1. Business Accounting
Final Project – Oil & Gas
Marcelo Rigoni
Ed Walker

2. Contents
 Oil Industry Overview
 BP
 Exxon Mobil
 PetroChina
 Chevron Texaco
 Petrobras

3. Oil Industry Overview
 The price of Crude Oil drives the Industry
 In late 90s price dropped to $10/barrel due to Asian
downturn
 Small companies bankrupted and large companies
merged

4. Oil Industry Overview
 Exploration stopped and oil service companies suffered
 Reviving global economy, increased energy demand
and political turmoil have seen Crude hit $55/barrel
 The higher prices have seen higher profits for
producers, refiners, pipelines, etc.

5. World Oil Reserves
6%
2%
4%
66% 4%
12%
6%

6. World Oil Consumption

7. World Oil - Flow

8. Oil Industry Performance
NYSE
100
80
Share Price (USD)
60
40
20
0
Jan-00 Jul-00 Dec-00 Jun-01 Dec-01 Jun-02 Dec-02 Jun-03 Dec-03 Jun-04
Date
BP Exxon PetroChina Chevron

9.  Head Office Irvine, Texas, USA
 Incorporated in 1882
 Exxon and Mobile merged (99)
 Operates exploration, production and
petrochemicals businesses
 Production capacity of 6.3 million barrels/day

10.  Head Office in London, England
 Incorporated in 1909
 Four Main Businesses: Exploration and
Production; Gas, Power and Renewables;
Refining and Marketing; and Petrochemicals
 Recent Mergers: Amoco (98), Atlantic Richfield
(00), Tyumen (03)
 Produces 1.2 million barrels/day

11.  Head Office San Ramon, California, USA
 Incorporated in 1876
 Broad range of petroleum products
 Merged with Texaco in 2001
 Production capacity 2.7 million barrels/day

12.  Head Office Rio de Janeiro, Brazil
 Incorporated 1953
 Operates in four businesses; exploration,
refinery, gas & international
 15th largest in the world
 Production capacity of 2 million barrels/day

13.  Head Office Beijing, China
 Incorporated 1988
 Broad range of petroleum & natural gas
activities
 Acquired 50% equity in Amerada Hess
Indonesia (03) with huge oil reserves
 Imported 125 million barrels in 2003

14. Oil Industry
Net Sales Comparison 2003
2003 net sales
$ billion
300
250
200
150
100
50
0
EXXON M OBIL BP PLC CHEVRON US PETROBRAS PETROCHINA

15. Profitability Ratios
PROFITABILITY EXXON MOBIL BP PLC CHEVRON U.S.
RATIOS 2001 2002 2003 2001 2002 2003 2001 2002 2003
profit margin 0,07 0,06 0,09 0,02 0,05 0,06 0,03 0,01 0,06
return on assets 0,11 0,08 0,12 0,03 0,05 0,07 0,05 0,02 0,09
return on equity 0,21 0,15 0,24 0,07 0,13 0,16 0,10 0,04 0,20
return on invested capital 0,36 0,28 0,42 0,17 0,41 0,45 0,27 0,11 0,37
PROFITABILITY PETROBRAS PETROCHINA INDUSTRY
RATIOS 2001 2002 2003 2001 2002 2003 AVERAGE
profit margin 0,10 0,07 0,15 0,22 0,19 0,25 0,10
return on assets 0,09 0,07 0,12 0,12 0,10 0,15 0,09
return on equity 0,26 0,25 0,38 0,21 0,17 0,23 0,19
return on invested capital 0,67 0,98 1,11 0,32 0,24 0,35 0,43

16. Activity Ratios
ACTIVITY EXXON MOBIL BP PLC CHEVRON U.S.
RATIOS 2001 2002 2003 2001 2002 2003 2001 2002 2003
asset turnover 1,49 1,34 1,42 1,36 1,14 1,28 1,37 1,28 1,49
receivables turnover 10,92 9,66 10,15 6,58 5,44 5,71 12,83 10,55 12,52
average colletion period 33 38 36 56 67 64 28 35 29
inventory turnover 14,12 11,50 15,26 19,62 17,77 18,69 13,50 14,66 26,67
inventory period in days 26 32 24 19 21 20 27 25 14
working capital turnover 38,35 38,29 38,89 -116,46 -131,47 175,79 -45,66 -44,75 200,43
ACTIVITY PETROBRAS PETROCHINA INDUSTRY
RATIOS 2001 2002 2003 2001 2002 2003 AVERAGE
asset turnover 0,93 1,03 0,80 0,57 0,54 0,60 1,11
receivables turnover 8,42 8,53 9,32 5,49 7,30 7,12 8,70
average colletion period 43 43 39 66 50 51 45
inventory turnover 9,51 9,04 10,14 3,51 3,40 3,54 12,73
inventory period in days 38 40 36 104 107 103 42
working capital turnover 5,44 6,92 8,60 -101,99 -29,56 -14,45 2

17. Solvency and
Leverage Ratios
SOLVENCY AND EXXON MOBIL BP PLC CHEVRON U.S.
LEVERAGE RATIOS 2001 2002 2003 2001 2002 2003 2001 2002 2003
current ratio 1,18 1,15 1,20 0,96 0,97 1,08 0,89 0,89 1,21
quick ratio 0,92 0,91 0,96 0,76 0,75 0,85 0,64 0,76 1,04
cash/ acid test ratio 0,22 0,22 0,28 0,04 0,03 0,04 0,10 0,15 0,26
debt ratio 0,49 0,51 0,48 0,52 0,57 0,56 0,56 0,59 0,55
debt-to-equity ratio 0,96 1,05 0,94 1,07 1,35 1,27 1,28 1,45 1,24
interest coverage 85,26 45,52 158,78 8,04 11,02 22,39 11,10 8,46 28,11
DU PONT MODEL 0,21 0,15 0,24 0,07 0,13 0,16 0,10 0,04 0,20
SOLVENCY AND PETROBRAS PETROCHINA INDUSTRY
LEVERAGE RATIOS 2001 2002 2003 2001 2002 2003 AVERAGE
current ratio 1,78 1,47 1,60 0,97 0,84 0,76 1,13
quick ratio 1,48 1,10 1,33 0,66 0,52 0,50 0,88
cash/ acid test ratio 0,91 0,48 0,86 0,16 0,14 0,12 0,27
debt ratio 0,64 0,71 0,68 0,40 0,37 0,35 0,53
debt-to-equity ratio 1,78 2,44 2,13 0,66 0,59 0,53 1,25
interest coverage - 5,18 8,04 19,70 20,68 46,71 34,21
DU PONT MODEL 0,26 0,25 0,38 0,21 0,17 0,23 0,19

18. Thank to you to tolerate this
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