|
Ours is a long-term business, with today's accomplishments a reflection of well-executed plans set in motion years ago. Likewise, our success at building shareholder value in the future is dependent on plans we develop and implement today.
ExxonMobil is managed to enhance long-term shareholder value.
The following strategies will guide ExxonMobil as we strive to meet shareholder and customer expectations:
- Maintaining a leadership position in core businesses
- Being the most efficient competitor in every aspect of our business
- Capturing quality investment opportunities while maintaining a selective and disciplined approach
- Maintaining a high-quality portfolio of productive assets
- Developing and employing the best technology
- Ensuring safe, environmentally sound operations
- Continually improving an already high-quality workforce in a high-performance climate across the organization
- Maintaining a strong financial position and ensuring that financial resources are employed wisely
1999 Highlights
- Exxon and Mobil merged to form Exxon Mobil Corporation
- Record best employee safety performance
- Annual dividend payments increased;17th consecutive year
- 1.9 billion oil-equivalent barrels added to the resource base
- Proved reserves additions replaced 106 percent of production
- Significant discoveries in Angola, the Gulf of Mexico, and Nigeria
- Record exploratory acreage acquisitions in high-potential areas
- Expanded premium lubricant manufacturing capacity
- Implemented worldwide chemical additive joint venture with Shell
- Record chemical sales volumes
- Record coal and copper production
1999 Industry Conditions
World GDP grew at 2.7 percent in 1999. Continued strong growth in the U.S., coupled with the beginning of recovery in Asia, resulted in better economic performance than in 1998. World oil demand increased by over 1 million barrels per day in 1999.
Oil prices recovered to average nearly $18 per barrel in 1999. Prices ranged from a low of under $10 per barrel early in the year to a high of nearly $27 per barrel towards year end. Oil inventories began the year at historically high levels but decreased throughout the year due to curtailment of supply.
Natural gas prices increased in the U.S. but were down in Europe. U.S. Gulf Coast natural gas prices averaged $2.17 per million BTU, up $0.17 per million BTU versus 1998. Gas prices declined 17 percent in Europe, where gas prices track the movement of petroleum product prices, but on a delayed basis.
Refining margins decreased in all major markets in 1999. Fuels marketing margins were also broadly lower. Increasing crude prices, high product inventories, and new refinery capacity in Asia all contributed to the lower downstream margins.
Worldwide petrochemical demand growth accelerated from 1998 rates as Asian economies began to recover.
| Financial Highlights |
| (millions of dollars) |
1999 |
1998 |
1997 |
|
|
| Total revenue |
185,527 |
169,642 |
201,746 |
|
Net income |
7,910 |
8,074 |
11,732 |
|
Cash from operations and asset management |
15,867 |
17,958 |
23,635 |
|
Capital and exploration expenditures |
13,307 |
15,535 |
14,117 |
|
Cash dividends to ExxonMobil shareholders |
5,872 |
5,843 |
5,757 |
|
Total assets at year end |
144,521 |
139,335 |
143,751 |
|
Total debt at year end |
18,972 |
17,016 |
17,182 |
|
Shareholders' equity at year end |
63,466 |
62,120 |
63,121 |
|
Average capital employed |
83,836 |
80,079 |
79,650 |
| Market valuation at year end |
280,150 |
245,536 |
206,891 |
|
|
| Key Financial Ratios |
|
Earnings per share - assuming dilution (dollars) |
2.25 |
2.28 |
3.28 |
|
Return on average capital employed (percent) |
10.3 |
10.7 |
15.5 |
|
Net income to average shareholders' equity (percent) |
12.6 |
12.9 |
18.7 |
|
Net income to total revenue (percent) |
4.3 |
4.8 |
5.8 |
|
Debt to capital(1) (percent) |
22.0 |
20.6 |
20.3 |
| Current assets to current liabilities(2) |
0.80 |
0.85 |
0.99 |
| Fixed charge coverage (times) |
6.6 |
6.9 |
9.9 |
|
|
(1)Debt includes short- and long-term debt. Capital includes short- and long-term debt, shareholders' equity, and minority interest.
(2)Current liabilities include short-term debt (notes and loans payable).
|
ExxonMobil is engaged in all aspects of the worldwide oil and natural gas business — exploration, production, manufacturing, distribution, and marketing. ExxonMobil is also a leading producer and marketer of petrochemicals and has interests in electric power generation, coal and minerals.
Exxon Mobil Corporation has numerous affiliates, many with names that include Exxon, ExxonMobil, Esso, and Mobil. For convenience in this report, those terms as well as the terms corporation, company, we, our, and its are sometimes used as abbreviated references to specific affiliates or affiliate groups.
Unless otherwise noted, the data in this book reflects ExxonMobil's operations in 1999, including those assets being impacted by the European Commission and U.S. Federal Trade Commission reviews. Additionally, certain assets being "held separate" pending completion of required divestitures are included, unless otherwise noted.
Projections, targets, estimates, and business plans in this report are forward-looking statements. Actual future results, including merger synergies, project dates, capacities, production rates, and resource recoveries could differ materially due to, for example, changes in market conditions affecting the oil and gas industry; the outcome of commercial negotiations; our ability to implement our business strategies as planned; and other factors discussed in Item 1 of ExxonMobil's Form 10-K.
The following third-party service mark, referenced in the text of this report, is owned by the entity indicated: Tesco (Tesco Stores Limited).
Liquids and Natural Gas Reserves and Resources
Proved oil and gas reserves are the estimated quantities of crude oil, natural gas, and natural gas liquids which geologic and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions, i.e., prices and costs as of the date the estimate is made. Prices include consideration of changes in existing prices provided only by contractual arrangements, but not on escalations based upon future conditions. In some cases, substantial new investments in additional wells and related facilities will be required to recover these proved reserves. Proved reserves include 100 percent of each majority-owned affiliate's participation in proved reserves and ExxonMobil's ownership percentage of the proved reserves of equity companies, but exclude royalties and quantities due others. To more accurately represent ExxonMobil's total proved liquids reserves, tar sands reserves associated with the Syncrude operation in Canada have been included in this report. Gas reserves exclude the gaseous equivalent of liquids expected to be removed from the gas on leases, at field facilities, and at gas processing plants. These liquids are included in net proved reserves of crude oil and natural gas liquids. Net proved developed reserves are those volumes which are expected to be recovered through existing wells with existing equipment and operating methods. Undeveloped reserves are those volumes that are expected to be recovered as a result of future investments to drill new wells, to recomplete existing wells, and/or to install facilities to collect and deliver the production from existing and future wells.
ExxonMobil's total resources include proved reserves and other quantities of oil and gas that are not yet classified as proved reserves, but which ExxonMobil believes will likely be produced in the future and be moved into the proved reserves category.
Minerals and Coal Terminology
Reserves are the estimated tonnage of ore materials and coal that geologic and engineering data demonstrate with reasonable certainty to be extractable in future years using specified mining techniques. Coal reserves also take into account any expected loss due to cleaning and processing. Resources include reserves as well as other bodies of material in which ExxonMobil has an interest, but are less well-defined than reserves and for which technical work, engineering studies, and/or changed economic conditions are required to confirm the mineability of the material.
The average grades quoted express the estimated percentage of metals contained in the ore. The cutoff
grade used to calculate the tonnage and average grade of each deposit is the metal content limit above which the reserves may be extracted and processed.
|
|
