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ExxonMobil's earnings hit record $40.6 billion in 2007
Helped by $90 and $100-a-barrel oil, ExxonMobil announced Friday that earnings increased 4 percent to a record $40.6 billion in 2007. That’s $4.6 million an hour, roughly the gross domestic product of Costa Rica and Uruguay combined.

The country’s biggest company also set a record for highest quarterly results. Irving-based ExxonMobil saw net income rise 14 percent to $11.7 billion, or $2.13 a share while its nearest rival, California-based Chevron said profits climbed 29 percent to $4.88 billion, or $2.32 a share.

Unlike recent years, there was no immediate outcry from consumer groups and critics in Congress over Big Oil’s profits.

One exception was Rep Ed Markey, D-Mass., who said in an e-mail statement quoted by Bloomberg news: “While the oil companies are turning the American consumer upside down at the pump, shaking out every last cent, the White House is defending unnecessary giveaways and tax breaks to big oil.”

The subprime mortgage crisis has monopolized attention, said Dan Short, dean of Texas Christian University’s Neeley School of Business, explaing the paucity of angry backlash. “Being the biggest, they have long been the poster child or lightning rod for any issue that comes up,” Short said.

The annual results, which beat financial analysts’ collective prediction by 18 cents, gave little indication of how the average motorist will fare at the pump this year. Company spokesman Alan Jeffers stressed that ExxonMobil, which handles about 3 percent of hydrocarbons burned by world, doesn’t set oil prices.

All of the attention on the amount that Exxon-Mobil earns is misplaced, Jeffers said, decrying the translation of it into dollars per hour or minute. Putting it into perspective, he said it amounted to about 10 cents on every dollar of revenue — half what many in the pharmaceutical industry earn — and less than the 25 cents per greenback ExxonMobil pays in taxes.

Some analysts saw a gray lining in Exxon’s pearly white cloud, noting difficulties the large integrated energy companies are having in finding new high-yielding fields in the face of growing assertiveness by national oil companies.

“Even to show a 1 percent increase in this environment, big projects are getting hard to find,” said Brian Youngberg, an industry analyst with Edward Jones in St. Louis.

“And there definitely is a heightened aggressivenes by some countries,” Youngberg said. “Whether there will be more extreme cases like Venezuela (which ExxonMobil after the country demanded a joint venture with a state firm), only time will tell. The landscape is changing and they’ll have to adapt.

“They can boost production through acquisitions,” Youngberg said. “But that’s tough because there are not too many companies out there at the scale that would move the needle.”

Jeffers noted that Exxon has 19 major projects to be implemented over the next three years that could potentially bring in 1.3 billion barrels of oil a day and 7.3 billion cubic feet of gas for it and its partners.

The company said a project 90 miles off the coast of Angola is “ahead of schedule and within budget,” while UBS Investment Research noted medium-term growth was possible from fields in Qatar, Nigeria, and Russia’s Sakhalin island.

But the spokesman held out little hope of the biggest energy company changing its long standing policy and diversifying into alternative sources like wind and solar any time soon.

ExxonMobil bought back 6 percent of its shares, up sharply from recent years, which pleased the stock market. “Investors are willing to sacrifice a bit on the production side if they can make it up on the buy-back side,” said Youngberg of Edward Jones.

It’s nifty having the largest of the major oil companies based in North Texas, said TCU’s Short. But aside from salaries from from more than 10,000 in Houston and several hundred in Irving, Fort Worth-based “XTO probably invests more in infrastructure in the state.”

Although earning beat analysts’ forecast, shares in ExxonMobil (Ticker: XOM) closed down 45 cents, or .52 percent, to finish at $85.95 on the New York Stock Exchange.
http://www.star-telegram.com/business/story/448056.html