Company Analysis

1. Company Analysis: Exxon
Mobil Corporation
SETH PORTER
COMPANY ANALYSIS: EXXON MOBIL

2. Company Description
 Exxon Mobile is based out of Irving Texas. The address is 5959 Las Colinas Boulevard, Irving, Texas 75039 2298, USA.
 The contact information is the following:
 Telephone: 1 972 444 1000
 Fax: 1 972 44 1348
 Website: www.exxonmobile.com (MarketLine Industry, pg.25-29).
 About: Exxon Mobil is one of leaders in the Oil & Gas industry. They are considered one of the super majors. A super
major is an Oil & Gas company with capitalization of 100 Billion or more (S&P, pg.3). They are the world's largest
publicly traded international oil and gas company (exxonmobile.com).“They are an integrated Oil & Gas company. They
are engaged in the exploration and production refining and marketing of Oil & Gas. The company is also a major
manufacturer and marketer of commodity petrochemicals. Including olefins, aromatics, polyethylene, and
polypropylene plastics and a wide variety of specialty products. They conduct their business across the globe
(MarketLine Industry, pg.25).”
 As an integrated Oil & Gas company they operate through all three segments of the industry: Upstream, downstream
and chemicals.
 History: ExxonMobil was known until 1972 as Standard Oil Company, this former oil and natural resources merged
with Mobil Corporation as ExxonMobil in 1999 (Encyclopedia Britannica).ExxonMobil has been in business for over
125 years. They began as a regional marketer of kerosene in the U.S. They evolved grew, and merged with Standard Oil
and became largest publically traded petroleum and petrochemical company in the world. They now operate globally
and can be found in most of the countries in the world. Their most familiar brand names are the following: Exxon, Esso
and Mobile (exxonmobile.com)

3. Industry Overview
 Industry Description: “Companies in this industry develop and operate fields to extract crude oil and natural
gas. Major companies include Apache, ConocoPhillips, and Exxon Mobil (all based in the US), as well as BP (the UK),
LUKOIL and Tatneft (Russia), National Iranian Oil Company, PETROBRAS (Brazil), Royal Dutch Shell (the
Netherlands), and Saudi Aramco (Saudi Arabia).The global oil and gas exploration and production industry produces
about 75 million barrels of oil per day and more than 100,000 billion cubic feet (Bcf) of natural gas annually. The largest
oil-producing countries are Russia, Saudi Arabia, and the US. The largest natural gas producers are the US, Russia,
Canada, and Iran. The US oil and gas exploration and production industry consists of about 5,000 companies with
combined annual revenue of about $290 billion and is expected to have a high-growth rate over the next two years. Key
growth drivers include rising demand for energy (Hoover’s Company Profiles).”
 Competitive Landscape: The companies involved also deal with many different factors in production,
manufacture and distribution; including weighing the different global economic, political and environmental factors
that are tied to profit. An example of this is explained by the S & P Industry Profile: How to Analyze Oil & Gas
Production & Marketing, “The fortunes of oil and gas companies are tied to overall supply and demand issues that are
reflected in oil and gas prices. Price changes affect industry sectors differently. For example, high prices for oil and
natural gas benefit the upstream (exploration and production) companies but hurt the downstream (refiners) in the
form of raw material costs (pg.1).” This affects the overall strength and profit of these companies, but many Oil & Gas
companies are considered integrated, which means they are involved in all three sectors of the industry. “For integrated
oil companies, the business diversification between the upstream and the downstream tends to mitigate the effects of oil
and gas price fluctuations. Because they are usually more leveraged to the upstream, such companies general benefit
from higher prices for oil and natural gas (pg.1).” This supply and demand runs the industry and the companies and
even countries involved (many are state run nationalized institutions) in the Oil and Gas industry.

4. Products & Services
 Exxon Mobil Corporation: Engages in the exploration and production of crude oil and natural gas, and
manufacture of petroleum products. The company also transports and sells crude oil, natural gas, and petroleum
products. It has approximately 37,228 gross and 31,264 net operated wells (Yahoo! Finance). This makes them a
vertically integrated company.
 Upstream: The upstream explores and produces crude Oil & Natural Gas. This segment of their business has
operations in 36 countries and this includes five global companies. Besides Oil & Gas they are also active and engaged in
power generation, ExxonMobil has interests in 16 Gigawatts of power generation worldwide including a power plant in
China (MarketLine Industry, pg.25).
 Midstream & Downstream: The downstream activities include refining, supply and fuels marketing. The
refining and supply operations encompass a global network of plants, transportation systems, and distribution centers
that provide a range of fuels, lubricants and other products to their global customers. The fuels marketing serve
motorists around the world with more than 26.728 service stations and provide one million industrial and wholesale
customers with fuel products(MarketLine Industry, pg.26).
 Chemicals: This segment of their company manufactures and sells petrochemicals. They are an integrated
manufacturer and marketer of olefins, aromatics, fluids, synthetic rubber, polyethylene, polypropylene, orientated
polypropylene package films, plasticizers, synthetic base stocks, additives for fuels and lubricants, zeolite catalysts, and
other products(MarketLine Industry, pg.26).

5. Key Employees
 Chairman & Ceo: Rex W. Tillerson age 59 a successful engineer who rose through the company after starting in
1975.
 2011 compensation: $2,387,000.00 salary, $4,368,000.00 bonus, $34,920,506.00 total compensation.
 SVP, Treasurer and Principal Financial Officer : Donald D. (Don) Humphreys age 65.
 2011 compensation: $1,171,000.00 salary, $2,994,000.00 bonus, $18,486,060.00 total compensation
 SVP: Michael J. (Mike) Dolan age 58.
 2011 compensation: $991,250.00 salary, $2,232,000.00 bonus, $15,206,997.00 total compensation
 VP; President, ExxonMobil Exploration Company: Stephen M. Greenlee.

6. Global Environment
 Global Overview: “ Exxon Mobil engages in oil and gas exploration, production, supply, transportation, and
marketing worldwide. In 2011 it reported proved reserves of 24.9 billion barrels of oil equivalent, including its major
holdings in oil sands through Imperial Oil. Exxon Mobil's 36 refineries in 20 countries have a throughput capacity of
more than 6.2 million barrels per day. The company supplies refined products to more than 25,000 gas stations in 100
countries. Exxon Mobil is also a major petrochemical producer(Hoover’s Company Profiles).”
 Global Holdings: Exxon Mobil has holdings in Europe, the US, and eastern Canada, the company is looking for
new opportunities in West Africa (both onshore and off) in South America, and in the former Soviet Union. In 2011 the
company agreed to spend $1 billion in a joint venture with Rosneft to explore oil and gas fields in the Black Sea
(Hoover’s Company Profiles). Their proven reserves are 11,673 million barrels and 62.1 million acres of exploration in
33 countries. They also own a majority interest in Castle Peak Power Company which generates electricity in Hong Kong
and main land China (MarketLine Industry, pg.26).
 Global Industry Concerns: Economic, political and geopolitical concerns all are factors in the Oil & Gas
industry. This is a supply and demand industry and if any of these become a concern the price for their product can
skyrocket immediately, even with the companies’ reserves in play. An example of this in the last year is economic
turmoil has led to lower demand. Specifically economic downturn in the EU, China and the US have all had economic
issues, but slowly and sanctions on Iran which is threatening to close the Straight of Hormuz, unrest between Israel and
Iran and led to higher prices of oil. Also, emerging markets such as India have had slow growth. This directly affects oil
demand (S & P, pg.1). This is an extremely complicated market that is affected by countless elements and any of the
global elements can change the makeup of ExxonMobil.

7. Industry & Company Risks
 Industry wide risks: Economic, political and geopolitical concerns all are factors in the Oil & Gas industry.
This is a supply and demand industry and if any of these become a concern the price for their product can skyrocket
immediately, even with the companies’ reserves in play. Transportation issues such as spillage from a tanker e.g., BP in
2010, the Keystone Pipeline controversy and other issues can cause industry wide impacts.
 General Company Risks: The summary of the company market and the factors they face are broken down
into five sections: Buyer power, supplier power, substitutes, degree of rivalry and new entrants. This forms the market
for their products. The buyer power is considered moderate as is the Supplier Power, New entrants are assessed as
weak within the Oil & Gas market. The capital it takes to enter this market and be competitive against the international
markets is extremely difficult to attain. The threat of substitutes within the Oil & Gas market is considered moderate,
but in the future this is could change as reserves of Oil & Gas decline in the future. “Since oil and gas companies are
typically large integrated players that benefit from the scale of their operations.” They have fierce rivalry within the oil
and gas market (MarketLine Industry, pg.19).
 ExxonMobil Risks: There are many risks for an integrated Oil & Gas company an example of this is the
transportation of their product. Exxon is being sued for $5 million after one if its pipelines burst, leading to an oil spill
in Arkansas. This is a small amount of money for the oil giant but this crude spill can lead to more damage for the
company, including clean up costs, lawsuits, loss of revenue, and negative public image which can cause havoc on the
bottom line and lead to investors backing out (Google News).

8. Financial information & Trends
$ Million 2007 2008 2009 2010 2011
Revenues 404,552.0 477,359.0 310,586.0 383.221.0 486,429.0
Loss 40,610.0 45,220.0 19,280.0 30,460.0 41,060.0
Total Assets 242,082.o 228,052.0 233,323.0 302,510.0 331,052.0
Total
Liabilities
116,038.0 110,529.0 117,529.0 149,831.0 170,306.0
Employees 80,800 79,900 80,700 83,600 82,100
Key Financials: ExxonMobil recorded revenues of $486,429 million in the fiscal year ending in December 2011, an
increase of 26.9% compared to fiscal 2010. its net income was $41,060 million in fiscal 2011, compared to a net income of
$30,460 million in the preceding year (MarketLine Industry, pg.26). They have grown as a company and have every
indication of strong financial growth as the market continues to grow which it is projected to do.

9. Financial information & Trends
 2012 Key Number vs. Competitors:
Exxon
Mobil
Royal Dutch
Shell
BP Chevron
Annual Sales $482.30B $481.70B $388.29B $241.91B
Employees 76,900 87,000 85,700 62,000
Market Cap $389.65B $217.39B $132.80B $210.52B
Trends: As projected from the key 2011 stats they are out performing their competitors
And this should hold true into the future with their strong reserves and acreage.

10. Financial information & Trends
 Earning projections:

11. News & Stocks
 Company News: ExxonMobil was facing a drastic cut in their resources through losing access to them in
Nigeria. Nigeria, Africa’s top oil producer, is selling majority stakes in power plants and letting private investors acquire
as much as 60 percent holdings in six state-owned transmission and 11 power-distribution companies spun out of the
former state- owned utility. ExxonMobil is one of these buyers and made a deal with the government to provide natural
gas to power companies while Nigeria also undertook a partial-risk guarantee, backed by the World Bank, to ensure
stable gas supply to its biggest plant, the 1,320-megawatts Egbin station in the southwest. The West African nation also
started the transfer of power assets to buyers by certifying part payments made by on 15 state-owned companies
(BloombergEnergy). The Oil spill previously mentioned in Arkansas has been a embarrassment for the company but
they are making inroads and progress in the area.
 General Company Stock information: Yahoo! Finances rates Exxon Mobil Corporation as a buy. The
company's strengths can be seen in multiple areas, such as its increase in net income, notable return on equity,
attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt
levels by most measures. These strengths outweigh the fact that the company shows low profit margins. They also pay
dividends and are projected to grow in the future.
 Stock current pricing: Exxon Mobil Corporation (XOM)
 -NYSE 89.30 Up 1.21(1.37%) 4:00PM EDT|After Hours : 89.25 Down 0.05 (0.06%) 6:09PM EDT

12. Conclusion
 Exxon Mobil is one of the giants of the industry. They are strong in their oil and natural gas reserves with
abundant acreage of unproven plays to explore in the future. They are strong in multiple areas across many different
industries and areas of the globe. Their public image is strong even with the recent pipeline burst. Their diverse
portfolio and interest e.g., chemicals, alternative power, and recent acquisitions in Africa and China project profits and
stability in the near future. The financial analysts project growth in the future and as an industry all signs point to
continued steady and profitable growth until at least 2018. In an industry that is fiercely competitive they are competing
and out performing many of their top competitors; and with an industry that is extremely hard to break into they don’t
face the threat of new entrants in the market. Financially this is a steady and profitable company that is low risk and is
poised to stay at the top of the market in the future, with their diverse interests and holdings, but their exploration and
sales of Oil & Natural gas is still their top priority and is lucrative. Exxon Mobil as an international conglomerate is one
the strongest companies in the world and most profitable industries. As an investor is a high priced stock that should
show steady growth over time.

13. Reference
 (2013) “BloomberyEnergy.” Retrieved from: http://www.bloomberg.com/energy/
 Encyclopedia Britannica Retrieved from: http://www.britannica.com/EBchecked/topic/199234/Exxon-
Corporation
 (2013). “Exxon Mobile” Retrieved from: http://www.exxonmobil.com/Corporate/default.aspx
 (2013) “GoogleNews” Retrieved From: http://www.fool.com/investing/general/2013/04/08/exxonmobil-reminds-us-of-
the-risks-of-pipelines.aspx
 (2013) “Hoover’s Company Profiles.”
 (June 2012) “Oil & Gas in The United States.” MarketLine Industy Profile. Retrieved from:
Business Source Complete.
 (2012) Standard & Poor’s Industry Surveys. Retrieved from: Standard & Poor’s net Advantage.
 (2013) Yahoo! Finances Retrieved from: http://finance.yahoo.com/q/pr?s=XOM+Profile