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Exxon Revenues, Earnings Tumble 21% From Year Ago, Sales Miss Expectations By $5 Billion; Stock Buyback Grinds To Near Halt

Tyler Durden's picture




 

Moments ago, following our chart showing the devastation in Q1 earning forecasts, Exxon Mobil came out with its Q4 earnings, and - as tends to happen when analysts take a butcher knife to estimates - beat EPS handily, when it reported $1.56 in EPS, above the $1.34 expected, if still 18% below the $1.91 Q4 EPS print from a year earlier. A primary contributing factor to this beat was surely the $3 billion in Q4 stock buybacks, with another $2.9 billion distributed to shareholders mostly in the form of dividends.  Overall, XOM distributed $23.6 billion to shareholders in 2014 through dividends and share purchases to reduce shares outstanding.

This number masks the 29% plunge in upstream non-US earnings which were smashed by the perfect storm double whammy of not only plunging oil prices but also by the strong dollar. Curiously, all this happened even as XOM actually saw its Q4 worldwide CapEx rise from $9.9 billion a year ago to $10.5 billion, even though capital and exploration expenditures were $38.5 billion in the full year, down 9% from 2013.

However, while XOM did the best with margins and accounting gimmickry it could under the circumstances, there was little it could do to halt the collapse in revenues, which printed at $87.3 billion, well below the $92.7 billion expected, and down a whopping 21% from a year ago. And this is just in Q4 - the Q1 slaughter has yet to be unveiled!

Some of the Q4 highlights from the report:

  • Upstream earnings were $5.5 billion in the fourth quarter of 2014, down $1.3 billion from the fourth quarter of 2013. Lower liquids realizations decreased earnings by $2.4 billion, while favorable volume effects increased earnings by $400 million. All other items increased earnings by a net $640 million, including U.S. deferred income tax effects and the recognition of a favorable arbitration ruling for expropriated Venezuela assets.
  • On an oil-equivalent basis, production decreased 3.8 percent from the fourth quarter of 2013. Excluding the impact of the expiry of the Abu Dhabi onshore concession, production decreased 0.7 percent.
  • Liquids production totaled 2.2 million barrels per day, down 53,000 barrels per day from the fourth quarter of 2013. The Abu Dhabi onshore concession expiry reduced volumes by 133,000 barrels per day. Excluding this impact, liquids production was up 80,000 barrels per day as project and work program contributions more than offset field decline and divestment impacts.
  • Fourth quarter natural gas production was 11.2 billion cubic feet per day, down 653 million cubic feet per day from 2013. Field decline, lower demand, and reduced entitlement volumes were partly offset by higher volumes from Papua New Guinea and work programs.
  • Earnings from U.S. Upstream operations were $1.5 billion, $317 million higher than the fourth quarter of 2013. Non-U.S. Upstream earnings were $4.0 billion, down $1.6 billion from the prior year.
  • Downstream earnings were $497 million, down $419 million from the fourth quarter of 2013. Stronger marketing and non-U.S. refining margins, mostly offset by weaker U.S. refining margins, increased earnings by a net $40 million. Volume and mix effects increased earnings by $20 million. All other items, primarily higher expenses and unfavorable tax effects, decreased earnings by $480 million. Petroleum product sales of 5.8 million barrels per day were 149,000 barrels per day lower than the prior year's fourth quarter.
  • The U.S. Downstream recorded a loss of $1 million, down $598 million from the fourth quarter of 2013. Non-U.S. Downstream earnings of $498 million were $179 million higher than the prior year.

But the biggest surprise, and what everyone will be focused on, is the sharp slowdown in CapEx: while XOM did $3 billion in stock buybacks in Q4, this number is set to slow to a trickle in Q1, with the company announcing it would repurchase only $1 billion in stock in Q1 2015. It is not quite a stock buyback halt... yet... but one or two more quarters of $45 oil and it will be, because as XOM notes, "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."

 

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Mon, 02/02/2015 - 09:30 | 5734326 SickDollar
SickDollar's picture

Time for QE4 BITCHEZ

Mon, 02/02/2015 - 09:33 | 5734337 LawsofPhysics
LawsofPhysics's picture

Yup.  bad timing.  Talk about killing a golden goose.

 

My guess is that the real monetization will begin shortly...

Mon, 02/02/2015 - 09:50 | 5734398 Whoa Dammit
Whoa Dammit's picture

Exxon should tell Vicki Nuland to cover their $5 billion earnings miss.

Mon, 02/02/2015 - 10:01 | 5734424 TruthInSunshine
TruthInSunshine's picture

Time for Mr. Yellen to authorize purchase of crude oil futures to get price of oil over $100/barrel target.

Great for economy and especially great for Mr. Obama's "prioritized middle class," and totally consistent with free markets.

Mon, 02/02/2015 - 10:04 | 5734433 Keyser
Keyser's picture

Funny, CNBS is reporting Exxon beat on earnings...  Spin city is in full effect... 

 

Mon, 02/02/2015 - 09:42 | 5734367 ejmoosa
ejmoosa's picture

Exxon #1 private sector tax collector in the US.

In the end, we know that it's the consumers that are footing the bill for all of those taxes....

Mon, 02/02/2015 - 09:37 | 5734341 observer007
observer007's picture

Oil? 20!

 

Oil Stocks: The $393 Billion Wealth Wipeout

The impact from the plunging price of crude oil is sending shockwaves across the globe.

 

More:

http://tersee.com/#!q=oil&t=text

Mon, 02/02/2015 - 09:46 | 5734382 cro_maat
cro_maat's picture

Fracking junk debt should be taking a bath but central planning worshipers are hanging on waiting for the inevitable FED bailout. Soon the FED will not only be the biggest holder of USSA RE but also own most of the energy sector - Winning!! / Sarc

Mon, 02/02/2015 - 09:33 | 5734327 freedom123
freedom123's picture

Criminal Putin regime wants to jail mother of 7 children for 20 years because she reported to Ukraine embassy about Putin regime troops moving to Ukraine:

http://www.digitaljournal.com/news/world/why-is-mother-of-7-svetlana-dav...

Mon, 02/02/2015 - 09:38 | 5734338 Haus-Targaryen
Haus-Targaryen's picture

Good.  She is a traitor.  

7 kids or 70 it is irrelevant.  She shouldn't have reported military movements to a foreign goverment.  Same thing would get you locked up in the US or whatever shithole country you are from -- my guess is you are a Ukie, so shithole is an accurate description.   

Mon, 02/02/2015 - 09:38 | 5734352 SickDollar
SickDollar's picture

Criminal ?? here in Merika you get locked up for less than that

 

Mon, 02/02/2015 - 10:08 | 5734456 Smegley Wanxalot
Smegley Wanxalot's picture

And if they don't lock you up, they sieze your assets.

Mon, 02/02/2015 - 10:19 | 5734497 CrimsonAvenger
CrimsonAvenger's picture

Right. Just think what would have happened if she had been selling individual cigarettes!

Mon, 02/02/2015 - 10:27 | 5734520 Keyser
Keyser's picture

You mean shot dead in your tracks, right?

Mon, 02/02/2015 - 10:58 | 5734619 JRobby
JRobby's picture

Trolls

Hawkers

Down vote Monday!

Mon, 02/02/2015 - 11:19 | 5734689 neuronius
neuronius's picture

If they were going to arrest anyone, it should have been the douchebag military officer discussing troop movements in a shared taxi.  duh.

Mon, 02/02/2015 - 13:37 | 5735315 cnmcdee
cnmcdee's picture

Nice thread jack.  Everybody knows Russia will quietly feed the rebels to destabilize eastern ukraine - that is just how it rolls.

Mon, 02/02/2015 - 09:32 | 5734331 MarketAnarchist
MarketAnarchist's picture

"Exxons stock up 1.6% premarket" - Marketwatch

 

BULLISH!

Mon, 02/02/2015 - 09:33 | 5734334 mrdenis
mrdenis's picture

xom is up ??????

Mon, 02/02/2015 - 09:32 | 5734335 LawsofPhysics
LawsofPhysics's picture

Stock down 50%, so bullish right?

Mon, 02/02/2015 - 09:34 | 5734339 Mayer Amschel R...
Mayer Amschel Rothschild's picture

Margin debt at record highs exceeding the previous highs of 2007 by 33% and now coporations out of profit to waste on stock buyback / mgnt bonus kick-back scheme.  Who's left to buy?

Mon, 02/02/2015 - 09:42 | 5734364 css1971
css1971's picture

Central banks

Mon, 02/02/2015 - 11:13 | 5734676 Buckaroo Banzai
Buckaroo Banzai's picture

Indeed! My understanding is they can print infinite amounts of money just with a few keyboard strokes.

Mon, 02/02/2015 - 09:38 | 5734346 Calculus99
Calculus99's picture

Reading the recently published Exxon book right now. Very interesting, not corporate propaganda. 

Exxon's employees seem cultish, think the square 'Greg Marmalard', the blond clean cut jackass in Animal House.

 

 

Mon, 02/02/2015 - 09:52 | 5734401 Bangin7GramRocks
Bangin7GramRocks's picture

I know one of these guys. Drags his family all over the world for that company. When they started sodomizing us with broom handles 7 years ago, he would recite the corporate talking points like he was an automaton.

Mon, 02/02/2015 - 10:59 | 5734634 JRobby
JRobby's picture

Exxon is a very large nation operating in many, many nations around the world.

Hey!?!? That sounds like another "nationless tribe" a little.

Mon, 02/02/2015 - 09:36 | 5734351 yogibear
yogibear's picture

"Stock Buyback Grinds To Near Halt"

Good! Lets see the rest join in.

Mon, 02/02/2015 - 09:38 | 5734354 Latitude25
Latitude25's picture

BTFD?

Mon, 02/02/2015 - 09:42 | 5734365 Billy Sol Estes
Billy Sol Estes's picture

Don't worry, they are building a fancy new compound North of Houston. But Rex is staying at his ranch in Irving though.

Mon, 02/02/2015 - 09:46 | 5734376 ThisIsBob
ThisIsBob's picture

  It will be rich poetry if all these motherfuckers end up long at the highs.

Mon, 02/02/2015 - 09:47 | 5734377 Dr. Engali
Dr. Engali's picture

"stock buy back grinds to a near halt" 

 

Because buying stawk at an all time high makes much more sense than a 52 week low.

 

 

Mon, 02/02/2015 - 09:48 | 5734390 roadhazard
roadhazard's picture

I am so sad for Big Oil. I guess now they will have to use the money from when every company was making $40 BILLION in Profit per QUARTER to get by now.  Fucking ripoffs.

Mon, 02/02/2015 - 09:53 | 5734403 Fix It Again Timmy
Fix It Again Timmy's picture

Five times each day, American investors need to kneel facing east [Wall St.] and recite: "Must buy stawks, Must buy stawks, Must buy stawks"...

Mon, 02/02/2015 - 09:56 | 5734404 Bangin7GramRocks
Bangin7GramRocks's picture

I know. We should all shed a tear for these assholes! Maybe Uncle Sam will open the other side of his blouse so big oil can suck from the other nipple. The billions in gubmint cheese is clearly not enough.

Mon, 02/02/2015 - 09:58 | 5734405 Never One Roach
Never One Roach's picture

Yes, it's true the oil sector is getting eviscerated. Yet the guest on NPR said that the low gas price is indubitably good for the economy and that Consumer Sentiment is highest since 2005.

"Consumer Sentiment ...."

... mmm ...

Are these the same consumers that were described as being "Gruberized" [aka, stupid] by Barry's Buddy ?

 

 

 

Mon, 02/02/2015 - 09:55 | 5734408 buzzsaw99
buzzsaw99's picture

State-owned energy giant Rosneft will not be able to continue drilling in the Kara Sea in 2015 after Western sanctions halted its cooperation with ExxonMobil in the arctic, two company sources told Reuters. In September, Rosneft announced that it had found oil in the Kara Sea after drilling the Universitetskaya-1 well in partnership with Exxon. The Kara Sea resources are estimated to be comparable in size to those found in Saudi Arabia...

that is all

Mon, 02/02/2015 - 10:24 | 5734453 djsmps
djsmps's picture
CNBC:

 

ExxonMobil beats earnings expectations; shares rise

ExxonMobil posted earnings that easily topped expectations, though revenue fell slightly short

Mon, 02/02/2015 - 12:55 | 5735141 I Write Code
I Write Code's picture

The plunge happened late in the quarter, so next quarter will be worse.

The big collapse is in revenues, outside of some chaos the net may not change so much, and we may get a discount for future adjustments.  The majors are minimally hurt by this all, they like the new consumer-friendly low prices, too.

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