Major Oil Companies Report 3Q Profits

M.D. Holloway · 10-30-2006, 09:26 AM

Major Oil Companies Report 3Q Profits; ExxonMobil Reports Second Largest Quarterly Profit Ever Recorded By a Publicly Traded U.S. Company

October 23-27, 2006, The major U.S. integrated oil companies, for the most part, continued to report excellent profits for the third quarter 2006, led by ExxonMobil's $10.49 billion in third quarter 2006 earnings, the second-largest quarterly profit ever recorded by a publicly traded U.S. company.

October 26, 2006, ExxonMobil reported third quarter earnings of $10.49 billion, the second-largest quarterly profit ever recorded by a publicly traded U.S. company. The largest quarterly profit ever was ExxonMobil Corp.'s $10.71 billion profit recorded in the fourth quarter of 2005. The $10.49 billion was an increase of 5.8%, or $0.57 billion, from the $9.92 billion reported in the third quarter of 2005. Total revenues for the third quarter 2006 were $99.49 billion, down slightly from $100.72 billion in the third quarter of 2005.

October 26, 2006, Royal Dutch Shell reported net income for the third quarter 2006 of $5.94 billion, down 34% from the $9.03 billion for the third quarter of 2005, although operating profit rose. Third quarter revenues of $84.3 billion for 2006 increased 10% from the 2005 third quarter revenue.

October 24, 2006, BP reported that third quarter profit of $6.23 billion declined 3.6% from the $6.46 billion during the same period in 2005. Revenue climbed 4 percent to $70.7 billion.

October 27, 2006, Chevron Corp. reported that third quarter 2006 net income increased to a new high of $5.02 billion, a 40% increase from $3.59 billion in the same period a year earlier. Revenue for the period was $54.2 billion, slightly down from $54.5 billion in the year earlier period.

October 25, 2006, ConocoPhillips reported third quarter 2006 profit of $3.88 billion, a 2% increase compared to the year earlier period. Revenue for the third quarter 2006, including sales and equity in joint ventures, rose to $49.9 billion, up from $49.66 billion a year earlier.

October 26, 2006, In addition to the above U.S. based oil companies, Petro-Canada announced third quarter net earnings of $678 million, compared to $614 million in the same quarter of 2005.

Superman · 10-30-2006, 09:47 AM

It looks like, as a rule, ten percent of revenue is profit. And you all thought that profits were a small proportion of gasoline sales. So, when you pay $3 for a gallon of gas, $0.30 is oil company profit. What portion is taxes, again?

Rodeo · 10-30-2006, 10:47 AM

Nothing to see here ... move along.

Just don't forget to vote for the party of "family values" next week. The Raymond family that is.

Jim Richards · 10-30-2006, 11:02 AM

Geez, with all that money you'd think he'd get rid of that massive double chin.

Rodeo · 10-30-2006, 11:04 AM

He makes Austin Powers' "Fat Bastard" look like a sympathetic character.

Jim Richards · 10-30-2006, 11:13 AM

Quote:

Originally posted by Rodeo
He makes Austin Powers' "Fat Bastard" look like a sympathetic character.

Yep.

red-beard · red-beard's Garage

Yawn. Supe, depending on the state, more than 10%.

And if I only show 10% profit in my business (oil related) we would be shut down or sold! 35-45% for us is more the norm on a project basis, and 20% after-tax.

Rodeo · 10-30-2006, 12:02 PM

Profits never before realized in the history of civilization .... yawn. $400 Million severances ... yawn. What's for dinner?

widebody911 · widebody911's Garage

Quote:

Originally posted by Jim Richards
Geez, with all that money you'd think he'd get rid of that massive double chin.

Basic Ladder Theory, my friend - when you have that kind of green, you can still get the top shelf pussy; hell, look at Motion...

Rodeo · 10-30-2006, 12:15 PM

For that guy, I think pussy is an extra thick pork chop.

sammyg2 · 10-30-2006, 12:16 PM

10% net profit is not the norm for an oil company, that level would be considered unheard of prior to 2004.
Yes for the past 3 to 4 quarters some of the major oil companies have either approached or slightly exceeded the 10% mark (XOM = 10.5%) but that will be very short lived. You will very soon see them get back to 4 and 5%, maybe as low as 1 or 2 % which was normal for many, many years.

The independent oil companies typically see a profit margin of less than the majors because they don't actually pump oil out of the ground.

To put that in perspective, during a record profit run, when prices and profits were at the highest level ever seen in that industry (10%) the government was taking MORE THAN twice as much in taxes as the oil companies were making.
As prices go up, so do the sales tax, and we are paying sales on tax on excise tax. I love that, getting taxed on tax.

Where's that shipload of british tea again?

Disclaimer: I am currently employed by one of the corporations mentioned in the original post in this thread.

Rodeo · 10-30-2006, 12:24 PM

Do you serve pork chops to the Raymond family?

Disclaimer: I love pork chops

sammyg2 · 10-30-2006, 01:11 PM

Nope, I don't seve food. I try and keep an oil refinery running at maximum capacity so we can supply the wants and needs of the consumer, and then listen to them accuse us of everything under the sun as they take for granted their ability to cruise around in their cars and trucks cheaply.

At least, that's how it stands now. if the "informed voters" decide to pass a certain proposition that will tax oil to the tune of $4 billion a year in kalifornia, I along with just about the entire oil industry will be leaving this fine state.

Are you odd or even?
Which day do you want to wait in line for gasoline, and how much do you expect to pay for your 3 gallon ration? Anyone reember the green, yellow, and red flags at the gas stations?
The kids here probably don't remember, but they will soon understand if that stupid proposition passes.
Then they will have no one to blame but themselves.
of course the silver lining in all this is that Porsches are light weight so they are easy to push.

Superman · 10-30-2006, 02:20 PM

Red-Beard, are we talking about the same thing. Return on investment is not the same as profit / business volume. For example, if Exxon buys and sells a gallon of gasoline five times during the course of a year, and if that gallon costs Exxon about $3, then it has sold $15 worth of gasoline, but has only used $3 of its working capital. So, while profits ($1.50) are only ten percent of volume ($15), profits ($1.50) are HALF of working capital. That's a fifty percent ROI.

So yeah, I know about typical ROI's. And I think the thing you're talking about is not the same as what I'm talking about. Good for you that you earn 35% to 45% ROI. Not the same thing as profits divided by volume.

And I'm interested in your company's FIFTY PERCENT tax bracket. I'm not finding that in the tax tables.

M.D. Holloway · 10-30-2006, 02:32 PM

as I understand it: net margins = profit

lendaddy · 10-30-2006, 02:41 PM

I wonder how this compares to the profit margin/gross revenue of some really useful industries in the US, like....say...lawyers and law firms?

Superman · 10-30-2006, 02:41 PM

Yes, net margins = profits. Net margins is profit as a percent of business volume.

Simple example: Company starts with $3 in equity. Borrows another $3. That's debt. Company buys two gallons of gas, and resells them making 10% profit. That's $0.60 profit. Return on investment is 20%......if the company only does this once in a year. Let's say this company does this five times. Business volume is now $31, and net profit is $3. Net profit has remained at 10%, but profits as a percentage of investment (return on investment) is 100%.

That'd purdy good.

lendaddy · 10-30-2006, 02:50 PM

Quote:

Originally posted by Superman
Yes, net margins = profits. Net margins is profit as a percent of business volume.

Simple example: Company starts with $3 in equity. Borrows another $3. That's debt. Company buys two gallons of gas, and resells them making 10% profit. That's $0.60 profit. Return on investment is 20%......if the company only does this once in a year. Let's say this company does this five times. Business volume is now $31, and net profit is $3. Net profit has remained at 10%, but profits as a percentage of investment (return on investment) is 100%.

That'd purdy good.

ROI??? Based in relation to opening equity?? In a mature company, what's the point?

M.D. Holloway · 10-30-2006, 02:51 PM

Quote:

Originally posted by lendaddy
I wonder how this compares to the profit margin/gross revenue of some really useful industries in the US, like....say...lawyers and law firms?

Tough one to compare - the raw materials and process costs are not as defined. More slop and spin in the service industry. When you have measurables like crude and production costs (energy bills, labor, equipment) than it is a little more cut and dry. When lawyers or any service is involved your costs are people. How do you put a value on that? Going rate for a decent lawyer is $325/hr (less if they are less experienced more if they are Danny Crane).

Still, how do you determine the hourly value of a service? Is it the mean of the competition that sets it? I know that when I freelance I charge X$/word for an article or and hourly rate which can either A) Take into account several factors or B) Set to make a certain $$$ and back into it.

dtw · 10-30-2006, 02:56 PM

Quote:

Originally posted by Superman
It looks like, as a rule, ten percent of revenue is profit. And you all thought that profits were a small proportion of gasoline sales. So, when you pay $3 for a gallon of gas, $0.30 is oil company profit. What portion is taxes, again?

Here they're over $0.55 per gallon, or based on what I'm currently paying at the pump, over 25%. Nice try, though, Soup.

I'm not digging you though...I'd be in favor of $2.55 per gallon tax - I'd listen to just about any proposed measure to break the back of our oil dependency, and fast. I'm as guilty as the next guy, at an average of 24.5 mpg in my daily driver. It is shameful that our nation's average MPG has stagnated since 1981. It is insult to injury to see how laughable many of the current hybrid offerings are, with very poor payoff when analyzing incremental cost of the hybrid against pump savings per mile driven. I digress.

No animosity toward the oil companies either though, let them smoke 'em while they got 'em. Although I'm not sure most people know where their petro-dollars are going. My wife for example was more than a little shocked when I told her any gas she bought was funding Chavez & Co's little banana republic (she's outspoken anti-Chavez).

I think I had a point when I started writing this...