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Exxon, Chevron, ARCO beat third-quarter earnings estimates; Mobil, Texaco fall short
by The Associated Press
Big oil companies said Nov. 1 their third-quarter earnings rose from a year earlier because of higher crude oil prices, but profit growth was held back by competitive pricing in refined products.
Earnings at Exxon, Chevron and ARCO beat analysts’ estimates, while those at Mobil and Texaco fell short.
Share prices in all the companies fell on the New York Stock Exchange. At mid-afternoon Nov. 1, shares of Exxon were trading at $74.183/4, down 3.5 percent; Mobil at $97.683/4, down 4.2 percent; Chevron at $91, down 2.9 percent; Texaco at $16.75, down 1.79 percent, and ARCO at $91.561/4, down 2.6 percent.
Exxon income up $1.5 billion The nation’s largest oil company said its net income rose to $1.5 billion, or 61 cents a share, from $1.4 billion, or 58 cents a share, in the same quarter a year earlier. That beat the 59 cents per share estimate by analysts surveyed by First Call/Thomson.
Revenue increased to $33.07 billion from $28.5 billion a year ago.
Chairman Lee R. Raymond said a roughly $8 a barrel increase in crude oil prices was responsible for the revenue increase, resulting in higher earnings in its crude exploration and production business.
But lower profits in its refining and marketing businesses, weaker chemicals margins and lower coal prices hurt the company’s overall earnings.
Exxon said, however, it had record chemicals sales and reduced operating expenses.
For the first nine months, Exxon had net earnings of $3.73 billion, or $1.52 a share, compared with $4.84 billion, or $1.96 a share.
Revenues were $89.38 billion, up from $87.83 billion.
Exxon, based in Irving, Texas, is awaiting final regulatory approval of its merger with Mobil.
Reduced exploration, cost-cutting gives Mobil boost The second-largest U.S. oil company said operating income rose to $705 million, or 87 cents a share, from $497 million, or 61 cents a share, a year earlier. This year’s figure was 2 cents below the estimate of analysts surveyed by First Call/Thomson.
Net income increased to $688 million, or 85 cents a share, in the July-September quarter, from $509 million, or 63 cents a share, in the year-earlier quarter. The figure included a special charge of $17 million for costs related to the planned merger with Exxon.
Mobil, based in Fairfax, Va., said revenues rose to $16.4 billion from $13.6 billion.
Earnings benefited from lower exploration expenses and cost-cutting. Per-barrel operating expenses were down 6 percent for the year, and the company cited higher-than-expected production from the North Sea, Qatar, eastern Canada, Equatorial Guinea, Kazakhstan and Nigeria.
While crude oil and natural gas production was up, unexpected delays at refineries and lower profit margins on domestic sales hurt earnings, Mobil said.
“Worldwide crude oil and natural gas prices have continued to improve. However, worldwide refining and marketing margins remain depressed,” said chairman and CEO Lucio Noto.
Net income for the first nine months was $1.9 billion, compared with $1.86 billion a year earlier. Revenues were $42.78 billion, up from $40.50 billion.
Texaco profits double Profits at the nation’s third-largest oil company more than doubled from a year ago.
Operating income was $453 million, or 83 cents a share, compared with $208 million, or 37 cents per share, a year earlier. The results fell a penny short of the 84 cents predicted by analysts surveyed by First Call/Thomson Financial.
The figures do not include one-time charges, including income from the sale of two refineries. With those special items, net income rose to $387 million in the, or 71 cents a share, from $215 million, or 38 cents a share.
Revenues at Texaco, headquartered in White Plains, N.Y., were up 25 percent to 9.68 billion from $7.71 billion.
Still, high crude prices reduced profit margins at the company’s refining operations. Texaco said increased production — especially at its fields in the Caspian region — helped offset those low margins.
For the first nine months of the year, net income rose to $859 million, or $1.56 a share, from $791 million, or $1.42 a share. Revenues increased to $25.14 billion from $23.9 billion. Chevron has 80 percent increase in operating earnings The nation’s fourth-largest oil company credited higher crude oil prices and lower operating costs for an 80 percent increase in operating earnings to $702 million, or $1.07 per share, from $386 million, or 59 cents a share, a year earlier.
Analysts surveyed by First Call/Thomson Financial predicted earnings of $1.01 a share.
Net income — which factored in special charges, including a loss on the sale of Koa Oil Co. by Caltex — was $582 million, or 88 cents a share, up from $461 million, or 70 cents a share.
Revenue was $10.2 billion for the quarter, compared with $7.68 billion a year earlier, said Chevron, which is headquartered in San Francisco.
“Higher crude oil and natural gas prices boosted third quarter earnings in our exploration and production business,” said CEO Ken Derr, adding that operating earnings also “showed a solid improvement.”
However, Chevron joined other oil companies in noting that profit margins in refining and marketing were hurt by competitive pricing pressures at the retail level.
For the first nine months, net income was $1.26 billion, or $1.91 a share, compared with $1.55 billion, or $2.35 a share in 1998.
Revenues were $25.61 billion, up from $23.28 billion.
ARCO beats analysts predictions The fifth-largest U.S. oil company had earnings before one-time items of $511 million, or $1.55 per share, compared with $73 million, or 22 cents per share, a year earlier.
The results at the Los Angeles-based company easily beat the estimate of $1.23 per share of analysts surveyed by First Call/Thomson Financial.
The stronger earnings reflected higher crude prices as well as $370 million in cost-cutting measures. Such savings were expected to reach $500 million by the end of the year, said Mike R. Bowlin, ARCO’s chairman and chief executive officer.
ARCO is scheduled to merge with BP Amoco before the year’s end.
Special items in the third quarter, including an after-tax charge on the sale of Algerian oil assets, reduced ARCO’s net income from to $372 million, or $1.13 per share, from $872 million, or 2.71 per share.
For the first nine months of the year, ARCO had net earnings of $850 million, or $2.59 per share, compared with $1.25 billion, or $3.81 per share, in the same period a year earlier.
Revenue was $9.31 billion, up from $8.10 billion last year.
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