ExxonMobil’s 2021 profits soar to US$23B; its largest in 7 years

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Exxon Mobil Corporation, the world’s largest refiner and marketer of petroleum products, disclosed on Tuesday that it has bounced back from a massive US$1.4B loss in 2020, recording a whopping US$23B in earnings for 2021. Importantly, this is the company’s largest profit declaration in seven years.

During its earnings call which featured Stephen Littleton, Vice President of Investor Relations; Darren Woods, Chairman and Chief Executive Officer; and Kathy Mikells, Senior Vice President and Chief Financial Officer, the company noted that its fourth-quarter 2021 earnings totaled US$8.9 billion, or US$2.08 per share which resulted in full-year earnings of US$23 billion, or US$5.39 per share assuming dilution.

The American multinational said capital and exploration expenditures were US$5.8 billion in the fourth quarter and US$16.6 billion for the full year 2021, in line with guidance.

In 2021, Exxon said production volumes in the Permian increased nearly 100,000 oil-equivalent barrels per day, with improved capital efficiency. For this asset, the company said the focus remains on continuing to grow free cash flow by increasing recovery through efficiency gains and technology applications.

Further to this, ExxonMobil said it continued to progress its low cost of supply deepwater developments in Guyana, with estimated recoverable resources increasing to approximately 10 billion oil-equivalent barrels, supported by six commercial discoveries in 2021. It reminded shareholders that the Liza Unity floating production, storage, and offloading vessel (FPSO) arrived in Guyanese waters in October 2021 and is on schedule for the commencement of production this quarter.

With respect to capital allocation and structural cost improvement, Exxon said it paid down debt by an additional US$9 billion in the fourth quarter, bringing the full-year reduction to US$20 billion. The company said this no doubt strengthens the balance sheet and returns debt to pre-pandemic levels.

Furthermore, the company said it captured an additional US$1.9 billion in structural savings in 2021, increasing total savings to roughly US$5 billion relative to 2019.  Exxon said it is now on pace to exceed total annual structural cost reductions of US$6 billion by 2023.

Building on this work, the multinational recalled recent announcements to streamline its business structure to enhance effectiveness, grow value, and reduce costs. Exxon said these changes will more fully leverage global functional capabilities, improve line of site to markets, and enhance resource allocation to the highest corporate priorities.

OilNOW understands that during the fourth quarter, ExxonMobil’s Board of directors approved the company’s corporate plan for 2022, with capital spending anticipated to be in the range of US$21 billion to US$24 billion.

On the heels of the foregoing results, Chief Executive Officer and Chairman, Darren Woods thought it prudent to note that the company’s effective pandemic response, focused investments during the down-cycle, and structural cost savings are what positioned it to realize the full benefits of the market recovery in 2021.

“Our new streamlined business structure is another example of the actions we are taking to further strengthen our competitive advantages and grow shareholder value,” said the Exxon CEO.

He concluded, “We’ve made great progress in 2021 and our forward plans position us to lead in cash flow and earnings growth, operating performance, and the energy transition.”


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