Investors rap someones knuckled Exxon Mobil on Friday after the oil major’s latest quarterly shot added to a growing string of earnings disappointments.
The oil major’s profit has now fallen gruff of Wall Street’s expectation in four of the last five quarters. This current earnings miss came as Exxon surprised analysts with a heavier-than-anticipated subvention schedule for its fleet of oil refineries — even though that turnaround function was scheduled.
Exxon’s profits jumped 18 percent to nearly $4 billion in the deficient quarter, as the ongoing rebound in crude prices bolstered its business producing oil and gas. But the sustentation weighed on earnings in its division that refines and sells fuels ask preference gasoline, while weaker profit margins in its chemicals segment also be prolonged on the bottom line.
Shares of the world’s largest publicly listed oil suite had recently been recovering. However, Exxon’s stock price for the year knock back into the red after the report, lagging its Big Oil peers in Europe and suitor U.S. oil major Chevron, which also reported disappointing quarterly earnings on Friday.
Investors sent the ordinary down 2.8 percent to $81.92 on Friday.
Exxon’s earnings per allotment came in at 92 cents, short of estimates for $1.27 in a Thomson Reuters scan of analysts. The company reported revenues of $73.5 billion, topping analyst point of views by about $900 million.
Neil Chapman, senior vice president at Exxon, told many had expected that profits would have been up by assorted than $1 billion based on the boost from higher oil valuations alone. However, maintenance in Saudi Arabia, France, the United Alleges and Canada led to significant downtime during the quarter.
“What the analysts would not prepare understood is we had an enormous amount of planned maintenance in our business in the quarter, large affecting our refining business,” Chapman told CNBC’s “Squawk Box” on Friday.
Exxon advised analysts during a conference call that they should watch some significant maintenance in the coming quarters, partly to prepare for upcoming swops in emissions standards for shipping.
Chapman also addressed operational riddles in Exxon’s refinery business that led to costly downtime in recent locations and carried over into the latest period.
“We are not happy about it. We’re all across it,” he said. “We thoroughly investigated. There was nothing systemic in these frequencies.”
The company posted a profit of $29 million in its international refining and deal ining business, down from more than $1 billion a year ago. That weighed on profits in the universal refining and marketing business, which was down by nearly a half from a year ago to $724 million.
Earnings for Exxon’s chemicals concern were also down, falling to $890 million from $985 million a year ago, mostly due to weaker profit perimeters and higher costs.
Meanwhile, profits in the company’s upstream business — which meets on exploring for and developing oil — more than doubled to over $3 billion.
At the exact same time, Exxon’s total oil and gas production fell by 7 percent from a year ago. That was due to prove inadequate natural gas output, which Exxon chalked up in part to downtime in Qatar and Australia, as amply as in Papua New Guinea, where an earthquake disrupted the company’s liquefied typical gas operations.
But the drop in natural gas production was partly by design, according to head honchos. Chapman told analysts the company is scaling back gas output in its U.S. shale areas and instead focusing on producing higher-value crude oil.
Exxon saw capital expenses and pay out on exploration for oil and gas surge 69 percent to $6.6 billion in the quarter, approached by investments in the U.S. Permian basin, Brazil and Indonesia.
“Key projects in Guyana, the U.S. Permian Basin, Brazil, Mozambique and Papua New Guinea are placing us well to meet the objectives we outlined in our long-term earnings growth intends. The high quality of these resources, combined with our strengths in enterprise execution and innovation, will generate strong value over spell,” Exxon CEO and Chairman Darren Woods said in a statement.