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. Last Updated: 07/27/2016

Big Second-Quarter Profits a Boon For Giant ExxonMobil




NEW YORK -- ExxonMobil Corp., the No. 1 U.S. oil company, Tuesday said second-quarter earnings soundly beat expectations, more than doubling alongside strong oil prices and better profits on fuels such as gasoline.


Second-quarter profits, excluding special charges and merger expenses, rose to $4.15 billion, or $1.18 a share, from $1.86 billion, or 53 cents, in the same period last year on a pro forma basis, the oil giant said.


Revenue climbed to $55.96 billion from $43.28 billion last year.


"It was truly an excellent quarter for ExxonMobil," said Michael Young of Deutsche Banc Alex.Brown. "They handily beat consensus expectations and did it across a number of businesses."


Analysts surveyed by First Call/Thomson Financial were forecasting average earnings of $1.07 a share for the company, which completed its acquisition of Mobil late last year.


ExxonMobil, as well as the rest of the oil industry, has benefited from crude oil prices which averaged about $28.75 in the second quarter, or more than $10 a barrel higher than a year ago, as members of the Organization of Petroleum Exporting Countries stuck with promised production cutbacks.


Natural gas prices put on a similar show, helping make for what the Irving, Texas company said were the highest U.S. corporate earnings on record.


But ExxonMobil chairman Lee Raymond said the company is seeing the upside of its takeover of Mobil, too, a deal that is allowing the company to sharply cut its costs. Indeed, over the first six months of the year it said operating costs fell by $800 million.


Raymond said savings from the merger f which will result in about 16,000 job cuts, or 13 percent of the combination's original workforce f should increase over the remainder of the year. The company hopes to reap savings of $3.8 billion in the third year of the deal.


ABN Amro analyst Gene Nowak gave the No. 1 oil company high overall marks for the quarter. "It was formidable before the takeover, and I don't know how to describe it now."