Exxon concludes the second quarter with £840 million of net loss

Exxon concludes the second quarter with £840 million of net loss
Written by:
Wajeeh Khan
31st July, 16:00
  • Exxon Mobil Corp concludes the second quarter with £840 million of net loss.
  • The company's board declares a 66.21 pence per share of Q3 dividend on Friday.
  • The American multinational energy company may resort to deeper job and cost cuts.

Exxon Mobil Corporation (NYSE: XOM) revealed to have swung to a net loss of £840 million in the fiscal second quarter on Friday. The company attributed its loss to the Coronavirus pandemic that weighed heavily on global oil prices in recent months. Its peer, Chevron, also reported to have concluded its Q2 in loss on Friday.

Shares of the company opened roughly 2% down on Friday but jumped 1% in the next hour. At £31.51 per share, Exxon is currently 40% down year to date in the stock market after recovering from an even lower £23.93 per share in March when the impact of COVID-19 was at its peak. Learn more about how can you start trading on the stock market.

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Exxon’s Q2 financial results versus analysts’ estimates

According to Refinitiv, experts had forecast the company to print £29.04 billion in revenue in the second quarter. In terms of loss per share, they had estimated 46.42 pence. In its report on Friday, Exxon fell shy of both estimates posting a much lower £24.82 billion in revenue and a much higher 53.27 pence of adjusted loss per share. In Q2.

In the same quarter last year, the U.S. oil major had recorded £52.58 billion in revenue and 55.55 of adjusted earnings per share.

On a year over year basis, Exxon noted a 7% decline in oil-equivalent production. Nonetheless, the American multinational oil and gas corporation reiterated on Friday that it does not plan on slashing its dividend to shore up finances amidst COVID-19 and lower oil prices. Its board declared a 66.21 pence per share of Q3 dividend on Friday.

Exxon to resort to deeper job and cost cuts

The company, however, is likely to resort to deeper job and cost cuts in upcoming months to cushion the economic blow from the Coronavirus pandemic. According to CEO Darren Woods of Exxon:

“The global pandemic and oversupply conditions significantly impacted our second quarter financial results with lower prices, margins, and sales volumes. We have increased debt to a level we feel is appropriate to provide liquidity, given market uncertainties. Based on current projections, we do not plan to take on any additional debt.”

Exxon’s performance in the stock market was reported flat on average in 2019. At the time of writing, the Irving-based energy company has a market cap of £134 billion and a price to earnings ratio of 15.63.

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