first quarter 2013 earnings call -...
TRANSCRIPT
First Quarter 2013 Earnings CallDavid RosenthalVice President Investor Relations & SecretaryApril 25, 2013
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Cautionary StatementForward-Looking Statements. Outlooks, forecasts, estimates, targets, business plans, and other statements of future events or conditions in this presentation or the subsequent discussion period are forward-looking statements. Actual future results, including financial and operating performance; demand growth and mix; ExxonMobil’s production growth and mix; the amount and mix of capital expenditures; future distributions; resource additions and recoveries; finding and development costs; project plans, timing, costs, and capacities; drilling programs; product sales and mix; corporate and financing expenses; and the impact of technology could differ materially due to a number of factors. These include changes in oil or gas prices or other market conditions affecting the oil, gas, and petrochemical industries; reservoir performance; the outcome of exploration; timely completion of development projects; war and other political or security disturbances; changes in law or government regulation, including tax and environmental regulations; the outcome of commercial negotiations; the actions of competitors and customers; unexpected technological developments; the occurrence and duration of economic recessions; unforeseen technical difficulties; and other factors discussed here and under the heading "Factors Affecting Future Results" in the Investors section of our Web site at exxonmobil.com. See also Item 1A of ExxonMobil’s 2012 Form 10-K. Forward-looking statements are based on management’s knowledge and reasonable expectations on the date hereof, and we assume no duty to update these statements as of any future date.
Frequently Used Terms. References to barrels of oil or bitumen and similar terms include quantities of oil and gas that are not yet classified as proved reserves under SEC definitions but that we believe will likely be developed and moved into the proved reserves category in the future. For definitions and more information regarding resources, reserves, return on average capital employed, cash flow from operations and asset sales, and other terms used in this presentation, including information required by SEC Regulation G, see the "Frequently Used Terms" posted on the Investors section of our Web site. The Financial and Operating Review on our Web site also shows ExxonMobil's net interest in specific projects.
The term “project” as used in this presentation does not necessarily have the same meaning as under SEC Rule 13q-1 relating to government payment reporting. For example, a single project for purposes of the rule may encompass numerous properties, agreements, investments, developments, phases, work efforts, activities and components, each of which we may also informally describe herein as a “project.”
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Business Environment
Global economic growth was mixed in the first quarter
■ U.S. economic growth moderate
■ China’s growth rate slowed
■ European economies remain challenged
■ Crude oil and non-U.S. natural gas prices increased; U.S. natural gas prices flat
■ Industry refining margins strengthened
■ Chemical commodity product margins improved
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1Q13 Financial Results
Continued strong results, including earnings per share growth of 6% from a year ago
Earnings 9.5
Earnings Per Share – Diluted (dollars) 2.12
Shareholder Distributions 7.6
CAPEX 11.8
Cash Flow from Ops and Asset Sales* 14.0
Cash 6.6
Debt 13.4Billions of dollars unless specified otherwise
Note: cash includes restricted cash of $376M.* Includes $0.4B associated with asset sales.
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1Q13 Sources and Uses of Funds
Cash generation continues to fund a robust investment program and industry-leading shareholder distributions
Note: beginning and ending balances include restricted cash of $341M and $376M respectively.
Beginning Cash 9.9
Earnings 9.5
Depreciation 4.1
Working Capital / Other 0.0
Proceeds Associated with Asset Sales 0.4
Additions to PP&E (7.5)
Shareholder Distributions (7.6)
Additional Financing / Investing (2.2)
Ending Cash 6.6Billions of dollars unless specified otherwise
14.0
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Total Earnings – 1Q13 vs. 1Q12
Earnings increased by $50M, as higher Chemical earnings and lower corporate and financing expenses were mostly offset by lower Upstream earnings
1Q12 U/S D/S Chem C&F 1Q13
9,450 (765)(41) 436 420 9,500
Millions of Dollars
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Total Earnings – 1Q13 vs. 4Q12
Earnings decreased by $450M as lower Upstream and Downstream earnings were partly offset by higher Chemical earnings and lower corporate and financing expenses
4Q12 U/S D/S Chem C&F 1Q13
9,950 (725)(223) 179 319 9,500
Millions of Dollars
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Upstream
Major Projects
Continue to advance global portfolio of high-quality projects
■ Kearl development progressing Processing bitumen Expansion project 32% complete
■ Telok gas field commenced production On schedule and within budget
■ Hadrian North appraisal drilling completed
■ Erha North Phase 2 sanctioned
Installation of the Telok A Platform
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Upstream
Conventional Exploration
Active exploration drilling program
■ Tanzania Tangawizi-1 – significant gas discovery Zafarani-2 – successful appraisal well Additional drilling in 2013
■ Gulf of Mexico Phobos - encouraging early results Preparing to drill Thorn prospect
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Upstream
Conventional Exploration
Increasing portfolio of high-quality opportunities
■ Russia Arctic Expanded Rosneft SCA Additional 150M gross acres
■ Liberia New Country Entry 500K net acres offshore
■ Gulf of Mexico Awarded high bid blocks from
Western OCS Sale 229 Successful bidder in Central OCS
Sale 227 Acquired Maui interest
LIBERIA
SIERRA LEONE
50 KM
ExxonMobil
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Upstream
Unconventional Liquids
Progressing high-potential, liquids-rich unconventional opportunities
■ Celtic Acquisition Significant acreage position in liquids-
rich plays
■ Bakken Growing production Focused development drilling activity
■ Woodford Ardmore Growing production Encouraging results in Marietta Basin Delineating Caney Shale potential
ALBERTA
BR
ITIS
H C
OLO
MB
IA
Celtic
IOL / EM Canada
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Upstream
Earnings – 1Q13 vs. 1Q12
Earnings decreased $765M due to lower liquids realizations, lower volumes, and higher expenses, partly offset by higher gas realizations
1Q12 Realization Vol/Mix Other 1Q13
7,802 (230) (280) (250) 7,037
Millions of Dollars
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koebd
Upstream
Volumes – 1Q13 vs. 1Q12
Volumes decreased 3.5%: liquids -21 kbd, natural gas -823 mcfd
1Q12 Entitlements Quotas Divestments Net Growth 1Q13
4,553 11 (26) (55) 4,395Price/Spend: +48Net Interest: (136)
(88)
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Upstream
Earnings – 1Q13 vs. 4Q12
Earnings decreased $725M mainly due to the absence of gains on asset sales and tax items, partly offset by higher realizations
4Q12 Realization Vol/Mix Other 1Q13
7,762 340 (80) (980)7,037
Millions of Dollars
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Upstream
Volumes – 1Q13 vs. 4Q12
Volumes increased 2.4%: liquids -10 kbd, natural gas +672 mcfd
4Q12 Entitlements Quotas Divestments Net Growth 1Q13
Price/Spend: (70)Net Interest: (2)
4,293 (72) (10)184 4,395
koebd
0
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Downstream
Earnings – 1Q13 vs. 1Q12
1Q12 Margin Vol/Mix Other 1Q13
Millions of Dollars
1,586
780 (290)(530)
1,545
Earnings decreased $41M as lower gains on asset sales and lower volumes were offset by improved refining margins
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Downstream
Earnings – 1Q13 vs. 4Q12
Earnings decreased $223M reflecting lower volumes and the absence of a LIFO gain, partly offset by improved refining margins
4Q12 Margin Vol/Mix Other 1Q13
Millions of Dollars
1,768
470 (430)
(260)1,545
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Chemical
Earnings – 1Q13 vs. 1Q12
Earnings increased $436M due to stronger commodity margins and gains on asset sales
1Q12 Margin Vol/Mix Other 1Q13
Millions of Dollars
701
320 0120 1,137
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Chemical
Earnings – 1Q13 vs. 4Q12
Earnings increased $179M due to improved commodity margins and gains on asset sales
4Q12 Margin Vol/Mix Other 1Q13
Millions of Dollars
95880 10
90 1,137
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Summary
ExxonMobil’s financial and operating performance reflects the value of our strong integrated business model
* Includes $0.4B associated with asset sales
■ ExxonMobil possesses unique strengths that create long-term shareholder value
Balanced portfolio Disciplined investing High-impact technologies Operational excellence Global integration
Billions 1Q13
Earnings $9.5
Cash Flow from Ops and Asset Sales* $14.0
Capex $11.8
Shareholder Distributions $7.6