Exxon Breaks Record Profits... AGAIN!

[The Voice]

Exxon Mobil: Biggest profit in history
The largest U.S. oil company surges past analysts' estimates with a posted net income of $14.83 billion and sets a national record for quarterly profit.
See all CNNMoney.com RSS FEEDS (close) By Aaron Smith, CNNMoney.com staff writer
Last Updated: October 30, 2008: 3:28 PM ET
NEW YORK (CNNMoney.com) -- Exxon Mobil Corp. set a quarterly profit record for a U.S. company Thursday, surging past analyst estimates.

Exxon Mobil (XOM, Fortune 500), the leading U.S. oil company, said its third-quarter net profit was $14.83 billion, or $2.86 per share, up from $9.41 billion, or $1.70, a year earlier. That profit included $1.45 billion in special items.

The company's prior record was $11.68 billion in the second quarter of 2008.

The latest quarter's net income equaled $1,865.69 per second, nearly $400 a second more than the prior mark.

The company said its revenue totaled $137.7 billion in the third quarter.

Analysts had expected Exxon to report a 40% jump in earnings to $2.38 per share, or net income of $12.2 billion, and a 28% surge in revenue to $131.13 billion, according to a consensus of estimates compiled by Thomson Reuters.

The company's earnings were buoyed by oil prices, which reached record highs in the quarter before declining. Oil prices were trading at $140.97 a barrel at the beginning of the third quarter, and had fallen to $100.64 at the end.

Compare that to 2007, when prices traded at $71.09 a barrel at the beginning of the third quarter, and rose to $81.66 by the end.

Last of the big quarters
Exxon's special charges include the gain of $1.62 billion from the sale of a German natural gas company. It also includes the $170 million charge in interest related to punitive damages from the Valdez oil spill off the Alaskan coast in 1989.

The Irving, Texas-based company said it lost $50 million, before taxes, in oil revenue because of Hurricanes Gustav and Ike. The company expects damages related to these hurricanes to reduce fourth-quarter earnings by $500 million.

Exxon's stock price slipped by about 2% in afternoon trading. Bernie McGinn, Chief Executive of McGinn Investment Management and owner of 30,000 Exxon shares, said he wasn't surprised, given the recent downturn in oil prices.

"That's probably the last of the big profit quarters, at least for now," said McGinn. "You can't make the case that it's going to continue."

Despite the surge in profit, Exxon said oil production was down 8% in the third quarter, compared to the same period last year.

The company also said it is spending more money to locate new sources of oil. Exxon said it spent $6.9 billion on oil exploration in the third quarter, a jump of 26% from the same period last year. The company said it began a new program to tap natural gas offshore from Nigeria.

More investments
Exxon also has an aggressive program for buying back stock, with 109 million of its shares repurchased during the third quarter, at a cost of $8.7 billion.

In a conference call with analysts, David Rosenthal, vice president of investor relations for Exxon, said the company's "first priority" is using profits to continue investing in exploration programs for oil and other resources.

Rosenthal said the company would also consider using new-found funds to bolster its dividend, buy back more shares and to purchase other companies, but he declined to offer specific details.

Phil Weiss, analyst for Argus Research, said he doesn't expect Exxon to break any more profit records in future quarters.

"I don't expect the fourth quarter to be nearly as good as the third because of lower oil prices," said Weiss.

Analysts also said that demand for gasoline is falling, which could impact Exxon and other oil companies.

"While oil companies benefit from high oil prices in the short run, they might lose in the long run," Anas Alhajji, chief economist for NGP Energy Capital Management, wrote in an email to CNNMoney.com. "Higher oil prices lead to lower demand, as we have seen in recent months."

Earlier Thursday, Europe's leading oil company, Royal Dutch Shell PLC (RDSA), reported a 22% gain in net profit for the third quarter, to $8.45 billion. The company said sales rose 45% to $132 billion.

Exxon is the second-largest company in the Fortune 500 in terms of annual sales, behind Wal-Mart Stores (WMT, Fortune 500).

Exxon's stock price has fallen about 20% so far this year, compared to the S&P 500, which has fallen about 36%.

First Published: October 30, 2008: 8:17 AM ET

Record profits... I never would have guessed with how high gas was this year.

 

[Mdog1]

****ers should just start to give away gas because they are robbing us with those ridiculous prices.

 

[The Voice]

****ers should just start to give away gas because they are robbing us with those ridiculous prices.

I'm just gonna buy 100 barrols of gas right now and when it goes back to 4 bucks, I'll be selling it across the street. :chuckles:

 

[Man Called X]

In a conference call with analysts, David Rosenthal, vice president of investor relations for Exxon, said the company's "first priority" is using profits to continue investing in exploration programs for oil and other resources.

Don't forget making sure every CEO/CFO/board member gets an even fatter bonus this year.

 

[The Voice]

Don't forget making sure every CEO/CFO/board member gets an even fatter bonus this year.

Oh boy they invested 100M in alternative energy research!

Yeah, I know an engineer that just got a 200k signing bonus with them, his uncle also an engineer gets a 2M dollar bonus a year now. So it's not just CEO/CFO/Board Members. If they're giving smaller employees that kind of money, think of how much they're giving themselves...

 

[Man Called X]

Oh boy they invested 100M in alternative energy research!

Yeah, I know an engineer that just got a 200k signing bonus with them, his uncle also an engineer gets a 2M dollar bonus a year now. So it's not just CEO/CFO/Board Members. If they're giving smaller employees that kind of money, think of how much they're giving themselves...

Engineers are in high demand. It's pretty easy to take your pick of jobs as far as that goes. And that usually does include some sort of bonus for taking the job.

 

[The Voice]

Engineers are in high demand. It's pretty easy to take your pick of jobs as far as that goes. And that usually does include some sort of bonus for taking the job.

True, however if they can afford to give 200K's/yr in bonus for engineers. They are probably giving themselves double to triple digit M's

 

[Man Called X]

True, however if they can afford to give 200K's/yr in bonus for engineers. They are probably giving themselves double to triple digit M's

Of course they are. And they're using company money to fund vacations, extravagant parties, etc etc just like every other corrupt business has been caught doing in the past.

 

[Mac]

Corporate America runs this country, think of that at the booths and who wins tonight.

 

[cavincali]

Engineers are in high demand. It's pretty easy to take your pick of jobs as far as that goes. And that usually does include some sort of bonus for taking the job.

I will be an engineer in 44 days.

 

[The Voice]

Corporate America runs this country, think of that at the booths and who wins tonight.

Why would corporate America want Obama to win? A man who will raise taxes for them and make it easier to create union. The only thing he might do for him is health insurance...