HOUSTON (AP) — Oil giant Exxon Mobil Corp. today posted the largest annual profit by a U.S. company — $39.5 billion — even as earnings for the last quarter of 2006 declined 4 percent.
The 2006 profit topped the previous record, also by Exxon Mobil, of $36.13 billion set in 2005. The record earnings amounted to roughly $4.5 million an hour for the world’s largest publicly traded oil company, which produces about 3 percent of the world’s oil.
It also equals the approximate gross domestic product — a measure of all goods and services produced within a country in a given year — of countries such as Ecuador, Luxembourg and Croatia.
Also eye-popping was Exxon Mobil’s revenue, which rose to $377.64 billion for the year, surpassing the record $370.68 billion it posted in 2005.
Still, it marked the first time since the third quarter of 2002 that the Irving, Texas, company had a year-over-year quarterly earnings decline.
Exxon Mobil’s record annual earnings followed a year of extraordinarily high energy prices as crude oil topped $78 a barrel in the summer — driving up average gasoline prices in the United States to more than $3 a gallon. Prices retreated later in the year.
The fourth-quarter decline reflects lower profits from Exxon’s refining and marketing operations and a sharp drop-off in natural gas prices.
The company said earnings from exploration and production were $6.2 billion for the quarter, down from about $7 billion in the fourth quarter of 2005. Earnings also fell on the refining and marketing side to $1.96 billion in the most recent quarter from $2.4 billion a year ago.
Oil production for the quarter was up slightly from a year ago, while natural gas production was off slightly.
The company said it ended 2006 with $32.8 billion in cash and debt of $8.3 billion. Chairman Rex W. Tillerson and other company executives plan to meet with Wall Street analysts March 7 to discuss business plans.
Exxon Mobil’s results for the October-December period mimicked those of U.S. competitor ConocoPhillips, which last week said its fourth-quarter profit fell 13 percent — also primarily because of lower natural gas prices and refining margins. However, hefty earnings earlier in the year helped the Houston company post its most profitable year on record, earning $15.55 billion.
ConocoPhillips is the nation’s third-largest integrated oil company, behind Exxon Mobil and Chevron Corp., which is scheduled to report 2006 results tomorrow.
Also today, Royal Dutch Shell PLC reported a 21 percent rise in fourth-quarter earnings, buoyed in part by high energy prices and the sale of some operations. Net profit came to $5.28 billion, up from $4.37 billion. However, excluding divestitures and other one-time items, Shell’s earnings from oil production fell 3 percent, and fourth-quarter sales were flat at $75.5 billion.
The Anglo-Dutch company also said it had taken important steps to bulk up its proven reserves, which were revealed to have been inflated in a 2004 accounting scandal.
At Exxon Mobil, profit for the fourth quarter of 2006 declined to $10.25 billion from the $10.71 billion Exxon earned in the 2005 quarter — a record quarterly profit for any U.S. public company. That best-ever profit came when the price of both natural gas and crude oil skyrocketed in the wake of hurricanes Katrina and Rita, which damaged wells, pipelines and refineries in the key energy-producing Gulf of Mexico.
Analysts largely have predicted declines in fourth-quarter earnings for the big U.S. oil companies because of the moderation in prices.