Exxon Mobil Corp, an American multinational oil and gas corporation, has registered $6.75 billion net profit in the third quarter, the highest since the last quarter of 2017.
The company’s $1.58 a share profit shocked Refinitiv’s estimated earning by two cents. The results reflected the highest refining profit in at least two years, soaring natural gas prices and energy shortages.
Boosted by high profit and improved cash flow, the company has announced to revive its share buyback program next year.
The company remained the biggest U.S. corporate shares repurchaser for more than a decade until suspending the practice in 2016 amid weak results, saying it would buy shares only to offset dilution from executive pay plans.
Exxon, the largest oil and gas company in the United States, posted a loss of $680 million earlier this year.
According to Paul Sankey, an analyst at Sankey Research, the company has announced its buyback program too soon to be expected.
Exxon shares ended 16 cents at $64.49 as some analysts expressed disappointment in the size of buyback program.
Chief Executive Officer Darren Woods said that Exxon’s three businesses delivered higher returns due to effective restructurings and recovery of the global economy from the Covid-19 pandemic.
Speaking to analysts on a phone call, Woods said that the benefits of restructuring are manifesting themselves. He predicted that Exxon would deliver the same growth in earnings and cash flow because of the company’s pre-pandemic plans, expecting $30 billion in annual profit by 2025.
Exxon said it will resume its buybacks starting next year under a plan to spend up to $10 billion on share repurchases through 2023.
Overall profits in oil and gas surged in the third quarter over the rising global demand, reaching nearly $4 billion compared with a $383 million loss a year ago. The company said it will benefit in the fourth quarter from higher oil and gas volumes.
However, chemical profits reduced from last quarter’s high but more than tripled from the same period last year.
Exxon shares are up than 50 percent this year, as earnings bounced back from last year’s historic loss, but remain below where they traded in early 2020.