Chevron and Exxon Earnings on Tap: Downstream Takes the Spotlight

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Oil and gas supermajors Chevron (NYSE:CVX) and Exxon Mobil (NYSE:XOM) reported fourth-quarter and full-year 2012 results on Friday before the markets opened. Both companies beat bottom-line expectations but missed on the top-line, as production generally fell but downstream operations kicked into gear to provide an earnings boost.

Chevron reported fourth-quarter earnings of $7.2 billion, or $3.70 per diluted share, a 43.4 percent gain on the year-ago period and ahead of expectations for $3.04 per share. Sales and operating revenue for the quarter fell 3.4 percent to $56 billion, mainly due to lower crude oil volumes. For the quarter, earnings from upstream operations increased 19.5 percent to $6.8 billion. Downstream operations moved from a loss of $61 million in the fourth quarter of 2011 to gains of $925 million in the fourth quarter of 2012.

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4Q 2012 4Q 2011 Full-year 2012 Full-year 2011
Diluted EPS ($) 3.70 2.58 13.32 13.44
Upstream Earnings ($) in millions 6,858 5,737 23,788 24,786
Downstream Earnings ($) in millions 925 (61) 4,229 3,591

“We’ve now led the industry in earnings per barrel for over three years,” commented John Watson, chairman and CEO. “In the downstream business, we completed a multiyear plan to streamline the asset portfolio,” he added.

Shares were up modestly, about half a percent, on Friday morning following the report. Meanwhile, Exxon Mobil edged lower…

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