boosted by a favorable $ 300 million tax related item.
For the year, the Exxon share is down by 1% through Thursday's close, leaving behind both the S&P 500 and the energy sector. The S&P 500 is up 21% in 2019 while the energy sector is up 1%.
During the last quarter, Exxon hit the top and bottom line, as the strength of the company's upstream business outweighs the weakness in the refining and chemicals divisions. However, revenues fell by 21%.
Falling oil prices, over-supply concerns and high production are among the factors that have hit the energy sector hard. It is also particularly vulnerable to signs of global slowdown.