Exxon Mobil Corp.: Making No Apologies

Nov. 19, 2008
Oil producer won't say its 'sorry' for being successful.

For environmentalists and many politicians, Exxon Mobil Corp. is the epitome of corporate greed. In the past, the 2008 IW 50 Best Manufacturer has drawn the ire of consumers for earning record profits while gas prices remain sky high and its refusal to fully embrace green initiatives touted by its competitors.

Despite the backlash, Exxon CEO Rex Tillerson is unapologetic. In a recent New York Times article Tillerson says:

"Over the years there have been many predictions that our industry was in its twilight years, only to be proven wrong. As Mark Twain said, the news of our demise has been greatly exaggerated."

If it were in any other industry, the Irving, Texas-based company might be heralded as a model of efficiency for other manufacturers -- much like Toyota. Exxon's profit exceeds rival Chevron by $1 per barrel, Shell's by $3 per barrel and BP's by $5 per barrel, Bernstein Research analyst Neil McMahon said in the Times story.

The company beat its own record for the highest-ever quarterly profit for a U.S. company when it said in October that third-quarter net income rose to $14.8 billion, or $2.86 per share, compared with $9.4 billion, or $1.70, a year earlier.

One of the company's greatest strengths is investing abroad in oil and gas exploration and development. Exxon said Nov. 17 that it will sign an oil exploration deal with Turkey's state-run oil company to drill for hydrocarbon reserves in the Black Sea, according to Reuters news service. On Nov. 8, Bloomberg News reported that interest remains strong from liquefied natural gas (LNG) buyers in fuel from Exxon's $11 billion joint venture in Papua New Guinea to produce LNG.

Exxon Mobil Corp.
At A Glance

Exxon Mobil Corp.
Irving, Texas
Primary Industry: Petroleum & Coal Products
Number of Employees: 83,000
2007 In Review
Revenue: $395.7 billion
Profit Margin: 10.26%
Sales Turnover: 1.63
Inventory Turnover: 18.30
Revenue Growth: 6.75%
Return On Assets: 18.54%
Return On Equity: 35.67%

In addition, Exxon is making some strides in the development of alternative-energy sources. The company received a trade press award for its battery separator film technology, which is designed to improve the power, capacity, stability and safety margins of lithium-ion batteries.

Looking ahead, the company will face some challenges. Oil prices have been falling, and President-elect Barack Obama will likely change the nation's energy policies with a focus on alternative power sources.

But Tillerson doesn't seem too worried. In the Times article, he says up to the middle of the 21st century "the world will continue to rely dominantly on hydrocarbons to fuel its economy."

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