Imperial Oil announces estimated third-quarter financial and operating
results
--------------------- ---------------------
Third Quarter Nine Months
--------------------- ---------------------
(millions of dollars,
unless noted) 2009 2008 % 2009 2008 %
-------------------------------------------------------------------------
Net income (U.S. GAAP) 547 1,389 (61) 1,045 3,218 (68)
Net income per common share
- assuming dilution (dollars) 0.64 1.57 (59) 1.22 3.60 (66)
Capital and exploration
expenditures 575 360 60 1,604 930 72
"Net income for the third quarter was
Net income for the first nine months of 2009 was
Continued lower commodity prices and tight downstream margins resulted in challenging business conditions for the quarter compared to the same period last year. Imperial continues to weather this economic downturn well, with earnings supporting our investments in company growth projects through the down cycle. Our proven approach of focusing on those elements of the business within our control, combined with prudent financial management and disciplined capital investment, will continue to reward our shareholders in these uncertain times.
Imperial Oil continued its long-term focus and disciplined approach to capital investment. In the third quarter, capital and exploration expenditures increased to
During the first nine months of 2009, the company distributed
-------------------------------------------------------------------------
Imperial Oil is one of Canada's largest corporations and a leading member
of the country's petroleum industry. The company is a major producer of
crude oil and natural gas, and one of the largest petroleum refiners and
marketers with a coast-to-coast supply network that includes about 1,900
retail service stations.
-------------------------------------------------------------------------
Third quarter items of interest
- Net income was $547 million, versus $1,389 million for the third
quarter of 2008, and $209 million for the second quarter of 2009.
- Net income per common share was $0.64, versus $1.57 for the third
quarter of 2008.
- Cash flow from operating activities was $698 million, compared with
$1,635 million in the same period last year.
- Capital and exploration expenditures were $575 million, versus
$360 million for the third quarter of 2008.
- Gross oil-equivalent barrels of production averaged 304,000 barrels a
day, compared with 310,000 barrels a day in the same period last
year.
- Kearl oil sands project update
Following board approval of the first phase of Kearl in May, the
project has been proceeding with detailed design, procurement and
construction activities with a current workforce of about 3,000
employees and contractors. Kearl will be developed in three phases
and could ultimately produce more than 300,000 barrels of bitumen a
day before royalties. The first phase of the project is expected to
start up in late 2012. Imperial holds a 71-percent interest in the
project and is the operator in this joint venture with ExxonMobil
Canada.
- Cold Lake surpasses one billion barrels of production
The company's Cold Lake heavy oil operation in northeastern Alberta
has surpassed one billion barrels of cumulative production. Only
three other fields in Canada have achieved this milestone, and it is
the only in-situ operation to have done so. During four decades of
operation at Cold Lake, technological advancements have tripled
recovery rates while reducing fresh water use and surface land
disturbance.
- Cold Lake expansion
In September, Imperial filed amendment applications for the
previously approved Cold Lake Nabiye project (2004). The proposed
changes to the project will result in improved energy efficiency,
reduced greenhouse gas and sulphur dioxide emissions, and reduced
surface footprint. The Nabiye expansion is continuing to be advanced,
and if sanctioned, will add about 30,000 barrels a day of production
from a new plant. The expansion will access 250 million barrels of
previously undeveloped resource at the Cold Lake heavy oil operation.
Third quarter 2009 vs. third quarter 2008
Upstream net income in the third quarter was
The average price of Brent crude oil in U.S. dollars, a common benchmark for world oil markets, was
The company's average realizations for Cold Lake heavy oil also declined about 40 percent in the third quarter of 2009, compared to the corresponding period last year. The decline was less than that of lighter crude oil, due to the narrowing price spread between light crude oil and Cold Lake heavy oil.
The company's average realizations for natural gas averaged
Gross production of Cold Lake heavy oil averaged 145 thousand barrels a day during the third quarter, versus 143 thousand barrels in the same quarter last year. The cyclic nature of production at Cold Lake and lower maintenance activities contributed primarily to the increase in production in the third quarter of 2009.
The company's share of Syncrude's gross production in the third quarter was 78 thousand barrels a day, versus 79 thousand barrels in the third quarter of 2008.
Gross production of conventional crude oil averaged 25 thousand barrels a day in the third quarter, essentially the same as the corresponding period of 2008.
Gross production of natural gas during the third quarter of 2009 decreased to 291 million cubic feet a day from 309 million cubic feet in the same period last year. The lower production volume was primarily a result of natural reservoir decline.
Net income from Downstream was
Chemical net income was
Net income effects from Corporate and other were
Cash flow from operations was used to fund growth projects such as Kearl. The company will continue to evaluate its share-purchase program in the context of its overall capital activities.
In the third quarter of 2009, the company built
First nine months 2009 vs. first nine months 2008
Net income for the first nine months of 2009 was
-------------------------------------------------------------------------
First nine months highlights
- Net income was $1,045 million, down from $3,218 million in the first
nine months of 2008.
- Net income per common share decreased to $1.22 compared to $3.60 in
the same period of 2008.
- Cash flow from operations was $664 million, versus $3,351 million in
the same period of 2008.
- Capital and exploration expenditures were $1,604 million, up
72 percent.
- Gross oil-equivalent barrels of production averaged 292 thousands of
barrels per day, compared to 309 thousands of barrels per day in the
first nine months of 2008.
- Imperial distributed a total of $747 million cash to shareholders in
2009 through dividends and share repurchases, compared with
$2,048 million in 2008.
- Per-share dividends declared in the first three quarters of 2009
totaled $0.30, up from $0.28 in the same period of 2008.
-------------------------------------------------------------------------
Upstream net income for the first nine months was
The average price of Brent crude oil in U.S. dollars, a common benchmark for world oil markets, was
The company's average realizations for Cold Lake heavy oil also declined about 40 percent in the first three quarters of 2009, compared to the corresponding period last year. The decline was less than that of lighter crude oil, due to the narrowing price spread between light crude oil and Cold Lake heavy oil.
For the nine months of 2009, realizations for natural gas averaged
For the first nine months, gross production of Cold Lake heavy oil was 144 thousand barrels a day this year, compared with 147 thousand barrels in the same period of 2008. Lower production in the first nine months of 2009 was primarily due to the cyclic nature of production at Cold Lake.
During the first nine months of 2009, the company's share of gross production from Syncrude averaged 66 thousand barrels a day, down from 71 thousand barrels in 2008. Planned maintenance activities in the first half of 2009, which included design modifications to improve long-term operational performance, contributed to the reduced production in the first nine months of 2009.
Gross production of conventional crude oil averaged 25 thousand barrels a day in the first nine months of 2009, essentially the same as the corresponding period of 2008.
In the first nine months of the year, gross production of natural gas was 294 million cubic feet a day, down from 315 million cubic feet in the first nine months of 2008. The lower production volume was primarily a result of natural reservoir decline.
Nine-month net income from Downstream was
Chemical nine-month net income was
For the nine months of 2009, net income effects from Corporate and other were negative
During the first nine months of 2009, the company repurchased about 12 million shares for
Cash flow from operations was used to fund growth projects such as Kearl.
Key financial and operating data follow.
Go to http://files.newswire.ca/57/Q3_2009_Graphs.JPG to view charts of factors affecting net income.
Forward-Looking Statements
Statements in this report relating to future plans, projections, events or conditions are forward-looking statements. Actual future results, including project plans, costs, timing and capacities; financing sources; the resolution of contingencies and uncertain tax positions; the effect of changes in prices and other market conditions; and environmental and capital expenditures could differ materially depending on a number of factors, such as the outcome of commercial negotiations; changes in the supply of and demand for crude oil, natural gas, and petroleum and petrochemical products; political or regulatory events; and other factors discussed in Item 1A of the company's 2008 Form 10K.
IMPERIAL OIL LIMITED
THIRD QUARTER 2009
-------------------------------------------------------------------------
Third Quarter Nine Months
(millions of Canadian dollars,
unless noted) 2009 2008 2009 2008
-------------------------------------------------------------------------
Net income (U.S. GAAP)
Total revenues and other
income 5,561 9,515 15,534 25,637
Total expenses 4,802 7,558 14,079 21,132
-------------------------------------------------------------------------
Income before income taxes 759 1,957 1,455 4,505
Income taxes 212 568 410 1,287
-------------------------------------------------------------------------
Net income (U.S. GAAP) 547 1,389 1,045 3,218
-------------------------------------------------------------------------
Net income per common share
(dollars) 0.64 1.57 1.23 3.62
Net income per common share
- assuming dilution (dollars) 0.64 1.57 1.22 3.60
Gain/(loss) on asset sales,
after tax - 2 26 203
Total assets at September 30 16,822 18,627
Total debt at September 30 140 143
Interest coverage ratio - earnings
basis
(rolling 4 quarters, times
covered) 248.3 265.7
Other long-term obligations at
September 30 2,219 1,879
Shareholders' equity at
September 30 9,410 9,050
Capital employed at September 30 9,587 9,234
Return on average capital
employed (a)
(rolling 4 quarters, percent) 18.5 48.2
Dividends on common stock
Total 85 88 255 249
Per common share (dollars) 0.10 0.10 0.30 0.28
Millions of common shares
outstanding
At September 30 847.6 869.7
Average - assuming dilution 854.9 883.8 857.5 894.8
(a) Return on capital employed is net income excluding after-tax cost of
financing divided by the average rolling four quarters' capital
employed.
-------------------------------------------------------------------------
IMPERIAL OIL LIMITED
THIRD QUARTER 2009
-------------------------------------------------------------------------
Third Quarter Nine Months
(millions of Canadian dollars) 2009 2008 2009 2008
-------------------------------------------------------------------------
Total cash and cash equivalents 458 1,933 458 1,933
Net income 547 1,389 1,045 3,218
Adjustment for non-cash items:
Depreciation and depletion 194 188 584 550
(Gain)/loss on asset sales - (4) (32) (236)
Deferred income taxes and other (6) 137 (49) (105)
Changes in operating assets and
liabilities (37) (75) (884)(a) (76)
-------------------------------------------------------------------------
Cash from (used in) operating
activities 698 1,635 664 3,351
-------------------------------------------------------------------------
Cash from (used in) investing
activities (545) (307) (1,431) (581)
Sales of subsidiaries,
investments and property,
plant and equipment 8 19 45 260
Cash from (used in) financing
activities (85) (690) (749) (2,045)
-------------------------------------------------------------------------
(a) Year-to-date 2009 cash flow from operating activities was negatively
impacted by the timing of scheduled income tax payments.
IMPERIAL OIL LIMITED
THIRD QUARTER 2009
-------------------------------------------------------------------------
Third Quarter Nine Months
(millions of Canadian dollars) 2009 2008 2009 2008
-------------------------------------------------------------------------
Net income (U.S. GAAP)
Upstream 439 999 833 2,587
Downstream 62 270 226 539
Chemical 19 38 30 72
Corporate and other 27 82 (44) 20
-------------------------------------------------------------------------
Net income (U.S. GAAP) 547 1,389 1,045 3,218
-------------------------------------------------------------------------
Operating revenues by segment
Upstream 921 1,692 2,560 4,977
Downstream 4,380 7,393 12,217 19,223
Chemical 246 393 684 1,127
-------------------------------------------------------------------------
Operating revenues 5,547 9,478 15,461 25,327
-------------------------------------------------------------------------
Production and manufacturing
expenses
Upstream 549 671 1,825 1,927
Downstream 313 369 1,049 1,097
Chemical 47 52 142 159
-------------------------------------------------------------------------
Production and manufacturing
expenses 909 1,092 3,016 3,183
-------------------------------------------------------------------------
Capital and exploration
expenditures
Upstream 504 288 1,422 755
Downstream 64 67 167 162
Chemical 6 3 12 7
Corporate and other 1 2 3 6
-------------------------------------------------------------------------
Capital and exploration
expenditures 575 360 1,604 930
-------------------------------------------------------------------------
Exploration expenses charged
to income included above 21 34 126 91
-------------------------------------------------------------------------
IMPERIAL OIL LIMITED
THIRD QUARTER 2009
-------------------------------------------------------------------------
Third Quarter Nine Months
Operating statistics 2009 2008 2009 2008
-------------------------------------------------------------------------
Gross crude oil and NGL
production (thousands of
barrels a day)
Cold Lake 145 143 144 147
Syncrude 78 79 66 71
Conventional 25 27 25 27
-------------------------------------------------------------------------
Total crude oil production 248 249 235 245
Natural gas liquids (NGLs)
available for sale 7 9 8 11
-------------------------------------------------------------------------
Total crude oil and NGL
production 255 258 243 256
-------------------------------------------------------------------------
Gross natural gas production
(millions of cubic feet a day) 291 309 294 315
Gross oil-equivalent production(a)
(thousands of oil-equivalent
barrels a day) 304 310 292 309
Net crude oil and NGL production
(thousands of barrels a day)
Cold Lake 116 117 124 122
Syncrude 67 66 62 60
Conventional 19 20 21 19
-------------------------------------------------------------------------
Total crude oil production 202 203 207 201
Natural gas liquids (NGLs)
available for sale 6 7 6 9
-------------------------------------------------------------------------
Total crude oil and NGL
production 208 210 213 210
-------------------------------------------------------------------------
Net natural gas production
(millions of cubic feet a day) 295 248 278 254
Net oil-equivalent production(a)
(thousands of oil-equivalent
barrels a day) 257 251 259 252
Cold Lake blend sales (thousands
of barrels a day) 185 180 187 191
NGL Sales (thousands of barrels
a day) 9 8 9 11
Natural gas sales (millions of
cubic feet a day) 269 286 270 287
Average realizations and prices
(Canadian dollars)
Conventional crude oil
realizations (a barrel) 65.29 114.58 57.30 108.89
NGL realizations (a barrel) 36.24 78.21 38.14 65.70
Natural gas realizations
(a thousand cubic feet) 2.90 9.20 4.07 9.16
Syncrude realizations
(a barrel) 73.27 127.34 65.95 120.30
Western Canada Select heavy
oil (a barrel) 63.74 103.94 55.67 94.70
Refinery throughput (thousands
of barrels a day) 417 468 414 448
Refinery capacity utilization
(percent) 83 93 82 89
Petroleum product sales
(thousands of barrels a day)
Gasolines 204 210 200 203
Heating, diesel and jet fuels 138 160 143 157
Heavy fuel oils 22 32 26 29
Lube oils and other products 43 51 39 46
-------------------------------------------------------------------------
Net petroleum products sales 407 453 408 435
-------------------------------------------------------------------------
Petrochemical Sales (thousands
of tonnes a day) 2.8 2.8 2.8 3.0
(a) Gas converted to oil-equivalent at 6 million cubic feet =
1 thousand barrels
-------------------------------------------------------------------------
IMPERIAL OIL LIMITED
THIRD QUARTER 2009
-------------------------------------------------------------------------
Net income
Net income (U.S. GAAP) per common share
(millions of Canadian dollars) (dollars)
-------------------------------------------------------------------------
2005
First Quarter 393 0.38
Second Quarter 539 0.52
Third Quarter 652 0.64
Fourth Quarter 1,016 1.00
-------------------------------------------------------------------------
Year 2,600 2.54
-------------------------------------------------------------------------
2006
First Quarter 591 0.60
Second Quarter 837 0.85
Third Quarter 822 0.84
Fourth Quarter 794 0.83
-------------------------------------------------------------------------
Year 3,044 3.12
-------------------------------------------------------------------------
2007
First Quarter 774 0.82
Second Quarter 712 0.76
Third Quarter 816 0.88
Fourth Quarter 886 0.97
-------------------------------------------------------------------------
Year 3,188 3.43
-------------------------------------------------------------------------
2008
First Quarter 681 0.76
Second Quarter 1,148 1.29
Third Quarter 1,389 1.57
Fourth Quarter 660 0.77
-------------------------------------------------------------------------
Year 3,878 4.39
-------------------------------------------------------------------------
2009
First Quarter 289 0.34
Second Quarter 209 0.25
Third Quarter 547 0.64
-------------------------------------------------------------------------
To view the graph "Factors affecting net income", please visit http://files.newswire.ca/706/Q3_2009_Graphs.JPG
For further information: Investor relations: Mark Stumpf, (403) 237-4537; Media relations: Gordon Wong, (403) 237-2710
Share this article