UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 20212022
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________to__________
Commission File Number 1-2256
Exxon Mobil Corporation
(Exact name of registrant as specified in its charter)
| | | | | | | | |
New Jersey | | 13-5409005 |
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification Number) |
5959 Las Colinas Boulevard, Irving, Texas 75039-2298
(Address of principal executive offices) (Zip Code)
(972) 940-6000
(Registrant's telephone number, including area code)
_______________________
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | | | | | |
Title of Each Class | | Trading Symbol | | Name of Each Exchange
on Which Registered |
Common Stock, without par value | | XOM | | New York Stock Exchange |
0.142% Notes due 2024 | | XOM24B | | New York Stock Exchange |
0.524% Notes due 2028 | | XOM28 | | New York Stock Exchange |
0.835% Notes due 2032 | | XOM32 | | New York Stock Exchange |
1.408% Notes due 2039 | | XOM39A | | New York Stock Exchange |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | | | | | | | | | | |
Large accelerated filer | ☑ | Accelerated filer | ☐ |
| | | |
Non-accelerated filer | ☐ | Smaller reporting company | ☐ |
|
| Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.
| | | | | | | | |
Class | | Outstanding as of June 30, 20212022 |
Common stock, without par value | | 4,233,562,9174,167,636,295 |
EXXON MOBIL CORPORATION
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 20212022
TABLE OF CONTENTS
| | | | | |
PART I. FINANCIAL INFORMATION |
| |
Item 1. Financial Statements | |
| |
Condensed Consolidated Statement of Income - Three and six months ended June 30, 20212022 and 2020 2021 | 3 | |
| |
Condensed Consolidated Statement of Comprehensive Income - Three and six months ended June 30, 20212022 and 2020 2021 | 4 | |
| |
Condensed Consolidated Balance Sheet - As of June 30, 20212022 and December 31, 2020 2021 | 5 | |
| |
Condensed Consolidated Statement of Cash Flows - Six months ended June 30, 20212022 and 2020 2021 | 6 | |
| |
Condensed Consolidated Statement of Changes in Equity - Three months ended June 30, 20212022 and 2020 2021 | 7 | |
| |
| |
| |
Condensed Consolidated Statement of Changes in Equity - Six months ended June 30, 20212022 and 2020 2021 | 8 | |
| |
| |
| |
Notes to Condensed Consolidated Financial Statements | 9 | |
| |
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations | 1918 | |
| |
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 2833 | |
| |
Item 4. Controls and Procedures | 2833 | |
| |
| |
PART II. OTHER INFORMATION |
| |
Item 1. Legal Proceedings | 2934 | |
| |
| |
| |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 2934 | |
| |
Item 6. Exhibits | 2934 | |
| |
Index to Exhibits | 3035 | |
| |
Signature | 3136 | |
| |
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
| | | | | | | | | | | | | | |
ITEM 1. FINANCIAL STATEMENTS | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED STATEMENT OF INCOME |
(millions of dollars) |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
Revenues and other income | | | | | | | | |
Sales and other operating revenue | | 65,943 | | | 32,277 | | | 123,495 | | | 87,411 | |
Income from equity affiliates | | 1,436 | | | 103 | | | 2,909 | | | 878 | |
Other income | | 363 | | | 225 | | | 485 | | | 474 | |
Total revenues and other income | | 67,742 | | | 32,605 | | | 126,889 | | | 88,763 | |
Costs and other deductions | | | | | | | | |
Crude oil and product purchases | | 37,329 | | | 14,069 | | | 69,930 | | | 46,152 | |
Production and manufacturing expenses | | 8,471 | | | 6,895 | | | 16,533 | | | 15,192 | |
Selling, general and administrative expenses | | 2,345 | | | 2,409 | | | 4,773 | | | 4,988 | |
Depreciation and depletion | | 4,952 | | | 4,916 | | | 9,956 | | | 10,735 | |
Exploration expenses, including dry holes | | 176 | | | 214 | | | 340 | | | 502 | |
Non-service pension and postretirement benefit expense | | 162 | | | 271 | | | 540 | | | 540 | |
Interest expense | | 254 | | | 317 | | | 512 | | | 566 | |
Other taxes and duties | | 7,746 | | | 5,154 | | | 14,406 | | | 11,986 | |
Total costs and other deductions | | 61,435 | | | 34,245 | | | 116,990 | | | 90,661 | |
Income (Loss) before income taxes | | 6,307 | | | (1,640) | | | 9,899 | | | (1,898) | |
Income taxes | | 1,526 | | | (471) | | | 2,322 | | | 41 | |
Net income (loss) including noncontrolling interests | | 4,781 | | | (1,169) | | | 7,577 | | | (1,939) | |
Net income (loss) attributable to noncontrolling interests | | 91 | | | (89) | | | 157 | | | (249) | |
Net income (loss) attributable to ExxonMobil | | 4,690 | | | (1,080) | | | 7,420 | | | (1,690) | |
| | | | | | | | |
Earnings (Loss) per common share (dollars) | | 1.10 | | | (0.26) | | | 1.74 | | | (0.40) | |
| | | | | | | | |
Earnings (Loss) per common share - assuming dilution (dollars) | | 1.10 | | | (0.26) | | | 1.74 | | | (0.40) | |
| | | | | |
| |
CONDENSED CONSOLIDATED STATEMENT OF INCOME |
| | | | | | | | | | | | | | | | | | | | | |
(millions of dollars, unless noted) | | Three Months Ended June 30, | | | Six Months Ended June 30, |
| 2022 | 2021 | | | 2022 | 2021 |
Revenues and other income | | | | | | | |
Sales and other operating revenue | | 111,265 | | 65,943 | | | | 198,999 | | 123,495 | |
Income from equity affiliates | | 3,688 | | 1,436 | | | | 6,226 | | 2,909 | |
Other income | | 728 | | 363 | | | | 956 | | 485 | |
Total revenues and other income | | 115,681 | | 67,742 | | | | 206,181 | | 126,889 | |
Costs and other deductions | | | | | | | |
Crude oil and product purchases | | 65,613 | | 37,329 | | | | 118,001 | | 69,930 | |
Production and manufacturing expenses | | 10,686 | | 8,471 | | | | 20,927 | | 16,533 | |
Selling, general and administrative expenses | | 2,530 | | 2,345 | | | | 4,939 | | 4,773 | |
Depreciation and depletion (including impairments) | | 4,451 | | 4,952 | | | | 13,334 | | 9,956 | |
Exploration expenses, including dry holes | | 286 | | 176 | | | | 459 | | 340 | |
Non-service pension and postretirement benefit expense | | 120 | | 162 | | | | 228 | | 540 | |
Interest expense | | 194 | | 254 | | | | 382 | | 512 | |
Other taxes and duties | | 6,868 | | 7,746 | | | | 14,422 | | 14,406 | |
Total costs and other deductions | | 90,748 | | 61,435 | | | | 172,692 | | 116,990 | |
Income (loss) before income taxes | | 24,933 | | 6,307 | | | | 33,489 | | 9,899 | |
Income taxes | | 6,359 | | 1,526 | | | | 9,165 | | 2,322 | |
Net income (loss) including noncontrolling interests | | 18,574 | | 4,781 | | | | 24,324 | | 7,577 | |
Net income (loss) attributable to noncontrolling interests | | 724 | | 91 | | | | 994 | | 157 | |
Net income (loss) attributable to ExxonMobil | | 17,850 | | 4,690 | | | | 23,330 | | 7,420 | |
| | | | | | | |
Earnings (loss) per common share (dollars) | | 4.21 | | 1.10 | | | | 5.49 | | 1.74 | |
| | | | | | | |
Earnings (loss) per common share - assuming dilution (dollars) | | 4.21 | | 1.10 | | | | 5.49 | | 1.74 | |
| | | | | | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
| | | | | | | | | | | | | | | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
(millions of dollars) |
| | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
Net income (loss) including noncontrolling interests | | 4,781 | | | (1,169) | | | 7,577 | | | (1,939) | |
Other comprehensive income (loss) (net of income taxes) | | | | | | | | |
Foreign exchange translation adjustment | | 423 | | | 2,875 | | | 572 | | | (2,774) | |
| | | | | | | | |
Postretirement benefits reserves adjustment (excluding amortization) | | (47) | | | (136) | | | 121 | | | (49) | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | 215 | | | 203 | | | 593 | | | 407 | |
Total other comprehensive income (loss) | | 591 | | | 2,942 | | | 1,286 | | | (2,416) | |
Comprehensive income (loss) including noncontrolling interests | | 5,372 | | | 1,773 | | | 8,863 | | | (4,355) | |
Comprehensive income (loss) attributable to noncontrolling interests | | 178 | | | 131 | | | 324 | | | (541) | |
Comprehensive income (loss) attributable to ExxonMobil | | 5,194 | | | 1,642 | | | 8,539 | | | (3,814) | |
| | | | | |
| |
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
| | | | | | | | | | | | | | | | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Net income (loss) including noncontrolling interests | | 18,574 | | | 4,781 | | | 24,324 | | | 7,577 | |
| | | | | | | | |
Other comprehensive income (loss) (net of income taxes) | | | | | | | | |
Foreign exchange translation adjustment | | (2,537) | | | 423 | | | (1,796) | | | 572 | |
| | | | | | | | |
Postretirement benefits reserves adjustment (excluding amortization) | | 155 | | | (47) | | | 260 | | | 121 | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | 102 | | | 215 | | | 195 | | | 593 | |
Total other comprehensive income (loss) | | (2,280) | | | 591 | | | (1,341) | | | 1,286 | |
Comprehensive income (loss) including noncontrolling interests | | 16,294 | | | 5,372 | | | 22,983 | | | 8,863 | |
Comprehensive income (loss) attributable to noncontrolling interests | | 547 | | | 178 | | | 906 | | | 324 | |
Comprehensive income (loss) attributable to ExxonMobil | | 15,747 | | | 5,194 | | | 22,077 | | | 8,539 | |
| | | | | | | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
| | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED BALANCE SHEET |
(millions of dollars) |
| June 30, 2021 | | December 31, 2020 |
Assets | | | |
Current assets | | | |
Cash and cash equivalents | 3,465 | | | 4,364 | |
Notes and accounts receivable – net | 28,540 | | | 20,581 | |
Inventories | | | |
Crude oil, products and merchandise | 14,711 | | | 14,169 | |
Materials and supplies | 4,564 | | | 4,681 | |
Other current assets | 1,562 | | | 1,098 | |
Total current assets | 52,842 | | | 44,893 | |
Investments, advances and long-term receivables | 44,774 | | | 43,515 | |
Property, plant and equipment – net | 223,012 | | | 227,553 | |
Other assets, including intangibles – net | 16,661 | | | 16,789 | |
Total assets | 337,289 | | | 332,750 | |
| | | |
Liabilities | | | |
Current liabilities | | | |
Notes and loans payable | 15,293 | | | 20,458 | |
Accounts payable and accrued liabilities | 45,780 | | | 35,221 | |
Income taxes payable | 1,165 | | | 684 | |
Total current liabilities | 62,238 | | | 56,363 | |
Long-term debt | 45,319 | | | 47,182 | |
Postretirement benefits reserves | 22,082 | | | 22,415 | |
Deferred income tax liabilities | 18,511 | | | 18,165 | |
Long-term obligations to equity companies | 3,038 | | | 3,253 | |
Other long-term obligations | 20,545 | | | 21,242 | |
Total liabilities | 171,733 | | | 168,620 | |
| | | |
Commitments and contingencies (Note 3) | 0 | | 0 |
| | | |
Equity | | | |
Common stock without par value | | | |
(9,000 million shares authorized, 8,019 million shares issued) | 16,006 | | | 15,688 | |
Earnings reinvested | 383,922 | | | 383,943 | |
Accumulated other comprehensive income | (15,586) | | | (16,705) | |
Common stock held in treasury | | | |
(3,785 million shares at June 30, 2021 and 3,786 million shares at December 31, 2020) | (225,771) | | | (225,776) | |
ExxonMobil share of equity | 158,571 | | | 157,150 | |
Noncontrolling interests | 6,985 | | | 6,980 | |
Total equity | 165,556 | | | 164,130 | |
Total liabilities and equity | 337,289 | | | 332,750 | |
| | | | | |
| |
CONDENSED CONSOLIDATED BALANCE SHEET |
| | | | | | | | | | | | | | |
(millions of dollars, unless noted) | | June 30, 2022 | December 31, 2021 | | | |
| | | | | | |
ASSETS | | | | | | |
Current assets | | | | | | |
Cash and cash equivalents | | 18,861 | | 6,802 | | | | |
Notes and accounts receivable – net | | 48,063 | | 32,383 | | | | |
Inventories | | | | | | |
Crude oil, products and merchandise | | 19,580 | | 14,519 | | | | |
Materials and supplies | | 4,005 | | 4,261 | | | | |
Other current assets | | 2,654 | | 1,189 | | | | |
Total current assets | | 93,163 | | 59,154 | | | | |
Investments, advances and long-term receivables | | 46,820 | | 45,195 | | | | |
Property, plant and equipment – net | | 209,159 | | 216,552 | | | | |
Other assets, including intangibles – net | | 18,632 | | 18,022 | | | | |
Total Assets | | 367,774 | | 338,923 | | | | |
| | | | | | |
LIABILITIES | | | | | | |
Current liabilities | | | | | | |
Notes and loans payable | | 7,367 | | 4,276 | | | | |
Accounts payable and accrued liabilities | | 67,958 | | 50,766 | | | | |
Income taxes payable | | 4,785 | | 1,601 | | | | |
Total current liabilities | | 80,110 | | 56,643 | | | | |
Long-term debt | | 39,516 | | 43,428 | | | | |
Postretirement benefits reserves | | 17,408 | | 18,430 | | | | |
Deferred income tax liabilities | | 20,807 | | 20,165 | | | | |
Long-term obligations to equity companies | | 2,617 | | 2,857 | | | | |
Other long-term obligations | | 22,808 | | 21,717 | | | | |
Total Liabilities | | 183,266 | | 163,240 | | | | |
| | | | | | |
Commitments and contingencies (Note 3) | | 0 | 0 | | | |
| | | | | | |
EQUITY | | | | | | |
Common stock without par value | | | | | | |
(9,000 million shares authorized, 8,019 million shares issued) | | 16,018 | | 15,746 | | | | |
Earnings reinvested | | 407,902 | | 392,059 | | | | |
Accumulated other comprehensive income | | (15,017) | | (13,764) | | | | |
Common stock held in treasury | | | | | | |
(3,851 million shares at June 30, 2022 and 3,780 million shares at December 31, 2021) | | (231,587) | | (225,464) | | | | |
ExxonMobil share of equity | | 177,316 | | 168,577 | | | | |
Noncontrolling interests | | 7,192 | | 7,106 | | | | |
Total Equity | | 184,508 | | 175,683 | | | | |
Total Liabilities and Equity | | 367,774 | | 338,923 | | | | |
| | | | | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. | | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
| | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS |
(millions of dollars) |
| Six Months Ended June 30, |
| 2021 | | 2020 |
Cash flows from operating activities | | | |
Net income (loss) including noncontrolling interests | 7,577 | | | (1,939) | |
Depreciation and depletion | 9,956 | | | 10,735 | |
| | | |
Changes in operational working capital, excluding cash and debt | 1,573 | | | (2,247) | |
All other items – net | (192) | | | (275) | |
Net cash provided by operating activities | 18,914 | | | 6,274 | |
| | | |
Cash flows from investing activities | | | |
Additions to property, plant and equipment | (5,147) | | | (10,362) | |
Proceeds from asset sales and returns of investments | 557 | | | 129 | |
Additional investments and advances | (613) | | | (1,524) | |
Other investing activities including collection of advances | 132 | | | 309 | |
Net cash used in investing activities | (5,071) | | | (11,448) | |
| | | |
Cash flows from financing activities | | | |
Additions to long-term debt | 0 | | | 23,186 | |
Reductions in long-term debt | 0 | | | (3) | |
Additions to short-term debt (1) | 9,662 | | | 20,491 | |
Reductions in short-term debt (1) | (18,000) | | | (15,078) | |
Additions/(reductions) in debt with three months or less maturity | 1,320 | | | (5,998) | |
Contingent consideration payments | (28) | | | (21) | |
Cash dividends to ExxonMobil shareholders | (7,441) | | | (7,434) | |
Cash dividends to noncontrolling interests | (112) | | | (93) | |
Changes in noncontrolling interests | (207) | | | 317 | |
Common stock acquired | (1) | | | (305) | |
Net cash used in financing activities | (14,807) | | | 15,062 | |
Effects of exchange rate changes on cash | 65 | | | (401) | |
Increase/(decrease) in cash and cash equivalents | (899) | | | 9,487 | |
Cash and cash equivalents at beginning of period | 4,364 | | | 3,089 | |
Cash and cash equivalents at end of period | 3,465 | | | 12,576 | |
| | | |
Supplemental Disclosures | | | |
Income taxes paid | 2,079 | | | 1,768 | |
Cash interest paid | | | |
Included in cash flows from operating activities | 466 | | | 290 | |
Capitalized, included in cash flows from investing activities | 313 | | | 335 | |
Total cash interest paid | 779 | | | 625 | |
| | | | | |
| |
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW |
| | | | | | | | | | | |
(millions of dollars) | | Six Months Ended June 30, |
| 2022 | 2021 |
| | | |
CASH FLOW FROM OPERATING ACTIVITIES | | | |
Net income (loss) including noncontrolling interests | | 24,324 | | 7,577 | |
Depreciation and depletion (including impairments) | | 13,334 | | 9,956 | |
| | | |
Changes in operational working capital, excluding cash and debt | | (1,661) | | 1,573 | |
All other items – net | | (1,246) | | (192) | |
Net cash provided by operating activities | | 34,751 | | 18,914 | |
| | | |
CASH FLOW FROM INVESTING ACTIVITIES | | | |
Additions to property, plant and equipment | | (7,748) | | (5,147) | |
Proceeds from asset sales and returns of investments | | 1,232 | | 557 | |
Additional investments and advances | | (643) | | (613) | |
Other investing activities including collection of advances | | 150 | | 132 | |
Net cash used in investing activities | | (7,009) | | (5,071) | |
| | | |
CASH FLOW FROM FINANCING ACTIVITIES | | | |
| | | |
| | | |
Additions to short-term debt | | — | | 9,662 | |
Reductions in short-term debt | | (2,336) | | (18,000) | |
Additions/(reductions) in debt with three months or less maturity | | 1,303 | | 1,320 | |
Contingent consideration payments | | (58) | | (28) | |
Cash dividends to ExxonMobil shareholders | | (7,487) | | (7,441) | |
Cash dividends to noncontrolling interests | | (123) | | (112) | |
Changes in noncontrolling interests | | (697) | | (207) | |
Common stock acquired | | (5,986) | | (1) | |
Net cash used in financing activities | | (15,384) | | (14,807) | |
| | | |
Effects of exchange rate changes on cash | | (299) | | 65 | |
Increase/(decrease) in cash and cash equivalents | | 12,059 | | (899) | |
Cash and cash equivalents at beginning of period | | 6,802 | | 4,364 | |
Cash and cash equivalents at end of period | | 18,861 | | 3,465 | |
| | | |
SUPPLEMENTAL DISCLOSURES | | | |
Income taxes paid | | 5,545 | | 2,079 | |
Cash interest paid | | | |
Included in cash flows from operating activities | | 352 | | 466 | |
Capitalized, included in cash flows from investing activities | | 388 | | 313 | |
Total cash interest paid | | 740 | | 779 | |
| | | |
| | | |
Noncash right of use assets recorded in exchange for lease liabilities | | | |
Operating leases | | 1,039 | | 511 | |
Finance leases | | 656 | | 55 | |
| | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. |
(1) Includes commercial paper with a maturity greater than three months.
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
(millions of dollars) |
| ExxonMobil Share of Equity | | | | |
| Common Stock | | Earnings Reinvested | | Accumulated Other Comprehensive Income | | Common Stock Held in Treasury | | ExxonMobil Share of Equity | | Non-controlling Interests | | Total Equity |
Balance as of March 31, 2020 | 15,636 | | | 416,919 | | | (24,339) | | | (226,137) | | | 182,079 | | | 6,664 | | | 188,743 | |
Amortization of stock-based awards | 177 | | | — | | | — | | | — | | | 177 | | | — | | | 177 | |
Other | (1) | | | — | | | — | | | — | | | (1) | | | 223 | | | 222 | |
Net income (loss) for the period | — | | | (1,080) | | | — | | | — | | | (1,080) | | | (89) | | | (1,169) | |
Dividends - common shares | — | | | (3,715) | | | — | | | — | | | (3,715) | | | (48) | | | (3,763) | |
Other comprehensive income (loss) | — | | | — | | | 2,722 | | | — | | | 2,722 | | | 220 | | | 2,942 | |
| | | | | | | | | | | | | |
Dispositions | — | | | — | | | — | | | 1 | | | 1 | | | — | | | 1 | |
Balance as of June 30, 2020 | 15,812 | | | 412,124 | | | (21,617) | | | (226,136) | | | 180,183 | | | 6,970 | | | 187,153 | |
| | | | | | | | | | | | | |
Balance as of March 31, 2021 | 15,884 | | | 382,953 | | | (16,090) | | | (225,773) | | | 156,974 | | | 7,127 | | | 164,101 | |
Amortization of stock-based awards | 126 | | | — | | | — | | | — | | | 126 | | | — | | | 126 | |
Other | (4) | | | — | | | — | | | — | | | (4) | | | 33 | | | 29 | |
Net income (loss) for the period | — | | | 4,690 | | | — | | | — | | | 4,690 | | | 91 | | | 4,781 | |
Dividends - common shares | — | | | (3,721) | | | — | | | — | | | (3,721) | | | (60) | | | (3,781) | |
Other comprehensive income (loss) | — | | | — | | | 504 | | | — | | | 504 | | | 87 | | | 591 | |
Acquisitions, at cost | — | | | — | | | — | | | — | | | — | | | (293) | | | (293) | |
Dispositions | — | | | — | | | — | | | 2 | | | 2 | | | — | | | 2 | |
Balance as of June 30, 2021 | 16,006 | | | 383,922 | | | (15,586) | | | (225,771) | | | 158,571 | | | 6,985 | | | 165,556 | |
| | | | | |
| |
CONDENSED CONSOLIDATED STATEMENT OF CHANGE IN EQUITY |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | ExxonMobil Share of Equity | | |
| | | | | | | | |
(millions of dollars, unless noted) | | Common Stock | Earnings Reinvested | Accumulated Other Comprehensive Income | Common Stock Held in Treasury | ExxonMobil Share of Equity | Non-controlling Interests | Total Equity |
| | | | | | | | |
Balance as of March 31, 2021 | | 15,884 | | 382,953 | | (16,090) | | (225,773) | | 156,974 | | 7,127 | | 164,101 | |
Amortization of stock-based awards | | 126 | | — | | — | | — | | 126 | | — | | 126 | |
Other | | (4) | | — | | — | | — | | (4) | | 33 | | 29 | |
Net income (loss) for the period | | — | | 4,690 | | — | | — | | 4,690 | | 91 | | 4,781 | |
Dividends - common shares | | — | | (3,721) | | — | | — | | (3,721) | | (60) | | (3,781) | |
Other comprehensive income (loss) | | — | | — | | 504 | | — | | 504 | | 87 | | 591 | |
Acquisitions, at cost | | — | | — | | — | | — | | — | | (293) | | (293) | |
Dispositions | | — | | — | | — | | 2 | | 2 | | — | | 2 | |
Balance as of June 30, 2021 | | 16,006 | | 383,922 | | (15,586) | | (225,771) | | 158,571 | | 6,985 | | 165,556 | |
| | | | | | | | |
Balance as of March 31, 2022 | | 15,879 | | 393,779 | | (12,914) | | (227,529) | | 169,215 | | 7,311 | | 176,526 | |
Amortization of stock-based awards | | 143 | | — | | — | | — | | 143 | | — | | 143 | |
Other | | (4) | | — | | — | | — | | (4) | | (15) | | (19) | |
Net income (loss) for the period | | — | | 17,850 | | — | | — | | 17,850 | | 724 | | 18,574 | |
Dividends - common shares | | — | | (3,727) | | — | | — | | (3,727) | | (63) | | (3,790) | |
Other comprehensive income (loss) | | — | | — | | (2,103) | | — | | (2,103) | | (177) | | (2,280) | |
Acquisitions, at cost | | — | | — | | — | | (4,059) | | (4,059) | | (588) | | (4,647) | |
Dispositions | | — | | — | | — | | 1 | | 1 | | — | | 1 | |
Balance as of June 30, 2022 | | 16,018 | | 407,902 | | (15,017) | | (231,587) | | 177,316 | | 7,192 | | 184,508 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2021 | | | | Three Months Ended June 30, 2020 |
Common Stock Share Activity | Issued | | Held in Treasury | | Outstanding | | | | Issued | | Held in Treasury | | Outstanding |
| (millions of shares) | | | | (millions of shares) |
Balance as of March 31 | 8,019 | | | (3,785) | | | 4,234 | | | | | 8,019 | | | (3,791) | | | 4,228 | |
Acquisitions | — | | | — | | | — | | | | | — | | | — | | | — | |
Dispositions | — | | | — | | | — | | | | | — | | | — | | | — | |
Balance as of June 30 | 8,019 | | | (3,785) | | | 4,234 | | | | | 8,019 | | | (3,791) | | | 4,228 | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, 2022 | | Three Months Ended June 30, 2021 |
| | | | | | | | |
Common Stock Share Activity (millions of shares) | | Issued | Held in Treasury | Outstanding | | Issued | Held in Treasury | Outstanding |
Balance as of March 31 | | 8,019 | | (3,806) | | 4,213 | | | 8,019 | | (3,785) | | 4,234 | |
Acquisitions | | — | | (45) | | (45) | | | — | | — | | — | |
Dispositions | | — | | — | | — | | | — | | — | | — | |
Balance as of June 30 | | 8,019 | | (3,851) | | 4,168 | | | 8,019 | | (3,785) | | 4,234 | |
| | | | | | | | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
EXXON MOBIL CORPORATION |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
(millions of dollars) |
| ExxonMobil Share of Equity | | | | |
| Common Stock | | Earnings Reinvested | | Accumulated Other Comprehensive Income | | Common Stock Held in Treasury | | ExxonMobil Share of Equity | | Non-controlling Interests | | Total Equity |
Balance as of December 31, 2019 | 15,637 | | | 421,341 | | | (19,493) | | | (225,835) | | | 191,650 | | | 7,288 | | | 198,938 | |
Amortization of stock-based awards | 358 | | | — | | | — | | | — | | | 358 | | | — | | | 358 | |
Other | (183) | | | — | | | — | | | — | | | (183) | | | 380 | | | 197 | |
Net income (loss) for the period | — | | | (1,690) | | | — | | | — | | | (1,690) | | | (249) | | | (1,939) | |
Dividends - common shares | — | | | (7,434) | | | — | | | — | | | (7,434) | | | (93) | | | (7,527) | |
Cumulative effect of accounting change | — | | | (93) | | | — | | | — | | | (93) | | | (1) | | | (94) | |
Other comprehensive income (loss) | — | | | — | | | (2,124) | | | — | | | (2,124) | | | (292) | | | (2,416) | |
Acquisitions, at cost | — | | | — | | | — | | | (305) | | | (305) | | | (63) | | | (368) | |
Dispositions | — | | | — | | | — | | | 4 | | | 4 | | | — | | | 4 | |
Balance as of June 30, 2020 | 15,812 | | | 412,124 | | | (21,617) | | | (226,136) | | | 180,183 | | | 6,970 | | | 187,153 | |
| | | | | | | | | | | | | |
Balance as of December 31, 2020 | 15,688 | | | 383,943 | | | (16,705) | | | (225,776) | | | 157,150 | | | 6,980 | | | 164,130 | |
Amortization of stock-based awards | 328 | | | — | | | — | | | — | | | 328 | | | — | | | 328 | |
Other | (10) | | | — | | | — | | | — | | | (10) | | | 86 | | | 76 | |
Net income (loss) for the period | — | | | 7,420 | | | — | | | — | | | 7,420 | | | 157 | | | 7,577 | |
Dividends - common shares | — | | | (7,441) | | | — | | | — | | | (7,441) | | | (112) | | | (7,553) | |
| | | | | | | | | | | | | |
Other comprehensive income (loss) | — | | | — | | | 1,119 | | | — | | | 1,119 | | | 167 | | | 1,286 | |
Acquisitions, at cost | — | | | — | | | — | | | (1) | | | (1) | | | (293) | | | (294) | |
Dispositions | — | | | — | | | — | | | 6 | | | 6 | | | — | | | 6 | |
Balance as of June 30, 2021 | 16,006 | | | 383,922 | | | (15,586) | | | (225,771) | | | 158,571 | | | 6,985 | | | 165,556 | |
| | | | | |
| |
CONDENSED CONSOLIDATED STATEMENT OF CHANGE IN EQUITY |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | ExxonMobil Share of Equity | | |
| | | | | | | | |
(millions of dollars, unless noted) | | Common Stock | Earnings Reinvested | Accumulated Other Comprehensive Income | Common Stock Held in Treasury | ExxonMobil Share of Equity | Non-controlling Interests | Total Equity |
| | | | | | | | |
Balance as of December 31, 2020 | | 15,688 | | 383,943 | | (16,705) | | (225,776) | | 157,150 | | 6,980 | | 164,130 | |
Amortization of stock-based awards | | 328 | | — | | — | | — | | 328 | | — | | 328 | |
Other | | (10) | | — | | — | | — | | (10) | | 86 | | 76 | |
Net income (loss) for the period | | — | | 7,420 | | — | | — | | 7,420 | | 157 | | 7,577 | |
Dividends - common shares | | — | | (7,441) | | — | | — | | (7,441) | | (112) | | (7,553) | |
| | | | | | | | |
Other comprehensive income (loss) | | — | | — | | 1,119 | | — | | 1,119 | | 167 | | 1,286 | |
Acquisitions, at cost | | — | | — | | — | | (1) | | (1) | | (293) | | (294) | |
Dispositions | | — | | — | | — | | 6 | | 6 | | — | | 6 | |
Balance as of June 30, 2021 | | 16,006 | | 383,922 | | (15,586) | | (225,771) | | 158,571 | | 6,985 | | 165,556 | |
| | | | | | | | |
Balance as of December 31, 2021 | | 15,746 | | 392,059 | | (13,764) | | (225,464) | | 168,577 | | 7,106 | | 175,683 | |
Amortization of stock-based awards | | 281 | | — | | — | | — | | 281 | | — | | 281 | |
Other | | (9) | | — | | — | | — | | (9) | | (1) | | (10) | |
Net income (loss) for the period | | — | | 23,330 | | — | | — | | 23,330 | | 994 | | 24,324 | |
Dividends - common shares | | — | | (7,487) | | — | | — | | (7,487) | | (123) | | (7,610) | |
| | | | | | | | |
Other comprehensive income (loss) | | — | | — | | (1,253) | | — | | (1,253) | | (88) | | (1,341) | |
Acquisitions, at cost | | — | | — | | — | | (6,126) | | (6,126) | | (696) | | (6,822) | |
Dispositions | | — | | — | | — | | 3 | | 3 | | — | | 3 | |
Balance as of June 30, 2022 | | 16,018 | | 407,902 | | (15,017) | | (231,587) | | 177,316 | | 7,192 | | 184,508 | |
| | | Six Months Ended June 30, 2021 | | | | Six Months Ended June 30, 2020 | | | Six Months Ended June 30, 2022 | | Six Months Ended June 30, 2021 |
Common Stock Share Activity | Issued | | Held in Treasury | | Outstanding | | | | Issued | | Held in Treasury | | Outstanding | |
| | (millions of shares) | | | | (millions of shares) | | | | | |
Common Stock Share Activity (millions of shares) | | Common Stock Share Activity (millions of shares) | | Issued | Held in Treasury | Outstanding | | Issued | Held in Treasury | Outstanding |
Balance as of December 31 | Balance as of December 31 | 8,019 | | | (3,786) | | | 4,233 | | | 8,019 | | | (3,785) | | | 4,234 | | Balance as of December 31 | | 8,019 | | (3,780) | | 4,239 | | | 8,019 | | (3,786) | | 4,233 | |
Acquisitions | Acquisitions | — | | | — | | | — | | | — | | | (6) | | | (6) | | Acquisitions | | — | | (71) | | (71) | | | — | | — | | — | |
Dispositions | Dispositions | — | | | 1 | | | 1 | | | — | | | — | | | — | | Dispositions | | — | | — | | — | | | — | | 1 | | 1 | |
Balance as of June 30 | Balance as of June 30 | 8,019 | | | (3,785) | | | 4,234 | | | 8,019 | | | (3,791) | | | 4,228 | | Balance as of June 30 | | 8,019 | | (3,851) | | 4,168 | | | 8,019 | | (3,785) | | 4,234 | |
| The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. | | The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements. |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
EXXON MOBIL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
| | | | | |
| |
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
Note 1.Basis of Financial Statement Preparation
These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation's 20202021 Annual Report on Form 10-K. In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature. Prior data has been reclassified in certain cases to conform to the current presentation basis.
The Corporation's exploration and production activities are accounted for under the "successful efforts" method.
Note 2.Miscellaneous Financial Information Russia
Crude oil, productsIn response to Russia’s military action in Ukraine, the Corporation announced in early 2022 that it plans to discontinue operations on the Sakhalin-1 project (“Sakhalin”) and merchandise inventories are carried atdevelop steps to exit the lowerventure. In light of current marketthis, an impairment assessment was conducted, and management determined that the carrying value or cost, generally determined underof the last-in first-out method (LIFO).asset group was not recoverable. As a result, the Corporation’s first quarter earnings included after-tax charges of $3.4 billion largely representing the impairment of its operations related to Sakhalin. On a before-tax basis, the charges amounted to $4.6 billion, substantially all of which is reflected in the line captioned “Depreciation and depletion (including impairments)” on the Condensed Consolidated Statement of Income. The Corporation's results forexit from the second quarterproject would result in quantities estimated at 150 million oil-equivalent barrels no longer qualifying as proved reserves, which represented less than 1 percent of 2020 included a before-tax credit of $2,624 million, as rising prices reduced the charge against the book value of inventories from $2,777 million in the first quarter 2020 to $153 million for the first half of 2020. This adjustment, which is included in "Crude oil and product purchases", together with a market adjustment to inventory for equity companies included in "Income from equity affiliates", resulted in a $1,922 million after-tax credit to earnings (excluding noncontrolling interests) in the second quarter of 2020.
In the first half of 2020, mainly as a result of declines in prices for crude oil, natural gas and petroleum products and a significant decline in the Corporation's market capitalization18.5 billion oil-equivalent barrels of proved reserves at the end of the first quarter, before-tax goodwill impairment charges of $611 million and other impairment charges of $363 million were recognized. The charges related to goodwill impairments were included in “Depreciation and depletion” on the Statement of Income while the charges related to other impairments were largely included in “Income from equity affiliates.”year-end 2021.
Note 3. Litigation and Other Contingencies
Litigation. Litigation
A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits. Management has regular litigation reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably possible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. For purposes of our contingency disclosures, “significant” includes material matters, as well as other matters which management believes should be disclosed. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a material adverse effect upon the Corporation's operations, financial condition, or financial statements taken as a whole.
Other Contingencies. Contingencies
The Corporation and certain of its consolidated subsidiaries were contingently liable at June 30, 2021,2022, for guarantees relating to notes, loans and performance under contracts. Where guarantees for environmental remediation and other similar matters do not include a stated cap, the amounts reflect management’s estimate of the maximum potential exposure. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.
| | | | | | | | | | | | | | | | | | | | | | | |
| | | As of June 30, 2021 |
| | | Equity Company Obligations (1) | | Other Third-Party Obligations | | Total |
| | | (millions of dollars) |
Guarantees | | | | | |
| | Debt-related | 1,026 | | | 131 | | | 1,157 | |
| | Other | 865 | | | 4,933 | | | 5,798 | |
| | Total | 1,891 | | | 5,064 | | | 6,955 | |
(1)ExxonMobil share | | | | | | | | | | | |
| June 30, 2022 |
| | | |
(millions of dollars) | Equity Company Obligations (1) | Other Third-Party Obligations | Total |
Guarantees | | | |
Debt-related | 1,138 | | 144 | | 1,282 | |
Other | 757 | | 5,903 | | 6,660 | |
Total | 1,895 | | 6,047 | | 7,942 | |
| | | |
(1) ExxonMobil share | | | |
Additionally, the Corporation and its affiliates have numerous long-term sales and purchase commitments in their various business activities, all of which are expected to be fulfilled with no adverse consequences material to the Corporation’s operations or financial condition.
The operations and earnings of the Corporation and its affiliates throughout the world have been, and may in the future be, affected from time to time in varying degree by political developments and laws and regulations, such as forced divestiture of assets; restrictions on production, imports and exports; price controls; tax increases and retroactive tax claims; expropriation of property; cancellation of contract rightsrights; sanctions and environmental regulations. Both the likelihood of such occurrences and their overall effect upon the Corporation vary greatly from country to country and are not predictable.
In accordance with a Venezuelan nationalization decree issued in February 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil Project. The decree also required conversion of the Cerro Negro Project into a “mixed enterprise” and an increase in PdVSA’s or one of its affiliate’s ownership interest in the Project. ExxonMobil refused to accede to the terms proffered by the government, and on June 27, 2007, the government expropriated ExxonMobil’s 41.67 percent interest in the Cerro Negro Project.
ExxonMobil collected awards of $908 million in an arbitration against PdVSA under the rules of the International Chamber of Commerce in respect of an indemnity related to the Cerro Negro Project and $260 million in an arbitration for compensation due for the La Ceiba Project and for export curtailments at the Cerro Negro Project under rules of International Centre for Settlement of Investment Disputes (ICSID). An ICSID arbitration award relating to the Cerro Negro Project’s expropriation ($1.4 billion) was annulled based on a determination that a prior Tribunal failed to adequately explain why the cap on damages in the indemnity owed by PdVSA did not affect or limit the amount owed for the expropriation of the Cerro Negro Project. ExxonMobil filed a new claim seeking to restore the original award of damages for the Cerro Negro Project with ICSID on September 26, 2018.
The net impact of this matter on the Corporation’s consolidated financial results cannot be reasonably estimated. Regardless, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition.
An affiliate of ExxonMobil is one of the Contractors under a Production Sharing Contract (PSC) with the Nigerian National Petroleum Corporation (NNPC) covering the Erha block located in the offshore waters of Nigeria. ExxonMobil's affiliate is the operator of the block and owns a 56.25 percent interest under the PSC. The Contractors are in dispute with NNPC regarding NNPC's lifting of crude oil in excess of its entitlement under the terms of the PSC. In accordance with the terms of the PSC, the Contractors initiated arbitration in Abuja, Nigeria, under the Nigerian Arbitration and Conciliation Act. On October 24, 2011, a three-member arbitral Tribunal issued an award upholding the Contractors' position in all material respects and awarding damages to the Contractors jointly in an amount of approximately $1.8 billion plus $234 million in accrued interest. The Contractors petitioned a Nigerian federal court for enforcement of the award, and NNPC petitioned the same court to have the award set aside. On May 22, 2012, the court set aside the award. The Contractors appealed that judgment to the Court of Appeal, Abuja Judicial Division. On July 22, 2016, the Court of Appeal upheld the decision of the lower court setting aside the award. On October 21, 2016, the Contractors appealed the decision to the Supreme Court of Nigeria. In June 2013, the Contractors filed a lawsuit against NNPC in the Nigerian federal high court in order to preserve their ability to seek enforcement of the PSC in the courts if necessary. Following dismissal by this court, the Contractors appealed to the Nigerian Court of Appeal in June 2016. In October 2014, the Contractors filed suit in the United States District Court for the Southern District of New York (SDNY) to enforce, if necessary, the arbitration award against NNPC assets residing within that jurisdiction. NNPC moved to dismiss the lawsuit. On September 4, 2019, the SDNY dismissed the Contractors’ petition to recognize and enforce the Erha arbitration award. The Contractors filed a notice of appeal in the Second Circuit on October 2, 2019. At this time, the net impact of this matter on the Corporation's consolidated financial results cannot be reasonably estimated. However, regardless of the outcome of enforcement proceedings, the Corporation does not expect the proceedings to have a material effect upon the Corporation's operations or financial condition.Note 4. Other Comprehensive Income Information
| | | | | | | | | | | |
ExxonMobil Share of Accumulated Other Comprehensive Income (millions of dollars) | Cumulative Foreign Exchange Translation Adjustment | Postretirement Benefits Reserves Adjustment | Total |
Balance as of December 31, 2020 | (10,614) | | (6,091) | | (16,705) | |
Current period change excluding amounts reclassified from accumulated other comprehensive income (1) | 425 | | 119 | | 544 | |
Amounts reclassified from accumulated other comprehensive income | — | | 575 | | 575 | |
Total change in accumulated other comprehensive income | 425 | | 694 | | 1,119 | |
Balance as of June 30, 2021 | (10,189) | | (5,397) | | (15,586) | |
| | | |
Balance as of December 31, 2021 | (11,499) | | (2,265) | | (13,764) | |
Current period change excluding amounts reclassified from accumulated other comprehensive income (1) | (1,682) | | 245 | | (1,437) | |
Amounts reclassified from accumulated other comprehensive income | — | | 184 | | 184 | |
Total change in accumulated other comprehensive income | (1,682) | | 429 | | (1,253) | |
Balance as of June 30, 2022 | (13,181) | | (1,836) | | (15,017) | |
| | | |
(1) Cumulative Foreign Exchange Translation Adjustment includes net investment hedge gain/(loss) net of taxes of $327 million and $135 million in 2022 and 2021, respectively. |
| | | | | | | | | | | | | | | | | | | | | |
Amounts Reclassified Out of Accumulated Other Comprehensive Income - Before-tax Income/(Expense) (millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | | 2021 |
| | | | | | | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | | | | | | |
(Statement of Income line: Non-service pension and postretirement benefit expense) | | (132) | | (280) | | | (252) | | | (764) | |
| | | | | | | | | | | | | | | | | | | | | |
Income Tax (Expense)/Credit For Components of Other Comprehensive Income (millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
2022 | 2021 | | 2022 | | 2021 |
| | | | |
Foreign exchange translation adjustment | | (68) | | 19 | | | (90) | | | (34) | |
Postretirement benefits reserves adjustment (excluding amortization) | | (83) | | 25 | | | (123) | | | (33) | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | (30) | | (65) | | | (57) | | | (171) | |
Total | | (181) | | (21) | | | (270) | | | (238) | |
4. Other Comprehensive Income InformationNote 5. Earnings Per Share
| | | | | | | | | | | | | | | | | |
ExxonMobil Share of Accumulated Other Comprehensive Income | Cumulative Foreign Exchange Translation Adjustment | | Postretirement Benefits Reserves Adjustment | | Total |
| (millions of dollars) |
| | | | | |
Balance as of December 31, 2019 | (12,446) | | | (7,047) | | | (19,493) | |
Current period change excluding amounts reclassified from accumulated other comprehensive income (1) | (2,469) | | | (45) | | | (2,514) | |
Amounts reclassified from accumulated other comprehensive income | 0 | | | 390 | | | 390 | |
Total change in accumulated other comprehensive income | (2,469) | | | 345 | | | (2,124) | |
Balance as of June 30, 2020 | (14,915) | | | (6,702) | | | (21,617) | |
| | | | | |
Balance as of December 31, 2020 | (10,614) | | | (6,091) | | | (16,705) | |
Current period change excluding amounts reclassified from accumulated other comprehensive income (1) | 425 | | | 119 | | | 544 | |
Amounts reclassified from accumulated other comprehensive income | 0 | | | 575 | | | 575 | |
Total change in accumulated other comprehensive income | 425 | | | 694 | | | 1,119 | |
Balance as of June 30, 2021 | (10,189) | | | (5,397) | | | (15,586) | |
(1)Cumulative Foreign Exchange Translation Adjustment includes net investment hedge gain/(loss) net of taxes of $135 million and $5 million in 2021 and 2020, respectively. | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
2022 | 2021 | | 2022 | | 2021 |
Earnings per common share | | | | | | | |
Net income (loss) attributable to ExxonMobil (millions of dollars) | | 17,850 | | 4,690 | | | 23,330 | | | 7,420 | |
Weighted average number of common shares outstanding (millions of shares) | | 4,233 | | 4,276 | | | 4,248 | | | 4,274 | |
Earnings (loss) per common share (dollars) (1) | | 4.21 | | 1.10 | | | 5.49 | | | 1.74 | |
Dividends paid per common share (dollars) | | 0.88 | | 0.87 | | | 1.76 | | | 1.74 | |
| | | | | | | |
(1) The calculation of earnings (loss) per common share and earnings (loss) per common share – assuming dilution are the same in each period shown. |
| | | | | | | | | | | | | | | | | | | | | | | | |
Amounts Reclassified Out of Accumulated Other | | Three Months Ended June 30, | | Six Months Ended June 30, |
Comprehensive Income - Before-tax Income/(Expense) | | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
| | | | | | | | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | | | | | | | |
(Statement of Income line: Non-service pension and postretirement benefit expense) | | (280) | | | (260) | | | (764) | | | (522) | |
Note 6. Pension and Other Postretirement Benefits
| | | | | | | | | | | | | | | | | | | | | | | | |
Income Tax (Expense)/Credit For | | Three Months Ended June 30, | | Six Months Ended June 30, |
Components of Other Comprehensive Income | | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Foreign exchange translation adjustment | | 19 | | | 8 | | | (34) | | | 15 | |
Postretirement benefits reserves adjustment (excluding amortization) | | 25 | | | 52 | | | (33) | | | (10) | |
Amortization and settlement of postretirement benefits reserves adjustment included in net periodic benefit costs | | (65) | | | (57) | | | (171) | | | (115) | |
Total | | (21) | | | 3 | | | (238) | | | (110) | |
| | | | | | | | | | | | | | | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
2022 | 2021 | | 2022 | | 2021 |
Components of net benefit cost | | | | | | | |
Pension Benefits - U.S. | | | | | | | |
Service cost | | 177 | | 208 | | | 356 | | | 433 | |
Interest cost | | 129 | | 140 | | | 258 | | | 279 | |
Expected return on plan assets | | (140) | | (181) | | | (280) | | | (361) | |
Amortization of actuarial loss/(gain) | | 39 | | 61 | | | 78 | | | 122 | |
Amortization of prior service cost | | (7) | | (6) | | | (14) | | | (12) | |
Net pension enhancement and curtailment/settlement cost | | 53 | | 95 | | | 90 | | | 393 | |
Net benefit cost | | 251 | | 317 | | | 488 | | | 854 | |
| | | | | | | |
Pension Benefits - Non-U.S. | | | | | | | |
Service cost | | 145 | | 198 | | | 295 | | | 393 | |
Interest cost | | 157 | | 135 | | | 317 | | | 265 | |
Expected return on plan assets | | (207) | | (263) | | | (420) | | | (521) | |
Amortization of actuarial loss/(gain) | | 47 | | 107 | | | 94 | | | 215 | |
Amortization of prior service cost | | 11 | | 14 | | | 23 | | | 29 | |
Net pension enhancement and curtailment/settlement cost | | (1) | | — | | | (1) | | | 12 | |
Net benefit cost | | 152 | | 191 | | | 308 | | | 393 | |
| | | | | | | |
Other Postretirement Benefits | | | | | | | |
Service cost | | 38 | | 46 | | | 78 | | | 95 | |
Interest cost | | 53 | | 55 | | | 108 | | | 111 | |
Expected return on plan assets | | (4) | | (4) | | | (7) | | | (9) | |
Amortization of actuarial loss/(gain) | | — | | 19 | | | 3 | | | 38 | |
Amortization of prior service cost | | (10) | | (10) | | | (21) | | | (21) | |
Net benefit cost | | 77 | | 106 | | | 161 | | | 214 | |
5. Earnings Per Share
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
Earnings per common share | | | | | | | | |
Net income (loss) attributable to ExxonMobil (millions of dollars) | | 4,690 | | | (1,080) | | | 7,420 | | | (1,690) | |
Weighted average number of common shares outstanding (millions of shares) | | 4,276 | | | 4,271 | | | 4,274 | | | 4,270 | |
Earnings (Loss) per common share (dollars) (1) | | 1.10 | | | (0.26) | | | 1.74 | | | (0.40) | |
Dividends paid per common share (dollars) | | 0.87 | | | 0.87 | | | 1.74 | | | 1.74 | |
(1)The calculation of earnings (loss) per common share and earnings (loss) per common share – assuming dilution are the same in each period shown.
6. Pension and Other Postretirement Benefits
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Components of net benefit cost | | | | | | | | |
Pension Benefits - U.S. | | | | | | | | |
Service cost | | 208 | | | 232 | | | 433 | | | 467 | |
Interest cost | | 140 | | | 177 | | | 279 | | | 354 | |
Expected return on plan assets | | (181) | | | (175) | | | (361) | | | (350) | |
Amortization of actuarial loss/(gain) and prior service cost | | 55 | | | 79 | | | 110 | | | 158 | |
Net pension enhancement and curtailment/settlement cost | | 95 | | | 52 | | | 393 | | | 104 | |
Net benefit cost | | 317 | | | 365 | | | 854 | | | 733 | |
| | | | | | | | |
Pension Benefits - Non-U.S. | | | | | | | | |
Service cost | | 198 | | | 171 | | | 393 | | | 346 | |
Interest cost | | 135 | | | 162 | | | 265 | | | 323 | |
Expected return on plan assets | | (263) | | | (216) | | | (521) | | | (438) | |
Amortization of actuarial loss/(gain) and prior service cost | | 121 | | | 115 | | | 244 | | | 234 | |
Net pension enhancement and curtailment/settlement cost | | 0 | | | 0 | | | 12 | | | 0 | |
Net benefit cost | | 191 | | | 232 | | | 393 | | | 465 | |
| | | | | | | | |
Other Postretirement Benefits | | | | | | | | |
Service cost | | 46 | | | 44 | | | 95 | | | 89 | |
Interest cost | | 55 | | | 68 | | | 111 | | | 138 | |
Expected return on plan assets | | (4) | | | (5) | | | (9) | | | (9) | |
Amortization of actuarial loss/(gain) and prior service cost | | 9 | | | 14 | | | 17 | | | 26 | |
Net benefit cost | | 106 | | | 121 | | | 214 | | | 244 | |
Note 7. Financial Instruments and Derivatives
Financial Instruments.The estimated fair value of financial instruments and derivatives at June 30, 2021,2022 and December 31, 2020,2021, and the related hierarchy level for the fair value measurement was as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | At June 30, 2021 |
| | (millions of dollars) |
| | Fair Value | | | | | | | | |
| | Level 1 | | Level 2 | | Level 3 | | Total Gross Assets & Liabilities | | Effect of Counterparty Netting | | Effect of Collateral Netting | | Difference in Carrying Value and Fair Value | | Net Carrying Value |
Assets | | | | | | | | | | | | | | | | |
| Derivative assets (1) | 2,156 | | | 594 | | | — | | | 2,750 | | | (2,357) | | | 0 | | | — | | | 393 | |
| Advances to/receivables | | | | | | | | | | | | | | | |
| from equity companies (2)(6) | — | | | 3,167 | | | 5,727 | | | 8,894 | | | — | | | — | | | (291) | | | 8,603 | |
| Other long-term | | | | | | | | | | | | | | | |
| financial assets (3) | 1,104 | | | — | | | 1,303 | | | 2,407 | | | — | | | — | | | 190 | | | 2,597 | |
Liabilities | | | | | | | | | | | | | | | | |
| Derivative liabilities (4) | 2,806 | | | 759 | | | — | | | 3,565 | | | (2,357) | | | (650) | | | — | | | 558 | |
| Long-term debt (5) | 46,787 | | | 100 | | | 4 | | | 46,891 | | | — | | | — | | | (3,376) | | | 43,515 | |
| Long-term obligations | | | | | | | | | | | | | | | |
| to equity companies (6) | — | | | — | | | 3,337 | | | 3,337 | | | — | | | — | | | (299) | | | 3,038 | |
| Other long-term | | | | | | | | | | | | | | | |
| financial liabilities (7) | — | | | — | | | 972 | | | 972 | | | — | | | — | | | 57 | | | 1,029 | |
| | | | At December 31, 2020 | | June 30, 2022 |
| | | (millions of dollars) | |
| | | Fair Value | | | | | | | | | | | | |
| | | Level 1 | | Level 2 | | Level 3 | | Total Gross Assets & Liabilities | | Effect of Counterparty Netting | | Effect of Collateral Netting | | Difference in Carrying Value and Fair Value | | Net Carrying Value | | Fair Value | | |
(millions of dollars) | | (millions of dollars) | Level 1 | Level 2 | Level 3 | Total Gross Assets & Liabilities | Effect of Counterparty Netting | Effect of Collateral Netting | Difference in Carrying Value and Fair Value | Net Carrying Value |
Assets | Assets | | | | | | | | | | | | | | | | | Assets | | |
Derivative assets (1) | | Derivative assets (1) | 6,269 | | 2,935 | | — | | 9,204 | | (7,954) | | (209) | | — | | 1,041 | |
| | Derivative assets (1) | 1,247 | | | 194 | | | — | | | 1,441 | | | (1,282) | | | (6) | | | — | | | 153 | | |
Advances to/receivables from equity companies (2)(6) | | Advances to/receivables from equity companies (2)(6) | — | | 2,511 | | 5,017 | | 7,528 | | — | | — | | 666 | | 8,194 | |
| | Advances to/receivables | | |
| from equity companies (2)(6) | — | | | 3,275 | | | 5,904 | | | 9,179 | | | — | | | — | | | (367) | | | 8,812 | | |
| Other long-term | | |
Other long-term financial assets (3) | | Other long-term financial assets (3) | 1,166 | | — | | 1,017 | | 2,183 | | — | | — | | 188 | | 2,371 | |
| | financial assets (3) | 1,235 | | | — | | | 944 | | | 2,179 | | | — | | | — | | | 125 | | | 2,304 | | | | |
Liabilities | Liabilities | | Liabilities | | |
Derivative liabilities (4) | | Derivative liabilities (4) | 6,278 | | 3,921 | | — | | 10,199 | | (7,954) | | (218) | | — | | 2,027 | |
Long-term debt (5) | | Long-term debt (5) | 34,229 | | 61 | | 5 | | 34,295 | | — | | — | | 2,935 | | 37,230 | |
| | Derivative liabilities (4) | 1,443 | | | 254 | | | — | | | 1,697 | | | (1,282) | | | (202) | | | — | | | 213 | | |
Long-term obligations to equity companies (6) | | Long-term obligations to equity companies (6) | — | | — | | 2,635 | | 2,635 | | — | | — | | (18) | | 2,617 | |
| | Long-term debt (5) | 50,263 | | | 125 | | | 4 | | | 50,392 | | | — | | | — | | | (4,890) | | | 45,502 | | |
| Long-term obligations | | |
| to equity companies (6) | — | | | — | | | 3,530 | | | 3,530 | | | — | | | — | | | (277) | | | 3,253 | | |
| Other long-term | | |
| financial liabilities (7) | — | | | — | | | 964 | | | 964 | | | — | | | — | | | 44 | | | 1,008 | | |
Other long-term financial liabilities (7) | | Other long-term financial liabilities (7) | — | | — | | 742 | | 742 | | — | | — | | 51 | | 793 | |
(1)Included in the Balance Sheet lines: Notes and accounts receivable - net and Other assets, including intangibles - net | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | December 31, 2021 |
| | | | | | | | | |
| | | | | | | | | |
| | Fair Value | | | | |
(millions of dollars) | | Level 1 | Level 2 | Level 3 | Total Gross Assets & Liabilities | Effect of Counterparty Netting | Effect of Collateral Netting | Difference in Carrying Value and Fair Value | Net Carrying Value |
Assets | | | | | | | | | |
Derivative assets (1) | | 1,422 | | 1,523 | | — | | 2,945 | | (1,930) | | (28) | | — | | 987 | |
| | | | | | | | | |
Advances to/receivables from equity companies (2)(6) | | — | | 3,076 | | 5,373 | | 8,449 | | — | | — | | (123) | | 8,326 | |
| | | | | | | | | |
Other long-term financial assets (3) | | 1,134 | | — | | 1,058 | | 2,192 | | — | | — | | 181 | | 2,373 | |
| | | | | | | | | |
Liabilities | | | | | | | | | |
Derivative liabilities (4) | | 1,701 | | 2,594 | | — | | 4,295 | | (1,930) | | (306) | | — | | 2,059 | |
Long-term debt (5) | | 44,454 | | 88 | | 3 | | 44,545 | | — | | — | | (2,878) | | 41,667 | |
| | | | | | | | | |
Long-term obligations to equity companies (6) | | — | | — | | 3,084 | | 3,084 | | — | | — | | (227) | | 2,857 | |
| | | | | | | | | |
Other long-term financial liabilities (7) | | — | | — | | 902 | | 902 | | — | | — | | 58 | | 960 | |
(2)Included in the Balance Sheet line: Investments, advances and long-term receivables
(3)Included in the Balance Sheet lines: Investments, advances and long-term receivables and Other assets, including intangibles - net
(4)Included in the Balance Sheet lines: Accounts payable and accrued liabilities and Other long-term obligations
(5)Excluding finance lease obligations
(6)Advances to/receivables from equity companies and long-term obligations to equity companies are mainly designated as hierarchy level 3 inputs. The fair value is calculated by discounting the remaining obligations by a rate consistent with the credit quality and industry of the company.
| | | | | |
(1) | Included in the Balance Sheet lines: Notes and accounts receivable - net and Other assets, including intangibles - net |
(2) | Included in the Balance Sheet line: Investments, advances and long-term receivables |
(3) | Included in the Balance Sheet lines: Investments, advances and long-term receivables and Other assets, including intangibles - net |
(4) | Included in the Balance Sheet lines: Accounts payable and accrued liabilities and Other long-term obligations |
(5) | Excluding finance lease obligations |
(6) | Advances to/receivables from equity companies and long-term obligations to equity companies are mainly designated as hierarchy level 3 inputs. The fair value is calculated by discounting the remaining obligations by a rate consistent with the credit quality and industry of the company. |
(7) | Included in the Balance Sheet line: Other long-term obligations. Includes contingent consideration related to a prior year acquisition where fair value is based on expected drilling activities and discount rates. |
At June 30, 2021,2022 and December 31, 2020,2021, respectively, the Corporation had $495$1,403 million and $504$641 million of collateral under master netting arrangements not offset against the derivatives on the Consolidated Balance Sheet, primarily related to initial margin requirements.
The Corporation may use non-derivative financial instruments, such as its foreign currency-denominated debt, as hedges of its net investments in certain foreign subsidiaries. Under this method, the change in the carrying value of the financial instruments due to foreign exchange fluctuations is reported in accumulated other comprehensive income. As of June 30, 2021,2022, the
Corporation has designated $5.3$4.7 billion of its Euro-denominated long-term debt and related accrued interest as a net investment hedge of its European business. The net investment hedge is deemed to be perfectly effective.
The Corporation had undrawn short-term committed lines of credit of $10.7$10.6 billion, of which $10 billion will expire without renewal in the third quarter, and undrawn long-term committed lines of credit of $0.6$0.4 billion as of second quarter 2021.2022.
Derivative Instruments
Derivative Instruments.The Corporation’s size, strong capital structure, geographic diversity and the complementary nature of the Upstream, Downstream and Chemical businessesour business segments reduce the Corporation’s enterprise-wide risk from changes in commodity prices, currency rates and interest rates. In addition, the Corporation uses commodity-based contracts, including derivatives, to manage commodity price risk and for trading purposes.to generate returns from trading. Commodity contracts held for trading purposes are presented in the Condensed Consolidated Statement of Income on a net basis in the line “Sales and other operating revenue.”revenue". The Corporation’s commodity derivatives are not accounted for under hedge accounting. At times, the Corporation also enters into currency and interest rate derivatives, none of which are material to the Corporation’s financial position as of June 30, 2021,2022 and December 31, 2020,2021, or results of operations for the periods ended June 30, 2021,2022 and 2020.
2021.
Credit risk associated with the Corporation’s derivative position is mitigated by several factors, including the use of derivative clearing exchanges and the quality of and financial limits placed on derivative counterparties. The Corporation maintains a system of controls that includes the authorization, reporting and monitoring of derivative activity.
The net notional long/(short) position of derivative instruments at June 30, 2021,2022 and December 31, 2020,2021, was as follows:
| | | June 30, | | December 31, | |
| | 2021 | | 2020 | |
| (millions) | |
(millions) | | (millions) | June 30, 2022 | December 31, 2021 |
Crude oil (barrels) | Crude oil (barrels) | 30 | | | 40 | | Crude oil (barrels) | 47 | | 82 | |
Petroleum products (barrels) | Petroleum products (barrels) | (69) | | | (46) | | Petroleum products (barrels) | (39) | | (48) | |
Natural gas (MMBTUs) | Natural gas (MMBTUs) | (461) | | | (500) | | Natural gas (MMBTUs) | (115) | | (115) | |
|
Realized and unrealized gains/(losses) on derivative instruments that were recognized in the Condensed Consolidated Statement of Income are included in the following lines on a before-tax basis:
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Sales and other operating revenue | | (1,088) | | | (251) | | | (1,600) | | | 985 | |
Crude oil and product purchases | | (20) | | | (178) | | | (19) | | | (530) | |
Total | | (1,108) | | | (429) | | | (1,619) | | | 455 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
|
| | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | 2021 |
Sales and other operating revenue | | (1,413) | | (1,088) | | | (3,948) | | (1,600) | |
Crude oil and product purchases | | — | | (20) | | | (26) | | (19) | |
Total | | (1,413) | | (1,108) | | | (3,974) | | (1,619) | |
Note 8. Disclosures about Segments and Related Information
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
Earnings (Loss) After Income Tax | | (millions of dollars) | | (millions of dollars) |
Upstream | | | | | | | | |
United States | | 663 | | | (1,197) | | | 1,026 | | | (1,901) | |
Non-U.S. | | 2,522 | | | (454) | | | 4,713 | | | 786 | |
Downstream | | | | | | | | |
United States | | (149) | | | (101) | | | (262) | | | (202) | |
Non-U.S. | | (78) | | | 1,077 | | | (355) | | | 567 | |
Chemical | | | | | | | | |
United States | | 1,282 | | | 171 | | | 1,997 | | | 459 | |
Non-U.S. | | 1,038 | | | 296 | | | 1,738 | | | 152 | |
Corporate and financing | | (588) | | | (872) | | | (1,437) | | | (1,551) | |
Corporate total | | 4,690 | | | (1,080) | | | 7,420 | | | (1,690) | |
| | | | | | | | |
Sales and Other Operating Revenue | | | | | | | | |
Upstream | | | | | | | | |
United States | | 1,726 | | | 1,081 | | | 3,611 | | | 2,858 | |
Non-U.S. | | 3,792 | | | 2,022 | | | 6,886 | | | 4,589 | |
Downstream | | | | | | | | |
United States | | 19,040 | | | 8,203 | | | 35,118 | | | 23,587 | |
Non-U.S. | | 31,899 | | | 16,302 | | | 60,512 | | | 45,606 | |
Chemical | | | | | | | | |
United States | | 4,007 | | | 1,570 | | | 7,098 | | | 3,866 | |
Non-U.S. | | 5,474 | | | 3,090 | | | 10,361 | | | 6,890 | |
Corporate and financing | | 5 | | | 9 | | | (91) | | | 15 | |
Corporate total | | 65,943 | | | 32,277 | | | 123,495 | | | 87,411 | |
| | | | | | | | |
Intersegment Revenue | | | | | | | | |
Upstream | | | | | | | | |
United States | | 3,827 | | | 1,378 | | | 7,150 | | | 3,651 | |
Non-U.S. | | 7,747 | | | 2,852 | | | 14,564 | | | 9,239 | |
Downstream | | | | | | | | |
United States | | 5,438 | | | 2,056 | | | 9,391 | | | 6,008 | |
Non-U.S. | | 5,505 | | | 2,752 | | | 10,886 | | | 7,876 | |
Chemical | | | | | | | | |
United States | | 2,488 | | | 1,220 | | | 4,438 | | | 2,986 | |
Non-U.S. | | 1,342 | | | 708 | | | 2,573 | | | 1,971 | |
Corporate and financing | | 52 | | | 56 | | | 109 | | | 111 | |
Effective April 1, 2022, the Corporation streamlined its business structure by combining the Chemical and Downstream businesses into a single business, Product Solutions. Product Solutions consists of 3 operating segments:•Energy Products: Fuels, aromatics, and catalysts and licensing
•Chemical Products: Olefins, polyethylene, polypropylene, and intermediates
•Specialty Products: Finished lubricants, basestocks and waxes, synthetics, and elastomers and resins
Information disclosed in this note has been recast for the new segmentation.
| | | | | | | | | | | | | | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | 2021 |
Earnings (Loss) After Income Tax | | | | | | |
Upstream | | | | | | |
United States | | 3,749 | | 663 | | | 6,125 | | 1,026 | |
Non-U.S. | | 7,622 | | 2,522 | | | 9,734 | | 4,713 | |
Energy Products | | | | | | |
United States | | 2,655 | | (278) | | | 3,144 | | (510) | |
Non-U.S. | | 2,617 | | (578) | | | 1,933 | | (1,267) | |
Chemical Products | | | | | | |
United States | | 625 | | 1,149 | | | 1,395 | | 1,803 | |
Non-U.S. | | 450 | | 1,051 | | | 1,086 | | 1,788 | |
Specialty Products | | | | | | |
United States | | 232 | | 262 | | | 478 | | 442 | |
Non-U.S. | | 185 | | 487 | | | 415 | | 862 | |
Corporate and Financing | | (286) | | (588) | | | (980) | | (1,437) | |
Corporate total | | 17,850 | | 4,690 | | | 23,330 | | 7,420 | |
| | | | | | |
Sales and Other Operating Revenue | | | | | | |
Upstream | | | | | | |
United States | | 3,958 | | 1,726 | | | 6,614 | | 3,611 | |
Non-U.S. | | 7,101 | | 3,792 | | | 13,444 | | 6,886 | |
Energy Products | | | | | | |
United States | | 34,473 | | 18,770 | | | 59,326 | | 34,304 | |
Non-U.S. | | 52,804 | | 29,925 | | | 94,519 | | 56,815 | |
Chemical Products | | | | | | |
United States | | 3,180 | | 3,035 | | | 6,274 | | 5,533 | |
Non-U.S. | | 4,497 | | 4,244 | | | 8,994 | | 7,985 | |
Specialty Products | | | | | | |
United States | | 1,653 | | 1,242 | | | 3,044 | | 2,379 | |
Non-U.S. | | 3,591 | | 3,204 | | | 6,769 | | 6,073 | |
Corporate and Financing | | 8 | | 5 | | | 15 | | (91) | |
Corporate total (1) | | 111,265 | | 65,943 | | | 198,999 | | 123,495 | |
| | | | | | |
Intersegment Revenue | | | | | | |
Upstream | | | | | | |
United States | | 7,180 | | 3,827 | | | 13,371 | | 7,150 | |
Non-U.S. | | 13,533 | | 7,747 | | | 24,368 | | 14,564 | |
Energy Products | | | | | | |
United States | | 8,348 | | 4,102 | | | 15,197 | | 7,263 | |
Non-U.S. | | 10,848 | | 5,186 | | | 19,610 | | 10,085 | |
Chemical Products | | | | | | |
United States | | 2,558 | | 1,461 | | | 4,325 | | 2,806 | |
Non-U.S. | | 1,600 | | 929 | | | 3,107 | | 1,751 | |
Specialty Products | | | | | | |
United States | | 713 | | 584 | | | 1,272 | | 1,080 | |
Non-U.S. | | 195 | | 160 | | | 419 | | 320 | |
Corporate and Financing | | 59 | | 52 | | | 116 | | 109 | |
| | | | | | |
(1) See footnote on the next page |
| | | | | | | | | | | | | | | | | | | | |
Geographic Sales and Other Operating Revenue | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | 2021 |
United States | | 43,264 | | 24,773 | | | 75,258 | | 45,827 | |
Non-U.S. | | 68,001 | | 41,170 | | | 123,741 | | 77,668 | |
Total (1) | | 111,265 | | 65,943 | | | 198,999 | | 123,495 | |
| | | | | | |
Significant Non-U.S. revenue sources include: (2) | | | | | | |
Canada | | 9,642 | | 5,282 | | | 16,638 | | 9,541 | |
United Kingdom | | 8,306 | | 3,815 | | | 15,854 | | 6,758 | |
France | | 5,265 | | 3,247 | | | 9,622 | | 6,029 | |
Singapore | | 4,774 | | 3,515 | | | 9,096 | | 6,950 | |
Italy | | 3,063 | | 2,466 | | | 5,898 | | 4,331 | |
Belgium | | 3,041 | | 2,192 | | | 5,877 | | 4,181 | |
Australia | | 3,205 | | 2,019 | | | 5,661 | | 3,748 | |
| | | | | | |
(1) Includes approximately 23% and 15% related to revenue outside the scope of ASC 606 "Revenue from Contracts with Customers" for the three months ended June 30, 2022 and June 30, 2021, respectively, and 22% and 16% for the six months ended June 30, 2022 and June 30, 2021, respectively. Trade receivables in Notes and accounts receivable – net reported on the Balance Sheet include both receivables within the scope of ASC 606 and those outside the scope of ASC 606. Revenue and receivables outside the scope of ASC 606 primarily relate to physically settled commodity contracts accounted for as derivatives. Credit quality and type of customer are generally similar between those revenues and receivables within the scope of ASC 606 and those outside it. |
(2) Revenue is determined by primary country of operations. Excludes certain sales and other operating revenues in Non-U.S. operations where attribution to a specific country is not practicable. |
| | | | | | | | | | | | | | | | | | | | | | | | |
Geographic | | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
Sales and Other Operating Revenue | | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
United States | | 24,773 | | | 10,854 | | | 45,827 | | | 30,311 | |
Non-U.S. | | 41,170 | | | 21,423 | | | 77,668 | | | 57,100 | |
Total | | 65,943 | | | 32,277 | | | 123,495 | | | 87,411 | |
| | | | | | | | |
Significant Non-U.S. revenue sources include: (1) | | | | | | | | |
Canada | | 5,282 | | | 2,148 | | | 9,541 | | | 5,971 | |
United Kingdom | | 3,815 | | | 1,906 | | | 6,758 | | | 5,597 | |
Singapore | | 3,515 | | | 1,867 | | | 6,950 | | | 4,483 | |
France | | 3,247 | | | 1,583 | | | 6,029 | | | 4,172 | |
Italy | | 2,466 | | | 1,228 | | | 4,331 | | | 3,186 | |
Belgium | | 2,192 | | | 1,247 | | | 4,181 | | | 3,136 | |
Australia | | 2,019 | | | 1,372 | | | 3,748 | | | 3,025 | |
(1)Revenue is determined by primary country of operations. Excludes certain sales and other operating revenues in Non-U.S. operations where attribution to a specific country is not practicable.
Note 9. Divestment Activities
ExxonMobilIn February 2022, the Corporation signed an agreement in the first quarter of 2021 with HitecVision, through its wholly-owned portfolio company NEOSeplat Energy Offshore Limited for the sale of mostMobil Producing Nigeria Unlimited. The agreement is subject to certain conditions precedent and government approvals. In early July, a Nigerian court issued an order to halt transition activities and enter into arbitration with the Nigerian National Petroleum Company. The closing date and any loss on sale will depend on resolution of its non-operated upstreamthese matters.
In May 2022, the Corporation signed an agreement for the sale of ExxonMobil Exploration and Production Romania, consisting of certain unproved Upstream assets, to Romgaz S.A. The transaction closed in the third quarter, and the Corporation will recognize a gain on the sale of approximately $300 million.
In June 2022, the Corporation signed an agreement with Whitecap Resources Inc. for the sale of XTO Energy Canada, consisting of Upstream unconventional assets in the United Kingdom central and northern North Sea for more than $1 billion. The transaction is expected to close by year-end 2021, subject to standard conditions precedent, including regulatory and third-party approvals.Alberta. The agreed sales price is subject to interim period adjustments from the effective date of JanuaryMay 1, 2021,2022 to the closing date, and has an additional upside potential of approximately $0.3 billion in contingent payments, based on production levels and commodity prices. Estimated total cash flow from the divestment will range from $0.7 billion to $1.2 billion, of which $0.7 billion to $0.8 billion is expected in 2021 and the remainder in future years.
In the second quarter of 2021, ExxonMobil signed an agreement with Celanese for the sale of its global Santoprene business for $1.15 billion, subject to working capital and other adjustments. The sale includes 2 thermoplastic elastomers manufacturing sites in Pensacola, Florida and Newport, Wales along with associated assets.date. The transaction is expectedanticipated to close in the fourththird quarter, of 2021, subject to standard conditions precedent including regulatory approvals. Estimated total cash flow fromand the divestment is approximately $0.9 billion.
The Corporation expects to recognize a gain at closing for eachon the sale of these transactions. Estimated gain and net cash flow could change due to market factors, working capital adjustments, tax impacts, and closing dates.approximately $300 million.
10.Restructuring Activities
During 2020, ExxonMobil conducted an extensive global review of staffing levels and subsequently commenced targeted workforce reductions within a number of countries to improve efficiency and reduce costs. The programs, which are expected to be substantially completed by the end of 2021, include both voluntary and involuntary employee separations and reductions in contractors.
During the second quarter of 2021, the Corporation recorded before-tax charges of $10 million, consisting primarily of employee separation costs, from workforce reductions in Singapore and Europe associated with the global review of staffing levels. These costs are captured in “Selling, general and administrative expenses” on the Statement of Income.
For the first six months of the year, the recorded before-tax charges associated with the global review of staffing levels were $49 million.
For the full year, the Corporation estimates charges of less than $100 million related to planned workforce reduction programs associated with the global review of staffing levels. This does not include charges related to employee reductions associated with any portfolio changes or other projects.
The following tables summarize the reserves and charges related to the workforce reduction programs associated with the global review of staffing levels, which are recorded in “Accounts payable and accrued liabilities.”
| | | | | | | | | | | |
| Three Months Ended June 30, | | Six Months Ended June 30, |
| 2021 | | 2021 |
| (millions of dollars) | | (millions of dollars) |
Beginning Balance | 312 | | | 403 | |
Additions/adjustments | 10 | | | 49 | |
Payments made | (94) | | | (224) | |
Ending Balance | 228 | | | 228 | |
EXXON MOBIL CORPORATION
ItemITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
In early 2020,During the balance ofCOVID-19 pandemic, industry investment to maintain and increase production capacity was restrained to preserve capital, resulting in underinvestment and supply andtightness as demand for petroleum and petrochemical products experienced two significant disruptive effects. Onrecovered. In addition, industry rationalization of refining capacity resulted in more than 3 million barrels per day of capacity being taken offline. Across late 2021 and the first half of 2022, this dynamic, along with supply chain constraints, and a continuation of demand side,recovery led to a steady increase in oil and natural gas prices and refining margins. In the COVID-19 pandemic spread rapidly through most areasfirst half of 2022, tightness in the oil and natural gas markets was further exacerbated by Russia’s invasion of Ukraine and subsequent sanctions imposed upon business and other activities in Russia. The price of Brent crude oil and certain regional natural gas indicators increased to levels not seen for several years, and both natural gas realizations and industry refining margins improved to levels well above the 10-year range. By the end of the world resulting in substantial reductions in consumer and business activity and significantly reducedsecond quarter, high prices had led to a tempering of demand for crudesome products. Commodity and product prices are expected to remain volatile given the current global economic uncertainty and geopolitical events affecting supply and demand.
In response to Russia’s military action in Ukraine, the Corporation announced in early 2022 that it plans to discontinue operations on the Sakhalin-1 project (“Sakhalin”) and develop steps to exit the venture. The Corporation remains focused on protecting the safety of employees, operations, and the environment. The Corporation is complying with all applicable laws and sanctions and is currently engaged in transitioning Sakhalin-1 operating activities to another party.
The Corporation’s first quarter results included after-tax charges of $3.4 billion largely representing the impairment of its operations related to Sakhalin (see Note 2 to Condensed Consolidated Financial Statements). Efforts to transition operatorship to a third party and exit the venture are expected to result in minimal hydrocarbon sales and cash flows for the Corporation’s account in future periods. For reference, excluding the impact of impairments and other charges, after-tax earnings related to the Corporation’s interest in Sakhalin during the first half of 2022 were approximately $0.3 billion, and combined oil naturaland gas and petroleum products. This reductionproduction was approximately 45 thousand oil-equivalent barrels per day. The Corporation's exit from the project would result in demand coincided with announcementsquantities estimated at 150 million oil-equivalent barrels no longer qualifying as proved reserves, which represented less than one percent of increased production in certain key oil-producing countries which led to increases in inventory levels and sharp declines in prices for crude oil, natural gas, and petroleum products.
Demand for petroleum and petrochemical products has continued to recover through 2021 with the Corporation's second quarter 2021 financial results benefiting18.5 billion oil-equivalent barrels of proved reserves at year-end 2021.
The Corporation holds a 25% interest in Tengizchevroil, LLP (TCO), which operates the Tengiz and Korolev oil fields in Kazakhstan, and holds a 16.8% working interest in the Kashagan field in Kazakhstan. Oil production from stronger pricesthose operations is exported through the Caspian Pipeline Consortium (CPC) pipeline, in which the Corporation holds a 7.5% interest. CPC traverses parts of Kazakhstan and margins when comparedRussia to tanker-loading facilities on the Russian coast of the Black Sea. In the event that existing sanctions related to Russia’s military actions in Ukraine expand, new sanctions are imposed, countermeasures are employed by the Russian Federation, or other direct or indirect impacts arise, it is possible that the transportation of Kazakhstan oil through the CPC pipeline could be disrupted, curtailed, temporarily suspended, or otherwise restricted. In such a case, the Corporation could experience a loss of cash flows of uncertain duration. For reference, after-tax earnings related to the Corporation’s interests in Kazakhstan for the first quarterhalf of 2021.2022 were $1.5 billion, and its share of combined oil and gas production was approximately 250 thousand oil-equivalent barrels per day.
Effective April 1, 2022, the Corporation streamlined its business structure by combining the Chemical and Downstream businesses into a single business, Product Solutions. The ratenew business is focused on growing high-value products, improving competitiveness and paceleading in sustainability. Product Solutions consists of recovery, however, has varied across geographiesthree operating segments:
•Energy Products: Fuels, aromatics, and business lines, with Downstream margins remaining low comparedcatalysts and licensing
•Chemical Products: Olefins, polyethylene, polypropylene, and intermediates
•Specialty Products: Finished lubricants, basestocks and waxes, synthetics, and elastomers and resins
Further information on financial performance related to historical levels over the last decade. The Corporation continuesnew segments are disclosed in Management's Discussion and Analysis and Note 8 to closely monitor industry and economic conditions amid the uneven global recovery from the COVID-19 pandemic.Condensed Consolidated Financial Statements.
FUNCTIONAL EARNINGS SUMMARY
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
Earnings (Loss) (U.S. GAAP) | | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Upstream | | | | | | | | |
United States | | 663 | | | (1,197) | | | 1,026 | | | (1,901) | |
Non-U.S. | | 2,522 | | | (454) | | | 4,713 | | | 786 | |
Downstream | | | | | | | | |
United States | | (149) | | | (101) | | | (262) | | | (202) | |
Non-U.S. | | (78) | | | 1,077 | | | (355) | | | 567 | |
Chemical | | | | | | | | |
United States | | 1,282 | | | 171 | | | 1,997 | | | 459 | |
Non-U.S. | | 1,038 | | | 296 | | | 1,738 | | | 152 | |
Corporate and financing | | (588) | | | (872) | | | (1,437) | | | (1,551) | |
Net income (loss) attributable to ExxonMobil (U.S. GAAP) | | 4,690 | | | (1,080) | | | 7,420 | | | (1,690) | |
| | | | | | | | |
Earnings (Loss) per common share (dollars) | | 1.10 | | | (0.26) | | | 1.74 | | | (0.40) | |
| | | | | | | | |
Earnings (Loss) per common share - assuming dilution (dollars) | | 1.10 | | | (0.26) | | | 1.74 | | | (0.40) | |
Earnings (loss) excluding Identified Items, are earnings (loss) excluding individually significant non-operational events with an absolute corporate total earnings impact of at least $250 million in a given quarter. The earnings (loss) impact of an Identified Item for an individual segment in a given quarter may be less than $250 million when the item impacts several segments or several periods. Management uses these figures to improve comparability of the underlying business across multiple periods by isolating and removing significant non-operational events from business results. The Corporation believes this view provides investors increased transparency into business results and trends, and provides investors with a view of the business as seen through the eyes of management. Earnings (loss) excluding Identified Items is not meant to be viewed in isolation or as a substitute for net income (loss) attributable to ExxonMobil as prepared in accordance with U.S. GAAP. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended June 30, 2022
| Upstream | | Energy Products | | Chemical Products | Specialty Products | | | Corporate and Financing | | Total |
(millions of dollars) | U.S. | Non-U.S. | | U.S. | Non-U.S. | | U.S. | Non-U.S. | U.S. | Non-U.S. | | | |
Earnings (loss) (U.S. GAAP) | 3,749 | 7,622 | | 2,655 | 2,617 | | 625 | 450 | 232 | 185 | | | (286) | | 17,850 |
Identified Items | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Gain/(loss) on sale of assets | 299 | — | | — | — | | — | — | — | — | | | — | | 299 |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Earnings (loss) excluding Identified Items | 3,450 | 7,622 | | 2,655 | 2,617 | | 625 | 450 | 232 | 185 | | | (286) | | 17,551 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Three Months Ended June 30, 2021 | Upstream | | Energy Products | | Chemical Products | Specialty Products | | | Corporate and Financing | | Total |
(millions of dollars) | U.S. | Non-U.S. | | U.S. | Non-U.S. | | U.S. | Non-U.S. | U.S. | Non-U.S. | | | |
Earnings (loss) (U.S. GAAP) | 663 | | 2,522 | | | (278) | | (578) | | | 1,149 | | 1,051 | | 262 | 487 | | | (588) | | | 4,690 |
Identified Items | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Severance charges | — | | — | | | — | | — | | | — | | — | | — | — | | | (12) | | | (12) |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Earnings (loss) excluding Identified Items | 663 | | 2,522 | | | (278) | | (578) | | | 1,149 | | 1,051 | | 262 | 487 | | | (576) | | | 4,702 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months Ended June 30, 2022 | Upstream | | Energy Products | | Chemical Products | Specialty Products | | | Corporate and Financing | | Total |
(millions of dollars) | U.S. | Non-U.S. | | U.S. | Non-U.S. | | U.S. | Non-U.S. | U.S. | Non-U.S. | | | |
Earnings (loss) (U.S. GAAP) | 6,125 | 9,734 | | 3,144 | 1,933 | | 1,395 | 1,086 | 478 | 415 | | | (980) | | 23,330 |
Identified Items | | | | | | | | | | | | | | | |
Impairments | — | (2,877) | | — | — | | — | — | — | — | | | (98) | | (2,975) |
Gain/(loss) on sale of assets | 299 | — | | — | — | | — | — | — | — | | | — | | 299 |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Other - Russia impacts | — | (378) | | — | — | | — | — | — | — | | | — | | (378) |
| | | | | | | | | | | | | | | |
Earnings (loss) excluding Identified Items | 5,826 | 12,989 | | 3,144 | 1,933 | | 1,395 | 1,086 | 478 | 415 | | | (882) | | 26,384 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months Ended June 30, 2021 | Upstream | | Energy Products | | Chemical Products | Specialty Products | | | Corporate and Financing | | Total |
(millions of dollars) | U.S. | Non-U.S. | | U.S. | Non-U.S. | | U.S. | Non-U.S. | U.S. | Non-U.S. | | | |
Earnings (loss) (U.S. GAAP) | 1,026 | | 4,713 | | | (510) | | (1,267) | | | 1,803 | | 1,788 | | 442 | 862 | | | (1,437) | | | 7,420 |
Identified Items | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Severance charges | — | | — | | | — | | — | | | — | | — | | — | — | | | (43) | | | (43) |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Earnings (loss) excluding Identified Items | 1,026 | | 4,713 | | | (510) | | (1,267) | | | 1,803 | | 1,788 | | 442 | 862 | | | (1,394) | | | 7,463 |
|
References in this discussion to Corporate earnings (loss) mean net income (loss) attributable to ExxonMobil (U.S. GAAP) from the consolidated income statement.Condensed Consolidated Statement of Income. Unless otherwise indicated, references to earnings (loss), Upstream, Downstream,Energy Products, Chemical Products, Specialty Products, and Corporate and financingFinancing segment earnings (loss), and earnings (loss) per share are ExxonMobil's share after excluding amounts attributable to noncontrolling interests.
Due to rounding, numbers presented may not add up precisely to the totals indicated.
REVIEW OF SECOND QUARTER 20212022 RESULTS
ExxonMobil’s second quarter 20212022 earnings were $4.7$17.9 billion, or $1.10$4.21 per diluted share, compared with a lossearnings of $1.1$4.7 billion a year earlier. The increase in earnings was driven by higher Upstream realizations; higher Chemicalrealizations and Downstream margins; higher volumes;Energy Products margins. Capital and lower expenses. These impactsexploration expenditures were partly offset by$4.6 billion, up $0.8 billion from second quarter 2021.
Earnings for the absencefirst six months of prior2022 were $23.3 billion, or $5.49 per diluted share, compared with $7.4 billion a year favorable non-operational inventory adjustmentsearlier. Capital and higher scheduled maintenance activity.exploration expenditures were $9.5 billion, up $2.6 billion from 2021. The Corporation distributed $7.5 billion in dividends to shareholders and repurchased $6.1 billion of common stock.
UPSTREAM
| | | | | | | | | | | | | | | | | | | | |
Upstream Financial Results | | | | | | |
| | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | 2021 |
Earnings (loss) (U.S. GAAP) | | | | | | |
United States | | 3,749 | | 663 | | | 6,125 | | 1,026 | |
Non-U.S. | | 7,622 | | 2,522 | | | 9,734 | | 4,713 | |
Total | | 11,371 | | 3,185 | | | 15,859 | | 5,739 | |
| | | | | | |
Identified Items (1) | | | | | | |
United States | | 299 | | — | | | 299 | | — | |
Non-U.S. | | — | | — | | | (3,255) | | — | |
Total | | 299 | | — | | | (2,956) | | — | |
| | | | | | |
Earnings (loss) excluding Identified Items (1) | | | | | | |
United States | | 3,450 | | 663 | | | 5,826 | | 1,026 | |
Non-U.S. | | 7,622 | | 2,522 | | | 12,989 | | 4,713 | |
Total | | 11,072 | | 3,185 | | | 18,815 | | 5,739 | |
| | | | | | | | | | | | | | |
Upstream Second Quarter Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Price– Higher realizations increased earnings by $7,900 million as average realizations for crude oil increased 71%, while natural gas realizations increased 186%.
Earnings for the first six monthsVolume/Mix – Higher volumes increased earnings by $440 million, reflecting growth in Guyana and Permian and eased curtailments, partly offset by downtime, lower entitlements, and decline.
Other – All other items decreased earnings by $450 million due to divestment-related impairments and absence of 2021 were $7.4 billion, or $1.74 per diluted share, compared with a loss of $1.7 billion aprior year earlier.one-time tax impacts.
Identified Items (1) –2Q 2022 $299 million gain on the sale of U.S. Barnett Shale assets.
Capital(1) Refer to Functional Earnings Summary for definition of Identified Items and exploration expenditures were $6.9 billion, down $5.5 billion from 2020.
Oil-equivalent production was 3.7 million barrels per day, down 4 percent from the prior year. Excluding entitlement effects, divestments, and government mandates, oil-equivalent production was up 1 percent from the prior year.
The Corporation distributed $7.4 billion in dividends to shareholders.earnings (loss) excluding Identified Items.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Upstream results | | | | | | | | |
United States | | 663 | | | (1,197) | | | 1,026 | | | (1,901) | |
Non-U.S. | | 2,522 | | | (454) | | | 4,713 | | | 786 | |
Total | | 3,185 | | | (1,651) | | | 5,739 | | | (1,115) | |
Upstream earnings were $3,185 million in the second quarter of 2021, compared with a loss of $1,651 million in the second quarter of 2020.
•Realizations increased earnings by $4,320 million, driven by higher liquids realizations of $4,060 million and higher gas realizations of $260 million.
•Volume and mix effects increased earnings by $40 million due to favorable liquids sales mix of $30 million and higher gas sales volumes of $10 million.
•All other items increased earnings by $470 million, as lower expenses of $280 million and favorable other earnings impacts of $270 million were partly offset by unfavorable foreign exchange impacts of $80 million.
•U.S. Upstream earnings were $663 million, up $1,860 million from the prior year quarter.
•Non-U.S. Upstream earnings were $2,522 million, up $2,976 million from the prior year quarter.
•On an oil-equivalent basis, production decreased 2 percent from the second quarter of 2020.
•Liquids production totaled 2.2 million barrels per day, down 106,000 barrels per day, as higher demand was more than offset by lower entitlements and increased maintenance activity.
•Natural gas production was 8.3 billion cubic feet per day, up 304 million cubic feet per day, reflecting the impacts of higher demand partly offset by increased maintenance activity and divestments.
| | | | | | | | | | | | | | |
Upstream Year-to-Date Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Price– Higher realizations increased earnings by $13,830 million as average realizations for crude oil increased 69% and natural gas realizations increased 161%.
UpstreamVolume/Mix – Unfavorable volume and mix effects decreased earnings were $5,739by $380 million, reflecting impacts from the reduced Groningen gas production limit in Netherlands, higher downtime including the effects of weather in the first six months of 2021, compared with a loss of $1,115 million in the first six months of 2020.
•Realizations increased earnings by $5,610 million, with higher liquids realizations of $5,450 millionquarter, and higher gas realizations of $160 million.
•Volume and mix effects reduced earnings by $320 million, reflecting lower liquid sales volumes of $370 millionentitlements due to prices, partly offset by higher gas volumes of $50 million.growth in Permian and Guyana.
•Other – All other items increaseddecreased earnings by $1,560$370 million as lower expenses of $990 milliondue to divestment-related impairments and the absence of prior year unfavorable non-operational impactsone-time tax impacts.
Identified Items (1) –2022 $(2,956) million loss as a result of $410 million and other favorable earnings impacts of $460 million werethe company's plans to discontinue operations on the Russia Sakhalin-1 project, partly offset by unfavorable foreign exchange effectsa gain on the sale of $300 million.U.S. Barnett Shale assets.
•U.S. Upstream(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings were $1,026 million, compared with a loss of $1,901 million in the prior year.(loss) excluding Identified Items.
•Non-U.S. Upstream earnings were $4,713 million, up $3,927 million from the prior year.
•On an oil-equivalent basis, production decreased 4 percent from the first six months of 2020.
•Liquids production totaled 2.2 million barrels per day, down 164,000 barrels per day, with higher demand and project growth more than offset by lower entitlements, government mandates, decline and increased maintenance activity.
•Natural gas production was 8.7 billion cubic feet per day, up 38 million cubic feet per day, as higher demand was largely offset by increased maintenance activity, the Groningen production limit, and divestments.
| | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
Upstream additional information | | (thousands of barrels daily) | | (thousands of barrels daily) |
Volumes reconciliation (Oil-equivalent production) (1) | | | | |
2020 | | 3,638 | | 3,842 |
Entitlements - Net Interest | | 4 | | (1) |
Entitlements - Price / Spend / Other | | (147) | | (94) |
Government Mandates | | (6) | | (65) |
Divestments | | (23) | | (20) |
Growth / Other | | 116 | | 22 |
2021 | | 3,582 | | 3,684 |
| | | | | | | | | | | | | | | | | | | | | | |
Upstream Operational Results | | | | | | | | |
| | | | | | | | |
| | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2022 | | 2021 | | 2022 | | 2021 |
Net production of crude oil, natural gas liquids, bitumen and synthetic oil (thousands of barrels daily) | | | | | | | | |
United States | | 777 | | | 687 | | | 765 | | | 676 | |
Canada/Other Americas | | 556 | | | 529 | | | 516 | | | 552 | |
Europe | | 4 | | | 16 | | | 4 | | | 25 | |
Africa | | 224 | | | 254 | | | 240 | | | 254 | |
Asia | | 691 | | | 669 | | | 714 | | | 680 | |
Australia/Oceania | | 46 | | | 45 | | | 43 | | | 42 | |
Worldwide | | 2,298 | | | 2,200 | | | 2,282 | | | 2,229 | |
| | | | | | | | |
Net natural gas production available for sale (millions of cubic feet daily) | | | | | | | | |
United States | | 2,699 | | | 2,804 | | | 2,738 | | | 2,786 | |
Canada/Other Americas | | 180 | | | 189 | | | 180 | | | 203 | |
Europe | | 825 | | | 654 | | | 798 | | | 1,026 | |
Africa | | 67 | | | 46 | | | 63 | | | 35 | |
Asia | | 3,320 | | | 3,433 | | | 3,330 | | | 3,515 | |
Australia/Oceania | | 1,515 | | | 1,168 | | | 1,421 | | | 1,166 | |
Worldwide | | 8,606 | | | 8,294 | | | 8,530 | | | 8,731 | |
| | | | | | | | |
| | | | | | | | |
Oil-equivalent production (1) (thousands of oil-equivalent barrels daily) | | 3,732 | | | 3,582 | | | 3,704 | | 3,684 |
| | | | | | | | |
(1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels. |
2Q 2022 versus 2Q 2021
(1)Liquids production – 2.3 million barrels per day increased 98 thousand barrels per day from 2Q 2021, reflecting growth in Permian and Guyana and easing government-mandated curtailments, partly offset by lower entitlements due to higher prices, higher downtime, and divestments.
Natural gas is converted to an oil-equivalent basis at sixproduction available for sale – 8.6 billion cubic feet per day increased 312 million cubic feet per one thousand barrels.day from 2Q2021, reflecting reduced scheduled maintenance, partly offset by lower entitlements and divestments.
YTD 2022 versus YTD 2021
Liquids production – 2.3 million barrels per day increased 53 thousand barrels per day from 2021, reflecting growth in Permian and Guyana and easing government-mandated curtailments, partly offset by lower entitlements due to higher prices, higher downtime including the effects of weather in the first quarter of 2022, and divestments.
Natural gas production available for sale – 8.5 billion cubic feet per day decreased 201 million cubic feet per day from 2021, reflecting impacts from the reduced Groningen production limit, divestments, and entitlements.
| | | | | | | | | | | | | | | | |
Upstream Additional Information | | | | | | |
| | | | | | |
(thousands of barrels daily) | | | Three Months Ended June 30 | | | Six Months Ended June 30 |
Volumes reconciliation (Oil-equivalent production) (1) | | | | | | |
2021 | | | 3,582 | | | 3,684 |
Entitlements - Net Interest | | | (27) | | | (29) |
Entitlements - Price / Spend / Other | | | (57) | | | (48) |
Government Mandates | | | 90 | | | 101 |
Divestments | | | (28) | | | (46) |
Other | | | 172 | | | 42 |
2022 | | | 3,732 | | | 3,704 |
| | | | | | |
(1)Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels. |
Listed below are descriptions of ExxonMobil’s volumes reconciliation factors which are provided to facilitate understanding of the terms.
Entitlements - Net Interest are changes to ExxonMobil’s share of production volumes caused by non-operational changes to volume-determining factors. These factors consist of net interest changes specified in Production Sharing Contracts (PSCs) which typically occur when cumulative investment returns or production volumes achieve defined thresholds, changes in equity upon achieving pay-out in partner investment carry situations, equity redeterminations as specified in venture agreements, or as a result of the termination or expiry of a concession. Once a net interest change has occurred, it typically will not be reversed by subsequent events, such as lower crude oil prices.
Entitlements - Price, Spend and Other are changes to ExxonMobil’s share of production volumes resulting from temporary changes to non-operational volume-determining factors. These factors include changes in oil and gas prices or spending levels from one period to another. According to the terms of contractual arrangements or government royalty regimes, price or spending variability can increase or decrease royalty burdens and/or volumes attributable to ExxonMobil. For example, at higher prices, fewer barrels are required for ExxonMobil to recover its costs. These effects generally vary from period to period with field spending patterns or market prices for oil and natural gas. Such factors can also include other temporary changes in net interest as dictated by specific provisions in production agreements.
Government Mandates are changes to ExxonMobil's sustainable production levels due toas a result of temporary non-operational production limits or sanctions imposed by governments, generally upon a country, sector, type or method of production.
Divestments are reductions in ExxonMobil’s production arising from commercial arrangements to fully or partially reduce equity in a field or asset in exchange for financial or other economic consideration.
Growth and Other factors comprise all other operational and non-operational factors not covered by the above definitions that may affect volumes attributable to ExxonMobil. Such factors include, but are not limited to, production enhancements from project and work program activities, acquisitions including additions from asset exchanges, downtime, market demand, natural field decline, and any fiscal or commercial terms that do not affect entitlements.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Downstream results | | | | | | | | |
United States | | (149) | | | (101) | | | (262) | | | (202) | |
Non-U.S. | | (78) | | | 1,077 | | | (355) | | | 567 | |
Total | | (227) | | | 976 | | | (617) | | | 365 | |
ENERGY PRODUCTSDownstream results were a loss of $227 million in the second quarter of 2021, down $1,203 million from the second quarter of 2020. | | | | | | | | | | | | | | | | | | | | | | |
Energy Products Financial Results | | | | | | | | |
| | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Earnings (loss) (U.S. GAAP) | | | | | | | | |
United States | | 2,655 | | | (278) | | | 3,144 | | | (510) | |
Non-U.S. | | 2,617 | | | (578) | | | 1,933 | | | (1,267) | |
Total | | 5,273 | | | (856) | | | 5,077 | | | (1,777) | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Earnings (loss) excluding Identified Items (1) | | | | | | | | |
United States | | 2,655 | | | (278) | | | 3,144 | | | (510) | |
Non-U.S. | | 2,617 | | | (578) | | | 1,933 | | | (1,267) | |
Total | | 5,273 | | | (856) | | | 5,077 | | | (1,777) | |
| | | | | | | | |
(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items. |
•Margins increased earnings by $430 million, reflecting stronger industry refining conditions.
•Volume and mix effects increased earnings by $220 million.
•All other items decreased earnings by $1,860 million, reflecting the absence of a prior year favorable inventory adjustment of $1,590 million, unfavorable foreign exchange impacts of $90 million, higher expenses of $60 million, and other unfavorable earnings impacts of $120 million.
•U.S. Downstream results were a loss of $149 million, compared with a loss of $101 million in the prior year quarter.
•Non-U.S. Downstream results were a loss of $78 million, down $1,155 million from the prior year quarter.
•Petroleum product sales of 5.0 million barrels per day were 604,000 barrels per day higher than the prior year quarter.
| | | | | | | | | | | | | | |
Energy Products Second Quarter Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Downstream results were a loss of $617 million in the first six months of 2021, down $982 million from the first six months of 2020.•MarginsMargins decreased– Higher margins increased earnings by $1,340$5,770 million driven by lower realized fuels margins.due to improved industry refining margins and favorable derivative mark-to-market effects.
•VolumeVolume/Mix – Favorable volume and mix effects increased earnings by $30 million.$280 million, primarily as a result of lower scheduled maintenance and turnaround activity.
•Other – All other items increased earnings by $330 million, as lower expenses of $350 million and the absence of prior year unfavorable non-operational impacts of $350 million were partly offset by unfavorable foreign exchange and other earnings impacts of $370$80 million.
•U.S. Downstream results were a loss of $262 million, compared with a loss of $202 million in the prior year.
•Non-U.S. Downstream results were a loss of $355 million, down $922 million from the prior year.
•Petroleum product sales of 5.0 million barrels per day were 99,000 barrels per day higher than the prior year.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Chemical results | | | | | | | | |
United States | | 1,282 | | | 171 | | | 1,997 | | | 459 | |
Non-U.S. | | 1,038 | | | 296 | | | 1,738 | | | 152 | |
Total | | 2,320 | | | 467 | | | 3,735 | | | 611 | |
| | | | | | | | | | | | | | |
Energy Products Year-to-Date Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Chemical earnings were $2,320 million in the second quarter of 2021, up $1,853 million from the second quarter of 2020.•Margins– Higher margins increased earnings by $1,680 million.$5,960 million driven by an increase in industry refining margins.
•VolumeVolume/Mix – Favorable volume and mix effects increased earnings by $210 million.$580 million, mainly as a result of lower scheduled maintenance and turnaround activity.
•Other – All other items decreasedincreased earnings by $40$310 million, mainlyprimarily due to the absence of prior year favorable non-operationalterminal conversion impacts of $120 million, partly offset by favorable foreign exchange impacts of $70 million and other favorable earnings impacts.
•U.S. Chemical earnings were $1,282 million, up $1,111 million fromin the prior year quarter.year.
•Non-U.S. Chemical earnings were $1,038 million, up $742 million from the prior year quarter.
| | | | | | | | | | | | | | | | | | | | |
Energy Products Operational Results | | | | | | |
| | | | | | |
(thousands of barrels daily) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | 2021 | | 2022 | 2021 |
Refinery throughput | | | | | | |
United States | | 1,686 | | 1,532 | | | 1,686 | | 1,532 | |
Canada | | 413 | | 332 | | | 406 | | 348 | |
Europe | | 1,164 | | 1,223 | | | 1,179 | | 1,188 | |
Asia Pacific | | 532 | | 607 | | | 534 | | 576 | |
Other | | 193 | | 164 | | | 180 | | 161 | |
Worldwide | | 3,988 | | 3,858 | | | 3,985 | | 3,805 | |
| | | | | | |
Energy Products sales (1) | | | | | | |
United States | | 2,452 | | 2,230 | | | 2,358 | | 2,153 | |
Non-U.S. | | 2,858 | | 2,776 | | | 2,853 | | 2,766 | |
Worldwide | | 5,310 | | 5,006 | | | 5,211 | | 4,920 | |
| | | | | | |
Gasoline, naphthas | | 2,208 | | 2,117 | | | 2,161 | | 2,057 | |
Heating oils, kerosene, diesel oils | | 1,755 | | 1,704 | | | 1,739 | | 1,698 | |
Aviation fuels | | 350 | | 201 | | | 319 | | 192 | |
Heavy fuels | | 228 | | 275 | | | 238 | | 266 | |
Other energy products | | 769 | | 709 | | | 753 | | 707 | |
| | | | | | |
(1) Data reported net of purchases/sales contracts with the same counterparty. | |
•
Second quarter prime product sales of 6.5 million metric tons were 568,000 metric tons higher than the prior year quarter.
CHEMICAL PRODUCTS
| | | | | | | | | | | | | | | | | | | | | | |
Chemical Products Financial Results | | | | | | | | |
| | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Earnings (loss) (U.S. GAAP) | | | | | | | | |
United States | | 625 | | 1,149 | | | 1,395 | | | 1,803 | |
Non-U.S. | | 450 | | 1,051 | | | 1,086 | | | 1,788 | |
Total | | 1,076 | | | 2,200 | | | 2,481 | | | 3,591 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Earnings (loss) excluding Identified Items (1) | | | | | | | | |
United States | | 625 | | | 1,149 | | | 1,395 | | | 1,803 | |
Non-U.S. | | 450 | | | 1,051 | | | 1,086 | | | 1,788 | |
Total | | 1,076 | | | 2,200 | | | 2,481 | | | 3,591 | |
| | | | | | | | |
(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items. |
| | | | | | | | | | | | | | |
Chemical Products Second Quarter Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Margins– Lower margins decreased earnings by $960 million, reflecting higher feed and energy costs only partly offset by price increases.
Chemical earnings were $3,735 million in the first six months of 2021, up $3,124 million from the first six months of 2020.
•Volume/Mix – Higher marginsvolumes increased earnings by $2,300$40 million.
Other – All other items decreased earnings by $200 million, primarily driven by unfavorable foreign exchange, higher growth-related expenses, and increased planned maintenance.
| | | | | | | | | | | | | | |
Chemical Products Year-to-Date Earnings Factor Analysis | | |
(millions of dollars) | | | | |
MarginsVolume– Lower margins decreased earnings by $910 million, reflecting higher feed and mix effectsenergy costs, partly offset by price increases.
Volume/Mix – Higher volumes increased earnings by $240 million.$130 million, primarily due to higher U.S. sales including the start-up of the chemical complex in Corpus Christi, Texas.
•Other – All other items increaseddecreased earnings by $580$330 million, primarily driven by lowerhigher growth-related expenses, of $220 million, the absence of prior yearincreased planned maintenance, and unfavorable non-operational impacts of $210 million, favorable foreign exchange impacts of $120 million and other favorable earnings impacts of $30 million.effects.
•U.S. Chemical earnings were $1,997 million, up $1,538 million from the prior year.
•Non-U.S. Chemical earnings were $1,738 million, up $1,586 million from the prior year.
•First six months prime product sales of 13.0 million metric tons were 777,000 metric tons higher than the prior year.
| | | | | | | | | | | | | | | | | | | | | | |
Chemical Products Operational Results | | | | | | | | |
| | | | | | | | |
(thousands of metric tons) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Chemical Products sales (1) | | | | | | | | |
United States | | 1,998 | | | 1,782 | | | 4,030 | | | 3,403 | |
Non-U.S. | | 2,812 | | | 2,949 | | | 5,798 | | | 6,093 | |
Worldwide | | 4,811 | | | 4,731 | | | 9,829 | | | 9,496 | |
| | | | | | | | |
(1) Data reported net of purchases/sales contracts with the same counterparty. |
27
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Corporate and financing results | | (588) | | | (872) | | | (1,437) | | | (1,551) | |
Corporate and financing expenses were $588 million for the second quarter of 2021, down $284 million from the second quarter of 2020, reflecting lower financing costs and net favorable tax impacts.
SPECIALTY PRODUCTS
| | | | | | | | | | | | | | | | | | | | | | |
Specialty Products Financial Results | | | | | | | | |
| | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Earnings (loss) (U.S. GAAP) | | | | | | | | |
United States | | 232 | | | 262 | | | 478 | | | 442 | |
Non-U.S. | | 185 | | | 487 | | | 415 | | | 862 | |
Total | | 417 | | | 750 | | | 893 | | | 1,304 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Earnings (loss) excluding Identified Items (1) | | | | | | | | |
United States | | 232 | | | 262 | | | 478 | | | 442 | |
Non-U.S. | | 185 | | | 487 | | | 415 | | | 862 | |
Total | | 417 | | | 750 | | | 893 | | | 1,304 | |
| | | | | | | | |
(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items. |
| | | | | | | | | | | | | | |
Specialty Products Second Quarter Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Margins– Lower margins decreased earnings by $210 million, primarily related to lower industry basestock margins.
Volume/Mix – Unfavorable volume mix effects decreased earnings by $90 million, primarily driven by higher scheduled maintenance.
Other – All other items decreased earnings by $30 million.
| | | | | | | | | | | | | | |
Specialty Products Year-to-Date Earnings Factor Analysis | | |
(millions of dollars) | | | | |
Margins– Lower margins decreased earnings by $360 million, primarily related to lower industry basestock margins as a result of increased feed costs.
Volume/Mix – Unfavorable volume mix effects decreased earnings by $60 million driven by higher scheduled maintenance.
Other – All other items increased earnings by $10 million.
| | | | | | | | | | | | | | | | | | | | | | |
Specialty Products Operational Results | | | | | | | | |
| | | | | | | | |
(thousands of metric tons) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Specialty Products sales (1) | | | | | | | | |
United States | | 590 | | | 495 | | | 1,111 | | | 1,005 | |
Non-U.S. | | 1,511 | | | 1,447 | | | 2,995 | | | 2,932 | |
Worldwide | | 2,100 | | | 1,942 | | | 4,107 | | | 3,936 | |
| | | | | | | | |
(1) Data reported net of purchases/sales contracts with the same counterparty. | | |
CORPORATE AND FINANCING
| | | | | | | | | | | | | | | | | | | | | | |
Corporate and Financing Financial Results | | | | | | | | |
| | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
| | | | | | | | |
Earnings (loss) (U.S. GAAP) | | (286) | | | (588) | | | (980) | | | (1,437) | |
Identified Items (1) | | — | | | (12) | | | (98) | | | (43) | |
Earnings (loss) excluding Identified Items (1) | | (286) | | | (576) | | | (882) | | | (1,394) | |
| | | | | | | | |
(1) Refer to Functional Earnings Summary for definition of Identified Items and earnings (loss) excluding Identified Items. |
Corporate and Financing expenses were $286 million for the second quarter of 2022, $302 million lower than the second quarter of 2021, reflecting favorable one-time tax impacts.
Corporate and financingFinancing expenses were $1,437$980 million for the first six months of 2021, down $1142022, $457 million from 2020, reflecting lower financing costs and net favorable tax impacts, partly offset by higher retirement related expenses.than 2021.
LIQUIDITY AND CAPITAL RESOURCES
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Net cash provided by/(used in) | | | | | | | | |
Operating activities | | | | | | 18,914 | | | 6,274 | |
Investing activities | | | | | | (5,071) | | | (11,448) | |
Financing activities | | | | | | (14,807) | | | 15,062 | |
Effect of exchange rate changes | | | | | | 65 | | | (401) | |
Increase/(decrease) in cash and cash equivalents | | | | | | (899) | | | 9,487 | |
| | | | | | | | |
Cash and cash equivalents (at end of period) | | | | | | 3,465 | | | 12,576 | |
| | | | | | | | |
Cash flow from operations and asset sales | | | | | | | | |
Net cash provided by operating activities (U.S. GAAP) | | 9,650 | | | — | | | 18,914 | | | 6,274 | |
Proceeds associated with sales of subsidiaries, property, plant & equipment, and sales and returns of investments | | 250 | | | 43 | | | 557 | | | 129 | |
Cash flow from operations and asset sales | | 9,900 | | | 43 | | | 19,471 | | | 6,403 | |
Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider proceeds associated with asset sales together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities, including shareholder distributions. | | | | | | | | | | | | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Net cash provided by/(used in) | | | | | | | | |
Operating activities | | | | | | 34,751 | | | 18,914 | |
Investing activities | | | | | | (7,009) | | | (5,071) | |
Financing activities | | | | | | (15,384) | | | (14,807) | |
Effect of exchange rate changes | | | | | | (299) | | | 65 | |
Increase/(decrease) in cash and cash equivalents | | | | | | 12,059 | | | (899) | |
| | | | | | | | |
Cash and cash equivalents (at end of period) | | | | | | 18,861 | | | 3,465 | |
| | | | | | | | |
Cash flow from operations and asset sales | | | | | | | | |
Net cash provided by operating activities (U.S. GAAP) | | 19,963 | | | 9,650 | | | 34,751 | | | 18,914 | |
Proceeds associated with sales of subsidiaries, property, plant & equipment, and sales and returns of investments | | 939 | | | 250 | | | 1,232 | | | 557 | |
Cash flow from operations and asset sales | | 20,902 | | | 9,900 | | | 35,983 | | | 19,471 | |
| | | | | | | | |
Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider proceeds associated with asset sales together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities, including shareholder distributions. |
Cash flow from operations and asset sales in the second quarter of 20212022 was $9.9$20.9 billion, an increase of $9.9$11.0 billion from the comparable 20202021 period primarily reflecting higher earnings and more favorable working capital impacts.earnings.
Cash provided by operating activities totaled $18.9$34.8 billion for the first six months of 2021, $12.62022, $15.8 billion higher than 2020.2021. Net income including noncontrolling interests was $7.6$24.3 billion, an increase of $9.5$16.7 billion from the prior year period. The adjustmentsadjustment for the noncash provision of $10.0$13.3 billion for depreciation and depletion was down $0.8up $3.4 billion from 2020.2021. Changes in operational working capital were a contributionreduction of $1.6$1.7 billion, compared to a reductioncontribution of $2.2$1.6 billion in the prior year period. All other items net decreased cash flows by $0.2$1.2 billion in 20212022 versus a reduction of $0.3$0.2 billion in 2020.2021. See the Condensed Consolidated Statement of Cash Flows for additional details.
Investing activities for the first six months of 20212022 used net cash of $5.1$7.0 billion, a decreasean increase of $6.4$1.9 billion compared to the prior year. Spending for additions to property, plant and equipment of $5.1$7.7 billion was $5.2$2.6 billion lowerhigher than 2020.2021. Proceeds from asset sales ofwere $1.2 billion compared to $0.6 billion were $0.4 billion higher thanin the prior year.year period. Net investments and advances decreased $0.7 billion to $0.5 billion.were essentially flat with prior year.
Net cash used byin financing activities was $14.8$15.4 billion in the first six months of 2021,2022, including $7.0$6.1 billion for the purchase of debt repayments.71.1million shares of ExxonMobil stock, as part of the previously announced buyback program. This compares to net cash provided byused in financing activities of $15.1$14.8 billion in the prior year, due toreflecting long-term debt issuances inrepayments of $7.0 billion during the first six months of 2020.2021.
Total debt at the end of the second quarter of 20212022 was $60.6$46.9 billion compared to $67.6$47.7 billion at year-end 2020.2021. The Corporation's debt to total capital ratio was 26.820.3 percent at the end of the second quarter of 20212022 compared to 29.221.4 percent at year-end 2020.2021. The net debt to capital ratio was 13.2 percent at the end of the second quarter, a decrease of 5.7 percentage points from year-end 2021. The Corporation's capital allocation priorities continue to be investing in advantaged projects, strengthening the balance sheet and paying a reliable dividend.
The Corporation has access to significant capacity of long-term and short-term liquidity. CommercialIn addition to cash balances, commercial paper continues to provide short-term liquidity, and is reflected in "Notes and loans payable" on the Consolidated Balance Sheet. Cash and cash equivalents was $3.5$18.9 billion at the end of the second quarter of 2021.2022. The Corporation had undrawn short-term committed lines of credit of $10.7$10.6 billion, of which $10 billion will expire without renewal in the third quarter, and undrawn long-term committed lines of credit of $0.6$0.4 billion as of second quarter 2021.2022.
The Corporation distributed a total of $7.4$7.5 billion to shareholders in the first six months of 20212022 through dividends.
The Corporation, as part of its ongoing asset management program, continues to evaluate its mix of assets for potential upgrade. Because of the ongoing nature of this program, dispositions will continue to be made from time to time which will result in either gains or losses. Additionally, the Corporation continues to evaluate opportunities to enhance its business portfolio through acquisitions of assets or companies, and enters into such transactions from time to time. Key criteria for evaluating acquisitions include potential for future growth and attractive current valuations. Acquisitions may be made with cash, shares of the Corporation’s common stock, or both.
The termination of certain transportation service agreements in the first quarter reduced commitments previously reported at year-end in Form 10-K under “Take-or-pay and unconditional purchase obligations” by approximately $2.3 billion. The majority of those commitments related to the years 2026 and beyond.
Litigation and other contingencies are discussed in Note 3 to the unaudited condensed consolidated financial statements.
TAXES
| | | | | | | | | | | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| | (millions of dollars) | | (millions of dollars) |
Income taxes | | 1,526 | | | (471) | | | 2,322 | | | 41 | |
Effective income tax rate | | 30 | % | | 29 | % | | 31 | % | | -33 | % |
Total other taxes and duties (1) | | 8,441 | | | 5,683 | | | 15,724 | | | 13,180 | |
Total | | 9,967 | | | 5,212 | | | 18,046 | | | 13,221 | |
(1)Includes “Other taxes and duties” plus taxes that are included in “Production and manufacturing expenses” and “Selling, general and administrative expenses.”
| | | | | | | | | | | | | | | | | | |
| | | | | | | | |
| | | | | | | | |
(millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| 2022 | | 2021 | | 2022 | | 2021 |
Income taxes | | 6,359 | | | 1,526 | | | 9,165 | | | 2,322 | |
Effective income tax rate | | 31 | % | | 30 | % | | 34 | % | | 31 | % |
Total other taxes and duties (1) | | 7,779 | | | 8,441 | | | 16,228 | | | 15,724 | |
Total | | 14,138 | | | 9,967 | | | 25,393 | | | 18,046 | |
| | | | | | | | |
(1) Includes “Other taxes and duties” plus taxes that are included in “Production and manufacturing expenses” and “Selling, general and administrative expenses”. |
Total taxes were $10.0$14.1 billion for the second quarter of 2021,2022, an increase of $4.8$4.2 billion from 2020.2021. Income tax expense was $1.5$6.4 billion compared to a $0.5$1.5 billion income tax credit in the prior year reflecting higher commodity prices. The effective income tax rate of 3031 percent compared to 2930 percent in the prior year period. Total other taxes and duties decreased by $0.7 billion to $7.8 billion.
Total taxes were $25.4 billion for the first six months of 2022, an increase of $7.3 billion from 2021. Income tax expense increased by $6.8 billion to $9.2 billion reflecting higher commodity prices. The effective income tax rate of 34 percent compared to 31 percent in the prior year period primarily due to a change in mix of results in jurisdictions with varying tax rates.rates and the impact of one-time items. Total other taxes and duties increased by $2.8$0.5 billion to $8.4$16.2 billion.
Total taxes were $18.0 billion for the first six months of 2021, an increase of $4.8 billion from 2020. Income tax expense increased by $2.3 billion to $2.3 billion reflecting higher commodity prices. The effective income tax rate of 31 percent compared to -33 percent in the prior year period primarily due to a change in mix of results in jurisdictions with varying tax rates. Total other taxes and duties increased by $2.5 billion to $15.7 billion.
In the United States, the Corporation has various ongoing U.S. federal income tax positions at issue with the Internal Revenue Service (IRS) for tax years beginning in 2006. The Corporation filed a refund suit for tax years 2006-2009 in U.S. federal district court (District Court) with respect to the positions at issue for those years. On February 24, 2020, the Corporation received an adverse ruling on this suit. The IRS has asserted penalties associated with several of those positions. The Corporation has not recognized the penalties as an expense because the Corporation does not expect the penalties to be sustained under applicable law. On January 13, 2021, the District Court ruled that no penalties apply to the Corporation's positions in this suit. The Corporation filed a noticeand the government have appealed the District Court's rulings to the U.S. Court of appeal regarding the substantive issues toAppeals for the Fifth Circuit Court of Appeals on April 9, 2021. The government filed a notice of appeal regarding the penalty issue to the same court on April 19, 2021.(Fifth Circuit). Proceedings in the Fifth Circuit Court of Appeals are continuing.
On March 4, 2022, the Corporation also filed a refund suit for tax years 2010-2011 in District Court with respect to the positions at issue for those years. The Corporation has not recognized asserted penalties for 2010-2011 as an expense because the Corporation does not expect the penalties to be sustained under applicable law. Unfavorable resolution of all positions at issue with the IRS would not have a material adverse effect on the Corporation’s operations or financial condition.
RESTRUCTURING ACTIVITIES
During 2020, ExxonMobil conducted an extensive global review of staffing levels and subsequently commenced targeted workforce reductions within a number of countries to improve efficiency and reduce costs. The programs, which are expected to be substantially complete by the end of 2021, include both voluntary and involuntary employee separations and reductions in contractors.
In the first half of 2021, the Corporation recorded after-tax charges of $43 million, consisting primarily of employee separation costs, from workforce reduction programs in Singapore and Europe associated with the global review of staffing levels. The cash outflows in the first half of 2021 associated with these activities were $224 million.
The Corporation estimates total charges of less than $100 million in 2021 related to planned workforce reduction programs with cash outflows ranging between $400 million and $500 million. This does not include charges related to employee reductions associated with any portfolio changes or other projects. Before-tax workforce reduction savings, including employees and contractors, are estimated to range between $1 billion and $2 billion per year after program completion when compared to 2019 levels.
CAPITAL AND EXPLORATION EXPENDITURES
| | | | Second Quarter | | First Six Months | |
| | | 2021 | | 2020 | | 2021 | | 2020 | |
| | (millions of dollars) | | (millions of dollars) | |
(millions of dollars) | | (millions of dollars) | | Three Months Ended June 30, | | Six Months Ended June 30, |
| | 2022 | | 2021 | | 2022 | | 2021 |
Upstream (including exploration expenses) | Upstream (including exploration expenses) | | 2,817 | | | 3,577 | | | 5,174 | | | 8,703 | | Upstream (including exploration expenses) | | 3,627 | | | 2,817 | | | 7,506 | | | 5,174 | |
Downstream | | 455 | | | 1,053 | | | 925 | | | 2,287 | | |
Chemical | | 530 | | | 695 | | | 836 | | | 1,477 | | |
Energy Products | | Energy Products | | 506 | | | 429 | | | 1,072 | | | 878 | |
Chemical Products | | Chemical Products | | 419 | | | 512 | | | 855 | | | 811 | |
Specialty Products | | Specialty Products | | 56 | | | 44 | | | 79 | | | 72 | |
Other | Other | | 1 | | | 2 | | | 1 | | | 3 | | Other | | 1 | | | 1 | | | 1 | | | 1 | |
Total | Total | | 3,803 | | | 5,327 | | | 6,936 | | | 12,470 | | Total | | 4,609 | | | 3,803 | | | 9,513 | | | 6,936 | |
Capital and exploration expenditures in the second quarter of 20212022 were $3.8$4.6 billion, down 29up 21 percent from the second quarter of 2020.2021.
CapitalCapital and exploration expenditures in the first six months of 20212022 were $6.9$9.5 billion, down 44up 37 percent from the first six months of 2020.2021. The Corporation expects 2021 capital spendingplans to be towardinvest in the lower end of the guidance range of $16$21 billion to $19 billion.$24 billion in 2022. Actual spending could vary depending on the progress of individual projects and property acquisitions. If market conditions continue above the Corporation's planning basis, additional cash will not be used to increase capital investment above this range, but will instead be used to accelerate deleveraging.
FORWARD-LOOKING STATEMENTS
Statements related to outlooks, projections, goals, targets,outlooks; projections; descriptions of strategic, operating, and financial plans and objectives,objectives; statements of future ambitions and plans; and other statements of future events or conditions, are forward-looking statements. Actual future results, including financial and operating performance; total capital expenditures and mix;mix, including allocations of capital to low carbon solutions; cost reductions and expense reductions;efficiency gains, including the ability to offset inflationary pressure; plans to reduce future emissions intensity and absolute emission reductions;emissions intensity; timing and outcome of projects to capture and store CO2, produced biofuels, and use of plastic waste as recycling feedstock; timing and outcome of hydrogen projects; cash flow, dividends and shareholder returns, including the timing and amounts of share repurchases; future debt levels and shareholder returns;credit ratings; business and project plans, timing, costs, capacities and returns; asset management activities; results from settlement of outstanding derivatives; workforce reductions; the outcome of litigation, tax, and other contingencies;resource recoveries and future accounting and financial reporting effects of the foregoingproduction rates could differ materially due to a number of factors. These include global or regional changes in the supply and demand for oil, natural gas, petrochemicals, and feedstocks and other market conditions that impact prices and differentials;differentials for our products; variable impacts of trading activities on our margins and results each quarter; actions of competitors and commercial counterparties; the outcome of commercial negotiations, including final agreed terms and conditions; the ability to access short- and long-term debt markets on a timely and affordable basis;markets; the ultimate impacts of COVID-19, including the extent and nature of further outbreaks and the effects of government responses on people and economies; reservoir performance;performance, including variability and timing factors applicable to unconventional resources; the outcome of exploration projects;projects and decisions to invest in future reserves; timely completion of development and other construction projects; final management approval of future projects and any changes in the scope, terms, or costs of such projects as approved; changes in law, taxes, or regulation including environmental regulations, trade sanctions, and timely granting of governmental permits;permits and certifications; government policies and support and market demand for low carbon technologies like carbon capture;technologies; war, and other political or security disturbances; opportunities for potential investments or divestments and satisfaction of applicable conditions to closing, including regulatory approvals; the capture of efficiencies within and between business lines and the ability to maintain near-term cost reductions as ongoing efficiencies while maintaining future competitive positioning;efficiencies; unforeseen technical or operating difficulties and unplanned maintenance; the development and competitiveness of alternative energy and emission reduction technologies; the results of research programs and the ability to bring new technologies to commercial scale on a cost-competitive basis; and other factors discussed in this report and under Item 1A. Risk Factors of ExxonMobil’s 20202021 Form 10-K. We assume no duty to update
Forward-looking and other statements regarding our environmental, social and other sustainability efforts and aspirations are not an indication that these statements as of anyare necessarily material to investors or requiring disclosure in our filing with the SEC. In addition, historical, current, and forward-looking environmental, social and sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future, date.including future rule-making.
The term “project” as used in this report can refer to a variety of different activities and does not necessarily have the same meaning as in anyany government payment transparency reports.
reports.
ItemITEM 3. Quantitative and Qualitative Disclosures About Market Risk
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Information about market risks for the six months ended June 30, 2021,2022, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2020.2021.
ItemITEM 4. Controls and Procedures
CONTROLS AND PROCEDURES
As indicated in the certifications in Exhibit 31 of this report, the Corporation’s Chief Executive Officer, PrincipalChief Financial Officer and Principal Accounting Officer have evaluated the Corporation’s disclosure controls and procedures as of June 30, 2021.2022. Based on that evaluation, these officers have concluded that the Corporation’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Corporation in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to them in a manner that allows for timely decisions regarding required disclosures and are effective in ensuring that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. There were no changes during the Corporation’s last fiscal quarter that materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.
PART II. OTHER INFORMATION
ItemITEM 1. Legal ProceedingsLEGAL PROCEEDINGS
ExxonMobil has elected to use a $1 million threshold for disclosing environmental proceedings.
Refer to the relevant portions of Note 3 of this Quarterly Report on Form 10-Q for further information on legal proceedings.
ItemITEM 2. Unregistered Sales of Equity Securities and Use of ProceedsUNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Issuer Purchase of Equity Securities for Quarter Ended June 30, 2021 |
Period | | Total Number of Shares Purchased | | Average Price Paid per Share | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs |
April 2021 | | — | | | — | | | — | | | |
May 2021 | | — | | | — | | | — | | | |
June 2021 | | — | | | — | | | — | | | |
Total | | — | | | | | — | | | (See Note 1) |
| | | | | | | | | | | | | | | | | | |
Issuer Purchase of Equity Securities for Quarter Ended June 30, 2022 |
| | | | | | | | |
Period | | Total Number of Shares Purchased(1) | | Average Price Paid per Share(2) | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3) | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program (Billions of dollars) |
April 2022 | | 13,118,849 | | $85.39 | | 13,118,849 | | $26.8 |
May 2022 | | 16,117,414 | | $90.83 | | 16,113,008 | | $25.4 |
June 2022 | | 15,691,398 | | $94.02 | | 15,691,302 | | $23.9 |
Total | | 44,927,661 | | $90.36 | | 44,923,159 | | |
| | | | | | | | |
(1) Includes shares withheld from participants in the company's incentive program for personal income taxes. |
(2) In the first quarter, the average price paid per share was $78.63, which brings the full-year average price paid per share to $86.03. |
(3) In its earnings release dated April 29, 2022, the Corporation stated that the company increased its share repurchase program from up to $10 billion to a total of up to $30 billion through 2023. Purchases in the second quarter of 2022 were made under terms intended to qualify for exemption under Rules 10b-18 and 10b5-1. |
During the second quarter, the Corporation did not purchase any shares of its common stock for the treasury, and did not issue or sell any unregistered equity securities.
Note 1 - In its earnings release dated February 2, 2021, the Corporation stated that it had suspended its first quarter 2021 anti-dilutive share repurchase program due to market uncertainty and intends to resume this program in the future as market conditions improve.
ItemITEM 6. Exhibits
EXHIBITS
See Index to Exhibits of this report.
INDEX TO EXHIBITS
| | | | | | | | |
Exhibit | | Description |
| | |
| | |
| | |
| | ExxonMobil Supplemental Savings Plan. (incorporated by reference to Exhibit 10(iii)(c.1) to the Registrant's report on Form 10-Q for the quarter ended March 31, 2021). |
| | ExxonMobil Supplemental Pension Plan. (incorporated by reference to Exhibit 10(iii)(c.2) to the Registrant's report on Form 10-Q for the quarter ended March 31, 2021). |
| | ExxonMobil Additional Payments Plan. (incorporated by reference to Exhibit 10(iii)(c.3) to the Registrant's report on Form 10-Q for the quarter ended March 31, 2021). |
| | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Chief Executive Officer. |
| | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by PrincipalChief Financial Officer. |
| | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Accounting Officer. |
| | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer. |
| | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by PrincipalChief Financial Officer. |
| | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Accounting Officer. |
101 | | Interactive Data Files (formatted as Inline XBRL). |
104 | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
EXXON MOBIL CORPORATION
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | | | | | | |
| EXXON MOBIL CORPORATION |
Date: August 4, 20213, 2022 | By: | /s/ LEN M. FOX |
| | Len M. Fox |
| | Vice President, Controller and |
| | Principal Accounting Officer |