Company Analysis: Exxon

When analyzing Exxon's financial statements, it is important to look for large movements in specific accounts from one year to the next. In the fiscal year 2020, Exxon experienced a significant decrease in revenue, reflecting the impact of the COVID-19 pandemic on the oil and gas industry. Exxon's revenue in 2020 was $181.5 billion, compared to $264.9 billion in 2019. Additionally, Exxon's net income in 2020 was a loss of $22.4 billion, compared to a profit of $14.3 billion in 2019.

Exxon's notes to the financial statements provide additional information about the company's accounting methods and significant transactions. For example, the company notes that it recognized asset impairments of $19.3 billion in 2020 due to lower expected commodity prices and changes in the company's long-term business plans.

To evaluate Exxon's balance sheet, it is important to look for large changes in the company's assets, liabilities, or equity accounts. In 2020, Exxon's total assets decreased from $346.2 billion to $283.7 billion. This decrease was primarily due to a decrease in property, plant, and equipment, as well as a decrease in investments and advances. Additionally, Exxon's total liabilities decreased from $235.9 billion to $205.4 billion, primarily due to a decrease in long-term debt.

When analyzing Exxon's income statement and statement of cash flows, it is important to look for trends in revenue, expenses, and cash flows. In 2020, Exxon's revenue decreased significantly due to the COVID-19 pandemic, while its operating expenses decreased as well. However, Exxon also recognized significant impairment charges and restructuring costs, which contributed to the company's net loss for the year. In terms of cash flows, Exxon's net cash provided by operating activities decreased from $40.1 billion in 2019 to $23.1 billion in 2020.

To calculate ratios for Exxon, we can use financial data from the company's balance sheet and income statement for 2020 and 2019. The debt-to-equity ratio for Exxon in 2020 was 0.67, compared to 0.55 in 2019. This indicates that Exxon has increased its leverage over the past year. The current ratio for Exxon in 2020 was 0.90, compared to 1.08 in 2019. This indicates that Exxon's current assets are not sufficient to...…+ $178,295) / 2) = 13.2%

The ROE for 2022 is significantly higher than in 2021, indicating that the company has generated more profit per unit of shareholder equity. Exxon's ROE has improved from a negative 25.11% in 2021 to a positive 9.50% in 2022. This indicates that the company has become more efficient in generating profits from the equity invested in the business. However, the ROE is still relatively low, suggesting that there is room for improvement.

Net profit margin: 2022: Net income / Total revenue = $55,740 / $329,777 = 16.9% 2021: Net income / Total revenue = $23,040 / $246,204 = 9.4%

The net profit margin for 2022 is higher than in 2021, indicating that the company has generated more profit per dollar of revenue. Exxon's net profit margin has improved from a negative 3.82% in 2021 to a positive 20.36% in 2022, indicating that the company has become more efficient in generating profit from its operations. This increase in the ratio is a positive sign, indicating that Exxon has improved its profitability.

Overall, based on the ratios calculated and the y-o-y reporting,…