Exxon Mobil profit beats expectations on big cost cuts

Fri Apr 29, 2016 9:50am EDT
 
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By Ernest Scheyder

HOUSTON (Reuters) - Exxon Mobil Corp, the world's largest publicly traded oil producer, reported a higher-than-expected first-quarter profit on Friday as it slashed costs to offset plunging crude prices and weak refining margins.

The results reflect the new reality for an oil industry hammered by a more than 60 percent drop in crude prices since 2014 that has forced radical reductions in spending and personnel.

Exxon's capital budget during the first quarter dropped 33 percent from a year earlier, reflecting a drive to survive a price downturn that has already cost the company a perfect credit rating.

Exxon reported net income of $1.81 billion, or 43 cents per share, down from $4.94 billion, or $1.17 per share, a year earlier.

Analysts on average expected earnings of 31 cents per share, according to Thomson Reuters I/B/E/S.

Shares of Irving, Texas-based Exxon rose 0.6 percent to $88.60 in premarket trading.

Exxon Chief Executive Officer Rex Tillerson cited the company's large size and cash flow for helping it weather the low prices.

"The organization continues to respond effectively to challenging industry conditions," Tillerson said in a news release.   Continued...

 
A motorist fills up at an Exxon service station in a file photo. REUTERS/Stelios Varias