View of the ExxonMobil oil refinery in Baytown, Texas.
Jessica Rinaldi (Reuters)
Exxon Mobil (Exxon Mobil) on Friday announced a third consecutive quarter of losses due to the sluggish oil demand caused by the coronavirus pandemic that put pressure on the company̵
In the third quarter, the company lost $680 million, although Exxon Mobil stated that quarter-on-quarter results increased due to “early stages of demand recovery.”
Adjusted Exxon Mobil lost 18 cents per share in the third quarter, and revenue was 46.2 billion US dollars. According to Refinitiv’s estimates, Wall Street expects a loss of 25 cents per share and revenue of $46.01 billion.
In the third quarter of last year, the company earned 75 cents per share on revenue of $65.05 billion. In the second quarter of 2020, Exxon Mobil posted an adjusted loss of 70 cents per share and revenue of $32.61 billion.
Darren Woods, Chairman and CEO of Exxon Mobil, said: “We are confident in our long-term strategy and business foundation, and are taking the necessary measures to protect our balance sheet and dividends while maintaining value.” “We We are working hard to achieve the goal of reducing costs in 2020, and while we pass this unprecedented decline cycle, we will further save money next year.”
Exxon Mobil previously announced that it will cut its capital expenditure plan from 33 billion U.S. dollars to 23 billion U.S. dollars. The company said that it completed the plan ahead of schedule due to efficiency improvements and project slowdowns. The company’s 2021 capital plan targets between US$16 billion and US$19 billion.
Exxon Mobil said on Thursday that it intends to reduce its US employees by approximately 1,900, and the number of global layoffs may rise to 15%. As of the end of 2019, ExxonMobil had a total of 88,300 employees worldwide, including 13,300 contractors.
As oil and gas companies continue to struggle to cope with the continued decline in demand caused by Covid-19, some companies have announced dividend reductions to cut costs.
ExxonMobil has repeatedly stated that dividends are still a priority, and on Wednesday, the company maintained its fourth-quarter dividend at 87 cents per share. However, this is the first time since 1982 that the company has not raised its dividend. The company’s current yield is 10.56%.
The research firm Edward Jones pointed out that if demand cannot be fully recovered, Exxon Mobil will have to cut dividends in 2021.
For ExxonMobil, these have been difficult months. In August, the company was removed from the Dow Jones Industrial Average. Chevron also recently surpassed ExxonMobil for the first time as the US energy company with the highest market value, although ExxonMobil’s current market valuation is higher than that of Chevron.
In premarket trading on Friday, Exxon Mobil shares fell 1%. In 2020, the stock price fell 52%.
subscription CNBC Professional Edition To gain unique insights and analysis, as well as real-time workday programs from all over the world.