PART I. FINANCIAL INFORMATION | | | | | | | | | | | | Item 1. Financial Statements |
| | | | | | | | | | | | | | | | EXXON MOBIL CORPORATION |
| CONDENSED CONSOLIDATED STATEMENT OF INCOME |
| (millions of dollars) |
| | | | | | | | | | | | | | | | | ��
| | |
| Three Months Ended | | | Nine Months Ended
| | | | |
| September 30,March 31,
| | | September 30,
| |
|
| | | 2013
| | | 2012
| | | 2013
| | | 2012
| Revenues and other income
| | | | | 2014 |
|
| 2013 |
| Revenues and other income | | | | | | | | | Sales and other operating revenue (1) | | | 108,390101,760
| | | 110,989103,378
| | | 314,818
| | | 342,348
| | Income from equity affiliates | | | 3,4444,108
| | | 3,3864,418
| | | 10,960
| | | 11,247
| | Other income | | | 538905
| | | 766561
| | | 1,617
| | | 12,387
| | | Total revenues and other income | | | 112,372106,773
| | | 115,141108,357
| | | 327,395
| | | 365,982
| Costs and other deductions | | | | | | | | | | | | | | Crude oil and product purchases | | | 63,96158,314
| | | 64,61559,449
| | | 183,088
| | | 200,209
| | Production and manufacturing expenses | | | 9,84210,088
| | | 9,1289,736
| | | 29,856
| | | 28,765
| | Selling, general and administrative expenses | | | 3,1503,132
| | | 3,4683,118
| | | 9,536
| | | 10,555
| | Depreciation and depletion | | | 4,2874,192
| | | 4,0374,110
| | | 12,802
| | | 11,778
| | Exploration expenses, including dry holes | | | 486317
| | | 494445
| | | 1,385
| | | 1,388
| | Interest expense | | | 5266
| | | 5924
| | | 161
| | | 216
| | Sales-based taxes (1) | | | 7,8827,416
| | | 8,1377,492
| | | 22,926
| | | 24,657
| | Other taxes and duties | | | 8,5238,021
| | | 7,8837,945
| | | 24,646
| | | 27,388
| | | Total costs and other deductions | | | 98,18391,546
| | | 97,82192,319
| | Income before income taxes | | | 284,40015,227
| | | 304,95616,038
| | | Income before income taxes | | | 14,1895,857
| | | 17,3206,277
| | Net income including noncontrolling interests | | | 42,9959,370
| | | 61,0269,761
| | | Income taxesNet income attributable to noncontrolling interests
| | | 6,120270
| | | 7,394261
| | Net income attributable to ExxonMobil | | | 18,1909,100
| | | 23,647
| Net income including noncontrolling interests9,500
| | | 8,069
| | | 9,926
| | | 24,805
| | | 37,379
| | Net income attributable to noncontrolling interests
| | | 199
| | | 356
| | | 575
| | | 2,449
| Net income attributable to ExxonMobil
| | | 7,870
| | | 9,570
| | | 24,230
| | | 34,930
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Earnings per common share (dollars) | | | 1.792.10
| | | 2.092.12
| | | 5.46
| | | 7.50
| | | | | | | | | | | | | | | Earnings per common share - assuming dilution (dollars) | | | 1.792.10
| | | 2.092.12
| | | 5.46
| | | 7.50
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | Dividends per common share (dollars) | | | 0.63 | | | 0.57 | | | 1.83
| | | 1.61
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | (1) Sales-based taxes included in sales and other operating revenue | |
|
|
|
|
|
|
|
|
|
|
| | | operating revenue7,416
| | | 7,8827,492
| |
| 8,137
|
|
| 22,926
|
|
| 24,657
|
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
EXXON MOBIL CORPORATION | CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | September 30, | | | September 30, | | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | | | | | | | | | | Net income including noncontrolling interests | | | 8,069 | | | 9,926 | | | 24,805 | | | 37,379 | Other comprehensive income (net of income taxes) | | | | | | | | | | | | | | Foreign exchange translation adjustment | | | 1,229 | | | 1,620 | | | (2,317) | | | 1,298 | | Adjustment for foreign exchange translation (gain)/loss | | | | | | | | | | | | | | | | included in net income | | | - | | | (119) | | | - | | | (4,354) | | Postretirement benefits reserves adjustment | | | | | | | | | | | | | | | | (excluding amortization) | | | (222) | | | (224) | | | (58) | | | (404) | | Amortization and settlement of postretirement benefits reserves | | | | | | | | | | | | | | | | adjustment included in net periodic benefit costs | | | 455 | | | 454 | | | 1,353 | | | 2,083 | | | Total other comprehensive income | | | 1,462 | | | 1,731 | | | (1,022) | | | (1,377) | Comprehensive income including noncontrolling interests | | | 9,531 | | | 11,657 | | | 23,783 | | | 36,002 | | Comprehensive income attributable to | | | | | | | | | | | | | | | | noncontrolling interests | | | 331 | | | 541 | | | 420 | | | 1,062 | Comprehensive income attributable to ExxonMobil | | | 9,200 | | | 11,116 | | | 23,363 | | | 34,940 |
EXXON MOBIL CORPORATION | | CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended | | | | | | | | | | March 31, | | | | | | | | | | 2014 | | | 2013 | | | | | | | | | | | | | | | Net income including noncontrolling interests | | | | 9,370 | | | 9,761 | | | Other comprehensive income (net of income taxes) | | | | | | | | | | | Foreign exchange translation adjustment | | | | (786) | | | (1,209) | | | | Adjustment for foreign exchange translation (gain)/loss included in net income | | | 82 | | | - | | | | Postretirement benefits reserves adjustment (excluding amortization) | | | (84) | | | 65 | | | | Amortization and settlement of postretirement benefits reserves adjustment | | | | | | | | | | | | included in net periodic benefit costs | | | | 316 | | | 444 | | | | Unrealized change in fair value of stock investments | | | (54) | | | - | | | | | Total other comprehensive income | | | | (526) | | | (700) | | | Comprehensive income including noncontrolling interests | | | 8,844 | | | 9,061 | | | | Comprehensive income attributable to noncontrolling interests | | | 59 | | | 144 | | | Comprehensive income attributable to ExxonMobil | | | | 8,785 | | | 8,917 | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
EXXON MOBIL CORPORATION | EXXON MOBIL CORPORATION | | EXXON MOBIL CORPORATION | | CONDENSED CONSOLIDATED BALANCE SHEET | CONDENSED CONSOLIDATED BALANCE SHEET | | CONDENSED CONSOLIDATED BALANCE SHEET | | (millions of dollars) | (millions of dollars) | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | | | Sept. 30, | | | Dec. 31, | | | | | | | Mar. 31, | | | Dec. 31, | | | | | | | | 2013 | | | 2012 | | | | | | | 2014 | | | 2013 | | Assets | Assets | | | | | | | Assets | | | | | | | | Current assets | | | | | | | Current assets | | | | | | | | | Cash and cash equivalents | | | 5,310 | | | 9,582 | | | Cash and cash equivalents | | | 5,601 | | | 4,644 | | | | Cash and cash equivalents – restricted | | | 439 | | 341 | | | Cash and cash equivalents – restricted | | | 204 | | 269 | | | | Notes and accounts receivable – net | | | 33,230 | | 34,987 | | | Notes and accounts receivable – net | | | 32,480 | | 33,152 | | | | Inventories | | | | | | | | Inventories | | | | | | | | | | Crude oil, products and merchandise | | | 12,829 | | 10,836 | | | | Crude oil, products and merchandise | | | 14,439 | | 12,117 | | | | | Materials and supplies | | | 4,038 | | 3,706 | | | | Materials and supplies | | | 4,129 | | 4,018 | | | | Other current assets | | | 5,457 | | 5,008 | | | Other current assets | | | 5,011 | | 5,108 | | | | | Total current assets | | | 61,303 | | 64,460 | | | | Total current assets | | | 61,864 | | 59,308 | | | Investments, advances and long-term receivables | | | 37,048 | | 34,718 | | Investments, advances and long-term receivables | | | 37,169 | | 36,328 | | | Property, plant and equipment – net | | | 240,981 | | 226,949 | | Property, plant and equipment – net | | | 245,897 | | 243,650 | | | Other assets, including intangibles – net | | | 8,232 | | 7,668 | | Other assets, including intangibles – net | | | 8,103 | | 7,522 | | | | | Total assets | | | 347,564 | | | 333,795 | | | | Total assets | | | 353,033 | | | 346,808 | | | | | | | | | | | | | �� | | | | | | | | Liabilities | Liabilities | | | | | | | Liabilities | | | | | | | | Current liabilities | | | | | | | Current liabilities | | | | | | | | | Notes and loans payable | | | 13,889 | | | 3,653 | | | Notes and loans payable | | | 9,223 | | | 15,808 | | | | Accounts payable and accrued liabilities | | | 51,260 | | 50,728 | | | Accounts payable and accrued liabilities | | | 52,109 | | 48,085 | | | | Income taxes payable | | | 7,600 | | 9,758 | | | Income taxes payable | | | 8,776 | | 7,831 | | | | | Total current liabilities | | | 72,749 | | 64,139 | | | | Total current liabilities | | | 70,108 | | 71,724 | | | Long-term debt | | | 7,404 | | 7,928 | | Long-term debt | | | 12,144 | | 6,891 | | | Postretirement benefits reserves | | | 25,319 | | 25,267 | | Postretirement benefits reserves | | | 20,215 | | 20,646 | | | Deferred income tax liabilities | | | 39,506 | | 37,570 | | Deferred income tax liabilities | | | 40,783 | | 40,530 | | | Long-term obligations to equity companies | | | 4,636 | | 3,555 | | Long-term obligations to equity companies | | | 4,877 | | 4,742 | | | Other long-term obligations | | | 22,472 | | 23,676 | | Other long-term obligations | | | 22,015 | | 21,780 | | | | | Total liabilities | | | 172,086 | | | 162,135 | | | | Total liabilities | | | 170,142 | | | 166,313 | | | | | | | | | | | | | | | | | | | | | Commitments and contingencies (Note 2) | Commitments and contingencies (Note 2) | | | | | | | Commitments and contingencies (Note 2) | | | | | | | | | | | | | | | | | | | | | | Equity | Equity | | | | | | | Equity | | | | | | | | Common stock without par value | | | | | | | Common stock without par value | | | | | | | | | (9,000 million shares authorized, 8,019 million shares issued) | | | 10,062 | | 9,653 | | | (9,000 million shares authorized, 8,019 million shares issued) | | | 10,276 | | 10,077 | | | Earnings reinvested | | | 381,832 | | 365,727 | | Earnings reinvested | | | 393,800 | | 387,432 | | | Accumulated other comprehensive income | | | (13,051) | | (12,184) | | Accumulated other comprehensive income | | | (11,040) | | (10,725) | | | Common stock held in treasury | | | | | | | Common stock held in treasury | | | | | | | | | (3,650 million shares at Sept. 30, 2013 and | | | | | | | (3,725 million shares at Mar. 31, 2014 and | | | | | | | | 3,517 million shares at Dec. 31, 2012) | | | (209,598) | | (197,333) | | | 3,684 million shares at Dec. 31, 2013) | | | (216,638) | | (212,781) | | | | | ExxonMobil share of equity | | | 169,245 | | 165,863 | | | | ExxonMobil share of equity | | | 176,398 | | 174,003 | | | Noncontrolling interests | | | 6,233 | | 5,797 | | Noncontrolling interests | | | 6,493 | | 6,492 | | | | | Total equity | | | 175,478 | | 171,660 | | | | Total equity | | | 182,891 | | 180,495 | | | | | Total liabilities and equity | | | 347,564 | | | 333,795 | | | | Total liabilities and equity | | | 353,033 | | | 346,808 | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
EXXON MOBIL CORPORATION | EXXON MOBIL CORPORATION | | EXXON MOBIL CORPORATION | | CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | | CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS | | (millions of dollars) | (millions of dollars) | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended | | | | | | Three Months Ended | | | | | | | September 30, | | | | | | March 31, | | | | | | | 2013 | | | 2012 | | | | | | 2014 | | | 2013 | | Cash flows from operating activities | Cash flows from operating activities | | | | | | | Cash flows from operating activities | | | | | | | | Net income including noncontrolling interests | | | 24,805 | | | 37,379 | | | | Depreciation and depletion | | | 12,802 | | | 11,778 | | Net income including noncontrolling interests | | | 9,370 | | | 9,761 | | | Changes in operational working capital, excluding cash and debt | | | (2,676) | | | 3,119 | | Depreciation and depletion | | | 4,192 | | | 4,110 | | | Net (gain) on asset sales | | | (511) | | | (11,693) | | Changes in operational working capital, excluding cash and debt | | | 2,452 | | | 2,321 | | | All other items – net | | | 286 | | | 2,363 | | All other items – net | | | (911) | | | (2,600) | | | | Net cash provided by operating activities | | | 34,706 | | | 42,946 | | | Net cash provided by operating activities | | | 15,103 | | | 13,592 | | | | | | | | | | | | | | | | | | | Cash flows from investing activities | Cash flows from investing activities | | | | | | | Cash flows from investing activities | | | | | | | | Additions to property, plant and equipment | | | (25,243) | | | (24,214) | | Additions to property, plant and equipment | | | (7,328) | | | (7,494) | | | Proceeds associated with sales of subsidiaries, property, plant and | | | | | | | Proceeds associated with sales of subsidiaries, property, plant and | | | | | | | | | equipment, and sales and returns of investments | | | 871 | | | 6,850 | | | equipment, and sales and returns of investments | | | 1,111 | | | 360 | | | Additional investments and advances | | | (3,644) | | | (409) | | Additional investments and advances | | | (457) | | | (3,032) | | | Other investing activities – net | | | 527 | | | 1,174 | | Other investing activities – net | | | 368 | | | 112 | | | | Net cash used in investing activities | | | (27,489) | | | (16,599) | | | Net cash used in investing activities | | | (6,306) | | | (10,054) | | | | | | | | | | | | | | | | | | | Cash flows from financing activities | Cash flows from financing activities | | | | | | | Cash flows from financing activities | | | | | | | | Additions to long-term debt | | | 206 | | | 597 | | Additions to long-term debt | | | 5,500 | | | 5 | | | Reductions in long-term debt | | | - | | | (15) | | Additions/(reductions) in short-term debt – net | | | (6,668) | | | 1,587 | | | Additions/(reductions) in short-term debt – net | | | 9,483 | | | (3,506) | | Cash dividends to ExxonMobil shareholders | | | (2,732) | | | (2,561) | | | Cash dividends to ExxonMobil shareholders | | | (8,125) | | | (7,500) | | Cash dividends to noncontrolling interests | | | (58) | | | (105) | | | Cash dividends to noncontrolling interests | | | (225) | | | (287) | | Changes in noncontrolling interests | | | - | | | (1) | | | Changes in noncontrolling interests | | | (1) | | | 198 | | Common stock acquired | | | (3,860) | | | (5,621) | | | Tax benefits related to stock-based awards | | | 14 | | | - | | Common stock sold | | | 2 | | | 2 | | | Common stock acquired | | | (12,696) | | | (15,814) | | | Net cash used in financing activities | | | (7,816) | | | (6,694) | | | Common stock sold | | | 46 | | | 184 | | | | | Net cash used in financing activities | | | (11,298) | | | (26,143) | | | Effects of exchange rate changes on cash | Effects of exchange rate changes on cash | | | (191) | | | 187 | | Effects of exchange rate changes on cash | | | (24) | | | (212) | | Increase/(decrease) in cash and cash equivalents | Increase/(decrease) in cash and cash equivalents | | | (4,272) | | | 391 | | Increase/(decrease) in cash and cash equivalents | | | 957 | | | (3,368) | | Cash and cash equivalents at beginning of period | Cash and cash equivalents at beginning of period | | | 9,582 | | | 12,664 | | Cash and cash equivalents at beginning of period | | | 4,644 | | | 9,582 | | Cash and cash equivalents at end of period | Cash and cash equivalents at end of period | | | 5,310 | | | 13,055 | | Cash and cash equivalents at end of period | | | 5,601 | | | 6,214 | | | | | | | | | | | | | | | | | | | Supplemental Disclosures | Supplemental Disclosures | | | | | | | Supplemental Disclosures | | | | | | | | Income taxes paid | | | 19,871 | | | 17,895 | | Income taxes paid | | | 4,145 | | | 7,220 | | | Cash interest paid | | | 318 | | | 387 | | Cash interest paid | | | 87 | | | 105 | |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
| EXXON MOBIL CORPORATION | | CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ExxonMobil Share of Equity | | | | | | | | | | | | | | | | | Accumulated | | | | | | | | | | | | | | | | | | | | | | | Other | | Common | | | | | | | | | | | | | | | | | | | | | Compre- | | Stock | | ExxonMobil | | Non- | | | | | | | | | Common | | Earnings | | hensive | | Held in | | Share of | | controlling | | Total | | | | | | Stock | | Reinvested | | Income | | Treasury | | Equity | | Interests | | Equity | | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31, 2011 | | | 9,512 | | | 330,939 | | | (9,123) | | | (176,932) | | | 154,396 | | | 6,348 | | | 160,744 | | Amortization of stock-based awards | | | 618 | | | - | | | - | | | - | | | 618 | | | - | | | 618 | | Tax benefits related to stock-based | | | | | | | | | | | | | | | | | | | | | | | awards | | | 252 | | | - | | | - | | | - | | | 252 | | | - | | | 252 | | Other | | | (737) | | | - | | | - | | | - | | | (737) | | | (1,450) | | | (2,187) | | Net income for the period | | | - | | | 34,930 | | | - | | | - | | | 34,930 | | | 2,449 | | | 37,379 | | Dividends – common shares | | | - | | | (7,500) | | | - | | | - | | | (7,500) | | | (287) | | | (7,787) | | Other comprehensive income | | | - | | | - | | | 10 | | | - | | | 10 | | | (1,387) | | | (1,377) | | Acquisitions, at cost | | | - | | | - | | | - | | | (15,814) | | | (15,814) | | | (31) | | | (15,845) | | Dispositions | | | - | | | - | | | - | | | 558 | | | 558 | | | - | | | 558 | Balance as of September 30, 2012 | | | 9,645 | | | 358,369 | | | (9,113) | | | (192,188) | | | 166,713 | | | 5,642 | | | 172,355 | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31, 2012 | | | 9,653 | | | 365,727 | | | (12,184) | | | (197,333) | | | 165,863 | | | 5,797 | | | 171,660 | | Amortization of stock-based awards | | | 593 | | | - | | | - | | | - | | | 593 | | | - | | | 593 | | Tax benefits related to stock-based | | | | | | | | | | | | | | | | | | | | | | | | | awards | | | 200 | | | - | | | - | | | - | | | 200 | | | - | | | 200 | | Other | | | (384) | | | - | | | - | | | - | | | (384) | | | 242 | | | (142) | | Net income for the period | | | - | | | 24,230 | | | - | | | - | | | 24,230 | | | 575 | | | 24,805 | | Dividends – common shares | | | - | | | (8,125) | | | - | | | - | | | (8,125) | | | (225) | | | (8,350) | | Other comprehensive income | | | - | | | - | | | (867) | | | - | | | (867) | | | (155) | | | (1,022) | | Acquisitions, at cost | | | - | | | - | | | - | | | (12,696) | | | (12,696) | | | (1) | | | (12,697) | | Dispositions | | | - | | | - | | | - | | | 431 | | | 431 | | | - | | | 431 | Balance as of September 30, 2013 | | | 10,062 | | | 381,832 | | | (13,051) | | | (209,598) | | | 169,245 | | | 6,233 | | | 175,478 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Nine Months Ended September 30, 2013 | | | | | Nine Months Ended September 30, 2012 | | | | | | | | | Held in | | | | | | | | | | | Held in | | | | | Common Stock Share Activity | | Issued | | Treasury | | Outstanding | | | | | Issued | | Treasury | | Outstanding | | | | | (millions of shares) | | | | | (millions of shares) | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31 | | | 8,019 | | | (3,517) | | | 4,502 | | | | | | 8,019 | | | (3,285) | | | 4,734 | | | | Acquisitions | | | - | | | (141) | | | (141) | | | | | | - | | | (185) | | | (185) | | | | Dispositions | | | - | | | 8 | | | 8 | | | | | | - | | | 10 | | | 10 | | Balance as of September 30 | | | 8,019 | | | (3,650) | | | 4,369 | | | | | | 8,019 | | | (3,460) | | | 4,559 |
| EXXON MOBIL CORPORATION | | CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ExxonMobil Share of Equity | | | | | | | | | | | | | | | | | Accumulated | | | | | | | | | | | | | | | | | | | | | | | Other | | Common | | | | | | | | | | | | | | | | | | | | | Compre- | | Stock | | ExxonMobil | | Non- | | | | | | | | | Common | | Earnings | | hensive | | Held in | | Share of | | controlling | | Total | | | | | | Stock | | Reinvested | | Income | | Treasury | | Equity | | Interests | | Equity | | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31, 2012 | | | 9,653 | | | 365,727 | | | (12,184) | | | (197,333) | | | 165,863 | | | 5,797 | | | 171,660 | | Amortization of stock-based awards | | | 212 | | | - | | | - | | | - | | | 212 | | | - | | | 212 | | Tax benefits related to stock-based | | | | | | | | | | | | | | | | | | | | | | | awards | | | 188 | | | - | | | - | | | - | | | 188 | | | - | | | 188 | | Other | | | (388) | | | - | | | - | | | - | | | (388) | | | 241 | | | (147) | | Net income for the period | | | - | | | 9,500 | | | - | | | - | | | 9,500 | | | 261 | | | 9,761 | | Dividends – common shares | | | - | | | (2,561) | | | - | | | - | | | (2,561) | | | (105) | | | (2,666) | | Other comprehensive income | | | - | | | - | | | (583) | | | - | | | (583) | | | (117) | | | (700) | | Acquisitions, at cost | | | - | | | - | | | - | | | (5,621) | | | (5,621) | | | (1) | | | (5,622) | | Dispositions | | | - | | | - | | | - | | | 391 | | | 391 | | | - | | | 391 | Balance as of March 31, 2013 | | | 9,665 | | | 372,666 | | | (12,767) | | | (202,563) | | | 167,001 | | | 6,076 | | | 173,077 | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31, 2013 | | | 10,077 | | | 387,432 | | | (10,725) | | | (212,781) | | | 174,003 | | | 6,492 | | | 180,495 | | Amortization of stock-based awards | | | 201 | | | - | | | - | | | - | | | 201 | | | - | | | 201 | | Tax benefits related to stock-based | | | | | | | | | | | | | | | | | | | | | | | | | awards | | | 3 | | | - | | | - | | | - | | | 3 | | | - | | | 3 | | Other | | | (5) | | | - | | | - | | | - | | | (5) | | | - | | | (5) | | Net income for the period | | | - | | | 9,100 | | | - | | | - | | | 9,100 | | | 270 | | | 9,370 | | Dividends – common shares | | | - | | | (2,732) | | | - | | | - | | | (2,732) | | | (58) | | | (2,790) | | Other comprehensive income | | | - | | | - | | | (315) | | | - | | | (315) | | | (211) | | | (526) | | Acquisitions, at cost | | | - | | | - | | | - | | | (3,860) | | | (3,860) | | | - | | | (3,860) | | Dispositions | | | - | | | - | | | - | | | 3 | | | 3 | | | - | | | 3 | Balance as of March 31, 2014 | | | 10,276 | | | 393,800 | | | (11,040) | | | (216,638) | | | 176,398 | | | 6,493 | | | 182,891 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended March 31, 2014 | | | | | Three Months Ended March 31, 2013 | | | | | | | | | Held in | | | | | | | | | | | Held in | | | | | Common Stock Share Activity | | Issued | | Treasury | | Outstanding | | | | | Issued | | Treasury | | Outstanding | | | | | (millions of shares) | | | | | (millions of shares) | | | | | | | | | | | | | | | | | | | | | | | | | | | Balance as of December 31 | | | 8,019 | | | (3,684) | | | 4,335 | | | | | | 8,019 | | | (3,517) | | | 4,502 | | | | Acquisitions | | | - | | | (41) | | | (41) | | | | | | - | | | (63) | | | (63) | | | | Dispositions | | | - | | | - | | | - | | | | | | - | | | 7 | | | 7 | | Balance as of March 31 | | | 8,019 | | | (3,725) | | | 4,294 | | | | | | 8,019 | | | (3,573) | | | 4,446 |
The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.
EXXON MOBIL CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. Basis of Financial Statement Preparation These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation's 20122013 Annual Report on Form 10-K. In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature. Prior data has been reclassified in certain cases to conform to the current presentation basis. The Corporation's exploration and production activities are accounted for under the "successful efforts" method. 2. Litigation and Other Contingencies Litigation A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits. Management has regular litigation reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably possible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. For purposes of our contingency disclosures, “significant” includes material matters as well as other matters which management believes should be disclosed. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a material adverse effect upon the Corporation's operations, financial condition, or financial statements taken as a whole. Other Contingencies The Corporation and certain of its consolidated subsidiaries were contingently liable at September 30, 2013,March 31, 2014, for guarantees relating to notes, loans and performance under contracts. Where guarantees for environmental remediation and other similar matters do not include a stated cap, the amounts reflect management’s estimate of the maximum potential exposure. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. | | | | | | As of September 30, 2013 | | | | | | | | | Equity | | | Other | | | | | | | | | | | | Company | | | Third Party | | | | | | | | | | | | Obligations (1) | | | Obligations | | | Total | | | | | | | | | (millions of dollars) | | | | Guarantees | | | | | | | | | | | | | | Debt-related | | | 3,002 | | | 52 | | | 3,054 | | | | | Other | | | 3,572 | | | 4,774 | | | 8,346 | | | | | | Total | | | 6,574 | | | 4,826 | | | 11,400 | | | | | | | | | | | | | | | | | | | (1) ExxonMobil share | | | | | | | | | | | |
| | | | | | As of March 31, 2014 | | | | | | | | | Equity | | | Other | | | | | | | | | | | | Company | | | Third Party | | | | | | | | | | | | Obligations (1) | | | Obligations | | | Total | | | | | | | | | (millions of dollars) | | | | Guarantees | | | | | | | | | | | | | | Debt-related | | | 3,187 | | | 46 | | | 3,233 | | | | | Other | | | 4,309 | | | 4,437 | | | 8,746 | | | | | | Total | | | 7,496 | | | 4,483 | | | 11,979 | | | | | | | | | | | | | | | | | | | (1) ExxonMobil share | | | | | | | | | | | |
Additionally, the Corporation and its affiliates have numerous long-term sales and purchase commitments in their various business activities, all of which are expected to be fulfilled with no adverse consequences material to the Corporation’s operations or financial condition. The Corporation's outstanding unconditional purchase obligations at September 30, 2013,March 31, 2014, were similar to those at the prior year-end period. Unconditional purchase obligations as defined by accounting standards are those long-term commitments that are noncancelable or cancelable only under certain conditions, and that third parties have used to secure financing for the facilities that will provide the contracted goods or services. The operations and earnings of the Corporation and its affiliates throughout the world have been, and may in the future be, affected from time to time in varying degree by political developments and laws and regulations, such as forced divestiture of assets; restrictions on production, imports and exports; price controls; tax increases and retroactive tax claims; expropriation of property; cancellation of contract rights and environmental regulations. Both the likelihood of such occurrences and their overall effect upon the Corporation vary greatly from country to country and are not predictable. In accordance with a nationalization decree issued by Venezuela’s president in February 2007, by May 1, 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil Project. This Project had been operated and owned by ExxonMobil affiliates holding a 41.67 percent ownership interest in the Project. The decree also required conversion of the Cerro Negro Project into a “mixed enterprise” and an increase in PdVSA’s or one of its affiliate’s ownership interest in the Project, with the stipulation that if ExxonMobil refused to accept the terms for the formation of the mixed enterprise within a specified period of time, the government would “directly assume the activities” carried out by the joint venture. ExxonMobil refused to accede to the terms proffered by the government, and on June 27, 2007, the government expropriated ExxonMobil’s 41.67 percent interest in the Cerro Negro Project. ExxonMobil’s remaining net book investment in Cerro Negro producing assets is about $750 million. On September 6, 2007, affiliates of ExxonMobil filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes (ICSID) invoking ICSID jurisdiction under Venezuela’s Investment Law and the Netherlands-Venezuela Bilateral Investment Treaty. The ICSID Tribunal issued a decision on June 10, 2010, finding that it had jurisdiction to proceed on the basis of the Netherlands-Venezuela Bilateral Investment Treaty. The ICSID arbitration proceeding is continuing and a hearing on the merits was held in February 2012. At this time, the net impact of these matters on the Corporation’s consolidated financial results cannot be reasonably estimated. Regardless, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition. An affiliate of ExxonMobil is one of the Contractors under a Production Sharing Contract (PSC) with the Nigerian National Petroleum Corporation (NNPC) covering the Erha block located in the offshore waters of Nigeria. ExxonMobil's affiliate is the operator of the block and owns a 56.25 percent interest under the PSC. The Contractors are in dispute with NNPC regarding NNPC's lifting of crude oil in excess of its entitlement under the terms of the PSC. In accordance with the terms of the PSC, the Contractors initiated arbitration in Abuja, Nigeria, under the Nigerian Arbitration and Conciliation Act. On October 24, 2011, a three-member arbitral Tribunal issued an award upholding the Contractors' position in all material respects and awarding damages to the Contractors jointly in an amount of approximately $1.8 billion plus $234 million in accrued interest. The Contractors petitioned a Nigerian federal court for enforcement of the award, and NNPC petitioned the same court to have the award set aside. On May 22, 2012, the court set aside the award. The Contractors have appealed that judgment. In June 2013, the Contractors filed a lawsuit against NNPC in the Nigerian federal high court in order to preserve their ability to seek enforcement of the PSC in the courts if necessary. At this time, the net impact of this matter on the Corporation's consolidated financial results cannot be reasonably estimated. However, regardless of the outcome of enforcement proceedings, the Corporation does not expect the proceedings to have a material effect upon the Corporation's operations or financial condition.
3. Other Comprehensive Income Information | | | | | | Cumulative | | | Post- | | | | | | | | | | Foreign | | | retirement | | | | | | | | | | Exchange | | | Benefits | | | | | ExxonMobil Share of Accumulated Other | | | Translation | | | Reserves | | | | | | Comprehensive Income | | | Adjustment | | | Adjustment | | | Total | | | | | (millions of dollars) | | | | | | | | | | | | | | | Balance as of December 31, 2011 | | | 4,168 | | | (13,291) | | | (9,123) | | Current period change excluding amounts reclassified | | | | | | | | | | | | from accumulated other comprehensive income | | | 1,159 | | | (351) | | | 808 | | Amounts reclassified from accumulated other | | | | | | | | | | | | comprehensive income | | | (2,603) | | | 1,805 | | | (798) | | Total change in accumulated other comprehensive income | | | (1,444) | | | 1,454 | | | 10 | | Balance as of September 30, 2012 | | | 2,724 | | | (11,837) | | | (9,113) | | | | | | | | | | | | | | | Balance as of December 31, 2012 | | | 2,410 | | | (14,594) | | | (12,184) | | Current period change excluding amounts reclassified | | | | | | | | | | | | from accumulated other comprehensive income | | | (2,118) | | | (52) | | | (2,170) | | Amounts reclassified from accumulated other | | | | | | | | | | | | comprehensive income | | | - | | | 1,303 | | | 1,303 | | Total change in accumulated other comprehensive income | | | (2,118) | | | 1,251 | | | (867) | | Balance as of September 30, 2013 | | | 292 | | | (13,343) | | | (13,051) |
| | | | | | Cumulative | | | Post- | | | | | | | | | | | | | Foreign | | | retirement | | | Unrealized | | | | | | | | | | Exchange | | | Benefits | | | Change in | | | | | ExxonMobil Share of Accumulated Other | | | Translation | | | Reserves | | | Stock | | | | | Comprehensive Income | | | Adjustment | | | Adjustment | | | Investments | | | Total | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | | Balance as of December 31, 2012 | | | 2,410 | | | (14,594) | | | - | | | (12,184) | | Current period change excluding amounts reclassified | | | | | | | | | | | | | | | from accumulated other comprehensive income | | | (1,088) | | | 78 | | | - | | | (1,010) | | Amounts reclassified from accumulated other | | | | | | | | | | | | | | | comprehensive income | | | - | | | 427 | | | - | | | 427 | | Total change in accumulated other comprehensive income | | | (1,088) | | | 505 | | | - | | | (583) | | Balance as of March 31, 2013 | | | 1,322 | | | (14,089) | | | - | | | (12,767) | | | | | | | | | | | | | | | | | | Balance as of December 31, 2013 | | | (846) | | | (9,879) | | | - | | | (10,725) | | Current period change excluding amounts reclassified | | | | | | | | | | | | | | | from accumulated other comprehensive income | | | (555) | | | (93) | | | (54) | | | (702) | | Amounts reclassified from accumulated other | | | | | | | | | | | | | | | comprehensive income | | | 82 | | | 305 | | | - | | | 387 | | Total change in accumulated other comprehensive income | | | (473) | | | 212 | | | (54) | | | (315) | | Balance as of March 31, 2014 | | | (1,319) | | | (9,667) | | | (54) | | | (11,040) |
| | | | | | | | | | | | | | | | | | Three Months Ended | | | Nine Months Ended | | Amounts Reclassified Out of Accumulated Other | | | September 30, | | | September 30, | | | Comprehensive Income - Before-tax Income/(Expense) | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | | Foreign exchange translation gain/(loss) included in net income | | | | | | | | | | | | | (Statement of Income line: Other income) | - | | | 119 | | | - | | | 4,354 | | Amortization and settlement of postretirement benefits reserves | | | | | | | | | | | | | adjustment included in net periodic benefit costs (1) | (648) | | | (654) | | | (1,951) | | | (3,215) | | | | | | | | | | | | | | | | |
| | | | | | | | | | Three Months Ended | | Amounts Reclassified Out of Accumulated Other | | | | | | | March 31, | | Comprehensive Income - Before-tax Income/(Expense) | | | | 2014 | | | 2013 | | | | | | | | | | | (millions of dollars) | | | | | | | | | | | | | | | | Foreign exchange translation gain/(loss) included in net income | | | | | | | | (Statement of Income line: Other income) | | | | (82) | | | - | | Amortization and settlement of postretirement benefits reserves | | | | | | | | | | adjustment included in net periodic benefit costs (1) | (451) | | | (644) | | | | | | | | | | | | | | |
(1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 5 – Pension and Other Postretirement Benefits for additional details.)
| | | | | | Three Months Ended | | | Nine Months Ended | | Income Tax (Expense)/Credit For | | | September 30, | | | September 30, | | | Components of Other Comprehensive Income | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | | Foreign exchange translation adjustment | | | (16) | | | (55) | | | 100 | | | (92) | | Postretirement benefits reserves adjustment | | | | | | | | | | | | | | | Postretirement benefits reserves adjustment | | | | | | | | | | | | | | | | (excluding amortization) | | | 85 | | | 100 | | | 28 | | | 190 | | | Amortization and settlement of postretirement benefits reserves | | | | | | | | | | | | | | | adjustment included in net periodic benefit costs | | | (193) | | | (200) | | | (598) | | | (1,132) | | Total | | | (124) | | | (155) | | | (470) | | | (1,034) |
| | | | | | | | | | | | Three Months Ended | | Income Tax (Expense)/Credit For | | | | | | | | | March 31, | | Components of Other Comprehensive Income | | | | | | | | | 2014 | | | 2013 | | | | | | | | | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | | Foreign exchange translation adjustment | | | | | | | | | (32) | | | 37 | | Postretirement benefits reserves adjustment (excluding amortization) | | | 50 | | | (19) | | Amortization and settlement of postretirement benefits reserves | | | | | | | | | adjustment included in net periodic benefit costs | | | (135) | | | (200) | | Unrealized change in fair value of stock investments | | | 29 | | | - | | Total | | | | | | | | | (88) | | | (182) |
4. Earnings Per Share | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | September 30, | | | September 30, | | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | | | | | | | | | | | | | Earnings per common share | | | | | | | | | | | | | | Net income attributable to ExxonMobil (millions of dollars) | | | 7,870 | | | 9,570 | | | 24,230 | | | 34,930 | | | | | | | | | | | | | | | | Weighted average number of common shares | | | | | | | | | | | | | | | outstanding (millions of shares) | | | 4,395 | | | 4,597 | | | 4,438 | | | 4,657 | | | | | | | | | | | | | | | | | | Earnings per common share (dollars) | | | 1.79 | | | 2.09 | | | 5.46 | | | 7.50 | | | | | | | | | | | | | | | | | | Earnings per common share - assuming dilution | | | | | | | | | | | | | | Net income attributable to ExxonMobil (millions of dollars) | | | 7,870 | | | 9,570 | | | 24,230 | | | 34,930 | | | | | | | | | | | | | | | | Weighted average number of common shares | | | | | | | | | | | | | | | outstanding (millions of shares) | | | 4,395 | | | 4,597 | | | 4,438 | | | 4,657 | | | | Effect of employee stock-based awards | | | - | | | - | | | - | | | - | | Weighted average number of common shares | | | | | | | | | | | | | | | outstanding - assuming dilution | | | 4,395 | | | 4,597 | | | 4,438 | | | 4,657 | | | | | | | | | | | | | | | | | | Earnings per common share - assuming dilution (dollars) | | | 1.79 | | | 2.09 | | | 5.46 | | | 7.50 |
| | | | | | | Three Months Ended | | | | | | | | | March 31, | | | | | | | | | 2014 | | | 2013 | | | | | | | | | | | | | | | Earnings per common share | | | | | | | | | | | | | | | | | | | | | | Net income attributable to ExxonMobil (millions of dollars) | | | 9,100 | | | 9,500 | | | | | | | | | | | | | Weighted average number of common shares outstanding (millions of shares) | | | 4,328 | | | 4,485 | | | | | | | | | | | | | | | Earnings per common share (dollars) (1) | | | | 2.10 | | | 2.12 | | | | | | | | | | | | | |
(1) The calculation of earnings per common share and earnings per common share – assuming dilution are the same in each period shown.
5. Pension and Other Postretirement Benefits
| | | | | | | | Three Months Ended | | | | | | | | | March 31, | | | | | | | | | 2014 | | | 2013 | | | | | | | | | (millions of dollars) | | Components of net benefit cost | | | | | | | | | | Pension Benefits - U.S. | | | | | | | | | | | Service cost | | | | 177 | | | 187 | | | | Interest cost | | | | 202 | | | 187 | | | | Expected return on plan assets | | | | (200) | | | (209) | | | | Amortization of actuarial loss/(gain) and prior service cost | | | 104 | | | 164 | | | | Net pension enhancement and curtailment/settlement cost | | | 112 | | | 167 | | | | Net benefit cost | | | | 395 | | | 496 | | | | | | | | | | | | | | | | | | | | | | | | | | | Pension Benefits - Non-U.S. | | | | | | | | | | | Service cost | | | | 150 | | | 178 | | | | Interest cost | | | | 285 | | | 277 | | | | Expected return on plan assets | | | | (298) | | | (292) | | | | Amortization of actuarial loss/(gain) and prior service cost | | | 192 | | | 250 | | | | Net benefit cost | | | | 329 | | | 413 | | | | | | | | | | | | | | | | | | | | | | | | | | | Other Postretirement Benefits | | | | | | | | | | | Service cost | | | | 37 | | | 36 | | | | Interest cost | | | | 92 | | | 91 | | | | Expected return on plan assets | | | | (9) | | | (10) | | | | Amortization of actuarial loss/(gain) and prior service cost | | | 43 | | | 63 | | | | Net benefit cost | | | | 163 | | | 180 | | | | | | | | | | | | |
5. Pension and Other Postretirement Benefits
| | | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | | September 30, | | | September 30, | | | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | | (millions of dollars) | | Pension Benefits - U.S. | | | | | | | | | | | | | | | Components of net benefit cost | | | | | | | | | | | | | | | | Service cost | | | 206 | | | 173 | | | 581 | | | 489 | | | | Interest cost | | | 188 | | | 205 | | | 562 | | | 615 | | | | Expected return on plan assets | | | (209) | | | (196) | | | (626) | | | (590) | | | | Amortization of actuarial loss/(gain) and prior | | | | | | | | | | | | | | | | | service cost | | | 165 | | | 146 | | | 493 | | | 436 | | | | Net pension enhancement and | | | | | | | | | | | | | | | | | curtailment/settlement cost | | | 182 | | | 123 | | | 546 | | | 369 | | | | Net benefit cost | | | 532 | | | 451 | | | 1,556 | | | 1,319 | | | | | | | | | | | | | | | | | | | Pension Benefits - Non-U.S. | | | | | | | | | | | | | | | Components of net benefit cost | | | | | | | | | | | | | | | | Service cost | | | 170 | | | 156 | | | 521 | | | 490 | | | | Interest cost | | | 265 | | | 279 | | | 803 | | | 859 | | | | Expected return on plan assets | | | (278) | | | (269) | | | (841) | | | (831) | | | | Amortization of actuarial loss/(gain) and prior | | | | | | | | | | | | | | | | | service cost | | | 239 | | | 228 | | | 724 | | | 719 | | | | Net pension enhancement and | | | | | | | | | | | | | | | | | curtailment/settlement cost (1) | | | 1 | | | 109 | | | 2 | | | 1,538 | | | | Net benefit cost | | | 397 | | | 503 | | | 1,209 | | | 2,775 | | | | | | | | | | | | | | | | | | | Other Postretirement Benefits | | | | | | | | | | | | | | | Components of net benefit cost | | | | | | | | | | | | | | | | Service cost | | | 44 | | | 31 | | | 123 | | | 100 | | | | Interest cost | | | 87 | | | 89 | | | 264 | | | 293 | | | | Expected return on plan assets | | | (10) | | | (9) | | | (30) | | | (30) | | | | Amortization of actuarial loss/(gain) and prior | | | | | | | | | | | | | | | | | service cost | | | 61 | | | 48 | | | 186 | | | 156 | | | | Net benefit cost | | | 182 | | | 159 | | | 543 | | | 519 |
(1)Non-U.S. net pension enhancement and curtailment/settlement cost for the nine months ended September 30, 2012, includes $1,420 million (on a consolidated‑company, before‑tax basis) of accumulated other comprehensive income for the postretirement benefit reserves adjustment that was recycled into earnings and included in the Japan restructuring gain reported in “Other income”.
6. Financial Instruments The fair value of financial instruments is determined by reference to observable market data and other valuation techniques as appropriate. The only category of financial instruments where the difference between fair value and recorded book value is notable is long-term debt. The estimated fair value of total long-term debt, excluding capitalized lease obligations, was $7,318$12,086 million at September 30, 2013,March 31, 2014, and $8,027$6,787 million at December 31, 2012,2013, as compared to recorded book values of $7,014$11,786 million at September 30, 2013,March 31, 2014, and $7,497$6,516 million at December 31, 2012. 2013. The increase in the estimated fair value and book value of long-term debt reflects the Corporation’s issuance of $5,500 million of long-term debt in the first quarter of 2014. The $5,500 million of long-term debt is comprised of $750 million of floating-rate notes due in 2017, $500 million of floating-rate notes due in 2019, $1,500 million of 0.921% notes due in 2017, $1,750 million of 1.819% notes due in 2019, and $1,000 million of 3.176% notes due in 2024. The fair value of long-term debt by hierarchy level at September 30, 2013,March 31, 2014, is: Level 1 $5,984$11,142 million; Level 2 $1,270$880 million; and Level 3 $64 million. Level 1 represents quoted prices in active markets. Level 2 includes debt whose fair value is based upon a publicly available index. Level 3 involves using internal data augmented by relevant market indicators if available. During the third quarter, the Corporation established a $5.0 billion committed line of credit in the U.S., and reduced its previous U.S. line of credit from $2.7 billion at December 31, 2012 to $0.6 billion at September 30, 2013. The committed line of credit was unused as of September 30, 2013.
7. Disclosures about Segments and Related Information
| | | | | | Three Months Ended | | | Nine Months Ended | | | | | | | September 30, | | | September 30, | | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | | (millions of dollars) | | EARNINGS AFTER INCOME TAX | | | | | | | | | | | | | | | Upstream | | | | | | | | | | | | | | | | United States | | | 1,050 | | | 633 | | | 3,005 | | | 2,321 | | | | Non-U.S. | | | 5,663 | | | 5,340 | | | 17,050 | | | 19,812 | | | Downstream | | | | | | | | | | | | | | | | United States | | | 315 | | | 1,441 | | | 1,602 | | | 2,878 | | | | Non-U.S. (1) | | | 277 | | | 1,749 | | | 931 | | | 8,544 | | | Chemical | | | | | | | | | | | | | | | | United States | | | 680 | | | 565 | | | 1,947 | | | 1,492 | | | | Non-U.S. (1) | | | 345 | | | 225 | | | 971 | | | 1,448 | | | All other | | | (460) | | | (383) | | | (1,276) | | | (1,565) | | | Corporate total | | | 7,870 | | | 9,570 | | | 24,230 | | | 34,930 | | | | | | | | | | | | | | | | | | (1) | Nine months ended September 30, 2012, includes the gain associated with the Japan restructuring of $5.3 billion | | | in the non-U.S. Downstream and $0.6 billion in the non-U.S. Chemical segments. | | | | | | | | | | | | | | | | | | SALES AND OTHER OPERATING REVENUE (2) | | | | | | | | | | | | | | | Upstream | | | | | | | | | | | | | | | | United States | | | 3,416 | | | 2,718 | | | 9,516 | | | 8,108 | | | | Non-U.S. | | | 5,829 | | | 6,755 | | | 18,931 | | | 21,319 | | | Downstream | | | | | | | | | | | | | | | | United States | | | 32,032 | | | 31,621 | | | 92,995 | | | 92,991 | | | | Non-U.S. | | | 57,179 | | | 60,763 | | | 164,066 | | | 190,590 | | | Chemical | | | | | | | | | | | | | | | | United States | | | 3,873 | | | 3,493 | | | 11,479 | | | 11,167 | | | | Non-U.S. | | | 6,058 | | | 5,634 | | | 17,813 | | | 18,157 | | | All other | | | 3 | | | 5 | | | 18 | | | 16 | | | Corporate total | | | 108,390 | | | 110,989 | | | 314,818 | | | 342,348 | | | | | | | | | | | | | | | | | | (2) | Includes sales-based taxes | | | | | | | | | | | | | | | | | | | | | | | | | | | | INTERSEGMENT REVENUE | | | | | | | | | | | | | | | Upstream | | | | | | | | | | | | | | | | United States | | | 2,015 | | | 1,935 | | | 6,324 | | | 6,538 | | | | Non-U.S. | | | 12,505 | | | 11,105 | | | 35,097 | | | 35,171 | | | Downstream | | | | | | | | | | | | | | | | United States | | | 5,056 | | | 5,422 | | | 15,312 | | | 16,214 | | | | Non-U.S. | | | 14,099 | | | 15,309 | | | 39,263 | | | 47,215 | | | Chemical | | | | | | | | | | | | | | | | United States | | | 2,971 | | | 3,301 | | | 9,157 | | | 9,429 | | | | Non-U.S. | | | 2,352 | | | 2,292 | | | 6,407 | | | 7,565 | | | All other | | | 66 | | | 75 | | | 204 | | | 212 |
| | | | | | | Three Months Ended | | | | | | | | March 31, | | | | | | | | 2014 | | | 2013 | | Earnings After Income Tax | | | | (millions of dollars) | | | Upstream | | | | | | | | | | | United States | | | | 1,244 | | | 859 | | | | Non-U.S. | | | | 6,539 | | | 6,178 | | | Downstream | | | | | | | | | | | United States | | | | 623 | | | 1,039 | | | | Non-U.S. | | | | 190 | | | 506 | | | Chemical | | | | | | | | | | | United States | | | | 679 | | | 752 | | | | Non-U.S. | | | | 368 | | | 385 | | | All other | | | | (543) | | | (219) | | | Corporate total | | | | 9,100 | | | 9,500 | | | | | | | | | | | | | Sales and Other Operating Revenue (1) | | | | | | | | | | Upstream | | | | | | | | | | | United States | | | | 4,322 | | | 2,872 | | | | Non-U.S. | | | | 5,827 | | | 6,160 | | | Downstream | | | | | | | | | | | United States | | | | 30,412 | | | 30,998 | | | | Non-U.S. | | | | 51,288 | | | 53,407 | | | Chemical | | | | | | | | | | | United States | | | | 3,876 | | | 3,883 | | | | Non-U.S. | | | | 6,032 | | | 6,050 | | | All other | | | | 3 | | | 8 | | | Corporate total | | | | 101,760 | | | 103,378 | | | | | | | | | | | | | (1) Includes sales-based taxes | | | | | | | | | | | | | | | | | | Intersegment Revenue | | | | | | | | | | Upstream | | | | | | | | | | | United States | | | | 2,063 | | | 2,275 | | | | Non-U.S. | | | | 10,781 | | | 11,387 | | | Downstream | | | | | | | | | | | United States | | | | 4,909 | | | 5,170 | | | | Non-U.S. | | | | 12,842 | | | 13,517 | | | Chemical | | | | | | | | | | | United States | | | | 2,634 | | | 3,227 | | | | Non-U.S. | | | | 2,267 | | | 2,062 | | | All other | | | | 67 | | | 67 | | | | | | | | | | | |
EXXON MOBIL CORPORATION Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations FUNCTIONAL EARNINGS SUMMARY | FUNCTIONAL EARNINGS SUMMARY | FUNCTIONAL EARNINGS SUMMARY | | | | | | | | | | | | | | | | | | | | | | | | Third Quarter | | | First Nine Months | | | | First Three Months | Earnings (U.S. GAAP) | Earnings (U.S. GAAP) | | | 2013 | | | 2012 | | 2013 | | | 2012 | Earnings (U.S. GAAP) | | | 2014 | | | 2013 | | | | (millions of dollars) | | | | (millions of dollars) | Upstream | Upstream | | | | | | | | | | | | | Upstream | | | | | | | | United States | | | 1,050 | | | 633 | | 3,005 | | | 2,321 | United States | | | 1,244 | | | 859 | | Non-U.S. | | | 5,663 | | | 5,340 | | 17,050 | | | 19,812 | Non-U.S. | | | 6,539 | | | 6,178 | Downstream | Downstream | | | | | | | | | | | | Downstream | | | | | | | | United States | | | 315 | | | 1,441 | | 1,602 | | | 2,878 | United States | | | 623 | | | 1,039 | | Non-U.S. | | | 277 | | | 1,749 | | 931 | | | 8,544 | Non-U.S. | | | 190 | | | 506 | Chemical | Chemical | | | | | | | | | | | | Chemical | | | | | | | | United States | | | 680 | | | 565 | | 1,947 | | | 1,492 | United States | | | 679 | | | 752 | | Non-U.S. | | | 345 | | | 225 | | 971 | | | 1,448 | Non-U.S. | | | 368 | | | 385 | Corporate and financing | Corporate and financing | | | (460) | | | (383) | | (1,276) | | | (1,565) | Corporate and financing | | | (543) | | | (219) | | Net Income attributable to ExxonMobil (U.S. GAAP) | | | 7,870 | | | 9,570 | | 24,230 | | | 34,930 | Net Income attributable to ExxonMobil | | | 9,100 | | | 9,500 | | | | | | | | | | | | | | | | | | | | | Earnings per common share (dollars) | Earnings per common share (dollars) | | | 1.79 | | | 2.09 | | 5.46 | | | 7.50 | Earnings per common share (dollars) | | | 2.10 | | | 2.12 | Earnings per common share - assuming dilution (dollars) | | Earnings per common share - assuming dilution (dollars) | | 2.10 | | | 2.12 | | | | | | | | | | | | | | | | | | | | Earnings per common share - assuming dilution (dollars) | | | 1.79 | | | 2.09 | | 5.46 | | | 7.50 | |
References in this discussion to corporate earnings mean net income attributable to ExxonMobil (U.S. GAAP) from the consolidated income statement. Unless otherwise indicated, references to earnings, Upstream, Downstream, Chemical and Corporate and Financing segment earnings, and earnings per share are ExxonMobil's share after excluding amounts attributable to noncontrolling interests. REVIEW OF THIRDFIRST QUARTER 20132014 RESULTS ExxonMobil’s results forfirst quarter earnings and cash flow reflect the third quarter of 2013 reflect our continued progress across a diverse set ofcompany’s continuing focus on delivering profitable growth opportunities, which positions us well to deliverand creating long-term shareholder value. We maintain a long-term perspective on our business with a relentless focus on operational excellenceStrong performance in the Upstream benefitted from improved production mix and disciplined investing.increased unit profitability. ThirdFirst quarter 2014 earnings were $7.9$9.1 billion, down 184 percent from the thirdfirst quarter of 2012. Production of oil and natural gas increased2013. Upstream earnings were $7.8 billion, up 11 percent from a year earlier as new projects were brought on line and maintenance-related downtime decreased. Significantly weaker refining margins as a result of increased industry capacity negatively impacted ExxonMobil’s Downstream earnings.the previous year.
In the third quarter, capitalCapital and exploration expenditures for the first quarter were $10.5$8.4 billion, in line with anticipated spending plans.down 28 percent from the first quarter of 2013.
The Corporation distributed $5.8$5.7 billion to shareholders in the thirdfirst quarter through dividends and share purchases to reduce shares outstanding. Earnings in the first nine months of 2013 of $24,230 million decreased $10,700 million from 2012.
Earnings per share – assuming dilution for the first nine months of 2013 decreased 27 percent to $5.46.
| | | | | Third Quarter | | | First Nine Months | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | (millions of dollars) | Upstream earnings | | | | | | | | | | | | | | United States | | | 1,050 | | | 633 | | | 3,005 | | | 2,321 | | Non-U.S. | | | 5,663 | | | 5,340 | | | 17,050 | | | 19,812 | | | Total | | | 6,713 | | | 5,973 | | | 20,055 | | | 22,133 |
| | | | | First Three Months | | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | Upstream earnings | | | | | | | | United States | | | 1,244 | | | 859 | | Non-U.S. | | | 6,539 | | | 6,178 | | | Total | | | 7,783 | | | 7,037 |
Upstream earnings were $6,713$7,783 million in the third quarterfirst three months of 2013,2014, up $740$746 million from the thirdfirst quarter of 2012.2013. Higher liquids and natural gas realizations, partially offset by lower liquids realizations, increased earnings by $440$410 million. Production volume and mix effects increased earnings by $20 million. All other items, including favorable tax and foreign exchangeasset management impacts, partly offset by higher operating expenses, increased earnings by $280$320 million. On an oil-equivalent basis, production increased 1.5 percent from the third quarter of 2012. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production increased 2.7 percent.
Liquids production totaled 2,199 kbd (thousands of barrels per day), up 83 kbd from the third quarter of 2012. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was up 5.3 percent, as lower downtime and project ramp-up in Canada and Nigeria were partially offset by field decline.
Third quarter natural gas production was 10,914 mcfd (millions of cubic feet per day), down 147 mcfd from 2012. Excluding the impacts of entitlement volumes and divestments, natural gas production was down 0.3 percent, as field decline was mostly offset by lower downtime and project ramp-up.
Earnings from U.S. Upstream operations were $1,050 million, $417 million higher than the third quarter of 2012. Non‑U.S. Upstream earnings were $5,663 million, up $323 million from the prior year.
Upstream earnings in the first nine months of 2013 were $20,055 million, down $2,078 million from 2012. Higher gas realizations, partially offset by lower liquids realizations, increased earnings by $350 million. Lower sales volumes decreased earnings by $400 million. All other items, including lower net gains from asset sales, mainly in Angola, and higher expenses, reduced earnings by $2.0 billion.
On an oil-equivalent basis, production was down 1.4 percent compared to the same period in 2012. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, production was up 0.4 percent.
Liquids production of 2,192 kbd increased 13 kbd compared with 2012. Excluding the impacts of entitlement volumes, OPEC quota effects and divestments, liquids production was up 1.3 percent, as project ramp-up and lower downtime were partially offset by field decline.
Natural gas production of 11,818 mcfd decreased 431 mcfd from 2012. Excluding the impacts of entitlement volumes and divestments, natural gas production was down 0.8 percent, as field decline was partially offset by lower downtime, higher demand, and project ramp-up.
Earnings in the first nine months of 2013 from U.S. Upstream operations were $3,005 million, up $684 million from 2012. Earnings outside the U.S. were $17,050 million, down $2,762 million from the prior year.
On an oil-equivalent basis, production decreased 5.6 percent from the first quarter of 2013. Excluding the impact of the expiry of the Abu Dhabi onshore concession, production decreased 2.9 percent. Liquids production totaled 2,148 kbd (thousands of barrels per day), down 45 kbd from the first quarter of 2013. The Abu Dhabi onshore concession expiry reduced volumes by 118 kbd. Excluding this impact, liquids production was up 3.3 percent, driven by project ramp-up, mainly at Kearl, and lower downtime. First quarter natural gas production was 12,016 mcfd (millions of cubic feet per day), down 1,197 mcfd from 2013, primarily due to lower demand. Earnings from U.S. Upstream operations were $1,244 million, $385 million higher than the first quarter of 2013. Non-U.S. Upstream earnings were $6,539 million, up $361 million from the prior year. | | | | Third Quarter | | | First Nine Months | | | First Quarter | Upstream additional information | Upstream additional information | | | | (thousands of barrels daily) | | Upstream additional information | | (thousands of barrels daily) | Volumes reconciliation (Oil-equivalent production)(1) | Volumes reconciliation (Oil-equivalent production)(1) | | | | | | | | | Volumes reconciliation (Oil-equivalent production)(1) | | | | 2012 | | | | 3,960 | | | | 4,220 | | | 2013 | | 2013 | | | 4,395 | | | Entitlements - Net Interest | | | | (13) | | | | (51) | | Entitlements - Net Interest | | | (3) | | | Entitlements - Price / Spend | | | | (8) | | | | - | | Entitlements - Price / Spend | | | (49) | | | Quotas | | | | - | | | | 4 | | Quotas | | | - | | | Divestments | | | | (28) | | | | (26) | | Divestments | | | (20) | | | Net growth | | | | 107 | | | | 15 | | United Arab Emirates Onshore Concession Expiry | | | (118) | | 2013 | | | | 4,018 | | | | 4,162 | | | | | Net Growth | | | (54) | | 2014 | | 2014 | | | 4,151 | | | | | | | | | | | | | | | | | (1) Gas converted to oil-equivalent at 6 million cubic feet = 1 thousand barrels. | (1) Gas converted to oil-equivalent at 6 million cubic feet = 1 thousand barrels. | | | (1) Gas converted to oil-equivalent at 6 million cubic feet = 1 thousand barrels. |
Listed below are descriptions of ExxonMobil’s entitlement volume effects. These descriptions are provided to facilitate understanding of the terms. Production Sharing Contract (PSC) Net Interest Reductions are contractual reductions in ExxonMobil’s share of production volumes covered by PSCs. These reductions typically occur when cumulative investment returns or production volumes achieve thresholds as specified in the PSCs. Once a net interest reduction has occurred, it typically will not be reversed by subsequent events, such as lower crude oil prices. Price and Spend Impacts on Volumes are fluctuations in ExxonMobil’s share of production volumes caused by changes in oil and gas prices or spending levels from one period to another. For example, at higher prices, fewer barrels are required for ExxonMobil to recover its costs. According to the terms of contractual arrangements or government royalty regimes, price or spending variability can increase or decrease royalty burdens and/or volumes attributable to ExxonMobil. These effects generally vary from period to period with field spending patterns or market prices for crude oil or natural gas. | | | | | Third Quarter | | | First Nine Months | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | (millions of dollars) | Downstream earnings | | | | | | | | | | | | | | United States | | | 315 | | | 1,441 | | | 1,602 | | | 2,878 | | Non-U.S. | | | 277 | | | 1,749 | | | 931 | | | 8,544 | | | Total | | | 592 | | | 3,190 | | | 2,533 | | | 11,422 |
| | | | | First Three Months | | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | Downstream earnings | | | | | | | | United States | | | 623 | | | 1,039 | | Non-U.S. | | | 190 | | | 506 | | | Total | | | 813 | | | 1,545 |
Third quarter 2013For the first three months, Downstream earnings were $592$813 million, down $2,598$732 million from the thirdfirst quarter of 2012.2013. Weaker margins, mainly in refining, decreased earnings by $2.4 billion.$740 million. Volume and mix effects increased earnings by $150$80 million. All other items including lower gains on asset sales and foreign exchange impacts, decreased earnings by $380a net $70 million. Petroleum product sales of 6,0315,817 kbd were 7462 kbd lowerhigher than last year's third quarter reflecting divestment-related impacts.first quarter.
Earnings from the U.S. Downstream were $315$623 million, down $1,126$416 million from the thirdfirst quarter of 2012. Non‑U.S.2013. Non-U.S. Downstream earnings of $277$190 million were $1,472$316 million lower than last year. Downstream earnings in the first nine months of 2013 of $2,533 million decreased $8,889 million from 2012 driven by the absence of the $5.3 billion gain associated with the Japan restructuring. Lower margins, mainly refining, decreased earnings by $2.2 billion. Volume and mix effects decreased earnings by $430 million. All other items, including higher operating expenses, unfavorable foreign exchange impacts, and lower divestments, decreased earnings by $970 million. Petroleum product sales of 5,851 kbd decreased 346 kbd from 2012.
U.S. Downstream earnings in the first nine months of 2013 were $1,602 million, down $1,276 million from 2012. Non‑U.S. Downstream earnings were $931 million, a decrease of $7,613 million from last year.
| | | | | Third Quarter | | | First Nine Months | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | (millions of dollars) | Chemical earnings | | | | | | | | | | | | | | United States | | | 680 | | | 565 | | | 1,947 | | | 1,492 | | Non-U.S. | | | 345 | | | 225 | | | 971 | | | 1,448 | | | Total | | | 1,025 | | | 790 | | | 2,918 | | | 2,940 |
Third quarter 2013 Chemical earnings of $1,025 million were $235 million higher than the third quarter of 2012 due primarily to higher commodity margins. Third quarter prime product sales of 6,245 kt (thousands of metric tons) were 298 kt higher than last year's third quarter.
| | | | | First Three Months | | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | Chemical earnings | | | | | | | | United States | | | 679 | | | 752 | | Non-U.S. | | | 368 | | | 385 | | | Total | | | 1,047 | | | 1,137 |
Chemical earnings inof $1,047 million for the first ninethree months of 2013 of $2,918 million were $22$90 million lower than 2012. The absencethe first quarter of the gain associated with the Japan restructuring2013. Weaker margins decreased earnings by $630 million. Higher margins increased earnings by $520$90 million, while volume and mix effects increased earnings by $80$40 million. All other items increaseddecreased earnings by $10$40 million. PrimeFirst quarter prime product sales of 17,9866,128 kt (thousands of metric tons) were down 270218 kt from 2012. higher than last year's first quarter, driven by increased Singapore production. | | | Third Quarter | | | First Nine Months | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | (millions of dollars) | | | | | | | | | | | | | | Corporate and financing earnings | | | (460) | | | (383) | | | (1,276) | | | (1,565) |
Corporate and financing expenses of $460 million in the third quarter of 2013 were up $77 million from the third quarter of 2012, reflecting unfavorable tax impacts.
| | | | | First Three Months | | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | | | | | | | | | | Corporate and financing earnings | | | (543) | | | (219) |
Corporate and financing expenses were $1,276$543 million infor the first ninethree months of 2013, down $2892014, up $324 million from 2012, as favorable tax impacts were partially offset bythe first quarter of 2013, due primarily to the absence of the Japan restructuring gain.favorable tax impacts.
LIQUIDITY AND CAPITAL RESOURCES | LIQUIDITY AND CAPITAL RESOURCES | LIQUIDITY AND CAPITAL RESOURCES | | | | | | | | | | | | | | | | | | | | | | | | | Third Quarter | | | First Nine Months | | | | | First Three Months | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | 2014 | | | 2013 | | | | | (millions of dollars) | | | | | (millions of dollars) | Net cash provided by/(used in) | Net cash provided by/(used in) | | | | | | | | | | | | | Net cash provided by/(used in) | | | | | | | | Operating activities | | | | | | | | 34,706 | | 42,946 | Operating activities | | | 15,103 | | | 13,592 | | Investing activities | | | | | | | | (27,489) | | (16,599) | Investing activities | | | (6,306) | | | (10,054) | | Financing activities | | | | | | | | (11,298) | | (26,143) | Financing activities | | | (7,816) | | | (6,694) | Effect of exchange rate changes | Effect of exchange rate changes | | | | | | | | (191) | | 187 | Effect of exchange rate changes | | | (24) | | | (212) | Increase/(decrease) in cash and cash equivalents | Increase/(decrease) in cash and cash equivalents | | | | | | | | (4,272) | | 391 | Increase/(decrease) in cash and cash equivalents | | | 957 | | | (3,368) | | | | | | | | | | | | | | | | | | | | | | Cash and cash equivalents (at end of period) | Cash and cash equivalents (at end of period) | | | | | | | | 5,310 | | 13,055 | Cash and cash equivalents (at end of period) | | | 5,601 | | | 6,214 | Cash and cash equivalents – restricted (at end of period) | Cash and cash equivalents – restricted (at end of period) | | | | | | | | 439 | | 206 | Cash and cash equivalents – restricted (at end of period) | | | 204 | | | 376 | Total cash and cash equivalents (at end of period) | Total cash and cash equivalents (at end of period) | | | | | | | | 5,749 | | 13,261 | Total cash and cash equivalents (at end of period) | | | 5,805 | | | 6,590 | | | | | | | | | | | | | | | | | | | | | | Cash flow from operations and asset sales | Cash flow from operations and asset sales | | | | | | | | | | | Cash flow from operations and asset sales | | | | | | | | Net cash provided by operating activities (U.S. GAAP) | | | 13,431 | | 13,442 | | 34,706 | | 42,946 | Net cash provided by operating activities (U.S. GAAP) | | | 15,103 | | | 13,592 | | Proceeds associated with sales of subsidiaries, property, | | | | | | | | | | Proceeds associated with sales of subsidiaries, property, plant & equipment, | | | | | | | | plant & equipment, and sales and returns of investments | | | 206 | | 607 | | 871 | | 6,850 | | and sales and returns of investments | | | 1,111 | | | 360 | | Cash flow from operations and asset sales | | | 13,637 | | 14,049 | | 35,577 | | 49,796 | Cash flow from operations and asset sales | | | 16,214 | | | 13,952 |
Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider proceeds associated with asset sales together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities, including shareholder distributions. Cash provided by operating activities totaled $34.7$15.1 billion for the first ninethree months of 2013, $8.22014, $1.5 billion lowerhigher than 2012.2013. The major source of funds was net income including noncontrolling interests of $24.8$9.4 billion, a decrease of $12.6$0.4 billion from the prior year period. The adjustment for the noncash provision of $12.8$4.2 billion for depreciation and depletion increased by $1.0$0.1 billion. Changes in operational working capital added to cash flows in both periods. All other items net decreased cash flows by $2.7$0.9 billion in 2013, primarily due to an increase in inventory. Changes in operational working capital increased cash flows2014 and by $3.1$2.6 billion in 2012 primarily due to changes in payable balances partially offset by an increase in inventory. Net gain on asset sales was $0.5 billion in 2013 and $11.7 billion in 2012.2013. For additional details, see the Condensed Consolidated Statement of Cash Flows on page 6. Investing activities for the first ninethree months of 20132014 used net cash of $27.5$6.3 billion, an increasea decrease of $10.9$3.7 billion compared to the prior year. Spending for additions to property, plant and equipment of $25.2$7.3 billion was $1.0$0.2 billion higherlower than 2012.2013. Proceeds from asset sales of $0.9$1.1 billion decreased $6.0increased $0.8 billion. Additional investment and advances increased $3.2decreased $2.6 billion to $3.6$0.5 billion reflecting the impactabsence of the 2013 acquisition of Celtic Exploration Ltd. Cash flow from operations and asset sales in the first nine monthsquarter of 20132014 of $35.6$16.2 billion, including asset sales of $0.9$1.1 billion, decreased $14.2 billion. This reflectsincreased $2.3 billion from the change in cash flows from operating activities described above and the lower proceeds from asset sales, driven by the 2012 Japan restructuring.comparable 2013 period. During the first quarter of 2014, the Corporation issued $5.5 billion of long-term debt and used the proceeds to reduce short-term debt. Net cash used in financing activities of $11.3$7.8 billion in the first nine monthsquarter of 2014 was $1.1 billion higher than 2013 was $14.8 billion lower than 2012, reflecting total debt reduction in 2014 and short-term debt issuance in 2013, short-term debt reduction in 2012, andpartially offset by a lower level of purchases of shares of ExxonMobil stock in 2013.2014. During the thirdfirst quarter of 2013,2014, Exxon Mobil Corporation purchased 3440.5 million shares of its common stock for the treasury at a gross cost of $3.0$3.9 billion. These purchases wereincluded $3 billion to reduce the number of shares outstanding.outstanding with the balance used to acquire shares in conjunction with the company’s benefit plans and programs. Shares outstanding decreased from 4,4024,335 million at year-end 2013 to 4,294 million at the end of the secondfirst quarter to 4,369 million at the end of the third quarter 2013.2014. Purchases may be made in both the open market and through negotiated transactions, and may be increased, decreased or discontinued at any time without prior notice.
The Corporation distributed to shareholders a total of $5.8$5.7 billion in the thirdfirst quarter of 20132014 through dividends and share purchases to reduce shares outstanding. Total cash and cash equivalents of $5.7$5.8 billion at the end of the thirdfirst quarter of 20132014 compared to $13.3$6.6 billion at the end of the thirdfirst quarter of 2012.2013. Total debt of $21.3$21.4 billion compared to $11.6$22.7 billion at year-end 2012.2013. The Corporation's debt to total capital ratio was 10.810.5 percent at the end of the thirdfirst quarter of 20132014 compared to 6.311.2 percent at year-end 2012.2013. AlthoughWhile the Corporation issues long-term debt from time to time, the Corporation currently expects to cover its near-term financial requirements predominantly with internally generated funds, supplemented by its revolving commercial paper program. During the third quarter, the Corporation established a $5.0 billion committed line of credit in the U.S., and reduced its previous U.S. line of credit from $2.7 billion at December 31, 2012 to $0.6 billion at September 30, 2013. The committed line of credit was unused as of September 30, 2013.
The Corporation, as part of its ongoing asset management program, continues to evaluate its mix of assets for potential upgrade. Because of the ongoing nature of this program, dispositions will continue to be made from time to time which will result in either gains or losses. Additionally, the Corporation continues to evaluate opportunities to enhance its business portfolio through acquisitions of assets or companies, and enters into such transactions from time to time. Key criteria for evaluating acquisitions include potential for future growth and attractive current valuations. Acquisitions may be made with cash, shares of the Corporation’s common stock, or both. Litigation and other contingencies are discussed in Note 2 to the unaudited condensed consolidated financial statements. | | | | | | | | | | | | | | TAXES | TAXES | | | | | | | | | | | TAXES | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Third Quarter | | | First Nine Months | | | | | First Three Months | | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | | | | | | | | | | Income taxes | Income taxes | | | 6,120 | | 7,394 | | 18,190 | | 23,647 | | Income taxes | | | 5,857 | | | 6,277 | | | Effective income tax rate | | | 48 | % | | 47 | % | | 48 | % | | 43 | % | Effective income tax rate | | | 45 | % | | 46 | % | Sales-based taxes | Sales-based taxes | | | 7,882 | | 8,137 | | 22,926 | | 24,657 | | Sales-based taxes | | | 7,416 | | | 7,492 | | All other taxes and duties | All other taxes and duties | | | 9,252 | | 8,652 | | 27,019 | | 29,891 | | All other taxes and duties | | | 8,857 | | | 8,781 | | | | Total | | | 23,254 | | 24,183 | | 68,135 | | 78,195 | | Total | | | 22,130 | | | 22,550 | |
Income, sales-based and all other taxes and duties totaled $23.3$22.1 billion for the thirdfirst quarter of 2013,2014, a decrease of $0.9$0.4 billion from 2012.2013. Income tax expense decreased by $1.3$0.4 billion to $6.1$5.9 billion with the impact ofreflecting lower earnings partially offset by the higherpre-tax income and a lower effective tax rate. The effective income tax rate was 4845 percent compared to 4746 percent in the prior year period. Sales-based taxes and all other taxes and duties increased by $0.3 billion to $17.1were flat at $16.3 billion. Income, sales-based and all other taxes and duties totaled $68.1 billion for the first nine months of 2013, a decrease of $10.1 billion from 2012. Income tax expense decreased by $5.5 billion to $18.2 billion with the impact of lower earnings partially offset by the higher effective tax rate. The effective income tax rate was 48 percent compared to 43 percent in the prior year due to the absence of the lower effective tax rate on divestments. Sales-based and all other taxes decreased by $4.6 billion reflecting the Japan restructuring.
| | | | | | | | | | | | | | | CAPITAL AND EXPLORATION EXPENDITURES | | | | | | | | | | | | | | | | | | | | | Third Quarter | | | First Nine Months | | | | | | 2013 | | | 2012 | | | 2013 | | | 2012 | | | | | (millions of dollars) | | | | | | | | | | | | | | | | | Upstream (including exploration expenses) | | | 9,475 | | | 8,248 | | | 29,599 | | | 24,720 | | Downstream | | | 556 | | | 583 | | | 1,740 | | | 1,591 | | Chemical | | | 509 | | | 350 | | | 1,215 | | | 1,031 | | Other | | | 6 | | | 2 | | | 11 | | | 14 | | | Total | | | 10,546 | | | 9,183 | | | 32,565 | | | 27,356 | |
Capital and exploration expenditures in the third quarter of 2013 were $10.5 billion, up 15 percent from third quarter of 2012, in line with anticipated spending plans.
CAPITAL AND EXPLORATION EXPENDITURES | | | | | | | | | | | | | | | First Three Months | | | | | | 2014 | | | 2013 | | | | | | (millions of dollars) | | | | | | | | | | | Upstream (including exploration expenses) | | | 7,264 | | | 10,847 | | Downstream | | | 540 | | | 609 | | Chemical | | | 630 | | | 316 | | Other | | | 2 | | | 3 | | | Total | | | 8,436 | | | 11,775 | |
Capital and exploration expenditures in the first nine monthsquarter of 2014 were $8.4 billion, down 28 percent from first quarter of 2013, were $32.6 billion, up 19 percent fromreflecting the first nine monthsabsence of 2012, in line with anticipated spending plans and includedthe $3.1 billion for the acquisition of Celtic Exploration Ltd. acquisition. The Corporation anticipates an average investment profile of about $38$37 billion per year for the next several years. Actual spending could vary depending on the progress of individual projects and property acquisitions.
FORWARD-LOOKING STATEMENTS Statements relating to future plans, projections, events or conditions are forward-looking statements. Actual results, including project plans, costs, timing, and capacities; capital and exploration expenditures; resource recoveries; and share purchase levels, could differ materially due to factors including: changes in oil or gas prices or other market or economic conditions affecting the oil and gas industry, including the scope and duration of economic recessions; the outcome of exploration and development efforts; changes in law or government regulation, including tax and environmental requirements; the outcome of commercial negotiations; changes in technical or operating conditions; and other factors discussed under the heading "Factors Affecting Future Results" in the “Investors” section of our website and in Item 1A of ExxonMobil's 20122013 Form 10-K. We assume no duty to update these statements as of any future date. The term “project” as used in this report can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports. Item 3. Quantitative and Qualitative Disclosures About Market Risk Information about market risks for the ninethree months ended September 30, 2013,March 31, 2014, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2012.2013. Item 4. Controls and Procedures As indicated in the certifications in Exhibit 31 of this report, the Corporation’s Chief Executive Officer, Principal Financial Officer and Principal Accounting Officer have evaluated the Corporation’s disclosure controls and procedures as of September 30, 2013.March 31, 2014. Based on that evaluation, these officers have concluded that the Corporation’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the Corporation in the reports that it files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to them in a manner that allows for timely decisions regarding required disclosures and are effective in ensuring that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. There were no changes during the Corporation’s last fiscal quarter that materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.
PART II. OTHER INFORMATION Item 1. Legal Proceedings On September 10, 2013,Regarding the Pennsylvania Office of Attorney General filed eight criminal charges againstadministrative orders issued by the United States Environmental Protection Agency (USEPA) to XTO Energy Inc. (XTO) related tofor alleged violations of the discharge of fluidsClean Water Act at the Marquardt Well Site ofthree XTO locations in Penn Township, Pennsylvania, a matter which the Corporation previouslyWest Virginia reported in its 2010the Corporation’s Form 10-K and its Forms 10-Q for the thirdfirst quarter of 2012, the restoration plan for one site has been approved and the second quarterphysical portion of 2013.the restoration has been commenced. The charges includedplans for two other sites are still under review by USEPA. XTO has voluntarily disclosed five countsadditional West Virginia sites to the USEPA. XTO has submitted delineation reports for the additional sites which USEPA is reviewing. Negotiations continue on a Consent Decree to resolve outstanding penalty and compliance issues. It is expected that the USEPA will seek penalties from XTO in excess of unlawful conduct under$100,000 to resolve the Clean Streams Act and three counts undermatters at all of the Solid Waste Management Act. XTO believes criminal charges are unwarranted and plans to vigorously challenge the charges.sites.
On August 23, 2013,April 11, 2014, ExxonMobil Oil Corporation (EMOC) signed an agreement with South Coast Air Quality Management District (AQMD) to resolve the Louisiana Department of Environmental Quality (LDEQ) accepted a settlement proposal of ExxonMobil Refining and Supply Company and ExxonMobil Chemical Company, both divisions of Exxon Mobil Corporation (the “Corporation”), resolving a number of alleged exceedances of permit and regulatory limits for certain compounds reported from January 1, 2008,issues relating to March 31, 2013,three parallel flare lines at EMOC’s Torrance Refinery in California as well as Consolidated Compliance Orders & Notices of Potential Penalties issued by LDEQ from 2008 through 2012 to the Baton Rouge Refinery (BRRF), the Baton Rouge Chemical Plant, the Baton Rouge Anchorage Tank Farm and the Baton Rouge Resins Finishing Plant, including the BRRF matter previously reported in the Corporation’s Form 10-Q for the third quarter of 2009. The Corporation had previously self-disclosed these matters2013. Under the settlement, AQMD will give EMOC a full release of all pending AQMD Notices of Violation and all violations related to and arising from the LDEQ along with a proposed number of specific corrective action steps. The settlement terms includelines from 1998 through December 31, 2013, in exchange for ExxonMobil’s payment of a $300,000civil penalty an agreementof $8.1 million and the Refinery’s commitment to complete certain on-site improvement projects valuedpermanently close off the three lines before December 31, 2015. In addition, ExxonMobil will owe $14.5 million in back flare mitigation fees (initially paying 50% and retaining 50%) with the opportunity to apply 100% of the back mitigation fees towards one or more AQMD approved Mitigation Projects at $1,000,000, Beneficial Environmental Projects valued at $1,029,000 and a Stipulated Penalty Agreement to address any future environmental non-compliance. The settlementor near the Torrance Refinery. ExxonMobil will bealso pay back emissions fees through 2012 in the subjectamount of public notice and comment for 45 days before becoming final.$320,000. On October 2, 2013, ExxonMobil Oil Corporation’s Joliet Refinery in Channahon, Illinois, received a Notice from the United States Environmental Protection Agency (USEPA) alleging that the Refinery was out of compliance with several requirements of a Consent Decree entered into with the USEPA (United States v. Exxon Mobil Corp., CA No. 05-C-5809 (N.D. Ill.)) in December 2005 and reported in the Corporation’s Form 10-Q for the third quarter of 2005. The USEPA alleges violations of the requirements for continuous emissions and opacity monitoring, leak detection and repair requirements, and prohibitions against using emission reduction credits from Consent Decree projects in permitting. USEPA has indicated that it plansWith respect to propose penalties up to $1,242,500. ExxonMobil will contest the proposed penalties.
On October 3, 2013, ExxonMobil Oil Corporation’s Joliet Refinery received a Notice and Finding of Violation from the USEPA alleging that Joliet Refinery flares were modified and thereby triggered New Source Performance Standards (NSPS) requirements for refineries, and that the flares do not comply with federal and state combustion efficiency standards. The Notice also alleged that certain tanks at the Refinery were modified and triggered NSPS for tanks, that Prevention of Significant Deterioration Program permitting requirements were not met for projects involving the Refinery’s Fluid Catalytic Cracking Unit, and other leak detection and repair violations. Penalties sought will likely exceed $100,000.
In July 2013, ExxonMobil Oil Corporation’s Torrance Refinery in California confirmed and then self-reported that it may have failed to measure and report flow from parallel flare lines at the Refinery to the South Coast Air Quality Management District (AQMD) as required by AQMD Rule 1118. The Refinery is currently working with the AQMD to resolve the matter, but it is anticipated that a civil penalty in excess of $100,000 will be assessed.
Regarding the Notice of Enforcement and Proposed Agreed Order issued on January 30, 2013, by the Texas Commission on Environmental Quality (TCEQ) concerning three emission events in May and June 2012 at ExxonMobil Oil Corporation’s Beaumont Refinery previously reported in the Corporation’s Form 10-Q for the first quarter of 2013, the parties have agreed upon a full settlement of the enforcement action and a penalty of $126,250, which will become final after endorsement by the TCEQ at an upcoming agenda meeting.
In the enforcement action filed by the United States, on behalf of the USEPA, and the State of Arkansas, on behalf of the Arkansas Department of Environmental Quality, (ADEQ), against ExxonMobil Pipeline Company (EMPCo) related to the discharge of crude oil from the Pegasus Pipeline in Mayflower, Faulkner County, Arkansas, previously reported in the Corporation’s Forms 10-Q for the first, second and secondthird quarters of 2013, the court has setissued an order setting a trial date of February 15,24, 2015.
On September 16, 2013, the United States Department of Justice (USDOJ), based on a referral from the USEPA, advised that a civil enforcement investigation had been opened into the discharge of crude oil from the EMPCo’s North Line Pipeline near Torbert in Pointe Coupee Parish, Louisiana, on April 28, 2012. The USDOJ is investigating whether the discharge of oil contaminated waterways resulting in violations of the Clean Water Act. Penalties sought likely will be in excess of $100,000.
Refer to the relevant portions of Note 2 of this Quarterly Report on Form 10-Q for further information on legal proceedings.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | | | | | | | | | | | | | Issuer Purchase of Equity Securities for Quarter Ended September 30, 2013March 31, 2014 | | | | | | | | | | | | | | | | | | | | Total Number of | | Maximum Number | | | | | | | | | Shares Purchased | | of Shares that May | | | | | Total Number | | Average | | as Part of Publicly | | Yet Be Purchased | | | | | of Shares | | Price Paid | | Announced Plans | | Under the Plans or | Period | | | Purchased | | per Share | | or Programs | | Programs | | | | | | | | | | | | July 2013January 2014
| | 13,277,50213,628,922
| | $93.2497.93 | | 13,277,50213,628,922
| | | August 2013February 2014
| | 10,625,87112,887,419
| | $88.9892.98 | | 10,625,87112,887,419
| | | September 2013March 2014
| | 9,787,41813,981,145
| | $87.9894.89 | | 9,787,41813,981,145
| | | | Total | | | 33,690,79140,497,486
| | $90.3795.31 | | 33,690,79140,497,486
| | (See Note 1) |
Note 1 - On August 1, 2000, the Corporation announced its intention to resume purchases of shares of its common stock for the treasury both to offset shares issued in conjunction with company benefit plans and programs and to gradually reduce the number of shares outstanding. The announcement did not specify an amount or expiration date. The Corporation has continued to purchase shares since this announcement and to report purchased volumes in its quarterly earnings releases. In its most recent earnings release dated October 31, 2013,May 1, 2014, the Corporation stated that fourthsecond quarter 20132014 share purchases to reduce shares outstanding are anticipated to equal $3 billion. Purchases may be made in both the open market and through negotiated transactions, and purchases may be increased, decreased or discontinued at any time without prior notice. Item 6. Exhibits Exhibit | | Description | | | | 31.1 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Chief Executive Officer. | 31.2 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Financial Officer. | 31.3 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Accounting Officer. | 32.1 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer. | 32.2 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Financial Officer. | 32.3 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Accounting Officer. | 101 | | Interactive Data Files. |
The registrant has not filed with this report copies of the instruments defining the rights of holders of long-term debt of the registrant and its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed. The registrant agrees to furnish a copy of any such instrument to the Securities and Exchange Commission upon request.
EXXON MOBIL CORPORATION SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. | EXXON MOBIL CORPORATION | Date: November 5, 2013May 7, 2014 | By: | /s/ PATRICK T. MULVA | | | Patrick T. Mulva | | | Vice President, Controller and | | | Principal Accounting Officer | | | |
INDEX TO EXHIBITS Exhibit | | Description | | | | 31.1 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Chief Executive Officer. | 31.2 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Financial Officer. | 31.3 | | Certification (pursuant to Securities Exchange Act Rule 13a-14(a)) by Principal Accounting Officer. | 32.1 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Chief Executive Officer. | 32.2 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Financial Officer. | 32.3 | | Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Accounting Officer. | 101 | | Interactive Data Files. |
The registrant has not filed with this report copies of the instruments defining the rights of holders of long-term debt of the registrant and its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed. The registrant agrees to furnish a copy of any such instrument to the Securities and Exchange Commission upon request.
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