The Exxon Earnings Detail- Vanity

XOM Earnings Statements ^

[mnehring]

Dick Durbin is leading the charge on the left to attack "Big Oil", using today’s Exxon earning reports as his evidence that the public is being screwed at the pump.

We’ve all heard the lines of how ‘Big Oil’ earns around 9c per gallon while the government earns around 50c per gallon in gas tax, but where does Exxon’s $8 Billion come from?

The following is an analysis of Exxon’s earnings reports and it destroys much of the accusations made by the left. First, some notes on their financial press release:

• …Upstream earnings were $6,383 million, up $1,329 million from the first quarter of 2005. Earnings from U.S. Upstream operations were $1,280 million, $73 million lower than the first quarter of 2005. The combination of a litigation item and higher tax expenses reduced results by over 4 cents per share. Non-U.S. Upstream earnings were $5,103 million, up $1,402 million from 2005. Higher realizations were partly offset by negative foreign exchange impacts.

  Note: with all the complaints about earnings coming from ‘Big Oil’ gouging the American consumer, a correlation in the rise in gas prices in the US has actually hurt Exxon’s bottom line. The main increase in earnings, and the bulk of XOM’s earnings come from non-US earnings.

  Resource: http://library.corporate-ir.net/library/11/115/115024/items/194730/1Q06Supplement.pdf

  Detail on Upstream Earnings (thousands):
  United States 2006-1,280 2005- 1,353
  Non-U.S. 2006-5,103 2005-3,701
  
  Note the drastic increase in non-US revenue versus the decrease in US revenue.

[mnehring]

I am posting this to start the analysis and conversation to debunk the 'conventional wisdom' about 'Big Oil' screwing the American public.

As I do some more analysis of the earnings numbers, I'll post on this thread.

[mnehring]

Natural gas production available for sale,
millions of cubic feet daily (mcfd) (2006 vs 2005)
United States 1,707 1,897
Canada 882 923
Europe 5,977 5,767
Asia Pacific/Middle East 2,462 2,036
Russia/Caspian 82 74
Other 89 88
Worldwide 11,199 10,785


This supports the increase in worldwide demand argument.

[Para-Ord.45]

future referance ping to smack a durbin/schumer marxist up side da head wit`

[mnehring]

Note on post #2, US supply production decreased by around 10% while the Asia Pacific increased by 18%

[ElTianti]

Why is discussing a companies profits in unadjusted dollars deceptive?

The rational used to decry Exxon’s profits as measured in raw dollars, could just as easily be used to argue that minimum wage workers are making RECORD pay. It’s true that the minimum wage is larger (in raw dollars) than it ever has been, a RECORD HIGH!

However, because of inflation, that RECORD HIGH (!) wage doesn’t really buy more than it ever has, perhaps less.

[mnehring]

Breakdown of sales based on product (2006 vs 2005):

Gasolines, naphthas 3,008 3,144
Heating oils, kerosene, diesel 2,601 2,690
Aviation fuels 655 691
Heavy fuels 689 718
Specialty products 912 986
Total 7,865 8,229

[mnehring]

Good point.. Considering the global purchasing/sales by XOM, it will be interesting to do some analysis of the change in currency in relation to the revenue changes..

[Pessimist]

Question:

What is the meaning of "Upstream earnings"?

[mnehring]

Chemical prime product sales,
thousands of metric tons (kt)

United States 2,620 2,838
Non-U.S. 4,296 4,100
Worldwide 6,916 6,938


Note: Another category where US sales is decreasing while worldwide sales are increasing.

[mnehring]

Upstream earnings are exploration and production earnings as well as wholesale post production earnings. Downstream earnings are direct to consumer earnings.

I'm about to post the 'downstream earnings' detail.

[mnehring]

Right now they are coming from the earnings release statements from today (only posting GAAP measurements). These are not reported as externally audited.

[mnehring]

Downstream earnings (much lower as XOM isn't primarily in the direct to consumer business.)

Downstream (2006 versus 2005)
United States 162 148
Non-U.S. 419 304
Total 581 452


Note: A very slight increase in US earnings over last year, but not near the trend of non-US earnings.

[Pessimist]

So then the increase in upstream earnings offshore compared to a decrease of US upstream earnings just means that they increased offshore oil production and reduced US oil production.

Right?

I'm thinking the downstream earnings are probably more on point vis-a-vis the "gouging" crowd.

[mnehring]

Based on post #14, if anyone would complain about 'gouging' it wouldn't be the US. As you'll see, out of the $8 billion in 1Q earnings, only $162 million were US downstream earnings. This is only an increase of $14 million over 1Q 05 earnings, practically pocket change in the numbers we are talking about.

[AliVeritas]

http://www.washingtonpost.com/wp-dyn/content/article/2006/04/26/AR2006042602307_pf.html

[mnehring]

See Page #5

http://library.corporate-ir.net/library/11/115/115024/items/194730/1Q06Supplement.pdf

[You Dirty Rats]

I made the same point on another thread. Exxon Mobil made about 68% of their profit outside the United States. In addition, the return on investment for an Exxon Mobil shareholder is better than average, but nothing like other investments -- such as Hillary's commodity investment.

[mnehring]

Good point, your post is worth linking to:

http://www.freerepublic.com/focus/f-news/1622586/posts?page=70#70