Donate Bitcoin

Donate Paypal


PeakOil is You

PeakOil is You

[Whipple] The Peak Oil Crisis: Parsing 2014

General discussions of the systemic, societal and civilisational effects of depletion.

Re: [Whipple] The Peak Oil Crisis: Parsing 2014

Unread postby ROCKMAN » Sat 21 Jun 2014, 12:49:25

Pops/Sparky - Just one example of the mixing of apples and oranges you elude to: ExxonMobil likes to brag how they continue to replace production with new reserves thanks to their big capex expenditures. Which is exactly what they did do the year they acquired XTO: that move replaced more than 80% of their production that year. And all it took was giving the XTO shareholder $31 BILLION in XOM stock and taking over $10 Billion in debt.

But at best what details does the public see: ExxonMobil spends $X in capex that year and increases their reserves by a sh*t load. So no problems...nothing to look at here...move along. LOL. But XOM does spend a lot of capex every year. And a lot of it isn't being spent with a drill bit:

ExxonMobil runs one of the largest buybacks in corporate America, and the company's dogged commitment to share count reduction has resulted in the company going from 6.56 billion shares outstanding in 2003 to 4.34 billion at the end of 2013. That is a huge part of Exxon's wealth-building story: a third of the company's overall shares that existed in 2003 are now of the books. Over the past ten years, the earnings per share at Exxon have grown from $2.56 in 2003 to $7.45 in 2013. That's a total per share increase of 191% over the past ten years. When you look at how that earnings per share growth got created over the past decade, you will see that 48.6% of the growth can be attributed to good ole' increases in operational profits, and 51.4% of the earnings per share growth is the result of systematic share count reduction through the buyback program. Due to Exxon's $440 billion size (in terms of market valuation), it is probably no surprise that we have finally reached a tipping point in which growth through buybacks has become the leading cause of earnings per share growth over systematic operational improvements.

The devil is still in the details, eh? LOL.
User avatar
ROCKMAN
Expert
Expert
 
Posts: 11397
Joined: Tue 27 May 2008, 03:00:00
Location: TEXAS

Previous

Return to Peak Oil Discussion

Who is online

Users browsing this forum: No registered users and 77 guests