HOUSTON, Dec. 31 (Reuters) – ExxonMobil Corp. (XOM.N) on Thursday indicated a return to annual profits for 2021 as strong oil and gas prices led to a gain of up to $1.9 billion in operating profit that topped a one-time fee. .
The largest US oil producer released a snapshot of its fourth-quarter results that showed it expects higher profits compared to the previous quarter from oil and gas production.
The stock profile showed that operating profit in the refining and chemicals business would be flat to low. Official results are due on February 1, Reuters reports.
In 2020, Exxon suffered a historic loss of $22.4 billion due to write-offs from lower oil prices and lower refining margins. Cost cuts combined with energy price gains have allowed it to pay off debt and plan a share buyback program next year.
Analysts had expected adjusted earnings of $1.76 per share for the quarter, according to Refinitiv IBES data, compared to 3 cents per share excluding writedowns a year ago.
On Thursday, the regulatory filing noted that one-time fees for asset depreciation and contractual costs could cut oil and gas profits by as much as $1.2 billion. He did not give details of the affected production assets.
Exxon also said lower profit margins in chemicals could cut results by $600 million to $800 million, compared to the chemicals’ profit in the third quarter of $2.14 billion.
Refining margins could remain flat or fall by $200 million compared to prior-quarter profit of $1.23 billion.
To offset the negative effects, Exxon cited market gains of up to $1.1 billion for oil, gas and refined products. It also said the proceeds from asset sales, including its North Sea assets in the UK, could bring in up to $500 million.
More optimistic forecasts have allowed Exxon to extend planned spending of $20-25 billion per year on new projects through 2027, including $2.5 billion per year on carbon cuts, the company said, adding that it expects to double its annual pre-pandemic earnings by 2025. .the company said.
About 60% of its spending will be in key growth areas of US shale, Guyana, Brazil, liquefied natural gas, and chemical products.
Exxon shares fell 36 cents, or about 0.59 percent, on Thursday to close at $60.79. The stock is up 47% so far this year but is down 33% over the past five years.
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