Exxon Mobil Corp said on Thursday its first-quarter earnings rose over 10 percent as higher profits from its refining and chemical units outweighed lower oil and gas prices. Net income for the world's largest publicly traded company rose to $9.28 billion, or $1.62 a share, in the quarter, from $8.4 billion, or $1.37 a share, last year.
The results came in ahead of the average analyst forecast of $1.53 a share, according to Reuters Estimates. "They're running the ship very well," said Gene Pisasale, who helps manage about $25 billion at Mercantile Capital Advisors, a unit of PNC Wealth Management.
Pisasale, who was expecting results to be slightly ahead of last year's, said he was very surprised by the strength of the company's refining and marketing operations. Revenue in the quarter fell to $87.22 billion from $88.98 billion last year.
Earnings at the company's oil and gas exploration and production unit fell 5 percent to $6.04 billion, on lower commodity prices and decreased natural gas volumes. Still, Exxon Mobil's profit from its refining and marketing business surged more than 50 percent to $1.91 billion on higher margins from its refineries and sales of gasoline and other products. The company also increased the amount of fuel processed at its refineries in the quarter.
Its chemical segment's earnings rose 30 percent to $1.24 billion. Exxon Mobil has been using a portion of the huge profits it has generated in recent years from soaring oil prices to buy back shares. The company repurchased $7 billion of shares during the quarter, lowering the number of its shares outstanding by 1.7 percent. According to Standard & Poor's, Exxon Mobil has reduced its overall share count by 19 percent since the third quarter of 2000.
Furthermore, Exxon raised its second-quarter dividend 9.4 percent to 35 cents a share on Wednesday. Oil prices dropped sharply at the beginning of the quarter as geopolitical tensions seemed to ease, but renewed friction with Iran as well as concerns about gasoline supplies have pushed prices back up.
The average price of US crude was around $58 for the quarter - about $5, or 8 percent, lower than year-earlier levels. Since the beginning of the year, Exxon Mobil shares are up 4 percent, underperforming the Chicago Board Options Exchange's oil index, which rose about 5.5 percent in the same period. Shares of Exxon Mobil fell 27 cents to $79.63 in early New York Stock Exchange trading, just off their all-time high of $80.20 hit on Wednesday.
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