ExxonMobil gave the industry leading financial results in the first quarter.
This empowers him to return the leading amount of money in the industry to his shareholders.
The oil company expects to improve with its effectiveness in the coming years.
ExxonmobilI is the 800-pound gorilla in the oil sector. This is not only the biggest company in the market capitalization industry (over $ 450 billion), but also the leader in several important categories.
Thehe oil company He showed his ability in the first quarter when he achieved leading results in the background of challenging market conditions. Here’s a look at the quarter and the key factors nourishing Exxonmobilsuccess.
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The last results of the first quarter of ExxonMobil were Nothing but Extremely, given the market conditions during the period. The company brought an industry leading in a $ 7.7 billion profit, or $ 1.76 per share, which beat analysts’ expectations by $ 0.01 per share. It also runs the sector by producing $ 13 billion in cash flow to operations while generating $ 8.8 billion free cash flow.
The company has brought stronger than expected profits, despite the significant decline in industry refining margins, lower prices of raw oil, lower volumes of production based on some sales of non-joucks and higher costs than growth initiatives.
One of the factors nourishing his strong results was his Healthy production of oil and gas during the quarter. Exxon’s score is an average of 4.6 million Oil equivalent barrels (Boe)per dayS This was raised with a look 20% of the previous year periodGuided by the acquisition of Pioneer Natural Resources last year.
Image source: Getty Images.
The other major catalyst was the industry leading program for structural costs in the industry. This strategy It is now saving The $ 12.7 billion company a year compared to the 2019 level, which is more than any other international oil companies (IOC) in combination. The company caught an additional $ 600 million savings from cost through this program In the first quarterS
The combination of investment to increase its volumes and savings of structural costs added $ 4 billion to the bottom line of the company in the first quarter, which helped to compensate for some of the impact of inflation and other factors on its revenue.
Exxon cash leading industry has allowed it to lead to the return on shareholders leading in the industry. The oil giant has sent $ 9.1 billion to investors to its trimester, including redemption of a sector leading in $ 4.8 billion from its shares. This has the company on its way to buy around $ 20 billion this year.
Exxon also paid $ 4.3 billion in dividends. The company delivered its leading sector 42 an annual increase in dividend earlier this year. Only 4% of companies in S&P 500(Snpindex: ^gspc) have achieved a dividend growth of 42 years or more.
The elite balance of the company played a key role in its ability to return money to investors. The company ended the quarter with $ 18.5 billion in cash. Although this dropped from $ 23.2 billion at the end of the fourth quarter, it supports the leading industry Leverage From 12% capital debt (13% drop in the fourth quarter) and 7% on a net basis after factoring its massive cash balance (with respect to 6% at the end of last year). This gives him a lot of pillow for the time of oil prices in the future.
ExxonMobil firmly expects to improve its already leading results in the future. The company continues to invest strongly in the expansion of its previous resources, which are its assets with the lowest price and the highest margin. The company plans to launch 10 advantages this year, which will generate More than $ 3 billion in profits next year at constant prices and margins. In the meantime, even if prices and margins fall, these investments will still contribute to its financial results.
The company is also about to deliver $ 18 billion in structural cost savings by the end of 2030 compared to 2019. levelS When added to its growth investment, Exxon expects to add $ 20 billion to its profit and $ 30 billion to its cash flow by 2030.
The oil giant strategy to raise its profit capacity also puts it in a stronger position for lower oil prices with less oil In the futureS In the meantime, this will significantly increase the company’s potential if prices improve.
ExxonMobil continues to prove that this is the best managed company in the oil industry. Its ability to produce leading in industry profits and to return more money to investors than anyone else has helped Give it the fuel To produce a general return on peers (17% complex annual return on shareholders in the last three years). With more profit growth and cost savings, Exxon is in a strong position to continue to increase the value of shareholders In the futureBy turning it into an excellent oil stock to buy and hold for the long road.
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Matt Dilalo has no position in any of the reserves mentioned. Motley Fool has no position in any of the reserves mentioned. Motley Fool has a policy of disclosure.
ExxonMobil continues to prove that this is the best managed company in the oil patch originally published by Motley Fool
