FORM10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[✓]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2018March 31, 2019
OR
[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from --- to ---
Commission file number0-12014
IMPERIAL OIL LIMITED
(Exact name of registrant as specified in its charter)
CANADA | 98-0017682 | |||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||
505 Quarry Park Boulevard S.E. Calgary, Alberta, Canada | ||||||
T2C 5N1 | ||||||
(Address of principal executive offices) | (Postal Code) |
Registrant’s telephone number, including area code:1-800-567-3776
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading symbol | Name of each exchange on which registered | ||
None | None |
The registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 9190 days.
YES ✓ NO
The registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of RegulationS-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
YES ✓ NO
The registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, smaller reporting company, or an emerging growth company. See the definition of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule12b-2 of the Exchange Act of 1934).
Large accelerated filer | ✓ | Smaller reporting company | ||||||
Non-accelerated filer | Emerging growth company | |||||||
Accelerated filer |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
The registrant is a shell company (as defined in Rule12b-2 of the Exchange Act of 1934).
YES NO ✓
The number of common shares outstanding, as of June 30, 2018March 31, 2019 was 802,679,927.772,588,535.
IMPERIAL OIL LIMITED
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Item 2. Management’s discussion and analysis of financial condition and results of operations | ||||
Item 3. Quantitative and qualitative disclosures about market risk | ||||
Item 2. Unregistered sales of equity securities and use of proceeds | ||||
In this report all dollar amounts are expressed in Canadian dollars unless otherwise stated. This report should be read in conjunction with the company’s annual report on Form10-K for the year ended December 31, 2017.2018. Note that numbers may not add due to rounding.
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.
In this report, unless the context otherwise indicates, reference to “the company” or “Imperial” includes Imperial Oil Limited and its subsidiaries.
IMPERIAL OIL LIMITED
Consolidated statement of income (U.S. GAAP, unaudited)
Six Months | Three Months to March 31 | |||||||||||||||||||||||||
Second Quarter | to June 30 | |||||||||||||||||||||||||
millions of Canadian dollars | millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | |||||||||||||||||||
Revenues and other income | Revenues and other income | |||||||||||||||||||||||||
Revenues(a) | Revenues(a) | 9,516 | 6,985 | 17,416 | 13,943 | 7,965 | 7,900 | |||||||||||||||||||
Investment and other income(note 5) | 27 | 48 | 61 | 246 | ||||||||||||||||||||||
Investment and other income(note 4) | 17 | 34 | ||||||||||||||||||||||||
Total revenues and other income | Total revenues and other income | 9,543 | 7,033 | 17,477 | 14,189 | 7,982 | 7,934 | |||||||||||||||||||
Expenses | Expenses | |||||||||||||||||||||||||
Exploration | Exploration | 1 | - | 9 | 22 | 33 | 8 | |||||||||||||||||||
Purchases of crude oil and products(b) | Purchases of crude oil and products(b) | 6,537 | 4,642 | 11,317 | 8,975 | 4,895 | 4,780 | |||||||||||||||||||
Production and manufacturing(c) | Production and manufacturing(c) | 1,646 | 1,495 | 3,077 | 2,840 | 1,595 | 1,431 | |||||||||||||||||||
Selling and general(c) | Selling and general(c) | 273 | 198 | 467 | 401 | 213 | 194 | |||||||||||||||||||
Federal excise tax | Federal excise tax | 412 | 421 | 809 | 815 | 394 | 397 | |||||||||||||||||||
Depreciation and depletion | Depreciation and depletion | 358 | 352 | 735 | 744 | 390 | 377 | |||||||||||||||||||
Non-service pension and postretirement benefit(d) | 26 | 33 | 53 | 66 | ||||||||||||||||||||||
Financing(note 7) | 26 | 17 | 49 | 31 | ||||||||||||||||||||||
Non-service pension and postretirement benefit | 36 | 27 | ||||||||||||||||||||||||
Financing(d) (note 6) | 28 | 23 | ||||||||||||||||||||||||
Total expenses | Total expenses | 9,279 | 7,158 | 16,516 | 13,894 | 7,584 | 7,237 | |||||||||||||||||||
Income (loss) before income taxes | Income (loss) before income taxes | 264 | (125 | ) | 961 | 295 | 398 | 697 | ||||||||||||||||||
Income taxes |
Income taxes | 68 | (48 | ) | 249 | 39 | 105 | 181 | ||||||||||||||||||
Net income (loss) | Net income (loss) | 196 | (77 | ) | 712 | 256 | 293 | 516 | ||||||||||||||||||
Per share information(Canadian dollars) | Per share information(Canadian dollars) | |||||||||||||||||||||||||
Net income (loss) per common share - basic(note 10) | 0.24 | (0.09 | ) | 0.86 | 0.30 | |||||||||||||||||||||
Net income (loss) per common share - diluted(note 10) | 0.24 | (0.09 | ) | 0.86 | 0.30 | |||||||||||||||||||||
Dividends per common share - declared | 0.19 | 0.16 | 0.35 | 0.31 | ||||||||||||||||||||||
(a) | Amounts from related parties included in revenues. | 1,769 | 1,008 | 3,142 | 2,045 | |||||||||||||||||||||
(b) | Amounts to related parties included in purchases of crude oil and products. | 1,374 | 706 | 2,266 | 1,315 | |||||||||||||||||||||
(c) | Amounts to related parties included in production and manufacturing, and selling and general expenses. | 156 | 147 | 297 | 288 | |||||||||||||||||||||
(d) | Prior year amounts have been reclassified. See note 2 for additional details. | |||||||||||||||||||||||||
Net income (loss) per common share - basic(note 11) | 0.38 | 0.62 | ||||||||||||||||||||||||
Net income (loss) per common share - diluted(note 11) | 0.38 | 0.62 | ||||||||||||||||||||||||
(a) Amounts from related parties included in revenues. | 1,722 | 1,373 | ||||||||||||||||||||||||
(b) Amounts to related parties included in purchases of crude oil and products. | 728 | 892 | ||||||||||||||||||||||||
(c) Amounts to related parties included in production and manufacturing, and selling and general expenses. | 161 | 141 | ||||||||||||||||||||||||
(d) Amounts to related parties included in financing, (note 6) | 28 | 20 |
The information in the notes to consolidated financial statements is an integral part of these statements.
IMPERIAL OIL LIMITED
Consolidated statement of comprehensive income (U.S. GAAP, unaudited)
Six Months | Three Months to March 31 | |||||||||||||||||||||||
Second Quarter | to June 30 | |||||||||||||||||||||||
millions of Canadian dollars
| 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Net income (loss) | 196 | (77 | ) | 712 | 256 | 293 | 516 | |||||||||||||||||
Other comprehensive income (loss), net of income taxes | ||||||||||||||||||||||||
Postretirement benefits liability adjustment (excluding amortization) | - | - | (19 | ) | 41 | 18 | (19) | |||||||||||||||||
Amortization of postretirement benefits liability adjustment included in net periodic benefit costs | 27 | 34 | ||||||||||||||||||||||
Amortization of postretirement benefits liability adjustment | 33 | 36 | 67 | 72 | ||||||||||||||||||||
Total other comprehensive income (loss) | 33 | 36 | 48 | 113 | 45 | 15 | ||||||||||||||||||
Comprehensive income (loss) | 229 | (41 | ) | 760 | 369 | 338 | 531 |
The information in the notes to consolidated financial statements is an integral part of these statements.
IMPERIAL OIL LIMITED
Consolidated balance sheet (U.S. GAAP, unaudited)
As at | As at | |||||||||||||||
June 30 | Dec 31 | As at Mar 31 | As at Dec 31 | |||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2019 | 2018 | ||||||||||||
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Assets | ||||||||||||||||
Current assets | ||||||||||||||||
Cash | 873 | 1,195 | 1,011 | 988 | ||||||||||||
Accounts receivable, less estimated doubtful accounts(a) | 2,625 | 2,712 | 3,233 | 2,529 | ||||||||||||
Inventories of crude oil and products | 1,221 | 1,075 | 1,251 | 1,297 | ||||||||||||
Materials, supplies and prepaid expenses | 456 | 425 | 568 | 541 | ||||||||||||
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Total current assets | 5,175 | 5,407 | 6,063 | 5,355 | ||||||||||||
Investments and long-term receivables(b) | 860 | 865 | 854 | 857 | ||||||||||||
Property, plant and equipment, | 53,272 | 52,778 | 53,878 | 53,944 | ||||||||||||
less accumulated depreciation and depletion | (19,028 | ) | (18,305 | ) | (19,634) | (19,719) | ||||||||||
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Property, plant and equipment, net | 34,244 | 34,473 | 34,244 | 34,225 | ||||||||||||
Goodwill | 186 | 186 | 186 | 186 | ||||||||||||
Other assets, including intangibles, net(note 9) | 925 | 670 | 1,150 | 833 | ||||||||||||
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Total assets | 41,390 | 41,601 | 42,497 | 41,456 | ||||||||||||
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Liabilities | ||||||||||||||||
Current liabilities | ||||||||||||||||
Notes and loans payable(c) | 202 | 202 | 202 | 202 | ||||||||||||
Accounts payable and accrued liabilities(a) (note 9) | 3,923 | 3,877 | 4,713 | 3,688 | ||||||||||||
Income taxes payable | 89 | 57 | 37 | 65 | ||||||||||||
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Total current liabilities | 4,214 | 4,136 | 4,952 | 3,955 | ||||||||||||
Long-term debt(d) (note 8) | 4,992 | 5,005 | ||||||||||||||
Long-term debt(d) (note 7) | 4,972 | 4,978 | ||||||||||||||
Other long-term obligations(e) (note 9) | 3,943 | 3,780 | 3,108 | 2,943 | ||||||||||||
Deferred income tax liabilities | 4,476 | 4,245 | 5,146 | 5,091 | ||||||||||||
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Total liabilities | 17,625 | 17,166 | 18,178 | 16,967 | ||||||||||||
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Shareholders’ equity | ||||||||||||||||
Common shares at stated value(f) (note 10) | 1,483 | 1,536 | ||||||||||||||
Earnings reinvested(note 11) | 24,049 | 24,714 | ||||||||||||||
Accumulated other comprehensive income (loss)(note 12) | (1,767 | ) | (1,815 | ) | ||||||||||||
Common shares at stated value(f) (note 11) | 1,427 | 1,446 | ||||||||||||||
Earnings reinvested(note 12) | 24,364 | 24,560 | ||||||||||||||
Accumulated other comprehensive income(loss) (note 13) | (1,472) | (1,517) | ||||||||||||||
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Total shareholders’ equity | 23,765 | 24,435 | 24,319 | 24,489 | ||||||||||||
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Total liabilities and shareholders’ equity | 41,390 | 41,601 | 42,497 | 41,456 | ||||||||||||
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(a) | Accounts receivable, less estimated doubtful accounts included net amounts receivable from related parties of |
(b) | Investments and long-term receivables included amounts from related parties of |
(c) | Notes and loans payable included amounts to related parties of $75 million |
(d) | Long-term debt included amounts to related parties of $4,447 million |
(e) | Other long-term obligations included amounts to related parties of |
(f) | Number of common shares authorized and outstanding were 1,100 million and |
The | information in the notes to consolidated financial statements is an integral part of these statements. |
IMPERIAL OIL LIMITED
Consolidated statement of cash flows (U.S. GAAP, unaudited)
Inflow (outflow) | Three Months to March 31 | |||||||
millions of Canadian dollars | 2019 | 2018 | ||||||
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Operating activities | ||||||||
Net income (loss) | 293 | 516 | ||||||
Adjustments fornon-cash items: | ||||||||
Depreciation and depletion | 390 | 377 | ||||||
(Gain) loss on asset sales(note 4) | 5 | (10) | ||||||
Deferred income taxes and other | (4) | 185 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (704) | 427 | ||||||
Inventories, materials, supplies and prepaid expenses | 19 | (217) | ||||||
Income taxes payable | (28) | 16 | ||||||
Accounts payable and accrued liabilities | 903 | (415) | ||||||
All other items - net(a) (b) | 129 | 106 | ||||||
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Cash flows from (used in) operating activities | 1,003 | 985 | ||||||
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Investing activities | ||||||||
Additions to property, plant and equipment(b) | (431) | (371) | ||||||
Proceeds from asset sales(note 4) | 22 | 12 | ||||||
Loans to equity company | (54) | (6) | ||||||
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Cash flows from (used in) investing activities | (463) | (365) | ||||||
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Financing activities | ||||||||
Reduction in finance lease obligations(note 8) | (7) | (6) | ||||||
Dividends paid | (149) | (134) | ||||||
Common shares purchased(note 11) | (361) | (250) | ||||||
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Cash flows from (used in) financing activities | (517) | (390) | ||||||
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Increase (decrease) in cash | 23 | 230 | ||||||
Cash at beginning of period | 988 | 1,195 | ||||||
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Cash at end of period(c) | 1,011 | 1,425 | ||||||
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(a) Included contribution to registered pension plans. | (41) | (44) |
(b) | The impact of carbon emission programs are included in additions to property, plant and equipment, and all other items, net. |
(c) | Cash is composed of cash in bank and cash equivalents at cost. Cash equivalents are all highly liquid securities with maturity of three months or less when purchased. |
The information in the notes to consolidated financial statements is an integral part of these statements.
IMPERIAL OIL LIMITED
Consolidated statement of cash flows (U.S. GAAP, unaudited)
Six Months | ||||||||||||||||||
Inflow (outflow) | Second Quarter | to June 30 | ||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Operating activities | ||||||||||||||||||
Net income (loss) | 196 | (77 | ) | 712 | 256 | |||||||||||||
Adjustments fornon-cash items: | ||||||||||||||||||
Depreciation and depletion | 358 | 352 | 735 | 744 | ||||||||||||||
(Gain) loss on asset sales(note 5) | (9 | ) | (31 | ) | (19 | ) | (213 | ) | ||||||||||
Deferred income taxes and other | 24 | (37 | ) | 209 | 163 | |||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||||
Accounts receivable | (340 | ) | 146 | 87 | 424 | |||||||||||||
Inventories, materials, supplies and prepaid expenses | 40 | (45 | ) | (177 | ) | (117 | ) | |||||||||||
Income taxes payable | 16 | 16 | 32 | (448 | ) | |||||||||||||
Accounts payable and accrued liabilities | 439 | (30 | ) | 24 | (240 | ) | ||||||||||||
All other items - net (a) (b) | 135 | 198 | 241 | 277 | ||||||||||||||
Cash flows from (used in) operating activities | 859 | 492 | 1,844 | 846 | ||||||||||||||
Investing activities | ||||||||||||||||||
Additions to property, plant and equipment(b) | (357 | ) | (320 | ) | (728 | ) | (442 | ) | ||||||||||
Proceeds from asset sales(note 5) | 9 | 39 | 21 | 222 | ||||||||||||||
Loan to equity company | (31 | ) | - | (37 | ) | - | ||||||||||||
Cash flows from (used in) investing activities | (379 | ) | (281 | ) | (744 | ) | (220 | ) | ||||||||||
Financing activities | ||||||||||||||||||
Reduction in capitalized lease obligations(note 8) | (7 | ) | (6 | ) | (13 | ) | (13 | ) | ||||||||||
Dividends paid | (132 | ) | (127 | ) | (266 | ) | (254 | ) | ||||||||||
Common shares purchased(note 10) | (893 | ) | (127 | ) | (1,143 | ) | (127 | ) | ||||||||||
Cash flows from (used in) financing activities | (1,032 | ) | (260 | ) | (1,422 | ) | (394 | ) | ||||||||||
Increase (decrease) in cash | (552 | ) | (49 | ) | (322 | ) | 232 | |||||||||||
Cash at beginning of period | 1,425 | 672 | 1,195 | 391 | ||||||||||||||
Cash at end of period(c) | 873 | 623 | 873 | 623 | ||||||||||||||
(a) | Included contribution to registered pension plans. | (57 | ) | (58 | ) | (101 | ) | (98 | ) | |||||||||
(b) | The impact of carbon emission programs are included in additions to property, plant and equipment, and all other items, net. | |||||||||||||||||
(c) | Cash is composed of cash in bank and cash equivalents at cost. Cash equivalents are all highly liquid securities with maturity of three months or less when purchased. | |||||||||||||||||
The information in the notes to consolidated financial statements is an integral part of these statements. |
IMPERIAL OIL LIMITED
Notes to consolidated financial statements (unaudited)
1. Basis of financial statement preparation
These unaudited consolidated financial statements have been prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) and follow the same accounting policies and methods of computation as, and should be read in conjunction with, the most recent annual consolidated financial statements filed with the U.S. Securities and Exchange Commission (SEC) in the company’s 20172018 annual report on Form10-K. In the opinion of the company, 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 year’s data has been reclassified in certain cases to conform to the current presentation basis.
The company’s exploration and production activities are accounted for under the “successful efforts” method.
The results for the sixthree months ended June 30, 2018,March 31, 2019, are not necessarily indicative of the operations to be expected for the full year.
All amounts are in Canadian dollars unless otherwise indicated.
IMPERIAL OIL LIMITED
2. Accounting changes
Effective January 1, 2018,2019, Imperial adopted the Financial Accounting Standards Board’s standard,Revenue from Contracts with Customers,Leases (Topic 842), as amended. The standard establishesrequires all leases to be recorded on the balance sheet as a single revenueright of use asset and a lease liability. The company used a transition method that applies the new lease standard at January 1, 2019. The company applied a policy election to exclude short-term leases from the balance sheet recognition model for alland also elected certain practical expedients at adoption. As permitted, Imperial did not reassess whether existing contracts with customers, eliminates industry and transaction specific requirements, and expands disclosure requirements. The standard was adopted usingare or contain leases, the modified retrospective method, under which prior year results are not restated, but supplemental information is providedlease classification for any material impactsexisting leases, initial direct costs for any existing lease and whether existing land easements and right of the standard on 2018 results. Theway, which were not previously accounted for as leases, are or contain a lease. At adoption of the standard did not have a material impactlease accounting change, on any of the lines reported in the company’s consolidated financial statements. The cumulative effect of adoption of the new standard was de minimis. The company did not elect any practical expedients that require disclosure. See note 4 for additional details.
Effective January 1, 2018, Imperial adopted2019, an operating lease liability of $298 million was recorded and the Financial Accounting Standards Board’s standard update, Compensation – Retirement Benefits (Topic 715):Improving the Presentationoperating lease right of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The update requires separate presentation of the service cost component from other components of net benefit costs. The other components are reported in a new line on the company’s consolidated statement of income,“Non-service pension and postretirement benefit”. Imperial elected to use the practical expedient which uses the amounts disclosed in the pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements, as it is impracticable to determine the amounts capitalized in those periods. Beginning in 2018, the other components of net benefit costs are included in the Corporate and other expenses. The“Non-service pension and postretirement benefit” line reflects thenon-service costs, which primarily includes interest costs, expected return on plan assets, and amortization of actuarial gains and losses, that were previously included in “Production and manufacturing” and “Selling and general” expenses. Additionally, only the service cost component of net benefit costs is eligible for capitalization in situations where it is otherwise appropriate to capitalize employee costs in connection with the construction or production of an asset.
The impact of the retrospective presentation change on Imperial’s consolidated statement of income for the period ended June 30, 2018 is shown below.
Second Quarter | Six Months to | |||||||||||||||||||||||||||
millions of Canadian dollars | 2017 | June 30, 2017 | ||||||||||||||||||||||||||
As reported | Change | As adjusted | As reported | Change | As adjusted | |||||||||||||||||||||||
Production and manufacturing | 1,525 | (30) | 1,495 | 2,900 | (60) | 2,840 | ||||||||||||||||||||||
Selling and general | 201 | (3) | 198 | 407 | (6) | 401 | ||||||||||||||||||||||
Non-service pension and postretirement benefit | - | 33 | 33 | - | 66 | 66 |
Effective January 1, 2018, Imperial adopted the Financial Accounting Standards Board’s standard update, Financial Instruments - Overall (Subtopic825-10):Recognition and Measurement of Financial Assets and Financial Liabilities. The standard requires investments in equity securities other than consolidated subsidiaries and equity method investments to be measured at fair value, with changes in the fair value recognized through net income. The company elected a modified approach for equity securities that do not have a readily determinable fair value. This modified approach measures investments at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.asset was $298 million. There was no cumulative earnings effect related to the adoption of this standard. The carrying value of equity securities without readily determinable fair values as at June 30, 2018 were not significant to Imperial.adjustment.
The standard also expanded disclosures related to financial statements. The company’s only notable financial instrument is long-term debt ($4,447 million, excluding capitalized lease obligations), where the difference between fair value and carrying value was de minimis. The fair value of long-term debt was primarily a level 2 measurement.
IMPERIAL OIL LIMITED
3. Business segments
Second Quarter | Upstream | Downstream | Chemical | |||||||||||||||||||||||||||||||||
Three Months to March 31 | Upstream | Downstream | Chemical | |||||||||||||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||
Revenues and other income | ||||||||||||||||||||||||||||||||||||
Revenues(a) | 2,318 | 1,787 | 6,870 | 4,909 | 328 | 289 | 2,240 | 1,989 | 5,474 | 5,607 | 251 | 304 | ||||||||||||||||||||||||
Intersegment sales | 650 | 289 | 332 | 242 | 74 | 62 | 948 | 657 | 448 | 362 | 72 | 73 | ||||||||||||||||||||||||
Investment and other income(note 5) | 3 | 5 | 19 | 42 | - | (2 | ) | |||||||||||||||||||||||||||||
Investment and other income(note 4) | - | 1 | 10 | 22 | - | - | ||||||||||||||||||||||||||||||
2,971 | 2,081 | 7,221 | 5,193 | 402 | 349 | 3,188 | 2,647 | 5,932 | 5,991 | 323 | 377 | |||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||
Exploration | 1 | - | - | - | - | - | 33 | 8 | - | - | - | - | ||||||||||||||||||||||||
Purchases of crude oil and products | 1,573 | 1,026 | 5,803 | 4,014 | 216 | 193 | 1,586 | 1,374 | 4,582 | 4,294 | 193 | 202 | ||||||||||||||||||||||||
Production and manufacturing(b) | 1,106 | 1,051 | 488 | 426 | 52 | 48 | ||||||||||||||||||||||||||||||
Selling and general(b) | - | (7 | ) | 197 | 185 | 23 | 19 | |||||||||||||||||||||||||||||
Production and manufacturing | 1,156 | 1,012 | 381 | 368 | 58 | 51 | ||||||||||||||||||||||||||||||
Selling and general | - | - | 179 | 173 | 21 | 21 | ||||||||||||||||||||||||||||||
Federal excise tax | - | - | 412 | 421 | - | - | - | - | 394 | 397 | - | - | ||||||||||||||||||||||||
Depreciation and depletion | 300 | 298 | 49 | 47 | 4 | 3 | 334 | 318 | 46 | 51 | 4 | 3 | ||||||||||||||||||||||||
Non-service pension and postretirement benefit(b) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Financing(note 7) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Non-service pension and postretirement benefit | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Financing(note 6) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Total expenses | 2,980 | 2,368 | 6,949 | 5,093 | 295 | 263 | 3,109 | 2,712 | 5,582 | 5,283 | 276 | 277 | ||||||||||||||||||||||||
Income (loss) before income taxes | (9 | ) | (287 | ) | 272 | 100 | 107 | 86 | 79 | (65) | 350 | 708 | 47 | 100 | ||||||||||||||||||||||
Income taxes | (3 | ) | (86 | ) | 71 | 22 | 29 | 22 | 21 | (21) | 93 | 187 | 13 | 27 | ||||||||||||||||||||||
Net income (loss) | (6 | ) | (201 | ) | 201 | 78 | 78 | 64 | 58 | (44) | 257 | 521 | 34 | 73 | ||||||||||||||||||||||
Cash flows from (used in) operating activities | (10 | ) | 117 | 776 | 302 | 116 | 100 | 280 | 337 | 732 | 590 | 48 | 83 | |||||||||||||||||||||||
Capital and exploration expenditures(c) | 183 | 91 | 88 | 39 | 7 | 3 | ||||||||||||||||||||||||||||||
Capital and exploration expenditures(b) | 372 | 206 | 129 | 57 | 17 | 4 | ||||||||||||||||||||||||||||||
Total assets as at March 31(c) | 35,235 | 34,463 | 5,556 | 5,034 | 454 | 417 | ||||||||||||||||||||||||||||||
Second Quarter | Corporate and other | Eliminations | Consolidated | |||||||||||||||||||||||||||||||||
Three Months to March 31 | Corporate and other | Eliminations | Consolidated | |||||||||||||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | 2019 | 2018 | 2019 | 2018 | ||||||||||||||||||||||||
Revenues and other income | ||||||||||||||||||||||||||||||||||||
Revenues(a) | - | - | - | - | 9,516 | 6,985 | - | - | - | - | 7,965 | 7,900 | ||||||||||||||||||||||||
Intersegment sales | - | - | (1,056 | ) | (593 | ) | - | - | - | - | (1,468) | (1,092) | - | - | ||||||||||||||||||||||
Investment and other income(note 5) | 5 | 3 | - | - | 27 | 48 | ||||||||||||||||||||||||||||||
Investment and other income(note 4) | 7 | 11 | - | - | 17 | 34 | ||||||||||||||||||||||||||||||
5 | 3 | (1,056 | ) | (593 | ) | 9,543 | 7,033 | 7 | 11 | (1,468) | (1,092) | 7,982 | 7,934 | |||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||
Exploration | - | - | - | - | 1 | - | - | - | - | - | 33 | 8 | ||||||||||||||||||||||||
Purchases of crude oil and products | - | - | (1,055 | ) | (591 | ) | 6,537 | 4,642 | - | - | (1,466) | (1,090) | 4,895 | 4,780 | ||||||||||||||||||||||
Production and manufacturing(b) | - | - | - | - | 1,646 | 1,525 | ||||||||||||||||||||||||||||||
Selling and general(b) | 54 | 6 | (1 | ) | (2 | ) | 273 | 201 | ||||||||||||||||||||||||||||
Production and manufacturing | - | - | - | - | 1,595 | 1,431 | ||||||||||||||||||||||||||||||
Selling and general | 15 | 2 | (2) | (2) | 213 | 194 | ||||||||||||||||||||||||||||||
Federal excise tax | - | - | - | - | 412 | 421 | - | - | - | - | 394 | 397 | ||||||||||||||||||||||||
Depreciation and depletion | 5 | 4 | - | - | 358 | 352 | 6 | 5 | - | - | 390 | 377 | ||||||||||||||||||||||||
Non-service pension and postretirement benefit(b) | 26 | - | - | - | 26 | - | ||||||||||||||||||||||||||||||
Financing(note 7) | 26 | 17 | - | - | 26 | 17 | ||||||||||||||||||||||||||||||
Non-service pension and postretirement benefit | 36 | 27 | - | - | 36 | 27 | ||||||||||||||||||||||||||||||
Financing(note 6) | 28 | 23 | - | - | 28 | 23 | ||||||||||||||||||||||||||||||
Total expenses | 111 | 27 | (1,056 | ) | (593 | ) | 9,279 | 7,158 | 85 | 57 | (1,468) | (1,092) | 7,584 | 7,237 | ||||||||||||||||||||||
Income (loss) before income taxes | (106 | ) | (24 | ) | - | - | 264 | (125 | ) | (78) | (46) | - | - | 398 | 697 | |||||||||||||||||||||
Income taxes | (29 | ) | (6 | ) | - | - | 68 | (48 | ) | (22) | (12) | - | - | 105 | 181 | |||||||||||||||||||||
Net income (loss) | (77 | ) | (18 | ) | - | - | 196 | (77 | ) | (56) | (34) | - | - | 293 | 516 | |||||||||||||||||||||
Cash flows from (used in) operating activities | (23 | ) | (27 | ) | - | - | 859 | 492 | (57) | (25) | - | - | 1,003 | 985 | ||||||||||||||||||||||
Capital and exploration expenditures(c) | 6 | 10 | - | - | 284 | 143 | ||||||||||||||||||||||||||||||
Capital and exploration expenditures(b) | 11 | 7 | - | - | 529 | 274 | ||||||||||||||||||||||||||||||
Total assets as at March 31(c) | 1,697 | 1,934 | (445) | (268) | 42,497 | 41,580 |
IMPERIAL OIL LIMITED
(a) | Included export sales to the United States of |
(b) |
Capital and exploration expenditures (CAPEX) include exploration expenses, additions to property, plant and equipment, additions to capital leases, additional investments and acquisitions. CAPEX excludes the purchase of carbon emission credits. |
(c) | Effective January 1, 2019, Imperial adopted the Financial Accounting Standards Board’s standard,Leases (Topic 842), as amended. As at March 31, 2019, “Total assets” include right of use assets of $286 million. An election was made not to restate prior periods. See note 8 for additional details. |
IMPERIAL OIL LIMITED
Six Months to June 30 | Upstream | Downstream | Chemical | |||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||
Revenues and other income | ||||||||||||||||||||||||
Revenues(a) | 4,307 | 3,498 | 12,477 | 9,883 | 632 | 562 | ||||||||||||||||||
Intersegment sales | 1,307 | 907 | 694 | 551 | 147 | 129 | ||||||||||||||||||
Investment and other income(note 5) | 4 | 10 | 41 | 233 | - | (1 | ) | |||||||||||||||||
5,618 | 4,415 | 13,212 | 10,667 | 779 | 690 | |||||||||||||||||||
Expenses | ||||||||||||||||||||||||
Exploration | 9 | 22 | - | - | - | - | ||||||||||||||||||
Purchases of crude oil and products | 2,947 | 2,142 | 10,097 | 8,023 | 418 | 394 | ||||||||||||||||||
Production and manufacturing(b) | 2,118 | 2,024 | 856 | 775 | 103 | 101 | ||||||||||||||||||
Selling and general(b) | - | (4 | ) | 370 | 373 | 44 | 41 | |||||||||||||||||
Federal excise tax | - | - | 809 | 815 | - | - | ||||||||||||||||||
Depreciation and depletion | 618 | 634 | 100 | 95 | 7 | 6 | ||||||||||||||||||
Non-service pension and postretirement benefit(b) | - | - | - | - | - | - | ||||||||||||||||||
Financing(note 7) | - | 4 | - | - | - | - | ||||||||||||||||||
Total expenses | 5,692 | 4,822 | 12,232 | 10,081 | 572 | 542 | ||||||||||||||||||
Income (loss) before income taxes | (74 | ) | (407 | ) | 980 | 586 | 207 | 148 | ||||||||||||||||
Income taxes | (24 | ) | (120 | ) | 258 | 128 | 56 | 39 | ||||||||||||||||
Net income (loss) | (50 | ) | (287 | ) | 722 | 458 | 151 | 109 | ||||||||||||||||
Cash flows from (used in) operating activities | 327 | 425 | 1,366 | 358 | 199 | 77 | ||||||||||||||||||
Capital and exploration expenditures(c) | 389 | 194 | 145 | 73 | 11 | 7 | ||||||||||||||||||
Total assets as at June 30 | 34,781 | 35,527 | 5,090 | 4,334 | 408 | 384 | ||||||||||||||||||
Six Months to June 30 | Corporate and other | Eliminations | Consolidated | |||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||
Revenues and other income | ||||||||||||||||||||||||
Revenues(a) | - | - | - | - | 17,416 | 13,943 | ||||||||||||||||||
Intersegment sales | - | - | (2,148 | ) | (1,587 | ) | - | - | ||||||||||||||||
Investment and other income(note 5) | 16 | 4 | - | - | 61 | 246 | ||||||||||||||||||
16 | 4 | (2,148 | ) | (1,587 | ) | 17,477 | 14,189 | |||||||||||||||||
Expenses | ||||||||||||||||||||||||
Exploration | - | - | - | - | 9 | 22 | ||||||||||||||||||
Purchases of crude oil and products | - | - | (2,145 | ) | (1,584 | ) | 11,317 | 8,975 | ||||||||||||||||
Production and manufacturing(b) | - | - | - | - | 3,077 | 2,900 | ||||||||||||||||||
Selling and general(b) | 56 | - | (3 | ) | (3 | ) | 467 | 407 | ||||||||||||||||
Federal excise tax | - | - | - | - | 809 | 815 | ||||||||||||||||||
Depreciation and depletion | 10 | 9 | - | - | 735 | 744 | ||||||||||||||||||
Non-service pension and postretirement benefit (b) | 53 | - | - | - | 53 | - | ||||||||||||||||||
Financing(note 7) | 49 | 27 | - | - | 49 | 31 | ||||||||||||||||||
Total expenses | 168 | 36 | (2,148 | ) | (1,587 | ) | 16,516 | 13,894 | ||||||||||||||||
Income (loss) before income taxes | (152 | ) | (32 | ) | - | - | 961 | 295 | ||||||||||||||||
Income taxes | (41 | ) | (8 | ) | - | - | 249 | 39 | ||||||||||||||||
Net income (loss) | (111 | ) | (24 | ) | - | - | 712 | 256 | ||||||||||||||||
Cash flows from (used in) operating activities | (48 | ) | (14 | ) | - | - | 1,844 | 846 | ||||||||||||||||
Capital and exploration expenditures(c) | 13 | 22 | - | - | 558 | 296 | ||||||||||||||||||
Total assets as at June 30 | 1,438 | 1,071 | (327 | ) | (211 | ) | 41,390 | 41,105 |
IMPERIAL OIL LIMITED
IMPERIAL OIL LIMITED
4. Accounting policy for revenue recognition
Imperial generally sells crude oil, natural gas and petroleum and chemical products under short-term agreements at prevailing market prices. In some cases, products may be sold under long-term agreements, with periodic price adjustments to reflect market conditions.
Revenue is recognized at the amount the company expects to receive when the customer has taken control, which is typically when title transfers and the customer has assumed the risks and rewards of ownership. The prices of certain sales are based on price indexes that are sometimes not available until the next period. In such cases, estimated realizations are accrued when the sale is recognized, and are finalized when final information is available. Such adjustments to revenue from performance obligations satisfied in previous periods are not significant. Payment for revenue transactions is typically due within 30 days. Future volume delivery obligations that are unsatisfied at the end of the period are expected to be fulfilled through ordinary production or purchases. These performance obligations are based on market prices at the time of the transaction and are fully constrained due to market price volatility.
“Revenues” and “Accounts receivable, less estimated doubtful accounts” primarily arise from contracts with customers. Long-term receivables are primarily fromnon-customers. Contract assets are mainly from marketing assistance programs and are not significant. Contract liabilities are mainly customer prepayments, loyalty programs and accruals of expected volume discounts, and are not significant.
5. Investment and other income
Investment and other income included gains and losses on asset sales as follows:
Six Months | ||||||||||||||||
Second Quarter | to June 30 | |||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Proceeds from asset sales | 9 | 39 | 21 | 222 | ||||||||||||
Book value of asset sales | - | 9 | 2 | 10 | ||||||||||||
Gain (loss) on asset sales, before tax(a) | 9 | 31 | 19 | 213 | ||||||||||||
Gain (loss) on asset sales, after tax(a) | 8 | 28 | 15 | 186 |
Three Months to March 31 | ||||||||
millions of Canadian dollars | 2019 | 2018 | ||||||
Proceeds from asset sales | 22 | 12 | ||||||
Book value of asset sales | 27 | 2 | ||||||
Gain (loss) on asset sales,before-tax | (5 | ) | 10 | |||||
Gain (loss) on asset sales,after-tax | (4 | ) | 7 |
6.5. Employee retirement benefits
The components of net benefit cost were as follows:
Six Months | ||||||||||||||||||||||||
Second Quarter | to June 30 | Three Months to March 31 | ||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Pension benefits: | ||||||||||||||||||||||||
Current service cost | 60 | 54 | 120 | 109 | 57 | 60 | ||||||||||||||||||
Interest cost | 75 | 79 | 151 | 158 | 81 | 76 | ||||||||||||||||||
Expected return on plan assets | (100 | ) | (101 | ) | (201 | ) | (202 | ) | (87 | ) | (101 | ) | ||||||||||||
Amortization of prior service cost | 1 | 2 | 2 | 5 | - | 1 | ||||||||||||||||||
Amortization of actuarial loss (gain) | 43 | 45 | 87 | 89 | 37 | 44 | ||||||||||||||||||
Net periodic benefit cost | 79 | 79 | 159 | 159 | 88 | 80 | ||||||||||||||||||
Other postretirement benefits: | ||||||||||||||||||||||||
Current service cost | 4 | 4 | 8 | 8 | 4 | 4 | ||||||||||||||||||
Interest cost | 6 | 6 | 11 | 12 | 5 | 5 | ||||||||||||||||||
Amortization of actuarial loss (gain) | 1 | 2 | 3 | 4 | - | 2 | ||||||||||||||||||
Net periodic benefit cost | 11 | 12 | 22 | 24 | 9 | 11 |
IMPERIAL OIL LIMITED
7.6. Financing and additional notes and loans payable information
Six Months | ||||||||||||||||||||||||
Second Quarter | to June 30 | Three Months to March 31 | ||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Debt-related interest | 32 | 27 | 62 | 49 | 39 | 30 | ||||||||||||||||||
Capitalized interest | (6 | ) | (10 | ) | (13 | ) | (22 | ) | (11 | ) | (7 | ) | ||||||||||||
Net interest expense | 26 | 17 | 49 | 27 | 28 | 23 | ||||||||||||||||||
Other interest | - | - | - | 4 | - | - | ||||||||||||||||||
Total financing | 26 | 17 | 49 | 31 | 28 | 23 |
8.7. Long-term debt
As at | As at | |||||||||||||||
June 30 | Dec 31 | As at Mar 31 | As at Dec 31 | |||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2019 | 2018 | ||||||||||||
Long-term debt | 4,447 | 4,447 | 4,447 | 4,447 | ||||||||||||
Capital leases | 545 | 558 | ||||||||||||||
Finance leases(a) | 525 | 531 | ||||||||||||||
Total long-term debt | 4,992 | 5,005 | 4,972 | 4,978 |
(a) | Maturity analysis of finance lease liabilities is disclosed in note 8. |
IMPERIAL OIL LIMITED
8. Leases
The company generally purchases the property, plant and equipment used in operations, but there are situations where assets are leased, primarily rail cars, marine vessels, storage tanks and other moveable equipment. Right of use assets and lease liabilities are established on the balance sheet for leases with an expected term greater than one year, by discounting the amounts fixed in the lease agreement for the duration of the lease which is reasonably certain, considering the probability of exercising any early termination and extension options. The portion of the fixed payment related to service costs for long-term transportation agreements is excluded from the calculation of right of use assets and lease liabilities. Usually, assets are leased only for a portion of their useful lives and are accounted for as operating leases. In limited situations assets are leased for nearly all of their useful lives and are accounted for as finance leases. In general, leases are capitalized using the company’s incremental borrowing rate.
Variable payments under these lease agreements are not significant. Residual value guarantees, restrictions, or covenants related to leases, and transactions with related parties are also not significant. The company’s activities as a lessor are not material.
At adoption of the lease accounting change (see note 2), on January 1, 2019, an operating lease liability of $298 million was recorded and the operating lease right of use asset was $298 million. There was no cumulative earnings effect adjustment.
The table below summarizes the total lease cost incurred:
Three Months to March 31 2019 | ||||||||
millions of Canadian dollars | Operating leases | Finance leases | ||||||
Operating lease cost | 37 | |||||||
Short-term and other (net of sublease rental income) | 15 | |||||||
Amortization of right of use assets | 13 | |||||||
Interest on lease liabilities | 10 | |||||||
Total lease cost | 52 | 23 | ||||||
The following table summarizes the amounts related to operating leases and finance leases recorded on the Consolidated balance sheet: |
| |||||||
As at March 31 2019 | ||||||||
millions of Canadian dollars | Operating leases | Finance leases | ||||||
Right of use assets | ||||||||
Included in Other assets, including intangibles, net | 286 | |||||||
Included in Property, plant and equipment, net | 588 | |||||||
Total right of use assets | 286 | 588 | ||||||
Lease liability due within one year | ||||||||
Included in Accounts payable and accrued liabilities | 123 | 45 | ||||||
Included in Notes and loans payable | 27 | |||||||
Long-term lease liability | ||||||||
Included in Other long-term obligations | 160 | 4 | ||||||
Included in Long-term debt | 525 | |||||||
Total lease liability | 283 | 601 |
IMPERIAL OIL LIMITED
The maturity analysis of the company’s lease liabilities, weighted average remaining lease term and weighted average discount rates applied are summarized below:
As at March 31 2019 | ||||||||
millions of Canadian dollars, unless noted | Operating leases | Finance leases | ||||||
Maturity analysis of lease liabilities | ||||||||
2019 remaining months | 101 | 84 | ||||||
2020 | 90 | 71 | ||||||
2021 | 45 | 50 | ||||||
2022 | 15 | 49 | ||||||
2023 | 13 | 48 | ||||||
2024 | 12 | 47 | ||||||
2025 and beyond | 28 | 1,086 | ||||||
Total lease payments | 304 | 1,435 | ||||||
Discount to present value | (21 | ) | (834 | ) | ||||
Total lease liability | 283 | 601 | ||||||
Weighted average remaining lease term(years) | 4 | 38 | ||||||
Weighted average discount rate(percent) | 2.7 | 7.0 | ||||||
In addition to the operating lease liabilities in the table immediately above, at March 31, 2019, additional undiscounted commitments for leases not yet commenced totalled $11 million. These unrecorded lease commitments are the primary difference between the operating lease liabilities reflected in the table above and the $291 million disclosed at December 31, 2018, for minimum lease commitments under the prior lease accounting standard. |
| |||||||
The table below summarizes the cash paid for amounts included in the measurement of lease liabilities and the right of use assets obtained in exchange for new lease liabilities: |
| |||||||
Three Months to March 31 2019 | ||||||||
millions of Canadian dollars | Operating leases | Finance leases | ||||||
Cash paid for amounts included in the measurement of lease liabilities | ||||||||
Cash flows from operating activities | 36 | |||||||
Cash flows from financing activities | 7 | |||||||
Non-cash right of use assets recorded for lease liabilities | ||||||||
For January 1 adoption ofLeases (Topic 842) | 298 | - | ||||||
In exchange for new lease liabilities during the period | 7 | - |
IMPERIAL OIL LIMITED
At December 31, 2018, the company heldnon-cancelable operating leases covering primarily storage tanks, rail cars and marine vessels, with minimum undiscounted lease commitments totaling $291 million as indicated in the following table:
millions of Canadian dollars | As at Dec 31 2018 | |||
Payments due by period | ||||
2019 | 130 | |||
2020 | 82 | |||
2021 | 43 | |||
2022 | 13 | |||
2023 | 11 | |||
2024 and beyond | 12 | |||
Total lease payments under minimum commitments(a) | 291 |
(a) | Net rental cost under cancelable andnon-cancelable operating leases incurred in 2018 was $221 million (2017 - $206 million, 2016 - $253 million). Related rental income was not material. |
9. Other long-term obligations
As at | As at | As at | As at | |||||||||||||
June 30 | Dec 31 | Mar 31 | Dec 31 | |||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2019 | 2018 | ||||||||||||
Employee retirement benefits(a) | 1,501 | 1,529 | 1,172 | 1,195 | ||||||||||||
Asset retirement obligations and other environmental liabilities(b) | 1,471 | 1,460 | 1,444 | 1,435 | ||||||||||||
Share-based incentive compensation liabilities | 129 | 99 | 88 | 78 | ||||||||||||
Other obligations(c) | 842 | 692 | ||||||||||||||
Operating lease liability(c) | 160 | - | ||||||||||||||
Other obligations | 244 | 235 | ||||||||||||||
Total other long-term obligations | 3,943 | 3,780 | 3,108 | 2,943 |
(a) | Total recorded employee retirement benefits obligations also included |
(b) | Total asset retirement obligations and other environmental liabilities also included |
(c) | Effective January 1, 2019, Imperial adopted the Financial Accounting Standards Board’s standard,Leases (Topic 842), as amended. The standard requires all leases to be recorded |
On July 3,10. Financial instruments
The fair value of the company’s financial instruments is determined by reference to various market data and other appropriate valuation techniques. There are no material differences between the fair value of the company’s financial instruments and the recorded carrying value. At March 31, 2019 and December 31, 2018 the Governmentfair value of Ontario revoked its carbon emission cap and trade regulation, prohibiting all trading of emissions allowances. On July 25, 2018, the Government of Ontario introduced legislation proposing to repeal Ontario’s cap and trade legislation and providing the framework for the wind down of the cap and trade program. The company’s net carbon emission program credits (obligations) reflected in the Consolidated balance sheet approximately totalled $65long-term debt ($4,447 million, at June 30, 2018. Imperial will continue to assess this financial position in light of these announcements and the anticipated legislative process.excluding finance lease obligations) was primarily a level 2 measurement.
IMPERIAL OIL LIMITED
10.11. Common shares
As of | As of | |||||||||||||||
June 30 | Dec 31 | |||||||||||||||
thousands of shares | 2018 | 2017 | As of Mar 31 2019 | As of Dec 31 2018 | ||||||||||||
Authorized | 1,100,000 | 1,100,000 | 1,100,000 | 1,100,000 | ||||||||||||
Common shares outstanding | 802,680 | 831,242 | 772,589 | 782,565 |
The current12-month normal course issuer bid program that was in place during the second quarter of 2018 came into effect in June of 2017 and was amended on April 27, 2018. The program enabled the company to purchase up to a maximum of 42,326,545 common shares (5 percent of the total shares on June 13, 2017), which included shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. Exxon Mobil Corporation participated to maintain its ownership percentage in Imperial at approximately 69.6 percent.
The company announced another12-month normal course issuer bid program effective June 27, 2018, andunder which Imperial will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 40,391,196 common shares (5 percent of the total shares on June 13, 2018) which includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent.
The excess of the purchase cost over the stated value of shares purchased has been recorded as a distribution of earnings reinvested.
The company’s common share activities are summarized below:
Thousands of shares | Millions of dollars | Thousands of shares | Millions of dollars | |||||||||||||
Balance as at December 31, 2016 | 847,599 | 1,566 | ||||||||||||||
Balance as at December 31, 2017 | 831,242 | 1,536 | ||||||||||||||
Issued under employee share-based awards | 2 | - | 2 | - | ||||||||||||
Purchases at stated value | (16,359 | ) | (30 | ) | (48,679 | ) | (90 | ) | ||||||||
Balance as at December 31, 2017 | 831,242 | 1,536 | ||||||||||||||
Balance as at December 31, 2018 | 782,565 | 1,446 | ||||||||||||||
Issued under employee share-based awards | - | - | - | - | ||||||||||||
Purchases at stated value | (28,562 | ) | (53 | ) | (9,976 | ) | (19 | ) | ||||||||
Balance as at June 30, 2018 | 802,680 | 1,483 | ||||||||||||||
Balance as at March 31, 2019 | 772,589 | 1,427 |
The following table provides the calculation of basic and diluted earnings per common share:share and the dividends declared by the company on its outstanding common shares:
Three Months to March 31 | ||||||||
2019 | 2018 | |||||||
Net income (loss) per common share - basic | ||||||||
Net income (loss)(millions of Canadian dollars) | 293 | 516 | ||||||
Weighted average number of common shares outstanding(millions of shares) | 777.5 | 829.0 | ||||||
Net income (loss) per common share(dollars) | 0.38 | 0.62 | ||||||
Net income (loss) per common share - diluted | ||||||||
Net income (loss)(millions of Canadian dollars) | 293 | 516 | ||||||
Weighted average number of common shares outstanding(millions of shares) | 777.5 | 829.0 | ||||||
Effect of employee share-based awards(millions of shares) | 2.3 | 2.5 | ||||||
Weighted average number of common shares outstanding, assuming dilution(millions of shares) | 779.8 | 831.5 | ||||||
Net income (loss) per common share(dollars) | 0.38 | 0.62 | ||||||
Dividends per common share - declared(dollars) | 0.19 | 0.16 |
Second Quarter | Six Months to June 30 | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net income (loss) per common share - basic | ||||||||||||||||
Net income (loss)(millions of Canadian dollars) | 196 | (77 | ) | 712 | 256 | |||||||||||
Weighted average number of common shares outstanding(millions of shares) | 816.1 | 847.0 | 822.6 | 847.3 | ||||||||||||
Net income (loss) per common share(dollars) | 0.24 | (0.09 | ) | 0.86 | 0.30 | |||||||||||
Net income (loss) per common share - diluted | ||||||||||||||||
Net income (loss)(millions of Canadian dollars) | 196 | (77 | ) | 712 | 256 | |||||||||||
Weighted average number of common shares outstanding(millions of shares) | 816.1 | 847.0 | 822.6 | 847.3 | ||||||||||||
Effect of employee share-based awards(millions of shares) | 2.7 | 2.9 | 2.6 | 2.8 | ||||||||||||
Weighted average number of common shares outstanding, assuming dilution(millions of shares) | 818.8 | 849.9 | 825.2 | 850.1 | ||||||||||||
Net income (loss) per common share(dollars) | 0.24 | (0.09 | ) | 0.86 | 0.30 |
IMPERIAL OIL LIMITED
11.12. Earnings reinvested
Second Quarter | Six Months to June 30 | Three Months to March 31 | ||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Earnings reinvested at beginning of period | 24,861 | 25,558 | 24,714 | 25,352 | 24,560 | 24,714 | ||||||||||||||||||
Net income (loss) for the period | 196 | (77 | ) | 712 | 256 | 293 | 516 | |||||||||||||||||
Share purchases in excess of stated value | (853 | ) | (121 | ) | (1,090 | ) | (121 | ) | (342 | ) | (237 | ) | ||||||||||||
Dividends declared | (155 | ) | (136 | ) | (287 | ) | (263 | ) | (147 | ) | (132 | ) | ||||||||||||
Earnings reinvested at end of period | 24,049 | 25,224 | 24,049 | 25,224 | 24,364 | 24,861 |
12.13. Other comprehensive income (loss) information
Changes in accumulated other comprehensive income (loss):
millions of Canadian dollars | 2018 | 2017 | 2019 | 2018 | ||||||||||||
Balance at January 1 | (1,815 | ) | (1,897 | ) | (1,517 | ) | (1,815 | ) | ||||||||
Postretirement benefits liability adjustment: | ||||||||||||||||
Current period change excluding amounts reclassified | (19 | ) | 41 | 18 | (19 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income | 67 | 72 | 27 | 34 | ||||||||||||
Balance at June 30 | (1,767 | ) | (1,784 | ) | ||||||||||||
Balance at March 31 | (1,472 | ) | (1,800 | ) |
Amounts reclassified out of accumulated other comprehensive income (loss) -before-tax before tax income (expense):
Second Quarter | Six Months to June 30 | Three Months to March 31 | ||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Amortization of postretirement benefits liability adjustment | (46 | ) | (49 | ) | (92 | ) | (98 | ) | (37 | ) | (46 | ) |
(a) | This accumulated other comprehensive income component is included in the computation of net periodic benefit cost (note |
Income tax expense (credit) for components of other comprehensive income (loss):
Second Quarter | Six Months to June 30 | Three Months to March 31 | ||||||||||||||||||||||
millions of Canadian dollars | 2018 | 2017 | 2018 | 2017 | 2019 | 2018 | ||||||||||||||||||
Postretirement benefits liability adjustments: | ||||||||||||||||||||||||
Postretirement benefits liability adjustment (excluding amortization) | - | - | (7 | ) | 16 | 7 | (7 | ) | ||||||||||||||||
Amortization of postretirement benefits liability adjustment included | 13 | 13 | 25 | 26 | 10 | 12 | ||||||||||||||||||
Total | 13 | 13 | 18 | 42 | 17 | 5 |
13.14. Recently issued accounting standards
Effective January 1, 2019,2020, Imperial will adopt the Financial Accounting Standards Board’s standard,update,LeasesFinancial Instruments - Credit Losses (Topic 842)326), as amended. The standard requires all leases with an initial term greater than one yeara valuation allowance for credit losses be recordedrecognized for certain financial assets that reflects the current expected credit loss over the asset’s contractual life. The valuation allowance considers the risk of loss, even if remote and considers past events, current conditions and expectations of the future. Imperial is evaluating the standard and its effect on the balance sheet as a right of use asset and a lease liability. The company acquired lease accounting software to facilitate implementation, and is currently installing, configuring and testing the software. Based on leases outstanding at the end of 2017, the company estimates the operating lease right of use asset and lease liability would have been in the range of $200 million to $250 million at that time. The effect on Imperial’s consolidated balance sheet as a result of implementing the standard on January 1, 2019 could differ considerably depending on operating leases commenced in 2018 as well as interest rates and other factors such as the expiry or renewal of leases during the year.company’s financial statements.
IMPERIAL OIL LIMITED
Item 2. | Management’s discussion and analysis of financial condition and results of operations |
Operating results
SecondFirst quarter 20182019 vs. secondfirst quarter 20172018
The company’s net income for the secondfirst quarter of 20182019 was $196$293 million or $0.24$0.38 per share on a diluted basis, an increase of $273 million compared to the net lossincome of $77$516 million or $0.09$0.62 per share for the same period last year.2018.
Upstream recorded a net lossincome was $58 million in the secondfirst quarter, of $6up $102 million compared to a net loss of $201 million infrom the same period of 2017.2018. Improved results reflect the impact of higher Canadian crude oil realizations of about $280$160 million partially offset byand higher royalty costsSyncrude and Norman Wells volumes of about $50 million and$80 million. Results were negatively impacted by higher operating expenses of about $120 million and lower Cold Lake volumes of about $50 million mainly associated with planned turnarounds.million.
West Texas Intermediate (WTI) averaged US$67.9154.90 per barrel in the secondfirst quarter of 2018, up2019, down from US$48.2062.89 per barrel in the same quarter of 2017.2018. Western Canada Select (WCS) averaged US$48.8142.44 per barrel and US$37.1838.67 per barrel respectively for the same periods. The WTI / WCS differential widenednarrowed during the first quarter of 2019 to average approximately US$1912 per barrel infor the second quarter, of 2018, from approximatelycompared to around US$1124 per barrel in the same period of 2017.2018.
The Canadian dollar averaged US$0.780.75 in the secondfirst quarter of 2018, an increase2019, a decrease of US$0.04 from the secondfirst quarter of 2017.2018.
Imperial’s average Canadian dollar realizations for bitumen increased in the quarter, supported by an increase in WCS and lower diluent costs. Bitumen realizations averaged $48.85 per barrel for the first quarter of 2019, up from $35.61 per barrel in the first quarter of 2018. The company’s average Canadian dollar realizations for synthetic crudes increasedcrude declined generally in line with the North American benchmarks,WTI, adjusted for changes in exchange rates and transportation costs. Bitumen realizations averaged $48.90 per barrel for the second quarter of 2018, an increase of $10.68 per barrel versus the second quarter of 2017. Synthetic crude realizations averaged $86.31$69.34 per barrel, an increase of $21.24compared to $77.26 per barrel forin the same period of 2017.2018.
Gross production of Cold Lake bitumen averaged 133,000145,000 barrels per day in the secondfirst quarter, compared to 160,000153,000 barrels per day in the same period last year. Lower volumes were primarilyproduction was mainly due to planned maintenance and production timing.timing associated with steam management.
Gross production of Kearl bitumen averaged 180,000 barrels per day in the secondfirst quarter (128,000(127,000 barrels Imperial’s share), up from 171,000compared to 182,000 barrels per day (121,000(129,000 barrels Imperial’s share) during the secondfirst quarter of 2017. Higher production was mainly the result of mining optimization, partially offset by planned turnaround activities.2018.
The company’s share of gross production from Syncrude averaged 50,00078,000 barrels per day, up from 27,00065,000 barrels per day in the secondfirst quarter of 2017.2018. Higher production was mainly due to the absence of the Syncrude Mildred Lake upgrader fire that occurred in March 2017,reduced downtime, partially offset by planned turnaround activities and a power disruption that occurred on June 20, 2018, resulting in a complete shutdown of all processing units for the remainder of the second quarter. Recoveryimpacts from the power outage is ongoing with partialGovernment of Alberta’s production restored in July and return to full rates anticipated in September.curtailment order.
Downstream net income was $201$257 million in the secondfirst quarter, up from $78compared to net income of $521 million in the secondfirst quarter of 2017.2018. Earnings increaseddecreased mainly due to strongerlower margins of about $390 million, partially offset by the impact of increased planned turnaround activity of about $200$180 million and the impact of a stronger Canadian dollar.refinery reliability events of about $60 million.
Refinery throughput averaged 363,000383,000 barrels per day, up from 358,000compared to 408,000 barrels per day in the secondfirst quarter of 2017.2018. Capacity utilization increasedwas 91 percent, compared to 86 percent from 8596 percent in the secondfirst quarter of 2017.2018. Reduced throughput was mainly due to reliability events at company facilities.
Petroleum product sales were 510,000477,000 barrels per day, up from 486,000compared to 478,000 barrels per day in the secondfirst quarter of 2017. Sales growth continues to be driven by optimization across the full Downstream value chain, and the expansion of Imperial’s logistics capabilities.2018.
IMPERIAL OIL LIMITED
Chemical net income of $78was $34 million in the secondfirst quarter, matched best-ever quarterly results. Earnings increased $14compared to $73 million from the same periodquarter of 2017, benefitting from increased volumes and2018, primarily reflecting lower margins.
Corporate and other expenses were $77$56 million in the secondfirst quarter, compared to $18$34 million in the same period of 2017, primarily due to higher share-based compensation charges. In addition, as part of the implementation of the Financial Accounting Standards Board’s update, Compensation – Retirement Benefits (Topic 715):Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, beginning January 1, 2018, Corporate and other includes allnon-service pension and postretirement benefit expenses. Prior to 2018, the majority of these costs were allocated to the operating segments.2018.
IMPERIAL OIL LIMITED
Six months 2018 vs. six months 2017
Net income in the first six months of 2018 was $712 million, or $0.86 per share on a diluted basis, an increase of $456 million compared to a net income of $256 million or $0.30 per share in the first six months of 2017.
Upstream recorded a net loss of $50 million in the first six months of 2018, compared to a net loss of $287 million from the same period of 2017. Improved results reflect the impact of higher Canadian crude oil realizations of about $350 million, partially offset by the impact of higher operating costs of about $50 million mainly associated with planned turnarounds. Results also reflect the impact of higher royalties and the strengthening of the Canadian dollar compared to the prior year.
West Texas Intermediate averaged US$65.44 per barrel in the first six months of 2018, up from US$49.96 per barrel in the prior year. Western Canada Select averaged US$43.74 per barrel and US$37.22 per barrel respectively for the same periods. The WTI / WCS differential widened to approximately US$22 per barrel in the first six months of 2018, from approximately US$13 per barrel in the same period of 2017.
The Canadian dollar averaged US$0.78 in the first six months of 2018, an increase of about US$0.03 from the same period of 2017.
Imperial’s average Canadian dollar realizations for bitumen and synthetic crudes increased generally in line with the North American benchmarks, adjusted for changes in the exchange rate and transportation costs. Bitumen realizations averaged $41.84 per barrel for the first six months of 2018, an increase of $4.63 per barrel versus 2017. Synthetic crude realizations averaged $81.24 per barrel, an increase of $14.24 per barrel from the same period of 2017.
Gross production of Cold Lake bitumen averaged 143,000 barrels per day in the first six months of 2018, compared to 159,000 barrels per day from the same period of 2017. Lower volumes were primarily due to planned maintenance and production timing.
Gross production of Kearl bitumen averaged 181,000 barrels per day in the first six months of 2018 (128,000 barrels Imperial’s share) up from 177,000 barrels per day (125,000 barrels Imperial’s share) from the same period of 2017.
During the first six months of 2018, the company’s share of gross production from Syncrude averaged 57,000 barrels per day, up from 46,000 barrels per day from the same period of 2017. Higher production was due to the absence of the impact associated with the March 2017 fire at the Syncrude Mildred Lake upgrader, partially offset by planned turnaround activities, and a power disruption that occurred on June 20, 2018, resulting in a complete shutdown of all processing units for the remainder of the second quarter. Recovery from the power outage is ongoing with partial production restored in July and return to full rates anticipated in September.
Downstream net income was $722 million, an increase of $264 million versus the prior year. Higher earnings reflect stronger margins of about $690 million, partially offset by the impact of increased planned turnaround activity of about $200 million, the impact of a stronger Canadian dollar of about $60 million and the absence of the $151 million gain on the sale of a surplus property in 2017.
Refinery throughput averaged 386,000 barrels per day in the first six months of 2018, up from 378,000 barrels per day from the same period of 2017. Capacity utilization increased to 91 percent from 90 percent in the same period of 2017.
Petroleum product sales were 494,000 barrels per day in the first six months of 2018, up from 486,000 barrels per day from the same period of 2017. Sales growth continues to be driven by optimization across the full Downstream value chain, and the expansion of Imperial’s logistics capabilities.
Chemical net income was $151 million, up from $109 million in the first half of 2017, primarily due to higher margins and volumes.
IMPERIAL OIL LIMITED
Corporate and other expenses were $111 million for the first six months of 2018, compared to $24 million in the same period of 2017, primarily due to higher share-based compensation charges. In addition, beginning January 1, 2018, Corporate and other includes allnon-service pension and postretirement benefit expenses. Prior to 2018, the majority of these costs were allocated to the operating segments.
IMPERIAL OIL LIMITED
Liquidity and capital resources
Cash flow generated from operating activities was $859$1,003 million in the secondfirst quarter, an increase of $367up from $985 million fromin the corresponding period in 2017,2018, reflecting higher working capital effects, partially offset by lower earnings.
Investing activities used net cash of $379$463 million in the secondfirst quarter, compared with $281$365 million used in the same period of 2017.2018.
Cash used in financing activities was $1,032$517 million in the secondfirst quarter, compared with $260$390 million used in the secondfirst quarter of 2017. Dividends paid in the second quarter of 2018 were $132 million. The per share dividend paid in the second quarter was $0.16, up from $0.15 in the same period of 2017. During the second quarter, the company purchased about 21.4 million shares for $893 million.
The company’s cash balance was $873 million at June 30, 2018, versus $623 million at the end of second quarter 2017.
Cash flow generated from operating activities was $1,844 million in the first six months of 2018, compared with $846 million from the same period of 2017, reflecting higher earnings and working capital effects.
Investing activities used net cash of $744 million in the first six months of 2018, compared with $220 million used in the same period of 2017, reflecting higher additions to property, plant and equipment, and lower proceeds from asset sales.
Cash used in financing activities was $1,422 million in the first six months of 2018, compared with $394 million used in the same period of 2017.2018. Dividends paid in the first six monthsquarter of 20182019 were $266$149 million. The per share dividend paid in the first six months of 2018quarter was $0.32,$0.19, up from $0.30 from$0.16 in the same period of 2017.2018. During the first six months of 2018,quarter, the company, under its share purchase program, purchased about 28.610 million shares for $1,143$361 million, including shares purchased from Exxon Mobil Corporation.
On April 27, 2018,The company’s cash balance was $1,011 million at March 31, 2019, versus $1,425 million at the company announced by news release that it had received final approval from the Toronto Stock Exchange for an amendment to its normal course issuer bid to increase the numberend of common shares that it may purchase. Under the amendment, the number of common shares eligible for purchase increased to a maximum of 42,326,545 common shares during the period June 27, 2017 to June 26,first quarter 2018.
On June 22, 2018, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 40,391,196 common shares during the period June 27, 2018 to June 26, 2019. This maximum includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. The program will end should the company purchase the maximum allowable number of shares, or on June 26, 2019.
Recently issued accounting standards
Effective January 1, 2019,2020, Imperial will adopt the Financial Accounting Standards Board’s standard,update,LeasesFinancial Instruments - Credit Losses (Topic 842)326), as amended. The standard requires all leases with an initial term greater than one yeara valuation allowance for credit losses be recordedrecognized for certain financial assets that reflects the current expected credit loss over the asset’s contractual life. The valuation allowance considers the risk of loss, even if remote and considers past events, current conditions and expectations of the future. Imperial is evaluating the standard and its effect on the balance sheet as a right of use asset and a lease liability. The company acquired lease accounting software to facilitate implementation, and is currently installing, configuring and testing the software. Based on leases outstanding at the end of 2017, the company estimates the operating lease right of use asset and lease liability would have been in the range of $200 million to $250 million at that time. The effect on Imperial’s consolidated balance sheet as a result of implementing the standard on January 1, 2019 could differ considerably depending on operating leases commenced in 2018 as well as interest rates and other factors such as the expiry or renewal of leases during the year.company’s financial statements.
IMPERIAL OIL LIMITED
Forward-looking statements
Statements in this report regardingof future events or conditions in this report, including projections, targets, expectations, estimates, and business plans are forward-looking statements. Disclosure related to the share purchase program and capital activities constitutes forward-looking statements. Forward-looking statements are based on the company’s current expectations, estimates, projections and assumptions at the time the statements are made. Actual future financial and operating results, including expectations and assumptions concerning demand growth and energy source, supply and mix; commodity prices and foreign exchange rates; production rates, growth and mix; applicable laws and government policies; financing sources; and capital and environmental expenditures could differ materially due todepending on a number of factors. These factors include changes in the impactsupply of market conditions,and demand for crude oil, natural gas, and petroleum and petrochemical products and resulting price and margin impacts; transportation for accessing markets; political or regulatory events, including changes in law or governmental policy, changesgovernment policy; environmental risks inherent in operating conditions and costs, changes in project schedules, operating performance, demand for oil and gas commercial negotiationsexploration and production activities; environmental regulation; currency exchange rates; availability and allocation of capital; unanticipated operational disruptions; project management and schedules; operational hazards and risks; cybersecurity incidents; disaster response preparedness; and other factors discussed in Item 1A risk factors and Item 7 management’s discussion and analysis of financial condition and results of operations of Imperial Oil Limited’s most recent annual report on Form10-K.
Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties, some that are similar to other oil and gas companies and some that are unique to Imperial. Imperial’s actual results may differ materially from those expressed or other technicalimplied by its forward-looking statements and economic factors.readers are cautioned not to place undue reliance on them. Imperial undertakes no obligation to update any forward-looking statements contained herein, except as required by applicable law.
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.
IMPERIAL OIL LIMITED
Item 3. Quantitative and qualitative disclosures about market risk |
Information about market risks for the sixthree months ended June 30, 2018,March 31, 2019, does not differ materially from that discussed on page 4925 of the company’s annual report on Form10-K for the year ended December 31, 2017. The following table details those earnings sensitivities that have been updated from the fiscalyear-end to reflect current market conditions.2018.
Earnings Sensitivities (a)
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As indicated in the certifications in Exhibit 31 of this report, the company’s principal executive officer and principal financial officer have evaluated the company’s disclosure controls and procedures as of June 30, 2018.March 31, 2019. Based on that evaluation, these officers have concluded that the company’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by the company 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 has not been any change in the company’s internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting.
IMPERIAL OIL LIMITED
On May 15, 2018, Imperial entered a guilty plea in the Ontario Court of Justice with respect to committing the offence of discharging or causing or permitting the discharge of a contaminant, namely coker stabilizer thermocracked gas and coker stabilizer thermocracked gas condensate, on June 11, 2015 from Imperial’s refinery in Sarnia, Ontario into the natural environment that caused or was likely to have caused an adverse effect contrary to section 14(1) of the Environmental Protection Act, R.S.O. 1990, c.E.19, as amended. Imperial is required to pay $650,000 plus a 25 percent victim fine surcharge.
Item 2. Unregistered sales of equity securities and use of proceeds
Issuer purchases of equity securities
Total number of shares purchased | Average price paid (Canadian dollars) | Total number of as part of publicly announced plans or programs | Maximum number yet be purchased under the plans or programs (a) (b) | |||||||||||||||
April 2018 | ||||||||||||||||||
(April 1 - April 30) | 675,513 | 34.13 | 675,513 | 21,373,108 | ||||||||||||||
May 2018 | ||||||||||||||||||
(May 1 - May 31) | 10,876,173 | 41.39 | 10,876,173 | 10,496,935 | ||||||||||||||
June 2018 | ||||||||||||||||||
(June 1 - June 26) (a) | 9,322,449 | 42.80 | 9,322,449 | - | ||||||||||||||
(June 27 - June 30) (b) | 482,763 | 43.50 | 482,763 | 39,908,433 | (c) |
Total number of shares purchased | Average price paid (Canadian dollars) | Total number of shares purchased | Maximum number of shares that may yet be purchased under the plans or programs(a) | |||||||||||||
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January 2019 | 3,540,255 | 36.07 | 3,540,255 | 16,250,960 | ||||||||||||
(January 1 - January 31) | ||||||||||||||||
February 2019 | 3,057,193 | 35.95 | 3,057,193 | 13,193,767 | ||||||||||||
(February 1 - February 28) | ||||||||||||||||
March 2019 | 3,378,851 | 36.50 | 3,378,851 | 9,814,916 | (b) | |||||||||||
(March 1 - March 31) | ||||||||||||||||
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(a) |
On April 27, 2018, the company announced by news release that it had received final approval from the Toronto Stock Exchange for an amendment to its normal course issuer bid to increase the number of common shares that it may purchase. Under the amendment, the number of common shares eligible for purchase increased to a maximum of 42,326,545 common shares during the period June 27, 2017 to June 26, 2018. No other provisions of the normal course issuer bid were changed.
The program ended on June 26, 2018. Upon expiration, the company had purchased a total of 41,152,059 shares (of the maximum 42,326,545 shares available) under the program.
On June 22, 2018, the company announced by news release that it had received final approval from the Toronto Stock Exchange for a new normal course issuer bid and will continue its existing share purchase program. The program enables the company to purchase up to a maximum of 40,391,196 common shares during the period June 27, 2018 to June 26, 2019. This maximum includes shares purchased under the normal course issuer bid and from Exxon Mobil Corporation concurrent with, but outside of the normal course issuer bid. As in the past, Exxon Mobil Corporation has advised the company that it intends to participate to maintain its ownership percentage at approximately 69.6 percent. The program will end should the company purchase the maximum allowable number of shares, or on June 26, 2019. |
In its most recent quarterly earnings release, the company stated that it currently anticipates exercising its share purchases uniformly over the duration of the program. Purchase plans may be modified at any time without prior notice. |
The company will continue to evaluate its share purchase program in the context of its overall capital activities.
IMPERIAL OIL LIMITED
(31.1) Certification by the principal executive officer of the company pursuant to Rule13a-14(a). | ||
(31.2) Certification by the principal financial officer of the company pursuant to Rule13a-14(a). | ||
(32.1) Certification by the chief executive officer of the company pursuant to Rule13a-14(b) and 18 U.S.C. Section 1350. | ||
(32.2) Certification by the chief financial officer of the company pursuant to Rule13a-14(b) and 18 U.S.C. Section 1350. | ||
(101) Interactive data files. |
IMPERIAL OIL LIMITED
Pursuant to the requirements of theSecurities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Imperial Oil Limited | ||||
(Registrant) | ||||
Date: | /s/ Daniel E. Lyons
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(Signature) | ||||
Daniel E. Lyons | ||||
Senior vice-president, finance and administration, and controller | ||||
(Principal accounting officer) |
Date: | /s/ Cathryn Walker
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(Signature) | ||||
Cathryn Walker | ||||
Assistant corporate secretary |
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