Exxon Earnings Dip on Weak Refining Margins

Exxon Earnings Dip on Weak Refining Margins

ExxonMobil reports slightly lower profits as weak refining margins offset the benefit of higher natural gas prices in the U.S. that boosted earnings from petroleum production.

NEW YORK – ExxonMobil (IW 500/1) Thursday reported slightly lower profits as weak refining margins offset the benefit of higher natural gas prices in the U.S. that boosted earnings from petroleum production.

Earnings for the first quarter came in 4.2% lower from the year-ago period at $9.1 billion.

Exxon, the U.S.'s biggest oil company, again reported lower petroleum output, this time notching a decline of 5.6% from a year ago.

However, exploration and production earnings still grew by 10.6%, thanks in part to a 49% rise in U.S. natural gas prices in the wake of cold winter weather in much of the country.

Exxon officials have emphasized that they will not sacrifice solid profit margins to keep production high.

At the same time, analysts have been disappointed in how the slow ramp-up of many priority projects has meant lagging output.

Earnings in the downstream portion of the business, which covers refining and the selling of gasoline, tumbled 47.3% from a year ago. Chemical earnings also fell, but by a smaller percentage.

"ExxonMobil's first quarter earnings and cash flow reflect the company's continuing focus on delivering profitable growth and creating long-term shareholder value," CEO Rex Tillerson said. "Strong performance in the upstream benefited from improved production mix and increased unit profitability."

Exxon's results translated into $2.10 per share, above the $1.88 forecast by Wall Street analysts. Revenues of $106.8 billion lagged forecasts of $109.8 billion.

Shares of Dow member Exxon were up 0.3% to $102.75 in pre-market trade.

Copyright Agence France-Presse, 2014

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