Exxon Mobil Corp., the world’s largest energy company by market value, declined after fourth- quarter sales fell short of analysts’ estimates and oil production slumped on five continents.
Revenue rose 16 percent to $121.6 billion during the quarter, less than the $124.4 billion average of five analysts’ estimates compiled by Bloomberg. Exxon fell 1.4 percent to $84.29 at 10:25 a.m. in New York.
Oil and natural-gas production declined 8.8 percent during the final three months of 2011 to the equivalent of 4.53 million barrels of crude a day, the Irving, Texas-based company said in an e-mailed statement today. Paul Cheng, a Barclays Capital Plc analyst, had forecast daily output of 4.719 million barrels in a Jan. 27 note to clients.
“It’s a slight negative,” Brian Youngberg, an analyst at Edward Jones & Co. in St. Louis, said today in a telephone interview. “The company continues to be challenged to grow production.”
Net income increased to $9.4 billion, or $1.97 a share, from $9.25 billion, or $1.85, a year earlier, Exxon said. The per-share result matched the average of eight analysts’ estimates compiled by Bloomberg.
Asset sales added $810 million to fourth-quarter results, the company said. Without those proceeds, profit would have declined from a year earlier, Youngberg said.
Earnings from Exxon’s refining and marketing unit fell 63 percent to $425 million for the quarter, down from $1.15 billion a year earlier. Chemical profit tumbled 49 percent to $543 million.
Crude output from Exxon’s wells declined 11 percent, shrinking in every region where the company conducts operations except Asia, where production was unchanged, according to today’s statement.
In Africa, oil production declined 24 percent. The company’s European crude output dropped by 23 percent. Combined, the two regions account for about one-third of Exxon’s oil.
Gas production fell 6.7 percent worldwide to 13.68 billion cubic feet a day, the company said.
No XTO Benefit
The production declines indicate Exxon has yet to glean any tangible benefit from the $34.9 billion purchase of XTO Energy in June 2010, Youngberg said. The transaction was the largest of Chairman and Chief Executive Officer Rex Tillerson’s tenure and intended to harness the Fort Worth, Texas-based gas prospector’s expertise in penetrating gas- and oil-soaked shale rock.
“Production continues to decline and it just shows that the XTO deal is still not providing any growth,” Youngberg said.
Global oil demand was little changed during the fourth quarter compared with the final three months of 2010, after growing at a rate of 360,000 barrels a day during the July-to- October period, International Energy Agency figures showed.
Crude, gas and nuclear consumption will increase 32 percent worldwide during the next three decades as population growth elevates energy demand and environmental rules prompt the first decrease in coal usage since the 1700s, Exxon said last month.
Brent crude futures, the benchmark for two-thirds of the world’s oil, averaged $109.02 a barrel during the final three months of 2011, a 25 percent rise from a year earlier. The oil gains were offset by a glut of North American gas that pushed prices for the furnace and factory fuel to a 10-year low this month.
Tillerson plans to spend as much as $37 billion this year to drill for crude, construct gas-export terminals and expand chemical plants. Exxon will present details next month of a $3.2 billion Arctic exploration venture with Russia’s state- controlled OAO Rosneft, according to Eduard Khudainatov, CEO of the Moscow-based oil producer.
Exxon agreed to sell most of its interest in a Japanese refining business to TonenGeneral Sekiyu KK for $3.9 billion, the Tokyo-based company said on Jan. 29. International energy companies including Exxon, Chevron Corp. and ConocoPhillips have been reducing their exposure to refined fuels as slipping demand in some of the world’s largest economies curbed profits.
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