And that was just the beginning of a gusher of bad news ExxonMobil (XOM) reported on July 30 for the company’s second quarter.
Earnings per share dropped 63% from the second quarter of 2008. Revenue dropped 46% (to a mere $74.5 billion.) Production was flat (once you exclude declines due to OPEC production quotas and the divestiture of assets) as declines in production from existing fields offset increased producton in the United States and West Africa.
Investors who own ExxonMobil, as I do in my Jubak’s Picks portfolio, because it is the most efficient and consitent of oil companies, shouldn’t be surprised to learn that nothing in those results is making ExxonMobil deviate from its long-term plans.
Spending on capital projects and exploration came in at $12.2 billion for the first half of 2009. That’s essentially unchanged from the $12.5 billion spent in the first half of 2008 and, as CEO Rex Tillerson said, is “in-line with our longer-term plans.” If you own oil service and drilling stocks, the company didn’t say anythng to indicate a pickup in orders for that sector.
ExxonMobil did make one concession to falling profits from the global slump in oil demand: the company, which bought back $5.2 billion in shares in the second quarter, will cut share purchases to $4 billion in the third quarter to reduce pressure on operating cash flow.
ExxonMobil was in the middle of its conference call with analysts and investors when I posted this. I’ll add any news from that call in a new post later in the day. I’ll also update my target price at that time.