Running head: EXXON MOBIL SEC REPORT 1

SEC Report:
Exxon Mobil Corporation
Fiscal Year Ended December 31, 2019

Student’s Name:
Course Title and Number:
Professor’s Name:
EXXON MOBIL SEC REPORT 2

Table of Contents

I). Introduction and Company Background.....................................................................................3

II). Discussion on Income Statement...............................................................................................4

III). Discussion on Balance Sheet....................................................................................................4

IV). Discussion on Statement of Cash Flows..................................................................................5

V). Ratio Analysis...........................................................................................................................6

VI). Horizontal Analysis..................................................................................................................8

VII). Vertical Analysis.....................................................................................................................9

VIII). Conclusion...........................................................................................................................11

IX). References..............................................................................................................................12
EXXON MOBIL SEC REPORT 3

Exxon Mobil Corporation SEC Report

I). Introduction and Company Background

The Exxon Mobil Corporation operates businesses of petrochemicals and petroleum all
around the world. The operations of Exxon Mobil incorporate minerals and coal operations;
generation of electric power; and production and exploration of gas and oil. The firm
additionally is involved in the manufacturing of lubricants and fuels, and its seen as an integrated
oil and gas firm based in the United States of America. The history of Exxon Mobil falls on 135
years whereby the from has evolved from a US-based kerosene marketer to one of the largest
enterprises publicly trading petrochemical and petroleum around the globe. As of today, the firm
is operational in the majority of nations on a worldwide level and is famous for its well-known
brands: Mobil, Esso, and Exxon (Kumar, 2019). The firm is involved in making products that
lubricate industry, power cities, offers petrochemical building blocks, and drives modern
transportation leading to millions of consumer goods.
The mission of Exxon Mobil is “fueling the world safely and responsibly” (Banerjee,
Song, and Hasemyer, 2015). The fact that the firm has access to energy reinforces social
progress, economic prosperity, mobility, and human comfort. The operations of Exxon Mobil
touches approximately all aspects of modern life. There are four major brands under which
ExxonMobil markets its lubricants and fuels: ExxonMobil Chemical, Mobil, Exxon, and Esso.
To add on, the guiding principles of Exxon Mobil include being committed to sustaining the
position of a première chemical and petroleum manufacturing firm on a global scale. To achieve
this, the firm continuously attains superior operating and financial results which strictly adheres
to the tall ethical standards. Also, at the time Exxon acquired Mobil, it was cheaper for Exxon to
buy Mobil’s hydrocarbon reserves and infrastructure than to discover and develop its reserves.
Furthermore, the shares of ExxonMobil are listed on the New York Stock Exchange
(NYSE). The symbol for the shares is XOM. As of today, each share of ExxonMobil is trading at
$44.32 (Nasdaq, 2020). The huge success earned by the firm is duly translated in its financial
numbers as depicted by the financial statements of the firm. Oil and gas are big business (as a
percent of GDP) and it favors companies with economies of scale. So of course, this results in
companies with very large revenue numbers. And given even a normal profit margin this results
in very large profit numbers. People in the oil industry have a lot of respect for Exxon - the
EXXON MOBIL SEC REPORT 1

company regularly makes good profits, so they have the funds to invest in major projects; they
have good relations with Saudi Aramco.
II). Discussion on Income Statement
According to Barker (2010), the income statement is seen "as a financial statement that
shows you how profitable your business was over a given reporting period. It shows your
revenue, minus your expenses and losses". The income statement of Exxon Mobil as duly shown
in its annual report depicts that the revenue of the firm has been increasing over the years since
2016, however, the revenue reduced in the year 2019. The reduced profitability in 2019 can be
attributed to weaker pricing and sales in the refining and petrochemical divisions. The bottom-
line of the income statement for the year 2019 depicted the impact of investing billion dollars in
the production of oil from West Texas' Permian Basin and Guyana’s coastal waters, which
jumped the capital spending of the firm by 20% in a single year.
Another factor contributing to the weakening of refining profits was added downtime at
Beaumont Exxon's petrochemical and refining complex that is experiencing a crucial expansion.
Since Exxon Mobil has faced the blow of reduced revenue in the year 2020 owing to the
prevalence of Covid-19, it can be forecasted that the year 2002 will be yielding lesser revenues
as compared to the earlier years. In FY 2019, Exxon Mobil closed its income statements on
$14.34 million of net income and total revenue of $255.583 million; a major factor that evolves
Exxon Mobil as a leading firm in oil and gas sector (Exxon Mobil Corporation, 2019).
The net income of the firm reduced from 2018 to 2019 by around $6.5 million, which can
be seen as a major hot on the profitability of Exxon Mobil, however, this was mainly due to a
huge investment in new drills which resulted in increased expenses. The operating expenses at
Exxon Mobil followed the same trend as adopted by revenues, by increasing till the year 2018
and then reducing in 2019. To add on, the firm issued dividends thrice in 2019 worth $0.82,
$0.87, and $0.87 respectively. The net income of Exxon Mobil also denotes the Earning Per
Share declared by the firm. The EPS also tends to follow the same trend as net revenues. The
EPS increased from 4.63 in 2017 to 4.88 in 2018, and eventually reduced to $3.36 in 2019
(Exxon Mobil Corporation, 2019).
III). Discussion on Balance Sheet
According to Kulikova, Garyntsev, & Gafieva, (2015) the balance sheet of a firm "is a
financial statement that reports a company's assets, liabilities, and shareholders' equity".
EXXON MOBIL SEC REPORT 1

Accordingly, the balance sheet of Exxon Mobil denotes its assets that are divided into current
and non-current assets. The current assets include all the liquid assets owned by the firm,
including inventories that are composed of material and supplies, along with merchandise,
products, and crude oil. Another portion of the balance sheet is liabilities that Exxon Mobil owes
and the firm also includes the Postretirement benefits reserves in its long-term liability section.
To add on, equity is the third main component of the balance sheet, denoting common stock
(8,019 million issues shares, and 9,000 million authorized shares); reinvested earnings; treasury
common stock (3,785 million shares in 2019); and the noncontrolling interests of the firm
(Exxon Mobil Corporation, 2019).
All in all, the 2019 balance sheet denotes that Exxon Mobil entered the year 2020 on a
positive note. The total assets of the firm have amounted to $362,597 million. The major chunk
of assets is coming from property, plant, and equipment held by Exxon Mobil worth $253,018
million in the year 2019, which is a total of 70% of Exxon Mobil's total assets. This fact is not
very surprising owing to the fact that Exxon Mobil is working in the oil and gas sector and they
continue to make huge investments in PPE across various countries around the globe. As of FY
2019, the value of total liabilities was $163,659 million (Exxon Mobil Corporation, 2019). This
value is also very high; however, the amount of total assets totally overshadows this number,
indicating that Exxon Mobil is strong enough to pay back its liabilities in an effective manner.
the long-term debt of Exxon Mobil was $26,342 million including $7.0 billion long-term debt
taken by Exxon Mobil is the third quarter of FY2019.
On the other hand, the portion indicating the equity of Exxon Mobil shows that the firm
is not involved in selling preferred stock to the underlying shareholders, and the option available
for stockholders is limited to common stock only. To elaborate, the par value of the common
stock was not showing in the income statement. The common stock was (8,019 million issues
shares, and 9,000 million authorized shares); reinvested earnings; treasury common stock (3,785
million shares in 2019); and the noncontrolling interests of the firm. The value of liabilities plus
equity was totaled at $362,597 million including $19,493 million reinvested (Exxon Mobil
Corporation, 2019).
IV). Discussion on Statement of Cash Flows
A cash flow statement helps one determine the cash flow position of one's company. You
may have a revenue high enough to easily cover your expenses, but it won't help you if the due
EXXON MOBIL SEC REPORT 1

dates to pay your expenses are earlier than your revenue realization date. The cash flow
statement helps you plan to manage such situations by only considering the cash component in
your business. For example, You may already have $100 in your bank account which you may
plan to manage such cash shortages, or you may want to plan to extend your credit term with
your debtors and accordingly communicate. There are other ancillary benefits, such as, since it
talks about the cash health of Exxon Mobil - clearly, without cash available to make necessary
payments, Exxon Mobil will never be able to realize the revenue, which requires those expenses
to be incurred for it to be achieved - it is an important factor for external investors, lenders, and
customers.
According to Fraser, Ormiston, and Fraser, (2010) “there are three main areas of a cash
flow statement, including, operating activities, investing activities, and financing activities."
Owing to the fact that Exxon Mobil operates on an international level, its Cash Flow Statement
incorporates a provision for changes in the exchange rate and how it impacts on cash. The
operating activities of Exxon Mobil in 2019 depict a net cash standing of $29,716 million which
is a much lower amount as compared to $36,014 million of 2018. The major contributing factor
in such lesser operating activities cash is investing heavily in new drills in the year 2019 and also
a much greater contribution from the elevated Net Income of the FY2018 (Exxon Mobil
Corporation, 2019).
To add on, the investing activities of Exxon Mobil in 2019 depict a net cash standing of
$6,618 million which is a much higher amount as compared to $19,446 million of 2018. The
major contributing factor in such increased investing activities cash is investing heavily in new
drills in the year 2019 which is depicted in increased additions to PPE in FY2019. Conversely,
the financing activities of Exxon Mobil in 2019 depict a net cash standing of $29,716 million
which is a much lower amount as compared to $36,014 million of 2018. The major contributing
factor in such lesser investing activities cash is a $7,052 million addition to long -term debt in the
FY2019 and additions in commercial paper and debt (Exxon Mobil Corporation, 2019).
V). Ratio Analysis
Ratio Calculation
Ratio Name Ratio Formula
(2019)
50,052 / 63,989 = .
Current Ratio Current Assets / Current Liabilities
78
EXXON MOBIL SEC REPORT 1

The current ratio denotes the ability of a firm in paying-off its short-term debt and liabilities
within a time frame of one year. Exxon Mobil's current ratio is 0.78 which means that the firm
has only 78 cents for every 100 cents of owed liability.
Cash and Cash Equivalents / Current 3,089 / 63,989 = .
Cash Ratio
Liabilities 04
The cash ratio denotes the ability of a firm in paying-off its short-term debt and liabilities
within a time frame of one year, however, it does not include inventories in the amount of the
short-term assets. Exxon Mobil's current ratio is 0.04 which means that the firm has only 4
cents for every 100 cents of owed liability.  

163,659 / 362,597
Debt Ratio Total Debt / Total Assets
= .45
    45%
The debt ratio shows the value of a firm's assets that are financed by debt. The debt ratio of
Exxon Mobil is 45% which means that firm is not highly leveraged and has 55% equity
financing. 
 
Return on Net Income – Preferred Dividends / Average 14,340 – 0 /
Stockholders Equity Common Equity 198,938 = .072
    7.20%
The ratio shows how much return the stockholders are getting on investing their respective
equities. The return on stockholder’s equity for Exxon Mobil is 7.2% making it a lucrative
investment opportunity.  
Income Available to Common Shareholders/ 14,340,000,000 /
Earnings per Share Weighted-Average Number of Common 4,270,000,000 =
Shares Outstanding $3.36
The ratio of EPS denotes the value shareholders get on a per-share basis. The EPS of Exxon
Mobil as shown in the income statement is $3.36 per share in FY2019.  
 
163,659 / 198,938
Debt to Total Equity Total Debt / Total Equity
= 0.822
The ratio of debt to equity shows the number of the firm's assets that are financed by debt in
comparison to equity. The debt to total equity of Exxon Mobil is 0.822. 
EXXON MOBIL SEC REPORT 1

All in all, the ratio analysis of Exxon Mobil shows some impressive and certain alarming
financial facts. First of all, the management needs to take proactive measures in improving the
current and cash ratio of the firm, as it should be above 1 as a threshold. In addition, the debt
ratio and capital structure of the firm seem to be quite stable as indicated by the debt and debt to
total equity ratio.
VI). Horizontal Analysis

Differenc Differenc
Balance Sheet 2018 2019
e in $ e in %
24,70 26,96
Notes and accounts receivable 2,265 9.17%
1 6
Receivables can be seen as money owed by consumers for Exxon Mobil and are considered
the firm's asset. At Exxon, Mobil receivables increased by 9.17% in FY2019 as compared to
FY2018.  
14,80 14,01
Crude oil, products, and merchandise -793 -5.36%
3 0
The crude oil, products, and merchandise denote the cost of inventory of Exxon Mobil.
Analysis reveals that the amount of inventory reduced by 5.36% from FY2018 to FY2019.
Cash and Cash Equivalents 3,042 3,089 47 1.55%
The provision of cash and cash equivalents denotes the most liquid assets held by Exxon
Mobil. At Exxon Mobil, this increased by 1.55% which is a negligible change. The
significance of this cash is that it's used for reinvesting back and paying off the debt owed by
the firm.  

Differenc Differenc
Income Statement 2018 2019
e in $ e in %
290,2 264,9
Total Revenues and Other Income -25,274 -8.71%
12 38
This denotes the total revenue earned by Exxon Mobil from selling its product and services.
The decrease of 8.71% indicates that in FY2019 lesser revenue was earned making FY2018 as
the most profitable year for Exxon Mobil.
EXXON MOBIL SEC REPORT 1

279,3 255,5
Sales and other Operating Revenue -23,749 -8.50%
32 83
This indicates revenues from commodity contracts held for trading purposes. It is indicated
that in FY2019 there is 8.5% reduced in sales and other operating revenues.

156,1 143,8
Crude Oil and Product Purchases -12,371 -7.92%
72 01
This covers the purchases of crude oil and products that fall under the expenses section. There
is a 7.92% reduction in purchases which is logical as revenue also reduced by the almost same
percentage.  

To sum up, the horizontal analysis is used to determine the growth of a certain line item
in the financial statements. This involves comparing the performance from one year to another. It
is clearly evident that a reduction in income, revenue, and sales from FY2018 to FY2019 is
showing in the horizontal analysis of the income statement. The reduced profitability in 2019 can
be attributed to weaker pricing and sales in the refining and petrochemical divisions. The
bottom-line of the income statement for the year 2019 depicted the impact of investing billion
dollars in the production of oil from West Texas' Permian Basin and Guyana's coastal waters. In
addition, the horizontal analysis of the balance sheet shows that inventory reduced owing to
lesser revenue and receivables increased on the other hand.
VII). Vertical Analysis
The vertical analysis is used to determine how much each of the line items take up from
the big pie. Basically, we put something (like Sales or Total Assets or Total liabilities) and put it
as the big pie. If revenue is 100% at Exxon Mobil then how much percentage does the cost of
goods sold represent the revenues at Exxon Mobil.

Amount in $
Income Statement Percentage of Total
Million
Total Revenue 264,938 100%
Net Income Attributable to Exxon (14,340/264,938) * 100 =
14,340
Mobil 5.41%
(244,882/264,938) * 100 =
Total Costs and Other Deductions 244,882
92.43%
EXXON MOBIL SEC REPORT 1

It can be seen from the vertical analysis that net income attributable to Exxon Mobil is
only 5.41% of the total revenue at the firm. In addition, the total costs and other deductions make
up for 92.43% of the total revenue. This can be quite an alarming state that total costs are very
high and measures should be taken to control or reduced it to a minimum point.
Amount in $
Balance Sheet Percentage of Total
Million
Total Assets 362,597 100%
(43,164/362,597) *
Long term Investment and Receivables. Net 43,164
100 = 11.90%
Property, plant and equipment at cost less (253,018/362,597) *
253,018
accumulated depreciation and depletion 100 = 69.77%

On the other hand, the total assets at Exxon Mobil are taken as a base at 100%. In
addition, the long-term investment and receivables only make 11.9% of the total assets. Whereas
a major chunk of the total asset assets is coming from property, plant, and equipment held by
Exxon Mobil worth $253,018 million in the year 2019, which is a total of 70% of Exxon Mobil's
total assets. This fact is not very surprising owing to the fact that Exxon Mobil is working in the
oil and gas sector and they continue to make huge investments in PPE across various countries
around the globe. As of FY 2019, the value of total liabilities was $163,659 million (Exxon
Mobil Corporation, 2019). This value is also very high; however, the amount of total assets
totally overshadows this number, indicating that Exxon Mobil is strong enough to pay back its
liabilities in an effective manner.

VIII). Conclusion
The above detailed analysis reveals that Exxon Mobil has taken the right financial moves
to be the market leader in the oil and gas sector. The company faced declining profits in FY2019
owing to massive investments and uncertain oil prices. But on the other hand, it is a positive
initiative as investors are claiming that the management of Exxon Mobil is taking all necessary
actions for promoting the growth and development of the firm and expect the greatest returns on
their investment in the firm. Therefore, it can be said that while FY2019 has not been a very
promising year as expected by investors, however, it becomes irrelevant due to massive growth
EXXON MOBIL SEC REPORT 1

and investment plans. Over the years, the firm will growth and catchup on its profitability as
well.
To add on, the success of Exxon Mobil is duly translated in its financial numbers as
depicted by the financial statements of the firm. Oil and gas are big business (as a percent of
GDP) and it favors companies with economies of scale. As a matter of fact, Exxon Mobil and
any other current company dealing in oil and gas who have any forethought whatsoever have
converted themselves into energy companies rather than oil companies and they will continue to
transition as the technology moves them. Anyway, oil companies like Exxon Mobil with the
advance of Technology are able to find, explore, and extract oil in areas and regions that a couple
of years ago was unthinkable.
Even though in the past there have been many oil crises when countries like Saudi Arabia
and Iran were fighting to reduce prices and reducing supply. In such a scenario, there is and has
been no oil company as secure as Exxon Mobil. It is as plain and simple as that; Chevron is
cutting jobs, ConocoPhillips cut capital spending by 25%, and Exxon Mobil is currently sitting
on the most stable assets to survive this rout. Basically, Exxon is able to effectively shake off its
competitors, which is good in the long term. Exxon has lost some of its share value in the last
year but is still doing a lot better than Chevron, who lost a major market share and other
competitors. In addition, Exxon is a Supermajor. What this means is that it does basically
everything related to the Petrochemical industry, from actually drilling for oil, to refining it and
even working in other chemical businesses. This means that although oil prices are falling, it is
able to continue working, and profiting, in other sectors.
To conclude, the bottom-line of the income statement for the year 2019 depicted impact
of investing billion dollars in the production of oil from West Texas' Permian Basin and
Guyana's coastal waters, which jumped the capital spending of the firm by 20% in a single year
(Marra, & Gaswirth, 2018). On the other hand, the balance sheet indicated a stable capital
structure, while the management needs to work more on its current ratio. The horizontal and
vertical analysis reveals that FY2019 has not been the best one so far and the firm needs to take
initiatives of controlling its costs.
All in all, Exxon Mobil has proven its worth in the eyes of consumers, players of the oil
and gas industry and its shareholders. The company has taken effective decisions in the past
which has earned it the reputation of a market leader. Despite this, the management continues to
EXXON MOBIL SEC REPORT 1

diversify and invest in business opportunities that boost the growth and development of Exxon
Mobil.
EXXON MOBIL SEC REPORT 13

IX). References

Banerjee, N., Song, L., & Hasemyer, D. (2015). Exxon’s own research confirmed fossil fuels’
role in global warming decades ago. Inside Climate News, 16.

Barker, R. (2010). On the definitions of income, expenses, and profit in IFRS. Accounting in
Europe, 7(2), 147-158.

Exxon Mobil Corporation. (2019). SEC 10-K report: Exxon Mobil Corporation. Retrieved from
https://www.sec.gov/ix?
doc=/Archives/edgar/data/34088/000003408820000016/xom10k2019.htm

Fraser, L. M., Ormiston, A., & Fraser, L. M. (2010). Understanding financial statements.

Pearson.

Kulikova, L. I., Garyntsev, A. G., & Gafieva, G. M. (2015). The Balance sheet as an information
model. Procedia Economics and Finance, 24, 339-343.

Kumar, B. R. (2019). ExxonMobil Merger. In Wealth Creation in the World’s Largest Mergers
and Acquisitions (pp. 101-109). Springer, Cham.

Marra, K., & Gaswirth, S. (2018). Multiple stacked plays drive continued Permian
development. Oil & Gas Journal, 116(6), 44-47.

Nasdaq. (2020). XOM Exxon Mobil Corporation Common Stock. Retrieved from
https://www.nasdaq.com/market-activity/stocks/xom