Exxon's $8.4B quarterly profit fuels anger
By James R. Healey and Matt Krantz
USA Today
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ExxonMobil, the biggest publicly traded oil company, said yesterday its first-quarter profit jumped 6.9 percent from a year ago, to $8.4 billion.
That was a first-quarter record for Exxon, and the fourth-best first quarter ever reported by a company in the Standard & Poor's 500-stock index. While short of Wall Street forecasts, it triggered fresh outrage elsewhere as ExxonMobil became the lightning rod for fury over high gasoline prices.
"While ExxonMobil executives are popping champagne and celebrating their record profits, American families are popping antacids under the strain of soaring gas prices," said Sen. Robert Menendez, D-N.J., in a remark typical of the howls. Other reaction:
Checks would go to individuals with taxable income of up to $125,000 and couples with taxable income up to $150,000.
Calling $100 a "token gesture," Sen. Debbie Stabenow, D-Mich., proposed $500, which she said is how much more an average family will spend on energy this year.
The average price of gasoline in the U.S. is $2.927 per gallon, up 0.6 cents overnight and 69.8 cents more than a year ago, travel club AAA reported yesterday. The price has been edging closer to the peak $3.057 reported by AAA Sept. 5 after hurricane damage to energy operations in the Gulf of Mexico.
Most of Exxon's first-quarter earnings were from oil and natural gas, not from selling gasoline.
And Exxon's profit margins are below-average compared with others that have triggered no outcry. Exxon's first-quarter profit margin was 9.4 percent, meaning it kept 9.4 cents of every $1 in revenue. Microsoft kept 27.3 cents of every $1 in revenue in its most recent quarter; General Electric, 11.4 cents and McDonald's, 12.3 cents. In fact, Exxon is below the 11-cent average of Standard & Poor's 500 companies, says analyst Howard Silverblatt.
The furor is likely to continue. Reuters Estimates predicts ExxonMobil's operating profit, which excludes one-time items, will rise 2.9 percent this year to a record $35 billion.
