) posted first-quarter 2014 earnings of $2.10 per share, beating
the Zacks Consensus Estimate of $1.88. The upside came from
. However, earnings per share dropped 1% from $2.12 in the
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Total revenue in the quarter decreased 1.5% year over year to
$106.8 billion, and also came in below the Zacks Consensus
Estimate of $111.4 billion.
Quarterly earnings for the segment were $7.8 billion, up $746
million year over year. The improvement was primarily aided by
higher natural gas realizations, which were partly mitigated by
lower liquids realizations.
Production averaged 4.151 million barrels of oil-equivalent per
day (MMBOE/d), down 5.6% year over year. Liquid production
decreased 2.1% year over year to 2.148 million barrels per day
owing to the expiry of Abu Dhabi onshore concession. Natural gas
production was 12,016 MCF/d (millions of cubic feet per day),
down 1,197 MCF/d from 2013, primarily due to lower demand.
The segment recorded profit of $813 million in the first quarter,
down $732 million year over year, mainly due to weaker refining
ExxonMobil's refinery throughput averaged 4.5 million barrels per
day (MMBPD), down 1.5% from the year-earlier level of 4.6 MMBPD.
This unit contributed approximately $1.0 billion to the company's
profits, down $90 million from the year-earlier quarter. The
downside was mainly due to lower margins.
During the quarter, ExxonMobil generated cash flow from
operations and asset sales of $16.2 billion. The company returned
$5.7 billion to shareholders through dividends/share repurchases.
Capital spending decreased nearly 28% year over year to $8.4
We believe that ExxonMobil is the world's best-run integrated oil
company, based on its track record of superior return on capital
employed. The company boasts diversified operations across the
world with several new projects coming online through 2014.
ExxonMobil's strength is in its balanced operations, strong
financial flexibility and steady improvement in efficiency and
cost control. The company's efforts to build an unconventional
resource portfolio both in North America and overseas are aimed
at increasing production through wider exposure to large energy
resources with a long reserve life and low field declines.
However, we are skeptical about the company's near-term
performance due to its muddled refining fortunes.
ExxonMobil currently has a Zacks Rank #3 (Hold). However, there
are certain Zacks Ranked #1 stocks -
Helmerich & Payne, Inc.
Clayton Williams Energy, Inc.
Matrix Service Co.
) - that appear more rewarding for the short term.