Exxon Mobil Guides Weaker Segment Profits

By Michael Tobin

Exxon Mobil Corp. (XOM) said weaker natural gas prices and margins from its chemicals business could weigh on its profit in the second quarter.

The Irving, Texas-based energy giant said in a securities filing Monday that its profits generated in the quarter ended June 30 from its oil and gas exploration, refining and chemicals production segments may be smaller than what it earned in the year-earlier period.

Exxon generated $4 billion in profit during the second quarter of 2018.

Exxon said its upstream segment would generate between $2.4 billion and $3.1 billion in profit, compared with the $3.04 billion earned in the second quarter of last year and $2.9 billion earned in the first quarter. The segment's quarterly results benefited from higher oil prices, but were hurt by a decline in natural gas prices and maintenance costs as well as weaker gas demand.

Exxon said its downstream segment would generate between $100 million and $700 million in profit, compared with the $724 million earned in the second quarter of last year. The segment posted a $300 million loss in the first quarter. Higher refining margins are expected to help swing the segment to profitability, Exxon said.

Exxon said its chemical segment profit would be between breakeven and $300 million, compared with the $890 million earned in the second quarter of last year and the $500 million generated in the first quarter. Facility maintenance, in addition to a decline in margins, are expected to weigh on the segment's bottom line, Exxon said.

Analysts polled by FactSet expect Exxon to post earnings of 93 cents a share, or 89 cents a share on an adjusted basis, on revenue of $65.7 billion in the quarter.

Exxon is expected to release its second-quarter earnings report Aug. 2.

Write to Michael Tobin at [e-mail]

(END) Dow Jones Newswires

July 01, 2019 20:05 ET (00:05 GMT)

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