Exxon Mobil Corporation

Please stand by. We're about to begin. Good day, everyone, and welcome to this ExxonMobil Corporation first quarter 2023 earnings call. Today's call is being recorded. And at this time, I'd like to turn the call over to the Vice President of Investor Relations, Mrs. Jennifer Driscoll. Please go ahead, ma'am.

Good morning. Welcome to ExxonMobil's first quarter 2023 earnings call. Thanks for joining us today. I'm Jennifer Driscoll, Vice President, Investor Relations. Here with me are Darren Woods, Chairman and Chief Executive Officer, and Kathy Michaels, Senior Vice President and Chief Financial Officer. Our presentation and pre-recorded remarks are available on the New Investor Relations section of our website. They're meant to accompany the first quarter earnings news release, which is posted in the same location. Shortly, Darren will provide opening comments and reference a few slides from this presentation. That'll give analysts more time to ask questions before we conclude at 8.30 a.m. Central Time. During the presentation, we'll make forward-looking comments which are subject to risks and uncertainties. We describe some of them in our cautionary statement here on slide two. Additional information on the risks and uncertainties that apply to any forward-looking statements are listed in our most recent form 10-Ks and 10-Qs available on our website for investors. Also, please note that we provided supplemental information at the end of our earnings slides, which are posted on the website. And now, please turn to slide three for Darren's remarks.

Good morning. Thanks for joining us today. Following a record year, ExxonMobil delivered the highest first quarter earnings in our history, even as energy prices and refining margins moderated from the fourth quarter. This ongoing success reflects the hard work of our people. executing our strategic priorities, and fully leveraging our competitive advantages. Through investments in advantage assets, fixed improvements, and cost and operating discipline, we are delivering the structural earning improvements outlined in our corporate plan update last December, and expanding the energy supplies needed to meet growing global demand. Compared to the first quarter of 2022, we added about 300,000 oil equipment barrels per day to global supply, primarily from a 40% increase in production from Guyana and the Permian Basin. The increase more than offset our divestments in the expropriation of Saucland I, which we no longer account for, but which importantly remains part of global supply. In addition, our Beaumont refinery expansion reached nameplate capacity in the quarter. This 250,000 barrel a day expansion is the largest U.S. refinery addition in a decade, helping meet society's ongoing need for transportation fuels. In Guyana, we're pleased to announce that we reached final investment decisions for Uaru, the fifth offshore project, which will bring on even more production from this low-cost, low-carbon intensity resource. Uaru will provide an additional 250,000 barrels a day of gross capacity the startup targeted for 2026. Earnings in our product solutions business benefited from the team's solid operational execution, with top quartile turnaround cost and scheduled performance during a particularly heavy planned maintenance period. In low-carbon solutions, we're building momentum across several fronts. In early April, we announced a long-term agreement with Linde to capture, transport, and permanently store up to 2.2 million metric tons of CO2 annually. Hydrogen, we announced front-end engineering and design contract for the world's largest low-carbon hydrogen facility in Baytown. Heads of agreement with SK Group of Korea for offtake of blue ammonia from that facility. As we said during our low-carbon solution spotlight earlier this month, our low-carbon projects must be advantaged and deliver competitive returns. The ability of our low-carbon projects to compete successfully for capital is important if the world is going to meet its emissions aspirations. The incentives included in the Inflation Reduction Act are a positive step forward, although permitting and other regulatory improvements are still needed. In Europe, by contrast, the policy approach remains far more prescriptive and punitive. This is true whether we're talking about the emissions reductions needed to put the world on a path to net zero, or the production needed to provide Europe with affordable and reliable energy. The progress we're making across the company is underpinned by the continuing evolution of our business model. Effective on May 1st, two new enterprise-wide organizations will be up and running. Global Business Solutions will centralize a majority of our finance and procurement operations, enabling us to deliver simplified, corporate-wide processes. ExxonMobil Supply Chain will consolidate supply chain activities globally. These organizations will focus on leveraging our scale to drive efficiencies, improve operating and financial results, and importantly, deliver an improved experience for customers, vendors, and our people. On June 1st, we plan to launch our new enterprise-wide trading organization. Global trading will bring together expertise from across the company in crude, products, natural gas, power, and marine freight trading. We plan to build on our record 2022 results, leveraging the unique insights we gain from participating across each of our value chains and all along their entire length, with a global operating footprint larger than any of our competitors. Now, let me cover the quarter's headlines. We're pleased to have delivered $11.4 billion of earnings, a record first quarter following a record year. A significant contributing factor was structural cost savings that now total approximately $7.2 billion, which keeps us on track to meet our target of $9 billion by the end of this year. Cash flow from operations totaled $16.3 billion, and our net debt-to-capital ratio declined to 4%, further increasing the strength of our balance sheet while supporting shareholder distributions of $8.1 billion in the quarter, including $3.7 billion in dividends. Despite a dynamic market, our underlying performance remains rock solid and well ahead of our competition, reflecting the many improvements we've made over the last six years and, of course, the hard work of our people. Our diverse portfolio of advantaged businesses, improvements in mix, structural cost savings, excellence in execution are driving industry-leading earnings, cash flow, and shareholder value. Combined with the strength of our balance sheet, we have the capability to win across a wide variety of market conditions, deliver strong returns, while meeting the evolving needs of society, including the need to reduce emissions. Leveraging the capabilities and advantages developed in our traditional businesses, we're building an advantaged new business, Low Carbon Solutions, which is positioning us as a leader in the energy transition. our own and others' emissions and establishing long-term value of creative growth opportunities that will underpin continued growth in shareholder returns. With that, we turn the call over to Jennifer.