Exxon's $8B 1Q Profit Is 5th Highest Ever
By STEVE QUINN,
AP Business Writer
Exxon Mobil Corp., the world's largest oil company, reported Thursday the fifth highest quarterly profit for any public company in history, posting gains from higher oil prices that were likely to stoke the furor over outsized oil company earnings.
Despite the 7 percent gain in earnings to more than $8 billion in the first quarter, Exxon Mobil said its earnings came in below its record fourth-quarter because all three of its business — exploration and production; refining; chemicals — didn't perform as well.
The earnings report comes amid consumer outcry in the U.S. about soaring gasoline prices. The average retail price of gasoline in the U.S. is now $2.91 a gallon, or 68 cents higher than a year ago.
It also comes as Washington lawmakers are looking to appease consumers with various proposals to make big oil companies pay more taxes or provide consumers with some other relief.
In January, Exxon posted the highest quarterly profits of any public company in history: $10.71 billion for the fourth quarter of 2005 and $36.13 billion for the full year.
In the first quarter, net income rose to $8.4 billion, or $1.37 per share, from $7.86 billion, or $1.22 per share, a year ago. Excluding a gain on the sale of an interest in China's Sinopec, the company's year-ago profit was $7.4 billion, or $1.15 per share.
But analysts polled by Thomson Financial were looking for a higher profit of $1.47 per share for the latest quarter, and shares fell $1.02, or 1.6 percent, to $62.08 in morning trading on the New York Stock Exchange.
Howard Silverblatt, a senior index analyst for Standard & Poor's, said the latest profit figure still places Exxon fifth historically among quarterly earnings. Exxon also holds the first, second and fourth spots; Royal Dutch Shell PLC has the third spot.
The company said its average sale price for crude oil in the U.S. during the quarter was $55.99 per barrel compared to $42.70 a year ago. It sold natural gas in the U.S., on average, for $8.31 compared to $6.18 during the same period one year ago.
Earnings from exploration and production of oil and gas rose to $6.4 billion from $5 billion a year ago. Refining profits fell from $1.4 billion to $1.2 billion and profits from its chemical business fell to 949 million from $1.4 billion
Revenue grew to $88.98 billion from $82.05 billion a year earlier. Higher crude oil and natural gas prices and improved marketing margins were partly offset by lower chemical margins.
Placed in perspective, Exxon's revenue for the three-month period was still greater than the annual gross domestic product of some major oil producing nations, including the United Arab Emirates ($74.67 billion) and Kuwait ($55.31 billion), according to statistics maintained by the Central Intelligence Agency.
Exxon said it invested $4.8 billion in capital and exploration projects, a 41 percent increase from 2005.
"In the first quarter of 2006, the results of our continuing long-term investment program contributed to a 5 percent increase in production," Exxon chief executive said in a prepared statement.
Exxon also said it returned $7 billion to shareholders through dividends of $2 billion and buying back $5 billion worth of shares.
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