Exxon Achieves Record First-Quarter Profits Due to Increased Output

Exxon Mobil Corp announced on Friday that its Q1 profit had reached a record high, surpassing Wall Street’s expectations by more than double what it achieved last year. Despite a decline in energy prices, the company’s increased production of oil and gas contributed to its financial success, due to the startup of new offshore developments and refining facilities. “We delivered a first-quarter record despite the fact that energy prices and refining margins are softening a bit,” commented Chief Financial Officer Kathryn Mikells. The company’s strong growth in production was the leading contributor to its better-than-expected earnings.

The company achieved record-breaking quarterly profits in 2022, with net profits of $11.43 billion or $2.79 per share. This marks a significant increase compared to last year’s profits of $5.48 billion, which included a $3.4 billion after-tax writedown to exit Russia. According to REFINITIV data, the company’s earnings exceeded consensus estimates by 9%. As a result, shares were up by 0.5% in pre-market trading.

Exxon experienced the highest oil and gas production since 2019, reaching 3.83 million barrels of oil equivalent per day (boed) in Q1, an increase of 160,000 boed from the previous quarter. Production growth was due to an increase in output from the Permian Basin and Guyana, where a second production platform was activated last year, adding approximately 240,000 bpd to the output. The increased volumes partially offset a 16% decline in oil prices compared to a year ago. Exxon’s fuels production also expanded, with the completion of a new crude processing unit at its Texas-based plant adding 250,000 bpd of oil refining capacity. Although Exxon ended the quarter with $32.7 billion in cash, it currently has no interest in utilizing it for mergers or acquisitions, according to CFO Mikells. Exxon remains open to deals that would create synergies and boost shareholders’ returns, but its primary focus is on increasing production through organic investments, such as those in the Permian, Guyana, and the Beaumont refinery expansion, among others. “Our focus is really making sure that we are executing those organic opportunities,” Mikells stated.