Exxon delivers record first-quarter profit on higher output

Exxon Mobil Corp made a record first-quarter profit by pumping more oil and gas, beating analyst estimates and taking shares to an all-time high.

Exxon doubled profits from the same quarter last year as higher output more than compensated for lower energy prices.

Shares rose 2.3% to a record high of $119.52 per share after Exxon reported its results on Friday.

“We delivered a first-quarter record despite the fact that energy prices and refining margins are softening a bit,” Chief Financial Officer Kathryn Mikells said in an interview.

Oil companies are riding a wave of strong demand and have held the line on cost-cutting implemented when fuel demand collapsed during COVID-19 lockdowns.

The biggest contributor to the better-than-expected earnings came from strong production growth, RBC research analysts Biraj Borkhataria said. Exxon’s oil and gas output rose to the highest level in almost four years.

Net profit rose to $11.43 billion, or $2.79 per share, compared to $5.48 billion a year ago that included a $3.4 billion after-tax write-down to exit Russia. Results beat consensus by 9%, according to REFINITIV data.

Exxon’s output rose in the largest U.S. oilfield, the Permian Basin, and in Guyana, where the company started pumping from a second production platform last year that added about 240,000 barrels of oil equivalent per day (boepd) to output. Higher volumes partially offset a 16% drop in oil prices from a year ago.

First-quarter results also reflected the expansion of Exxon’s fuels production. The company finished the startup of a new crude processing unit last quarter at its Beaumont, Texas, plant that added 250,000 bpd of oil refining capacity.

Exxon’s oil and gas production rose to the most since 2019 to 3.83 million barrels of oil equivalent per day (boed), up by 160,000 boed from the previous quarter.

The producer ended the first quarter with $32.7 billion in cash, but it has no urge to tap it for mergers or acquisitions, Mikells said.

Exxon would be open to deals that could offer synergies and drive good returns for shareholders, she said. But it is focused on increasing production in the Permian, in Guyana and in the Beaumont refinery expansion, among others, Mikells said.

“I would expect to see cash balances higher so that we are well positioned as we go into the low end of the cycle,” Chief Executive Darren Woods said in a call with analysts.