埃克森美孚 (XOM) 2025 Q3 法說會逐字稿

Good morning, everyone. Welcome to Exxon Mobil's third-quarter 2025 earnings call. I'm Jim Chapman, Vice President, Treasurer, and Investor Relations.

This quarter's presentation and pre-recorded remarks are available on the Investors section of our website. They are meant to accompany the third-quarter earnings press release, which is posted in the same location.

During today's presentation, we'll make forward-looking remarks, including comments on our long-term plans, which are subject to risks and uncertainties. Please read our cautionary statement on slide 2. You can find more information on the risks and uncertainties that apply to any forward-looking statements in our SEC filings on our website. We also provide supplemental information at the end of our earnings slides, which are also posted on our website.

Our business is designed to grow value and to provide exceptional stability across the commodity cycles. Our focus remains unchanged: executing on our plans and leveraging our competitive advantages to create value for our shareholders.

Our unmatched investment portfolio, proprietary technology, execution excellence, integrated business, scale, cost discipline, and strong balance sheet are all unmatched in our industry. And the people of Exxon Mobil use these competitive advantages to drive superior results, delivering third-quarter adjusted earnings of $8.1 billion or $1.88 per share.

We did this while completing multiple large, complex new projects. So far this year, 8 of our 10 key projects for 2025 have successfully commenced operations, most recently at Yellowtail in Guyana and Bacalhau in Brazil.

Beyond our key 2025 startups, we announced our eighth carbon capture and storage contract -- this time, our first bioenergy agreement -- with AtmosClear to transport and permanently store biogenic CO2 from Its greenfield biopower plant project located in Louisiana. This brings our total CO2 under contract for CCS with third-party customers to more than 10 MTA, far more than any other company to date.

And we continue to advance our long-term technology-led growth ambitions. In addition to smaller inorganic investment activity during the quarter, we capitalize on exciting and material growth opportunities in both our Product Solutions and our Upstream businesses.

First, in Product Solutions, we announced the acquisition of key assets from Superior Graphite, a leader in graphite and carbon materials, accelerating our entry into the battery anode materials market. This acquisition is a strong strategic fit, bringing together Superior Graphite's differentiated furnace technology and know-how with our own core process capabilities, our proprietary technology, and our advantaged feedstock in a way that uniquely positions us to deliver breakthrough solutions that can change the game for the energy storage and auto sectors.

And in Upstream, we acquired more than 80,000 net acres in the Permian Basin from Sinochem Petroleum. This acreage expands the opportunities to leverage our technology advantages, like lightweight proppant and next-generation cube design. We know our competitive advantages and know the value they bring, especially in the Permian Basin. By applying our superior technology, our execution excellence and scale, we can unlock value for our shareholders in a way that is very much aligned with the one-plus-one-must-equal-three-or-more approach to acquisitions we have been describing for some time.

We are constantly investing in new technologies. Our newest supercomputer, named Discovery 6, one of the top 20 most powerful supercomputers in the world, was brought online this quarter here on our Houston campus in partnership with Hewlett Packard Enterprise and NVIDIA. Among other uses, this new supercomputer materially accelerates our ability to review and act on exploration data.

The deployment of our cutting-edge 4D seismic technology using this high-performance computing will revolutionize reservoir management, enabling enhanced real-time visualization of the subsurface, better well placement, and increased resource recovery with less capital. With these technologies, we can now do in a week what used to take months to increase resource recovery and potentially open up new exploration opportunities.

This past quarter, we returned $9.4 billion to shareholders through dividends and share buybacks. That's nearly $28 billion so far this year. We consistently and reliably return capital to our shareholders while continuing to invest in our differentiated opportunity set and maintaining an industry-leading balance sheet.

In December of last year, we laid out our plans to 2030, growing more profitable barrels, more high-value products, and lower costs. By leveraging our full suite of technologies and by maintaining operational excellence, we're accelerating delivery of those plans in 2025.

In the Upstream, our advantaged assets in the Permian, Guyana, and LNG made up more than 50% of our production to start the year. Year to date, we've continued to increase this percentage, well on our way to our plan of more than 60% by 2030. These improvements have been a key driver for our industry-leading improvement in unit earnings since 2019. We continue to build on that momentum, with unit earnings year to date of over $11 per barrel on a constant price basis.

In the third quarter, Yellowtail and Guyana started up, our fourth and largest-to-date offshore oil development in the country. With Yellowtail now online, we delivered record Guyana production during the quarter. We also took the final investment decision on our seventh project on the Stabroek Block, Hammerhead, which is expected to bring online 150,000 barrels per day in 2029. By the end of 2030, we expect to have total production capacity of 1.7 million oil equivalent barrels per day from eight developments in Guyana.

In Product Solutions, we're improving earnings by growing high-value products through advantaged projects. This year, we've laid the groundwork for future earnings growth by bringing projects like the Singapore Resid Upgrade Unit and the Fawley hydrofiner online. By 2030, we expect additional projects, like our recently FID'd major reconfiguration project in Baytown, to continue driving profitable growth and increasing Product Solutions earnings. By 2030, we expect high-value products to drive more than 40% of our Product Solutions earnings potential.

We are delivering on these growth projects while also reducing costs. Last December, we set a plan for an additional $6 billion of savings between 2024 and 2030. We've already added an additional $2.2 billion of structural cost savings, over a third of the way to our post-2024 plans in just nine months.

Our track record is clear. The cumulative savings in this area equate to roughly one-third of our current earnings per share. Our teams continue to optimize the business and bring value to our shareholders. Our commitment to increasing profitability, executing with excellence, and controlling costs will drive value for our shareholders well into the future and in any price environment.

In a capital-intensive business like ours, delivering major projects at industry-leading investment costs on time and on budget, or better still, ahead of schedule and under budget, is essential to driving leading shareholder returns. This is a great example of what we mean by execution excellence. And since we created our centralized Global Projects organization in 2019, consolidating decades of project management expertise, our performance in this area, completing large and complex projects at an advantage versus industry, has continued to improve.

This year, we completed more strategic projects than ever before. Our ability to execute multiple large complex projects simultaneously to the highest standard is a unique competitive advantage that will continue to keep Exxon Mobil in a league of its own to 2030 and well beyond.

To get a sense of our scale, we are delivering about three times as many mega projects, defined as those with capital costs in excess of $5 billion, as our nearest IOC competitor. Scale and deep proficiency enable project costs 10% to 20% lower and project delivery dates 20% faster than the industry average. Since its formation, Global Projects have been a cornerstone of our success globally.

In Guyana, we've now delivered four major deepwater developments, with Yellowtail started this year, and have three additional FPSOs in fabrication. We expanded our advantaged Chemical Products' global footprint with two world-scale newbuild steam crackers on the US Gulf Coast and in China. We started up an integrated complex with new-to-the-world technology to high-grade our refined products in Singapore. And we are advancing several major investments in LNG, in deepwater, and new markets for the coming years.

Just to highlight some of the broad range of work being performed by this organization, none of our competitors are developing as many mega projects or delivering at an industry-leading cost and schedule as we are. Since its formation, the Global Projects organization has realized tremendous capital cost savings which, by 2030, should total $10 billion. This organization epitomizes the core strength of Exxon Mobil, leveraging execution excellence, technology, integration, scale, and, of course, our talented people.

Turning to our third-quarter results, we delivered another strong quarter of both earnings and cash flow. We reported earnings of $7.5 billion, or $8.1 billion excluding identified items. Cash flow from operations was $14.8 billion underpinned by record production in both Permian and Guyana. Since 2019, we've delivered over $14 billion in structural cost savings, well on our way to achieving our 2030 plan.

Our cash CapEx was $8.6 billion for the quarter, which included approximately $2.4 billion for cash-funded growth acquisitions. Excluding this M&A activity, we expect our full-year cash CapEx to be slightly below the lower end of our prior guidance of $27 billion to $29 billion for the year. And our balance sheet remained the strongest of the IOCs, with a net debt to capital ratio of just 9.5%.

Our shareholder distributions remain consistent and predictable. We distributed $9.4 billion to shareholders this quarter, bringing our year-to-date total to nearly $28 billion. We remain on track for $20 billion of share repurchases this year, in line with our previous guidance. We've also announced an increase to our quarterly dividend of $0.04 to $1.03 per share. This year now marks our 43rd consecutive year of growing annual dividend per share payments, a longer track record than 95% of the companies in the S&P 500.

Our integrated model is a valuable, competitive advantage that ensures portfolio strength and stability across commodity cycles. Looking at the industry more broadly, third-quarter prices and refining margins were within the 10-year band. Crude prices were up slightly for the quarter due to strong demand, despite news of increased OPEC+ supply.

Robust demand kept natural gas prices at the top of the 10-year range. Refining margins improved due to continued high demand and diesel supply disruptions in Russia and in the Middle East. Chemical margins remain at the bottom of cycle as oversupply persists.

Looking at our earnings year to date, we continue to deliver strong results and drive value for our shareholders. Our year-to-date GAAP earnings are $22.3 billion. Earnings excluding identified items are $22.9 billion, down $3.2 billion versus last year, primarily driven by lower market prices. This is partially offset by advantaged volume growth and structural cost reductions, contributing $3.4 billion. These two categories highlight the value of our focus on profitable barrels, higher-value products, and cost discipline. Lastly, expenses are up $1.2 billion, driven by higher Tengiz depreciation costs and startup costs from new projects.

Looking at the sequential quarterly results, we had third-quarter GAAP earnings of $7.5 billion. Earnings excluding identified items were $8.1 billion, up $1 billion from the second quarter. This was the result of higher prices and margins, along with growth in advantaged production and disciplined cost management.

Now, let's look at cash flow. We generated $14.8 billion in cash flow in the third quarter, as our businesses continued to deliver strong results. Distributions to shareholders were $9.4 billion this quarter, including over $4.2 billion in dividends and just over $5 billion in share repurchases. We continue to reward our shareholders with strong and reliable distributions.

Our cash CapEx for the third quarter was $8.6 billion, including $2.4 billion for the cash-funded growth M&A I described earlier. Our industry-leading balance sheet enables the consistency and reliability you've come to expect from Exxon Mobil.

Looking to the fourth quarter, in the Upstream, we had about $400 million of net favorable tax and asset management items in the third quarter that we do not expect to repeat in the fourth quarter. Our full-year Permian production outlook is now 1.6 million oil equivalent barrels per day. Our total production guidance remains unchanged at 4.7 million oil equivalent barrels per day.

In Product Solutions, the China Chemical Complex and Singapore Resid Upgrade projects will continue to ramp up through year-end. We expect fourth-quarter corporate and financing expenses to be $600 million to $800 million. Excluding the cash-funded acquisitions which I described, we expect to be slightly below the lower end of our full-year cash CapEx guidance.

I'd also note that we typically see seasonally higher operating expenses across our businesses in the fourth quarter. For details on that, you can see prior year quarterly operating expense trends in our modeling toolkit located in the Investors section of our website.

In summary, we've built a company that is designed to lead through commodity cycles, one that is built on cost discipline, execution excellence, technology advancements, long-term growth, and delivering shareholder returns. We continue to reliably deliver, proving year in and year out that we are truly in a league of our own.

We look forward to connecting with you on December 9 for our corporate plan update, where we will spend more time discussing our exciting plans for the future.