Categotry Archives: Business

Major Comparison 2015

Similarly to what I did last year, now all the 2015 annual reports are out I thought it would be interesting to create tables showing revenues, profits, number of employees, and profit per employee for each of the majors. Despite the prolonged downturn, ExxonMobil is still doing very well as a company.  True, revenues are down and profits halved but any company that can make north of $16bn clear profit in the biggest slump in a generation must be doing […]

Patrick’s posers

Last week Total’s CEO Patrick Pouyanne wrote an article in LinkedIn which is worth taking a look at: Investments by the major oil companies are being scaled back in response to falling prices, which means they will no longer be able to offset the natural decline of currently producing fields. This is a rather frank admission coming from the CEO of one of the major oil companies which has done just that.  But alas he doesn’t tell us why, if […]

Another major comparison

Now that each of the supermajors has turned in their 2015 Q4 and preliminary full-year reports, it is time for some commentary. ExxonMobil: IRVING, Texas – February 2, 2016 – Exxon Mobil Corporation today announced estimated 2015 earnings of $16.2 billion compared with $32.5 billion a year earlier. … Exxon forecast capital spending at around $23.2 billion this year, a 25 percent drop from 2015. Summary: Their profits have halved last year so they’re cutting CAPEX further for 2016.  They don’t need to […]

Roundup

From the comments over at Tim Worstall’s: I happen to do a little work for a company started by a South African. He bought a British company and pitched up at a board meeting (chaired by a peer) where they were discussing which particular knob should be on the ethics committee or the audit committee. His contribution was “who’s going to be on the fucking profit committee?” Which serves nicely to illustrate the point I made here. The Daily Mail […]

Gordon’s ghost

This is bullshit: David Cameron will fly to Aberdeen on Thursday to announce a £250m package to prop up the North Sea oil industry, the first stage of an infrastructure investment for the city. The prime minister will promise a new “oil and gas technology centre” in Aberdeen to fund future research, including into innovative ways to extract oil and gas. His visit comes as the North Sea struggles against slumping oil prices, which have left many of its companies […]

Total Maintained

This might be encouraging for Total employees, but for their shareholders less so: French energy company Total expects a drop in 2015 results but does not plan to cut jobs as peer BP has done to weather currently low oil prices, its chief executive said in a radio interview on Tuesday. Patrick Pouyanne told Europe 1 that the group had the financial capacity to weather low oil prices. Pouyanne said Total like its peers was being hit by the fall […]

Brother, can you spare a dime?

French supermajor Total has issued an interesting press release: Total is raising approximately $1.2 billion of new debt financing through a structure combining the issue of non-dilutive cash-settled convertible bonds with the purchase of cash-settled call options to hedge Total’s exposure to the exercise of the conversion rights under the bonds. Why does Total need to borrow $1.2bn? Total intends to use the net proceeds of the issuance of the bonds for general corporate purposes. General corporate purposes, eh?  Would […]

Major comparison

Following on from this post, I thought it would be interesting to do a little digging and prepare charts for each supermajor showing their revenue, profit, staff headcount, and profit per employee for the past 3 years. Once again, I will state that this is a pretty crude method of judging a company’s performance.  One obvious shortcoming is the fact that as Upstream revenues have dropped, the profitability of Downstream sectors – which are more labor-intensive – has increased, and so one […]

Where the axe should fall

ExxonMobil bucks layoff trend reports Upstream Online. ExxonMobil will not make any major staffing cuts or reorganisations of its corporate structure, bucking a growing trend within the industry of operators slashing their headcounts in order to preserve cash amidst the steepest decline in oil prices in decades. I suspect the reason for this is that they were running a pretty lean operation to begin with.  Take a look at the table below (numbers taken from Wikipedia: ExxonMobil, Shell, BP, Chevron, […]

Too much information

A mate of mine from my university days works as one of the bosses in a company supplying specialist equipment to the oil and gas industry.  A few years ago, back in the days before the oil price collapsed and such jollies were kyboshed, I met him at his company’s stall at the ADIPEC exhibition in Abu Dhabi.  We started talking about his role in flogging equipment, and he told me over the course of the conversation that you can […]