<PAGE>
1995
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-2256
EXXON CORPORATION
(Exact name of registrant as specified in its charter)
NEW JERSEY 13-5409005
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
5959 LAS COLINAS BOULEVARD, IRVING, TEXAS 75039-2298
(Address of principal executive offices) (Zip Code)
(214) 444-1000
(Registrant's telephone number, including area code)
----------------
Securities registered pursuant to Section 12(b) of the Act:
<TABLE>
<CAPTION>
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
------------------- -----------------------
<S> <C>
COMMON STOCK, WITHOUT PAR VALUE (1,242,130,748 SHARES
OUTSTANDING AT FEBRUARY 29, 1996) NEW YORK STOCK EXCHANGE
REGISTERED SECURITIES GUARANTEED BY REGISTRANT:
SEARIVER MARITIME FINANCIAL HOLDINGS, INC.
TWENTY-FIVE YEAR DEBT SECURITIES DUE OCTOBER 1, 2011 NEW YORK STOCK EXCHANGE
EXXON CAPITAL CORPORATION
TWELVE YEAR 6% NOTES DUE JULY 1, 2005 NEW YORK STOCK EXCHANGE
</TABLE>
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
---- ----
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.
----
The aggregate market value of the voting stock held by non-affiliates of the
registrant on February 29, 1996, based on the closing price on that date of
$79 1/2 on the New York Stock Exchange composite tape, was in excess of $98
billion.
DOCUMENTS INCORPORATED BY REFERENCE:
1995 ANNUAL REPORT TO SHAREHOLDERS (PARTS I, II AND IV)
PROXY STATEMENT DATED MARCH 12, 1996 (PART III)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
EXXON CORPORATION
FORM 10-K
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
NUMBER
------
PART I
<C> <S> <C>
Item 1. Business..................................................... 1
Item 2. Properties................................................... 1-8
Item 3. Legal Proceedings............................................ 8
Item 4. Submission of Matters to a Vote of Security Holders.......... 8
Executive Officers of the Registrant [pursuant to
Instruction 3 to Regulation S-K, Item 401(b)]................ 9
PART II
Item 5. Market for Registrant's Common Stock and Related Shareholder
Matters...................................................... 9
Item 6. Selected Financial Data...................................... 9
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.................................... 9
Item 8. Financial Statements and Supplementary Data.................. 10
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure..................................... 10
PART III
Item 10. Directors and Executive Officers of the Registrant........... 10
Item 11. Executive Compensation....................................... 10
Item 12. Security Ownership of Certain Beneficial Owners and
Management................................................... 10
Item 13. Certain Relationships and Related Transactions............... 10
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form
8-K.......................................................... 10
Signatures............................................................ 11-12
Index to Financial Statements......................................... 13
Consent of Independent Accountants.................................... 13
Index to Exhibits..................................................... 14
</TABLE>
<PAGE>
PART I
ITEM 1. BUSINESS.
Exxon Corporation was incorporated in the State of New Jersey in 1882.
Divisions and affiliated companies of Exxon operate or market products in the
United States and over 100 other countries. Their principal business is
energy, involving exploration for, and production of, crude oil and natural
gas, manufacturing of petroleum products and transportation and sale of crude
oil, natural gas and petroleum products. Exxon Chemical Company, a division of
Exxon, is a major manufacturer and marketer of petrochemicals. Exxon is
engaged in exploration for, and mining and sale of, coal and other minerals.
Exxon also has an interest in electric power generation in Hong Kong.
Affiliates of Exxon conduct extensive research programs in support of these
businesses.
The terms corporation, company, Exxon, our, we and its, as used in this
report, sometimes refer not only to Exxon Corporation or to one of its
divisions but collectively to all of the companies affiliated with Exxon
Corporation or to any one or more of them. The shorter terms are used merely
for convenience and simplicity.
The oil and chemical industries are highly competitive. There is competition
within the industries and also with other industries in supplying the energy,
fuel and chemical needs of commerce, industry and individuals. The corporation
competes with other firms in the sale or purchase of various goods or services
in many national and international markets and employs all methods of
competition which are lawful and appropriate for such purposes.
Exxon Chemical is a major producer of basic petrochemicals, including
olefins and aromatics, and a leading supplier of specialty rubbers and of
additives for fuels and lubricants. Other products manufactured include
polyethylene and polypropylene plastics, plasticizers, specialty resins,
specialty and commodity solvents and performance chemicals for oil field
operations.
The operations and earnings of the corporation and its affiliates throughout
the world have been, and may in the future be, affected from time to time in
varying degree by political developments and laws and regulations, such as
forced divestiture of assets; restrictions on production, imports and exports;
price controls; tax increases and retroactive tax claims; expropriations of
property; cancellation of contract rights and environmental regulations. Both
the likelihood of such occurrences and their overall effect upon the
corporation vary greatly from country to country and are not predictable.
In 1995, the corporation spent $1,753 million (of which $565 million were
capital expenditures) on environmental conservation projects and expenses
worldwide, mostly dealing with air and water conservation. Total expenditures
for such activities are expected to be about $1.7 billion in 1996 and 1997
(with capital expenditures in each year representing about 30 percent of the
total).
Operating data and industry segment information for the corporation are
contained on pages F3, F20 and F27, information on oil and gas reserves is
contained on pages F24 and F25 and information on company-sponsored research
and development activities is contained on page F12 of the accompanying
financial section of the 1995 Annual Report to shareholders.*
ITEM 2. PROPERTIES.
Part of the information in response to this item and to the Securities
Exchange Act Industry Guide 2 is contained in the accompanying financial
section of the 1995 Annual Report to shareholders in Note 7, which note
appears on page F13, and on pages F3, and F22 through F27.*
- --------
*Only the data appearing on pages F1 and F3 through F27 of the accompanying
financial section of the 1995 Annual Report to shareholders, incorporated in
this report as Exhibit 13, are deemed to be filed as part of this Annual
Report on Form 10-K as indicated under Items 1, 2, 3, 5, 6, 7 and 8 and on
page 13.
<PAGE>
Information with regard to oil and gas producing activities follows:
1. NET RESERVES OF CRUDE OIL AND NATURAL GAS LIQUIDS (MILLIONS OF BARRELS) AND
NATURAL GAS (BILLIONS OF CUBIC FEET) AT YEAR-END 1995
Estimated proved reserves are shown on pages F24 and F25 of the accompanying
financial section of the 1995 Annual Report to shareholders. No major
discovery or other favorable or adverse event has occurred since December 31,
1995 that would cause a significant change in the estimated proved reserves as
of that date. The oil sands reserves shown separately for Canada represent
synthetic crude oil expected to be recovered from Imperial Oil Limited's 25
percent interest in the net reserves set aside for the Syncrude project, as
presently defined by government permit. For information on the standardized
measure of discounted future net cash flows relating to proved oil and gas
reserves, see page F26 of the accompanying financial section of the 1995
Annual Report to shareholders.
2. ESTIMATES OF TOTAL NET PROVED OIL AND GAS RESERVES FILED WITH OTHER FEDERAL
AGENCIES
During 1995, the company filed proved reserve estimates with the U.S.
Department of Energy on Forms EIA-23 and EIA-28. The information is consistent
with the 1994 Annual Report to shareholders with the exception of EIA-23 which
covered total oil and gas reserves from Exxon-operated properties in the U.S.
and does not include gas plant liquids.
3. AVERAGE SALES PRICES AND PRODUCTION COSTS PER UNIT OF PRODUCTION
Incorporated by reference to page F22 of the accompanying financial section
of the 1995 Annual Report to shareholders. Average sales prices have been
calculated by using sales quantities from our own production as the divisor.
Average production costs have been computed by using net production quantities
for the divisor. The volumes of crude oil and natural gas liquids (NGL)
production used for this computation are shown in the reserves table on page
F24 of the accompanying financial section of the 1995 Annual Report to
shareholders. The net production volumes of natural gas available for sale by
the producing function used in this calculation are shown on page F27 of the
accompanying financial section of the 1995 Annual Report to shareholders. The
volumes of natural gas were converted to oil equivalent barrels based on a
conversion factor of six thousand cubic feet per barrel.
4. GROSS AND NET PRODUCTIVE WELLS
<TABLE>
<CAPTION>
YEAR-END 1995
--------------------------
OIL GAS
------------- ------------
GROSS NET GROSS NET
------ ------ ------ -----
<S> <C> <C> <C> <C>
United States..................................... 18,706 6,765 4,855 2,069
Canada............................................ 6,386 4,033 5,315 2,905
Europe............................................ 1,647 508 1,039 352
Asia-Pacific...................................... 844 402 372 95
Other............................................. 733 105 16 6
------ ------ ------ -----
Total............................................ 28,316 11,813 11,597 5,427
====== ====== ====== =====
</TABLE>
5. GROSS AND NET DEVELOPED ACREAGE
<TABLE>
<CAPTION>
YEAR-END 1995
---------------------
GROSS NET
---------------------
(THOUSANDS OF ACRES)
<S> <C> <C>
United States.......................................... 5,214 3,729
Canada................................................. 3,789 1,809
Europe................................................. 12,388 3,936
Asia-Pacific........................................... 3,743 1,505
Other.................................................. 7,569 1,141
---------- ----------
Total................................................. 32,703 12,120
========== ==========
</TABLE>
2
<PAGE>
Note: Separate acreage data for oil and gas are not maintained because, in
many instances, both are produced from the same acreage.
6. GROSS AND NET UNDEVELOPED ACREAGE
<TABLE>
<CAPTION>
YEAR-END 1995
--------------
GROSS NET
------- ------
(THOUSANDS OF
ACRES)
<S> <C> <C>
United States................................................. 4,992 3,585
Canada........................................................ 4,128 2,388
Europe........................................................ 14,279 5,337
Asia-Pacific.................................................. 53,291 27,282
Other......................................................... 50,597 23,064
------- ------
Total........................................................ 127,287 61,656
======= ======
</TABLE>
7. SUMMARY OF ACREAGE TERMS IN KEY AREAS
United States
Oil and gas exploration leases are acquired for varying periods of time,
ranging from one to ten years. Production leases normally remain in effect
until production ceases.
Canada
Exploration permits are granted for varying periods of time with renewals
possible. Production leases are held as long as there is production on the
lease.
Cold Lake oil sands leases were taken for an initial 21-year term in 1968-69
and renewed for a second 21-year term in 1989-1990. All undeveloped Athabasca
oil sands leases are currently in their second 21-year term after being
renewed between 1980 and 1987. They may be renewed for a third term of 15
years if the leaseholder files a development plan with the Alberta regulatory
authority. The regulatory approval received for Syncrude has set the expiry
date of the current production lease at 2025. Also, two recent in-situ
Athabasca oil sands permits were obtained. At the end of five years, provided
delineation has been completed, the permits will convert to 15-year leases.
One permit is due to convert in 1999 and the other in 2000.
United Kingdom
Licenses issued prior to 1977 were for an initial period of six years with
an option to extend the license for a further 40 years on no more than half of
the license area. Licenses issued between 1977 and 1979 were for an initial
period of four years, after which one-third of the acreage was required to be
relinquished, followed by a second period of three years, after which an
additional one-third of the acreage was required to be relinquished, with an
option to extend for a total license period of 24 to 36 years on no more than
half the license area. Recent licenses are typically for an initial period of
six to nine years, with a second term of 12 to 15 years which may be extended
a further 18 to 24 years.
Netherlands
Onshore: Exploration drilling permits are issued for a period of two to five
years. Production concessions are granted after discoveries have been made
under conditions which are negotiated with the government. Normally, they are
field-life concessions covering an area defined by hydrocarbon occurrences.
Offshore: Prospecting licenses issued prior to March 1976 were for a 15-year
period, with relinquishment of about 50 percent of the original area required
at the end of ten years. Subsequent
3
<PAGE>
licenses are for ten years with relinquishment of about 50 percent of the
original area required after six years. For commercial discoveries within a
prospecting license, a production license is issued for a 40-year period.
Norway
Licenses issued prior to 1972 were for a total period of 46 years, with
relinquishment of at least one-fourth of the original area required at the end
of the sixth year and another one-fourth at the end of the ninth year.
Subsequent licenses are for a total period of 36 years, with relinquishment of
at least one-half of the original area required at the end of the sixth year.
France
Exploration permits are granted for periods of three to five years,
renewable up to two times accompanied by substantial acreage relinquishments:
50 percent of the acreage at first renewal; 25 percent of the remaining
acreage at second renewal. A 1994 law requires a bidding process prior to
granting of an exploration permit. Upon discovery of commercial hydrocarbons,
a production concession is granted for up to 50 years, renewable in periods of
25 years each.
Germany
Acreage holdings are generally concessions with indefinite periods subject
to minimum work commitments.
Australia
Onshore: Acreage terms are fixed by the individual state and territory
governments. These terms and conditions vary significantly between the states
and territories. Production licenses are generally granted for an initial term
of 21 years, with subsequent renewals, each for 21 years, for the full area.
Offshore: Acreage terms are fixed by the national government. Exploration
permits are granted for six years with possible renewals of five-year periods
to a total of 26 years. A 50 percent relinquishment of remaining area is
mandatory at the end of each renewal period. Production licenses are for 21
years, with one renewal of 21 years. Subsequent 21-year renewals are subject
to negotiation.
Malaysia
Exploration and production activities are governed by production sharing
contracts negotiated with the national oil company. The more recent contracts
have an overall term of 24 to 28 years with possible extensions to the
exploration or development periods. The exploration period is five to seven
years with the possibility of extensions, after which time areas with no
commercial discoveries must be relinquished. The development period is four to
six years from commercial discovery, with an option to extend the period for
an additional two years and possibly longer under special circumstances. Areas
from which commercial production has not started by the end of the development
period must be relinquished. The total production period is 15 years from
first commercial lifting, not to exceed the overall term of the contract.
Thailand
The Exxon concessions and the Petroleum Act of 1972 allow production for 30
years (through 2021) with a possible ten-year extension at terms generally
prevalent at the time.
Azerbaijan
The license is a production sharing contract with an initial period of 30
years from its 1994 execution date.
4
<PAGE>
Republic of Yemen
Production sharing agreements negotiated with the government entitle Exxon
to participate in exploration operations within a designated area during the
exploration period. In the event of a commercial discovery, the company is
entitled to proceed with development and production operations during the
development period. The length of these periods and other specific terms are
negotiated prior to executing the production sharing agreement. Existing
production operations have a development period extending 20 years from first
commercial declaration made in November 1985.
Egypt
Exploration and production activities are governed by concession agreements
negotiated with the government. These agreements generally permit three
exploration periods, with the first period being three years, and the
remaining two optional periods being two years each with 25 percent of the
remaining acreage relinquished at each renewal. Production operations have an
overall term of 30 years, with an option for a ten-year extension.
8. NUMBER OF NET PRODUCTIVE AND DRY WELLS DRILLED
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
A. Net Productive Exploratory Wells Drilled
United States................................................ 5 5 2
Canada (*)................................................... 5 8 13
Europe....................................................... 9 6 7
Asia-Pacific................................................. 15 9 7
Other........................................................ 2 3 3
--- --- ---
Total....................................................... 36 31 32
--- --- ---
B. Net Dry Exploratory Wells Drilled
United States................................................ 5 3 12
Canada (*)................................................... 12 8 7
Europe....................................................... 7 6 6
Asia-Pacific................................................. 7 7 6
Other........................................................ 2 5 1
--- --- ---
Total....................................................... 33 29 32
--- --- ---
C. Net Productive Development Wells Drilled
United States................................................ 152 188 193
Canada (*)................................................... 339 135 205
Europe....................................................... 32 25 19
Asia-Pacific................................................. 40 57 61
Other........................................................ 11 10 10
--- --- ---
Total....................................................... 574 415 488
--- --- ---
D. Net Dry Development Wells Drilled
United States................................................ 7 15 24
Canada (*)................................................... 3 3 --
Europe....................................................... 1 1 --
Asia-Pacific................................................. -- -- 3
Other........................................................ -- -- 2
--- --- ---
Total....................................................... 11 19 29
--- --- ---
Total number of net wells drilled.............................. 654 494 581
=== === ===
</TABLE>
- --------
* 1994 and 1993 counts restated for development wells now categorized as
exploration wells.
5
<PAGE>
9. PRESENT ACTIVITIES
A. Wells Drilling -- Year-End 1995
<TABLE>
<CAPTION>
GROSS NET
----- ---
<S> <C> <C>
United States...................................................... 29 24
Canada............................................................. 9 4
Europe............................................................. 45 15
Asia-Pacific....................................................... 8 5
Other.............................................................. 7 1
--- ---
Total............................................................. 98 49
=== ===
</TABLE>
B. Review of Principal Ongoing Activities in Key Areas
UNITED STATES
During 1995, exploration activities were conducted by Exxon Exploration
Company and producing activities by Exxon Company, U.S.A., both divisions of
Exxon Corporation. Some of the more significant ongoing activities are:
. Exploration and delineation of additional hydrocarbon resources
continued. At year-end 1995, Exxon's inventory of undeveloped acreage
totaled 3.6 million net acres. Exxon is active in areas onshore and
offshore in the lower 48 states and in Alaska. A total of ten net
exploration and delineation wells were completed during 1995.
. During 1995, 116 net development wells were completed within and around
mature fields in the inland lower 48 states.
. Exxon's net acreage in the Gulf of Mexico at year-end 1995 was 1.2
million acres. A total of 26 net exploratory and development wells were
completed during the year.
. There were no new major projects which started up in 1995. Fabrication
of facilities for the Ram-Powell project, which will involve setting a
tension-leg platform (TLP) in approximately 3,200 feet of water, is
progressing. Start-up is expected in 1997.
. Participation in Alaska production and development continued and a total
of nine net development wells were drilled in 1995. At the Point
McIntyre field, debottlenecking of production facilities continued,
allowing production to increase to 50 thousand barrels per day (net) by
year-end.
CANADA
During 1995, exploration and production activities in Canada were conducted
by the Resources Division of Imperial Oil Limited, which is 69.6 percent owned
by Exxon Corporation. Some of the more significant ongoing activities are:
. Gross commercial bitumen production from Cold Lake averaged 94 thousand
barrels per day during 1995. Work continued to expand the steam-
injection, bitumen recovery operations. The expansion is expected to
increase heavy oil production to about 130 thousand barrels per day by
1997.
. The Syncrude plant, 25 percent owned by Imperial and located in northern
Alberta, completed its 17th year of operations. Gross synthetic crude
production averaged 202 thousand barrels per day in 1995.
6
<PAGE>
OUTSIDE NORTH AMERICA
During 1995, exploration activities were conducted by Exxon Exploration
Company and producing activities by Exxon Company, International, both
divisions of Exxon Corporation. Some of the more significant ongoing
activities include:
United Kingdom
During the year, Exxon acquired an interest in ten new blocks. Net acreage,
however, remained at 1.7 million acres at year-end with offsetting
relinquishment and sales. During 1995, 23.3 net exploration and development
wells were completed. At year-end, development drilling was completed at
Gannet A and continued at the Gannet C, Nelson, Pelican and Schooner projects.
Construction of the Central North Sea Floating Production, Storage and Off-
loading project is ahead of schedule, and the Brent redevelopment program is
progressing with the start-up of the Brent Bravo platform. The Eastern Trough
Area Project was approved, with start-up anticipated in 1998.
Netherlands
Exxon's interest in licenses totaled 2.8 million net acres at year-end 1995.
During the year, 9.4 net exploration and development wells were completed.
Production start-up's during the year included the Pernis West, K-11 FB/FC,
L-13 FH and Den Velde fields. Two large underground natural gas storage projects
(Grijpskerk and Norg) were approved, with start-up anticipated in 1997-1998.
Norway
Total net offshore acreage licensed to Exxon at year-end 1995 remained at
0.3 million acres. During the year, 7.1 net exploration and development wells
were completed and production was initiated at the Statfjord North field.
Projects for development of the Sleipner West, Balder and Vigdis fields are
continuing as planned, with first production scheduled for 1996-1997.
France
Exxon's net acreage totaled 0.7 million net acres at the end of 1995. During
the year, 3.3 net exploration and development wells were drilled and
completed.
Germany
A total of 3.5 million acres were held by Exxon in Germany at year-end, with
5.8 net exploration and development wells drilled and completed during the
year. The Uelsen underground natural gas storage project was approved, with
start-up anticipated in 1997.
Australia
Exxon's 1995 year-end acreage holdings totaled 7.0 million net acres onshore
and 1.1 million net acres offshore, with exploration and production activities
underway in both areas. During the year, 19.9 net exploration and development
wells were completed. The West Tuna and Bream B projects are progressing with
first production anticipated in 1997.
Malaysia
Exxon has interests in production sharing contracts covering 4.2 million net
acres offshore Peninsular Malaysia. During 1995, a total of 40.7 net
exploration and development wells were completed. Development drilling was
completed for the Dulang field and waterflood and gas injection
7
<PAGE>
facilities were commissioned. Compression facilities at Jerneh were
commissioned and the Lawit gas project is progressing with start-up
anticipated in 1997. Development drilling continued on the Guntong D and
Tabu B platforms.
Indonesia
At year-end, Exxon's net acreage in Indonesia totaled 0.5 million acres, all
offshore, after the sale of its share in P.T. Stanvac Indonesia in December.
Thailand
Exxon's net acreage in the Khorat concession onshore Thailand totaled 0.1
million acres at year-end.
Azerbaijan
A total of 5,000 acres were held by Exxon in Azerbaijan at year-end, all
offshore. This interest (5 percent of the previously discovered Megastructure
fields) was acquired in 1995 from SOCAR, the state oil company of Azerbaijan.
Operations in 1995 included completion of a seismic survey and initiation of
topsides refurbishment for the one existing platform.
Republic of Yemen
Exxon's net acreage in the Republic of Yemen production sharing agreement
areas totaled 0.9 million acres onshore at year-end. During the year, 8.4 net
exploration and development wells were drilled and completed.
Egypt
Exxon is engaged in exploration and production activities in two contract
areas, with net acreage holdings totaling 0.1 million acres. During 1995, 4.0
net exploration and production wells were completed.
Colombia
At year-end, Exxon's net acreage in Colombia totaled 0.1 million acres after
the sale of its producing fields.
WORLDWIDE EXPLORATION
Exploration activities were underway in several areas in which Exxon has no
established production operations. A total of 38.7 million net acres were held
at year-end, and 3.7 net exploration wells were completed during the year.
ITEM 3. LEGAL PROCEEDINGS.
As initially reported in the registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1992, the registrant was sued by Metropolitan Dade
County in the Eleventh Judicial Circuit Court, Dade County, Florida, for
alleged hydrocarbon soil and groundwater contamination relating to an
underground tank and piping system beneath a former Exxon service station in
Opa Locka, Florida. On June 8, 1995, the court entered an order granting the
registrant's motion for summary judgment, and on August 9, 1995, the court
denied the plaintiff's motion for rehearing of that order.
Refer to the relevant portions of Note 14 on page F16 of the accompanying
financial section of the 1995 Annual Report to shareholders for further
information on legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
----------------
8
<PAGE>
EXECUTIVE OFFICERS OF THE REGISTRANT [pursuant to Instruction 3 to Regulation
S-K, Item 401(b)].
<TABLE>
<CAPTION>
AGE AS OF
MARCH 31,
NAME 1996 TITLE (HELD OFFICE SINCE)
---- --------- ---------------------------------------------
<S> <C> <C>
L. R. Raymond........... 57 Chairman of the Board (1993)
R. Dahan................ 54 Senior Vice President (1995)
E. J. Hess.............. 62 Senior Vice President (1993)
H. J. Longwell.......... 54 Senior Vice President (1995)
R. E. Wilhelm........... 55 Senior Vice President (1990)
A. L. Condray........... 53 Vice President (1995)
W. B. Cook.............. 60 Vice President and Controller (1994)
C. W. Matthews, Jr. .... 51 Vice President and General Counsel (1995)
R. B. Nesbitt........... 62 Vice President (1992)
E. A. Robinson.......... 62 Vice President and Treasurer (1983)
C. D. Roxburgh.......... 57 Vice President (1995)
P. E. Sullivan.......... 52 Vice President and General Tax Counsel (1995)
J. L. Thompson.......... 56 Vice President (1991)
T. P. Townsend.......... 59 Vice President -- Investor Relations (1990)
and Secretary (1995)
</TABLE>
For at least the past five years, Messrs. Raymond, Hess, Wilhelm, Robinson
and Townsend have been employed as executives of the registrant. Effective
February 1, 1996 Mr. Raymond also holds the title of president.
The following executive officers of the registrant have also served as
executives of the subsidiaries, affiliates or divisions of the registrant
shown opposite their names during the five years preceding December 31, 1995.
<TABLE>
<S> <C>
Esso Nederland B.V. ............................. Dahan
Exxon Chemical Company........................... Nesbitt
Exxon Coal and Minerals Company.................. Roxburgh
Exxon Company, International..................... Cook, Dahan, Longwell,
Roxburgh and Thompson
Exxon Company, U.S.A............................. Condray, Longwell, Matthews
and Sullivan
Exxon Exploration Company........................ Thompson
</TABLE>
Officers are generally elected by the Board of Directors at its meeting on
the day of each annual election of directors, each such officer to serve until
his or her successor has been elected and qualified.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS.
Incorporated by reference to the quarterly information which appears on page
F21 of the accompanying financial section of the 1995 Annual Report to
shareholders.
ITEM 6. SELECTED FINANCIAL DATA.
Incorporated by reference to page F3 of the accompanying financial section
of the 1995 Annual Report to shareholders.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Incorporated by reference to pages F4 through F7 of the accompanying
financial section of the 1995 Annual Report to shareholders.
9
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Reference is made to the Index to Financial Statements on page 13 of this
Annual Report on Form 10-K.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Incorporated by reference to the relevant portions of pages 4 through 8 and
to the portion of page 9 entitled "Section 16(a) Reports" of the registrant's
definitive proxy statement dated March 12, 1996.
ITEM 11. EXECUTIVE COMPENSATION.
Incorporated by reference to the fifth through eighth paragraphs of page 2
and pages 10 through 13 (excluding the portion of page 13 entitled "Board
Compensation Committee Report on Executive Compensation") of the registrant's
definitive proxy statement dated March 12, 1996.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Incorporated by reference to the relevant portions of pages 4 through 9
(excluding the portions of page 9 entitled "Transactions with Management" and
"Section 16(a) Reports") of the registrant's definitive proxy statement dated
March 12, 1996.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Incorporated by reference to the portion of page 9 entitled "Transactions
with Management" of the registrant's definitive proxy statement dated March
12, 1996.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a)(1) and (a) (2) Financial Statements:
See Index to Financial Statements on page 13 of this Annual Report on
Form 10-K.
(a)(3) Exhibits:
See Index to Exhibits on page 14 of this Annual Report on Form 10-K.
(b)Reports on Form 8-K.
The registrant did not file any reports on Form 8-K during the last
quarter of 1995.
10
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF SECTION 13 OF THE SECURITIES EXCHANGE ACT OF
1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY
THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.
EXXON CORPORATION
/s/ LEE R. RAYMOND
By: _________________________________
(Lee R. Raymond,
Chairman of the Board)
Dated March 8, 1996
----------------
POWER OF ATTORNEY
EACH PERSON WHOSE SIGNATURE APPEARS BELOW CONSTITUTES AND APPOINTS JAMES I.
ALCOCK, RICHARD E. GUTMAN AND FRANK A. RISCH, AND EACH OF THEM, HIS OR HER
TRUE AND LAWFUL ATTORNEYS-IN-FACT AND AGENTS, WITH FULL POWER OF SUBSTITUTION
AND RESUBSTITUTION, FOR HIM OR HER AND IN HIS OR HER NAME, PLACE AND STEAD, IN
ANY AND ALL CAPACITIES, TO SIGN ANY AND ALL AMENDMENTS TO THIS ANNUAL REPORT
ON FORM 10-K, AND TO FILE THE SAME, WITH ALL EXHIBITS THERETO, AND OTHER
DOCUMENTS IN CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE
COMMISSION, GRANTING UNTO SAID ATTORNEYS-IN-FACT AND AGENTS, AND EACH OF THEM,
FULL POWER AND AUTHORITY TO DO AND PERFORM EACH AND EVERY ACT AND THING
REQUISITE AND NECESSARY TO BE DONE, AS FULLY TO ALL INTENTS AND PURPOSES AS HE
OR SHE MIGHT OR COULD DO IN PERSON, HEREBY RATIFYING AND CONFIRMING ALL THAT
SAID ATTORNEYS-IN-FACT AND AGENTS OR ANY OF THEM, OR THEIR OR HIS OR HER
SUBSTITUTE OR SUBSTITUTES, MAY LAWFULLY DO OR CAUSE TO BE DONE BY VIRTUE
HEREOF.
----------------
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE
REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<S> <C> <C>
/s/ LEE R. RAYMOND Chairman of the Board March 8, 1996
- ------------------------------------------- (Principal Executive Officer)
(Lee R. Raymond)
/s/ MICHAEL J. BOSKIN Director March 8, 1996
- -------------------------------------------
(Michael J. Boskin)
/s/ RANDOLPH W. BROMERY Director March 8, 1996
- -------------------------------------------
(Randolph W. Bromery)
/s/ D. WAYNE CALLOWAY Director March 8, 1996
- -------------------------------------------
(D. Wayne Calloway)
</TABLE>
11
<PAGE>
<TABLE>
<S> <C> <C>
/s/ JESS HAY Director March 8, 1996
- -------------------------------------------
(Jess Hay)
/s/ JAMES R. HOUGHTON Director March 8, 1996
- -------------------------------------------
(James R. Houghton)
/s/ WILLIAM R. HOWELL Director March 8, 1996
- -------------------------------------------
(William R. Howell)
/s/ PHILIP E. LIPPINCOTT Director March 8, 1996
- -------------------------------------------
(Philip E. Lippincott)
/s/ HARRY J. LONGWELL Director March 8, 1996
- -------------------------------------------
(Harry J. Longwell)
/s/ MARILYN CARLSON NELSON Director March 8, 1996
- -------------------------------------------
(Marilyn Carlson Nelson)
/s/ JOHN H. STEELE Director March 8, 1996
- -------------------------------------------
(John H. Steele)
/s/ ROBERT E. WILHELM Director March 8, 1996
- -------------------------------------------
(Robert E. Wilhelm)
/s/ JOSEPH D. WILLIAMS Director March 8, 1996
- -------------------------------------------
(Joseph D. Williams)
/s/ W. BRUCE COOK Controller (Principal March 8, 1996
- ------------------------------------------- Accounting Officer)
(W. Bruce Cook)
/s/ EDGAR A. ROBINSON Treasurer (Principal March 8, 1996
- ------------------------------------------- Financial Officer)
(Edgar A. Robinson)
</TABLE>
12
<PAGE>
INDEX TO FINANCIAL STATEMENTS
The consolidated financial statements, together with the report thereon of
Price Waterhouse LLP dated February 28, 1996, appearing on pages F8 to F20; the
Quarterly Information appearing on page F21; and the Supplemental Information
on Oil and Gas Exploration and Production Activities appearing on pages F22 to
F26 of the accompanying financial section of the 1995 Annual Report to
shareholders are incorporated in this Annual Report on Form 10-K as Exhibit 13.
With the exception of the aforementioned information, no other data appearing
in the accompanying financial section of the 1995 Annual Report to shareholders
is deemed to be filed as part of this Annual Report on Form 10-K under Item 8.
Consolidated Financial Statement Schedules have been omitted because they are
not applicable or the required information is shown in the consolidated
financial statements or notes thereto.
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the following
Prospectuses constituting part of the Registration Statements on:
<TABLE>
<S> <C>
Form S-3 (No. 33-60677) --Exxon Corporation Shareholder Investment Program;
Form S-8 (No. 33-51107) --1993 Incentive Program of Exxon Corporation (together
with 1983 Stock Option and 1988 Long Term Incentive
Plans of Exxon Corporation);
Form S-8 (No. 33-19057) --Thrift Plans of Exxon Corporation and Participating
Affiliated Employers;
Form S-3 (No. 33-48919) --Guaranteed Debt Securities and Warrants to Purchase
Guaranteed Debt Securities of Exxon Capital Corporation;
Form S-3 (No. 33-8922) --Guaranteed Debt Securities of SeaRiver Maritime
Financial Holdings, Inc. (formerly Exxon Shipping
Company)
</TABLE>
of our report dated February 28, 1996 appearing on page F11 of the accompanying
financial section of the 1995 Annual Report to shareholders of Exxon
Corporation which is incorporated as Exhibit 13 in this Annual Report on Form
10-K.
Price Waterhouse LLP
Dallas, Texas
March 8, 1996
13
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<C> <S> <C>
3(i). Registrant's Restated Certificate of Incorporation, as
restated November 1, 1991 (incorporated by reference to
Exhibit 3(a) to the registrant's Annual Report on Form
10-K for 1991).
3(ii). Registrant's By-Laws, as revised to January 31, 1996.
10(iii)(a). Registrant's 1993 Incentive Program, as amended
(incorporated by reference to Exhibit 10(iii) to the
registrant's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1995).*
10(iii)(b). Registrant's Plan for Deferral of Nonemployee Director
Compensation and Fees, as amended (incorporated by
reference to Exhibit 10(iii)(b) to the registrant's
Annual Report on Form 10-K for 1993).*
10(iii)(c). Registrant's Restricted Stock Plan for Nonemployee
Directors, as amended (incorporated by reference to
Exhibit 10(iii)(c) to the registrant's Annual Report on
Form 10-K for 1994).*
10(iii)(d). Supplemental life insurance (incorporated by reference to
Exhibit 10(iii)(d) to the registrant's Annual Report on
Form 10-K for 1992).*
10(iii)(e). Registrant's Short Term Incentive Program (incorporated by
reference to Exhibit 10(iii)(e) to the registrant's
Annual Report on Form 10-K for 1993).*
12. Computation of ratio of earnings to fixed charges.
13. Pages F1 and F3 through F27 of the Financial Section of
the registrant's 1995 Annual Report to shareholders.
21. Subsidiaries of the registrant.
23. Consent of Independent Accountants (contained on page 13
of this Annual Report on Form 10-K).
27. Financial Data Schedule (included only in the electronic
filing of this document).
</TABLE>
- --------
* Compensatory plan or arrangement required to be identified pursuant to Item
14(a)(3) of this Annual Report on Form 10-K.
The registrant has not filed with this report copies of the instruments
defining the rights of holders of long-term debt of the registrant and its
subsidiaries for which consolidated or unconsolidated financial statements are
required to be filed. The registrant agrees to furnish a copy of any such
instrument to the Securities and Exchange Commission upon request.
14
<PAGE>
EXHIBIT 3(ii)
EXXON CORPORATION
INCORPORATED IN NEW JERSEY
BY-LAWS
ARTICLE I
Meetings of Shareholders
1. Meetings of shareholders may be held on such date and at such time and
place, within or without the State of New Jersey, as may be fixed by the board
of directors and stated in the notice of meeting.
2. The date for each annual meeting of shareholders, fixed as provided in
Section 1 of this Article I, shall be a date not more than thirteen months after
the date on which the last annual meeting of shareholders was held. The
directors shall be elected at the annual meeting of shareholders.
3. Special meetings of the shareholders may be called by the board of
directors, the chairman of the board or the president.
4. Except as otherwise provided by statute, written notice of the date, time,
place and purpose or purposes of every meeting of shareholders shall be given
not less than ten nor more than sixty days before the date of the meeting,
either personally or by mail, to each shareholder of record entitled to vote at
the meeting. The business transacted at special meetings shall be confined to
the purposes specified in the notice.
5. Unless otherwise provided by statute the holders of shares entitled to cast
a majority of votes at a meeting, present either in person or by proxy, shall
constitute a quorum at such meeting. Less than a quorum may adjourn.
6. For the purpose of determining the shareholders entitled to notice of or to
vote at any meeting of shareholders or any adjournment thereof, or for the
purpose of determining shareholders entitled to receive payment of any dividend
or allotment of any right, or for the purpose of any other action, the board of
directors may fix in advance a date as the record date for any such
determination of shareholders. Such date shall not be more than sixty nor less
than ten days before the date of such meeting, nor more than sixty days prior to
any other action.
7. The board of directors may, in advance of any shareholders' meeting, appoint
one or more inspectors to act at the meeting or any adjournment thereof. If
inspectors are not so appointed by the board or shall fail to qualify, the
person presiding at a shareholders' meeting may, and at the request of any
shareholder entitled to vote thereat, shall, make such appointment. In case any
person appointed as inspector fails to appear or act, the vacancy may be filled
by appointment made by the board in advance of the meeting or at the meeting by
the person presiding at the meeting. Each inspector, before entering upon the
discharge of the duties of inspector, shall take and sign an oath faithfully to
execute such duties at such meeting with strict impartiality and according to
the best of the inspector's ability.
1
<PAGE>
The inspectors shall determine the number of shares outstanding and the
voting power of each, the shares represented at the meeting, the existence of a
quorum, the validity and effect of proxies, and shall receive votes or consents,
hear and determine all challenges and questions arising in connection with the
right to vote, count and tabulate all votes or consents, determine the result,
and do such acts as are proper to conduct the election or vote with fairness to
all shareholders. If there are three or more inspectors, the act of a majority
shall govern. On request of the person presiding at the meeting or any
shareholder entitled to vote thereat, the inspectors shall make a report in
writing of any challenge, question or matter determined by them. Any report
made by them shall be prima facie evidence of the facts therein stated, and such
report shall be filed with the minutes of the meeting.
ARTICLE II
Board of Directors
1. The business and affairs of the corporation shall be managed by its board of
directors consisting of not less than ten nor more than fifteen members, who
shall hold office until the next annual meeting and until their successors shall
have been elected and qualified. The actual number of directors shall be
determined from time to time by resolution of the board. If at any time, except
at the annual meeting, the number of directors shall be increased, the
additional director or directors may be elected by the board, to hold office
until the next annual meeting and until their successors shall have been elected
and qualified.
2. The organization meeting of the board of directors, for the purpose of
organization or otherwise, shall be held without further notice on the day of
the annual meeting of shareholders, at such time and place as shall be fixed
from time to time pursuant to resolution of the board. Other regular meetings
of the board may be held without further notice at such times and places as
shall be fixed from time to time pursuant to resolution of the board. The
chairman of the board, the president, any vice president who is a member of the
board, or the secretary may change the day or hour or place of any single
regular meeting from that determined by the board upon causing that prior notice
of such change be transmitted to all directors.
Special meetings of the board may be called at the direction of the chairman
of the board, of the president or of any vice president who is a member of the
board, or, in the absence of such officers, at the direction of any one of the
directors. Any such meeting shall be held on such date and at such time and
place as may be designated in the notice of the meeting.
Notices required under this section may be transmitted in person, in
writing, or by telephone, telegram, cable or radio, and shall be effective
whether or not actually received, provided they are duly transmitted not less
than forty-eight hours in advance of the meeting. Notice may be waived in
writing before or after a meeting. No notice or waiver need specify the
business scheduled for any board meeting and any business may be transacted at
either a regular or special meeting.
2
<PAGE>
3. Five directors shall constitute a quorum for the transaction of business,
except that any directorship not filled at the annual meeting and any vacancy,
however caused, occurring in the board may be filled by the affirmative vote of
a majority of the remaining directors even though less than a quorum of the
board, or by a sole remaining director. At any meeting of the board, whether or
not a quorum is present, a majority of those present may adjourn the meeting.
Notice of an adjourned meeting need not be given if the time and place are fixed
at the meeting adjourning and if the period of adjournment does not exceed ten
days in any one adjournment.
4. (a) The provisions of this Section 4 of Article II shall be operative during
any emergency in the conduct of the business of the corporation resulting from
an attack on the United States or any nuclear or atomic disaster or from the
imminent threat of such an attack or disaster. For the purpose of this Section
4 of Article II, such an emergency is defined as any period following (i) an
enemy attack on the continental United States or any nuclear or atomic disaster
as a result and during the period of which the means of communication or travel
within the continental United States are disrupted or made uncertain or unsafe,
or (ii) a determination as herein provided that such an attack or disaster is
imminent or has occurred. The commencement and termination of the period of any
such emergency may be determined by the chairman of the board or, in the event
of the death, absence or disability of the chairman of the board, by the
president, or in the event of the death, absence or disability of both the
chairman of the board and the president, by such person or persons as the board
of directors may from time to time designate, but in the absence of such
specific designation, by the senior vice president who has been designated
pursuant to the authority of Section 6 of Article IV of these by-laws to
exercise the powers and perform the duties of the chairman of the board and the
president. To the extent not inconsistent with the provisions of this Section 4
of Article II, the by-laws in their entirety shall remain in effect during any
such emergency.
(b) Before or during any such emergency, the board may change the head
office or designate several alternative head offices or regional offices, or
authorize the officers to do so, said change to be effective during the
emergency.
(c) The officers or other persons designated by title in a list approved by
the board before or during the emergency, all who are known to be alive and
available to act in such order of priority and subject to such conditions and
for such period of time, not longer than reasonably necessary after the
termination of the emergency, as may be provided in the resolution of the board
approving the list, shall, to the extent required to provide a quorum at any
meeting of the board, be deemed and shall have all the powers of directors for
such meeting. Unless so designated, an officer who is not a director shall not
be deemed a director for the foregoing purpose.
(d) Meetings of the board may be called by any officer or director or in the
absence of all officers and directors by any person designated in a list
approved by the board pursuant to subsection (c) of this Section 4. Any such
meeting shall be held on such date and at such time and place as may be
designated in the notice of the meeting. Notice of any such meeting need be
given only to such of the directors as it may be feasible to reach
3
<PAGE>
at the time and such of the persons designated in such list as is considered
advisable in the judgment of the person calling the meeting. Any such notice
may be transmitted in person, in writing, or by telephone, telegram, cable or
radio, or by such other means as may be feasible at the time, shall be effective
whether or not actually received and shall be given at such time in advance of
the meeting as, in the judgment of the person calling the meeting, circumstances
permit.
(e) Three directors shall constitute a quorum for the transaction of
business.
(f) Before or during any such emergency, the board by resolution may (i)
appoint one or more committees in addition to or in substitution for one or more
of those appointed pursuant to the provisions of Article III of these by-laws to
act during such emergency and (ii) take any of the actions listed in Section 2
of Article III of these by-laws in regard to any committee established pursuant
to (i) of this subsection (f). Each such committee shall have at least three
members, none of whom need be a director. To the extent provided in such
resolution, each such committee shall have and may exercise all the authority of
the board, except that no such committee shall take the action which Section 1
of Article III of these by-laws prohibits committees of the board to take.
(g) Before or during any such emergency, the board may provide and from time
to time modify, lines of succession in the event that during such an emergency
any or all officers or agents of the corporation or any or all members of any
committee of the board shall for any reason be rendered incapable of discharging
their duties.
(h) No officer, director or employee acting in accordance with this Section
4 of Article II shall be liable except for willful misconduct. No officer,
director or employee shall be liable for any action taken in good faith in such
an emergency in furtherance of the ordinary business affairs of the corporation
even though not authorized by the by-laws then in effect.
(i) Persons may conclusively rely upon a determination made pursuant to
subsection (a) of this Section 4 that an emergency as therein defined exists
regardless of the correctness of such determination.
5. No contract or other transaction between the corporation and one or more of
its directors or between the corporation and any other corporation, firm or
association of any type or kind in which one or more of its directors are
directors or are otherwise interested, shall be void or voidable solely by
reason of such common directorship or interest, or solely because such director
or directors are present at the meeting of the board or a committee thereof
which authorizes or approves the contract or transaction, or solely because such
director's or directors' votes are counted for such purpose, if (a) the contract
or other transaction is fair and reasonable as to this corporation at the time
it is authorized, approved or ratified, or (b) the fact of the common
directorship or interest is disclosed or known to the board or committee and the
board or committee authorizes, approves or ratifies the contract or transaction
by unanimous written consent, provided at least one director so consenting is
disinterested, or by affirmative vote of a majority of the disinterested
directors, even though the disinterested directors be less than a quorum,
4
<PAGE>
or (c) the fact of the common directorship or interest is disclosed or known to
the shareholders and they authorize, approve or ratify the contract or
transaction.
ARTICLE III
Committees of the Board
1. The board, by resolution adopted by a majority of the entire board, may
appoint from among its members an executive committee and one or more other
committees, each of which shall have at least three members. To the extent
provided in such resolution, each such committee shall have and may exercise all
the authority of the board, except that no such committee shall (a) make, alter
or repeal any by-law of the corporation; (b) elect any director, or remove any
officer or director; (c) submit to shareholders any action that requires
shareholders' approval; or (d) amend or repeal any resolution theretofore
adopted by the board which by its terms is amendable or repealable only by the
board.
2. The board, by resolution adopted by a majority of the entire board, may (a)
fill any vacancy in any such committee; (b) appoint one or more directors to
serve as alternate members of any such committee, to act in the absence or
disability of members of any such committee with all the powers of such absent
or disabled members; (c) abolish any such committee at its pleasure; (d) remove
any director from membership on such committee at any time, with or without
cause; and (e) establish as a quorum for any such committee less than a majority
of the entire committee, but in no case less than the greater of two persons or
one-third of the entire committee.
3. Actions taken at a meeting of any such committee shall be reported to the
board at its next meeting following such committee meeting; except that, when
the meeting of the board is held within two days after the committee meeting,
such report shall, if not made at the first meeting, be made to the board at its
second meeting following such committee meeting.
ARTICLE IV
Officers
1. The board of directors at the organization meeting on the day of the annual
election of directors shall elect a chairman of the board, a president, one or
more vice presidents as the board may determine, any one or more of whom may be
designated as executive vice president or as senior vice president or in such
special or limiting style as the board may determine, a secretary, a treasurer,
a controller, a general counsel, and a general tax counsel. The chairman of the
board and the president shall each be a director, but the other officers need
not be members of the board.
2. The board of directors may from time to time elect, or authorize an officer
of the corporation to appoint in writing, assistant secretaries, assistant
treasurers, assistant controllers, and such other officers as the board may
designate.
5
<PAGE>
3. All officers of the corporation, as between themselves and the corporation,
shall have such authority and perform such duties in the management of the
corporation as may be provided in these by-laws, or as may be determined by
resolution of the board not inconsistent with these by-laws.
4. The chairman of the board shall be chief executive officer of the
corporation and shall preside at all meetings of shareholders and directors.
Subject to the board of directors, the chairman of the board shall have general
care and supervision of the business and affairs of the corporation. In the
absence of the president, the chairman of the board shall exercise the powers
and perform the duties of the president.
5. The president shall, subject to the board of directors, direct the current
administration of the business and affairs of the corporation. In the absence
of the chairman of the board, the president shall preside at meetings of the
shareholders and directors and exercise the other powers and duties of the
chairman.
6. In the event of the death, absence, or disability of the chairman of the
board and the president, a senior vice president may be designated by the board
to exercise the powers and perform the duties of those offices.
7. The secretary shall give notice of all meetings of the shareholders and of
the board of directors. The secretary shall keep records of the votes at
elections and of all other proceedings of the shareholders and of the board.
The secretary shall have all the authority and perform all the duties normally
incident to the office of secretary and shall perform such additional duties as
may be assigned to the secretary by the board, the chairman of the board or the
president.
The assistant secretaries shall perform such of the duties of the secretary
as may be delegated to them by the secretary.
8. The treasurer shall be the principal financial officer of the corporation.
The treasurer shall have charge and custody of all funds and securities of the
corporation; receive and give receipts for monies paid to the corporation, and
deposit such monies in the corporation's name in such banks or other
depositories as shall be selected for the purpose; and shall cause money to be
paid out as the corporation may require. The treasurer shall have all the
authority and perform all the duties normally incident to the office of
treasurer and shall perform such additional duties as may be assigned to the
treasurer by the board of directors, the chairman of the board or the president.
The assistant treasurers shall perform such of the duties of the treasurer
as may be delegated to them by the treasurer.
9. The controller shall be the principal accounting and financial control
officer of the corporation. The controller shall be responsible for the system
of financial control of the corporation, including internal audits, the
maintenance of its accounting records, and the preparation of the corporation's
financial statements. The controller shall periodically inform the board of
directors of the corporation's financial results and position. The controller
shall have all the authority and perform all the duties normally incident to the
office of controller and shall perform such additional duties as may be assigned
to the controller by the board of directors, the chairman of the board or the
president.
6
<PAGE>
The assistant controllers shall perform such of the duties of the controller
as may be delegated to them by the controller.
10. The general counsel shall advise the board of directors and officers on
legal matters, except those relating to taxes. The general tax counsel shall
advise the board of directors and officers on legal matters relating to taxes.
Each shall perform such additional duties as may be assigned to either of them
by the board of directors, the chairman of the board or the president.
11. Any vacancy occurring among the officers, however caused, may be filled by
the board of directors except that any vacancy in the office of an assistant
secretary, assistant treasurer or assistant controller appointed by an officer
of the corporation may be filled by the officer, if any, then authorized by the
board to make appointments to such office.
12. Any officer may be removed by the board with or without cause, and any
assistant secretary, assistant treasurer or assistant controller appointed by an
officer of the corporation may be removed with or without cause by the officer,
if any, then authorized by the board to make appointments to such office.
ARTICLE V
Divisions and Division Officers
1. The board of directors may from time to time establish one or more divisions
of the corporation and assign to such divisions responsibilities for such of the
corporation's business, operations and affairs as the board may designate.
2. The board of directors may appoint or authorize an officer of the
corporation to appoint in writing officers of a division. Unless elected or
appointed an officer of the corporation by the board of directors or pursuant to
authority granted by the board, an officer of a division shall not as such be an
officer of the corporation, except that such person shall be an officer of the
corporation for the purposes of executing and delivering documents on behalf of
the corporation or for other specific purposes, if and to the extent that such
person may be authorized to do so by the board of directors. Unless otherwise
provided in the writing appointing an officer of a division, such person's term
of office shall be for one year and until that person's successor is appointed
and qualified. Any officer of a division may be removed with or without cause by
the board of directors or by the officer, if any, of the corporation then
authorized by the board of directors to appoint such officer of a division.
3. The board of directors may prescribe or authorize an officer of the
corporation or an officer of a division to prescribe in writing the duties and
powers and authority of officers of divisions.
7
<PAGE>
ARTICLE VI
Transfer of Shares
1. Shares of the corporation shall be transferable on the records of the
corporation in accordance with the provisions of Chapter 8 of the Uniform
Commercial Code (New Jersey Statutes 12A:8-101 et seq.), as amended from time to
time, except as otherwise provided in the New Jersey Business Corporation Act
(New Jersey Statutes 14A:l-l et seq.).
2. In the case of lost, destroyed or wrongfully taken certificates, transfer
shall be made only after the receipt of a sufficient indemnity bond, if required
by the board of directors, and satisfaction of other reasonable requirements
imposed by the board.
3. The board of directors may from time to time appoint one or more transfer
agents and one or more registrars of transfers. All share certificates shall
bear the signature, which may be a facsimile, of a transfer agent and of a
registrar. The functions of transfer agents and registrars shall conform to
such regulations as the board may from time to time prescribe. The board may at
any time terminate the appointment of any transfer agent or registrar.
ARTICLE VII
Fiscal Year
The fiscal year of the corporation shall be the calendar year.
ARTICLE VIII
Corporate Seal
1. The corporate seal is, and until otherwise ordered by the board of directors
shall be, a circle containing the words "EXXON CORPORATION, INCORPORATED UNDER
THE LAWS OF NEW JERSEY" and may be an impression upon paper or wax or a printed
or facsimile reproduction of such impression.
2. The impression of the seal may be made and attested by either the secretary
or an assistant secretary for the authentication of contracts and other papers
requiring the seal.
ARTICLE IX
Amendments
The board of directors shall have the power to make, alter and repeal the
by-laws of the corporation, but by-laws made by the board may be altered or
repealed, and new by-laws made, by the shareholders.
8
<PAGE>
ARTICLE X
Indemnification
1. The corporation shall indemnify to the full extent from time to time
permitted by law any director or former director or officer or former officer
made, or threatened to be made, a party to, or a witness or other participant
in, any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative, arbitrative, legislative, investigative, or of
any other kind, by reason of the fact that such person is or was a director,
officer, employee or other corporate agent of the corporation or any subsidiary
of the corporation or serves or served any other enterprise at the request of
the corporation (including service as a fiduciary with respect to any employee
benefit plan of the corporation or any subsidiary of the corporation) against
expenses (including attorneys' fees), judgments, fines, penalties, excise taxes
and amounts paid in settlement, actually and reasonably incurred by such person
in connection with such action, suit or proceeding, or any appeal therein. No
indemnification pursuant to this Article X shall be required with respect to any
settlement or other nonadjudicated disposition of any threatened or pending
action or proceeding unless the corporation has given its prior consent to such
settlement or other disposition.
2. As any of the foregoing expenses are incurred, they shall be paid by the
corporation for the director or former director or officer or former officer in
advance of the final disposition of the action, suit or proceeding promptly upon
receipt of an undertaking by or on behalf of such person to repay such payments
if it shall ultimately be determined that such person is not entitled to be
indemnified by the corporation.
3. The foregoing indemnification and advancement of expenses shall not be
deemed exclusive of any other rights to which any person indemnified may be
entitled.
4. The rights provided to any person by this Article X shall be enforceable
against the corporation by such person, who shall be presumed to have relied
upon it in serving or continuing to serve as a director or in any of the other
capacities set forth in this Article X. No elimination of or amendment to this
Article X shall deprive any person of rights hereunder arising out of alleged or
actual occurrences, acts or failures to act occurring prior to notice to such
person of such elimination or amendment. The rights provided to any person by
this Article X shall inure to the benefit of such person's legal representative.
9
<PAGE>
EXHIBIT 12
EXXON CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(MILLIONS OF DOLLARS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1995 1994 1993 1992 1991
------- ------ ------ ------ -------
<S> <C> <C> <C> <C> <C>
Income before cumulative effect of
accounting changes.................. $ 6,470 $5,100 $5,280 $4,810 $ 5,600
Excess/(shortfall) of dividends over
earnings of affiliates owned less
than 50% accounted for by the equity
method.............................. 25 (20) (24) (28) (75)
Provision for income taxes(1)........ 4,428 3,025 3,113 2,811 3,304
Capitalized interest................. (418) (306) (291) (287) (256)
Minority interests in earnings of
consolidated subsidiaries........... 299 231 246 229 150
------- ------ ------ ------ -------
10,804 8,030 8,324 7,535 8,723
------- ------ ------ ------ -------
Fixed Charges:(1)
Interest expense--borrowings........ 478 530 533 580 711
Capitalized interest................ 533 405 374 364 331
Rental expense representative of
interest factor.................... 416 401 387 382 391
Dividends on preferred stock........ 3 3 7 29 27
------- ------ ------ ------ -------
1,430 1,339 1,301 1,355 1,460
------- ------ ------ ------ -------
Total adjusted earnings available for
payment of fixed charges............ $12,234 $9,369 $9,625 $8,890 $10,183
======= ====== ====== ====== =======
Number of times fixed charges are
earned.............................. 8.6 7.0 7.4 6.6 7.0
</TABLE>
- ---------------------
Note:
(1) The provision for income taxes and the fixed charges include Exxon
Corporation's share of non-consolidated companies 50% owned.
1
<PAGE>
EXHIBIT 13
FINANCIAL SECTION F1
<TABLE>
<CAPTION>
Page
----
<S> <C>
Business Profile.................................................... F2
Financial Review
Financial Summary........................................... F3
Management's Discussion and Analysis of Financial Condition
and Results of Operations.................................. F4-F7
Consolidated Financial Statements
Balance Sheet............................................... F8
Statement of Income......................................... F9
Statement of Shareholders' Equity........................... F9
Statement of Cash Flows..................................... F10
Report of Independent Accountants................................... F11
Notes to Consolidated Financial Statements.......................... F11-F20
1. Summary of Accounting Policies........................... F11
2. Miscellaneous Financial Information...................... F12
3. Cash Flow Information.................................... F12
4. Additional Working Capital Data.......................... F12
5. Equity Company Information............................... F13
6. Investments and Advances................................. F13
7. Investment in Property, Plant and Equipment.............. F13
8. Leased Facilities........................................ F14
9. Capital.................................................. F14
10. Leveraged Employee Stock Ownership Plan.................. F14
11. Interest Rate Swap, Currency Exchange and Commodity
Contracts............................................... F14
12. Fair Value of Financial Instruments...................... F15
13. Long-Term Debt........................................... F15
14. Litigation and Other Contingencies....................... F16
15. Annuity Benefits......................................... F16-F17
16. Other Postretirement Benefits............................ F18
17. Incentive Program........................................ F18
18. Income, Excise and Other Taxes........................... F19
19. Distribution of Earnings and Assets...................... F20
Quarterly Information............................................... F21
Supplemental Information on Oil and Gas Exploration and
Production Activities.............................................. F22-F26
Operating Summary................................................... F27
</TABLE>
<PAGE>
FINANCIAL SUMMARY F3
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991
- ---------------------------------------------------------------------------------------------------------------------------------
(millions of dollars, except per share amounts)
<S> <C> <C> <C> <C> <C>
Sales and other operating revenue
Petroleum and natural gas $107,749 $100,409 $ 98,808 $104,282 $103,752
Chemicals 11,737 9,544 8,641 9,131 9,171
Other and eliminations 2,318 2,175 2,083 2,259 2,145
------------------------------------------------------------------------
Total sales and other operating revenue $121,804 $112,128 $109,532 $115,672 $115,068
Earnings from equity interests and other revenue 2,116 1,776 1,679 1,434 1,424
------------------------------------------------------------------------
Revenue $123,920 $113,904 $111,211 $117,106 $116,492
------------------------------------------------------------------------
Earnings
Petroleum and natural gas
Exploration and production $ 3,412 $ 2,782 $ 3,313 $ 3,374 $ 3,128
Refining and marketing 1,272 1,389 2,015 1,574 2,555
------------------------------------------------------------------------
Total petroleum and natural gas $ 4,684 $ 4,171 $ 5,328 $ 4,948 $ 5,683
Chemicals 2,018 954 411 451 512
Other operations 479 409 138 254 224
Corporate and financing (711) (434) (597) (843) (819)
------------------------------------------------------------------------
Earnings before cumulative effect of accounting
changes $ 6,470 $ 5,100 $ 5,280 $ 4,810 $ 5,600
Cumulative effect of accounting changes -- -- -- (40) --
------------------------------------------------------------------------
Net income $ 6,470 $ 5,100 $ 5,280 $ 4,770 $ 5,600
------------------------------------------------------------------------
Net income per common share $ 5.18 $ 4.07 $ 4.21 $ 3.79 $ 4.45
- before cumulative effect of accounting changes $ 5.18 $ 4.07 $ 4.21 $ 3.82 $ 4.45
Cash dividends per common share $ 3.00 $ 2.91 $ 2.88 $ 2.83 $ 2.68
Net income to average shareholders' equity (percent) 16.6 14.1 15.4 13.9 16.5
Net income to total revenue (percent) 5.2 4.5 4.7 4.1 4.8
Working capital $ (1,418) $ (3,033) $ (3,731) $ (3,239) $ (3,842)
Ratio of current assets to current liabilities 0.92 0.84 0.80 0.84 0.82
Total additions to property, plant and equipment $ 7,201 $ 6,568 $ 6,919 $ 7,138 $ 7,262
Property, plant and equipment, less allowances $ 65,446 $ 63,425 $ 61,962 $ 61,799 $ 63,864
Total assets $ 91,296 $ 87,862 $ 84,145 $ 85,030 $ 87,560
Exploration expenses, including dry holes $ 693 $ 666 $ 648 $ 808 $ 914
Research and development costs $ 525 $ 558 $ 593 $ 624 $ 679
Long-term debt $ 7,778 $ 8,831 $ 8,506 $ 8,637 $ 8,582
Total debt $ 10,025 $ 12,689 $ 12,615 $ 13,424 $ 13,042
Fixed charge coverage ratio 8.6 7.0 7.4 6.6 7.0
Debt to capital (percent) 19.0 24.3 25.3 26.8 25.6
Shareholders' equity at year-end $ 40,436 $ 37,415 $ 34,792 $ 33,776 $ 34,927
Shareholders' equity per common share $ 32.56 $ 30.13 $ 28.02 $ 27.20 $ 28.12
Average number of common shares outstanding
(millions) 1,242 1,242 1,242 1,242 1,244
Number of registered shareholders at year-end
(thousands) 603 608 622 629 616
Wages, salaries and employee benefits $ 5,799 $ 5,881 $ 5,916 $ 5,985 $ 6,081
Number of employees at year-end (thousands) 82 86 91 95 101
</TABLE>
<PAGE>
F4
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
REVIEW OF 1995 RESULTS
Record net income of $6,470 million in 1995 compared with $5,100 million in
1994. Production and sales volumes increased in all business segments and
progress continued in reducing operating costs. Upstream earnings benefited from
stronger worldwide crude prices, but downstream margins were depressed
throughout the year. Chemicals earnings were more than double those achieved in
1994, and earnings from the coal, minerals and power businesses were up
significantly. Results in 1995 included $90 million of credits for settlement of
outstanding natural gas contract claims (all in the fourth quarter), while 1994
included $489 million of credits from asset sales and tax related items ($423
million for the fourth quarter).
Revenue for 1995 totaled $124 billion, up 9 percent from 1994, and the cost
of crude and product purchases increased 7 percent.
The combined total of operating costs (including operating, selling,
general, administrative, exploration, depreciation and depletion expenses)
increased 2.5 percent in 1995. Excluding the impact of the weaker U.S. dollar
and volume growth, operating expenses were reduced by about $600 million from
1994 reflecting ongoing cost reduction efforts. Worldwide unit operating costs
in 1995 were lower than 1994 in all major operating segments. Interest expense
in 1995 was $202 million lower than in 1994 as lower debt levels and foreign
exchange effects offset the impact of higher interest rates.
Exploration and Production
Worldwide crude prices during 1995 were on average about $1.25 per barrel above
the prior year. Liquids production of 1,726 kbd (thousand barrels per day) was
the highest level achieved since 1989, and was up from 1,709 kbd in 1994,
principally as a result of increased production from new developments in the
U.S. and North Sea. Natural gas production of 6,013 mcfd (million cubic feet per
day) increased from 5,978 mcfd in 1994 and was the highest level since 1981.
Increased production in the Asia-Pacific region and the U.S. was partially
offset by lower demand in Europe, as a result of unseasonably warm temperatures
during the first half of 1995. Excluding special items, earnings from U.S.
exploration and production operations were $971 million, up from $852 million in
1994. Outside the U.S., earnings from exploration and production operations were
$2,351 million versus $1,864 million in 1994, after excluding special items.
Refining and Marketing
Refining and marketing earnings were lower in 1995 than in 1994 due to much
weaker industry refining margins. However, worldwide petroleum product sales of
5,076 kbd were the highest since 1979 and up from 5,028 kbd in 1994, with most
of the growth in the Asia-Pacific region. U.S. refining and marketing earnings
were $229 million compared with $243 million in the prior year. The impact of
weaker product margins was offset by increased motor gasoline sales and lower
refinery maintenance expense in 1995. Earnings from refining and marketing
operations outside the U.S. were $1,043 million, down from $1,146 million in
1994, due principally to extremely weak refining margins in Europe.
Chemicals
Earnings from worldwide chemical operations totaled $2,018 million, a record
level and more than double 1994 earnings. Higher product margins and sales
volumes produced the earnings improvement. In 1995, Exxon achieved record prime
product sales of 13,481 thousand metric tons, up 289 thousand metric tons versus
the prior year.
Other Operations
Earnings from other operating segments were $479 million, up from $302 million
in 1994 after excluding gains on asset sales. Prices for both copper and coal
were higher, and copper and coal production from ongoing operations were at
record levels.
Corporate and Financing
Corporate and financing expenses in 1995 of $711 million were down $39 million
from the prior year, after excluding non-recurring credits in 1994. Lower debt
levels offset the impact of higher interest rates.
REVIEW OF 1994 RESULTS
Net income of $5,100 million in 1994 compared with $5,280 million in 1993.
Liquids production, refinery throughput and sales of natural gas, petroleum
products, chemicals, coal and copper were all above levels achieved in 1993.
Chemicals earnings more than doubled from 1993 and minerals moved into a
substantial net profit position. Results in 1994 included $489 million from
asset sales and tax related special credits ($423 million for the fourth
quarter), while 1993 included $676 million of such credits ($113 million for the
fourth quarter).
Revenue for 1994 totaled $114 billion, up 2 percent from 1993, and the cost
of crude and product purchases increased 1 percent.
<PAGE>
F5
The combined total of operating costs (including operating, selling,
general, administrative, exploration, depreciation and depletion expenses) was 2
percent higher than 1993 as a result of growth in production and sales volumes
and a general weakening of the U.S. dollar. Worldwide unit operating costs in
1994 were lower. Interest expense in 1994 was 14 percent higher than in 1993
reflecting higher interest rates.
Exploration and Production
As a result of a decline in worldwide crude prices in 1994, Exxon's average
crude realization was down by more than $1.30 per barrel from 1993. Worldwide
liquids production of 1,709 kbd was up from 1,667 kbd in 1993, principally as a
result of record production from the North Sea and increased production from new
developments in the U.S. Despite unseasonably warm temperatures in both the U.S.
and Europe during the fourth quarter, worldwide natural gas production in 1994
of 5,978 mcfd rose by 153 mcfd versus 1993, with the growth coming mainly from
new developments in the U.S. and Malaysia. Earnings from U.S. exploration and
production operations were $852 million, compared with $935 million in 1993.
Outside the U.S., earnings from exploration and production operations were
$1,930 million, versus $2,378 million in 1993. This reduction was due primarily
to lower crude prices, lower European gas sales, foreign exchange effects and
lower special credits from asset sales and tax rate changes.
Refining and Marketing
Refining and marketing earnings were lower in 1994 than in 1993 due to much
weaker industry refining margins and a significant increase in scheduled
refining maintenance activities. However, Exxon's worldwide petroleum product
sales of 5,028 kbd were up from 4,925 kbd in 1993, with increases in clean
product sales in most major markets. Also, earnings benefited from record sales
and earnings in the lubes and specialties product lines. U.S. refining and
marketing earnings were $243 million, compared with $465 million in 1993.
Earnings from refining and marketing operations outside the U.S. were $1,146
million, versus $1,550 million in 1993.
Chemicals
Earnings from worldwide chemical operations in 1994 totaled $954 million, more
than double the earnings level of 1993, as the recovery in the worldwide
chemical industry gained momentum throughout the year. Industry margins, driven
by increased demand and tight industry supplies, were up sharply. In 1994, Exxon
achieved record sales volumes of 13,192 thousand metric tons, up 5 percent
versus the prior year.
Other Operations
Earnings from other operating segments in 1994 totaled $409 million, up from
$138 million in 1993. Power earnings increased reflecting returns on a higher
asset base. Coal production increased, copper production was at a record level
and copper prices were much improved. Results also included significant credits
from asset sales.
Corporate and Financing
Corporate and financing charges of $434 million in 1994 compared with $597
million in 1993 as tax related credits in 1994 exceeded similar credits in 1993.
IMPACT OF INFLATION AND CHANGING PRICES
The general rate of inflation in most major countries of operation has been
relatively low in recent years, and the associated impact on operating costs has
been countered by cost reductions from efficiency and productivity improvements.
In the past, crude oil and product prices have fluctuated widely in
response to changing market forces. The impacts of these price fluctuations on
earnings from exploration and production operations, refining and marketing
operations and chemical operations have been varied, tending at times to
be offsetting.
SITE RESTORATION AND OTHER ENVIRONMENTAL COSTS
Over the years the corporation has accrued provisions for estimated site
restoration costs to be incurred at the end of the operating life of certain of
its facilities and properties. In addition, the corporation accrues provisions
for environmental liabilities in the many countries in which it does business
when it is probable that obligations have been incurred and the amounts can be
reasonably estimated. This policy applies to assets or businesses currently
owned or previously disposed. The corporation has accrued provisions for
probable environmental remediation obligations at various sites, including
multi-party sites where Exxon has been identified as one of the potentially
responsible parties by the U.S. Environmental Protection Agency. The involvement
of other financially responsible companies at these multi-party sites mitigates
Exxon's actual joint and several liability exposure. At present, no individual
site is expected to have losses material to Exxon's operations, financial
condition or liquidity.
<PAGE>
F6
At the end of 1995, accumulated site restoration and environmental
provisions amounted to $2.6 billion, including charges made against income of
$215 million in 1995, $160 million in 1994 and $331 million in 1993. Exxon
believes that any cost in excess of the amounts already provided for in the
financial statements would not have a materially adverse effect upon the
corporation's operations, financial condition or liquidity.
In 1995, the corporation spent $1,753 million (of which $565 million were
capital expenditures) on environmental conservation projects and expenses
worldwide, mostly dealing with air and water conservation. Total expenditures
for such activities are expected to be about $1.7 billion in 1996 and 1997 (with
capital expenditures in each year representing about 30 percent of the total).
TAXES
Income, excise and other taxes and duties totaled $41.2 billion in 1995, an
increase of $4.9 billion, or 13 percent. Income tax expense, both current and
deferred, was $4.0 billion compared to $2.7 billion in 1994, reflecting higher
pre-tax income in 1995 and a higher effective tax rate - 41.4 percent in 1995
versus 38.5 percent in 1994. Excise taxes and other taxes and duties were $3.6
billion higher reflecting increased sales and the impact of the weaker U.S.
dollar during 1995.
Income, excise and other taxes and duties totaled $36.3 billion in 1994, an
increase of $2.1 billion, or 6 percent. Income tax expense, both current and
deferred, was $2.7 billion compared to $2.8 billion in 1993, reflecting lower
pre-tax income in 1994. The effective income tax rate stayed the same at 38.5
percent. Excise taxes and other taxes and duties were $2.2 billion higher
reflecting increased sales and higher tax rates during 1994.
LIQUIDITY AND CAPITAL RESOURCES
In 1995, cash provided by operating activities totaled $13.8 billion, up $4.0
billion from 1994. Major sources of funds were net income of $6.5 billion and
non-cash provisions of $5.4 billion for depreciation and depletion.
Cash used in investing activities totaled $6.4 billion, up from $5.4
billion in 1994, primarily as a result of higher additions to property, plant
and equipment and lower asset sales.
Cash used in financing activities was $7.1 billion. Dividend payments on
common shares were increased from $2.91 per share to $3.00 per share and totaled
$3.7 billion, a payout of 58 percent. Total consolidated debt decreased by $2.7
billion to $10.0 billion.
Shareholders' equity increased by $3.0 billion to $40.4 billion. The ratio
of debt to capital decreased to 19 percent in 1995 compared to 24 percent in
1994.
In 1994, cash provided by operating activities totaled $9.9 billion, down
$1.7 billion from 1993. Major sources of funds were net income of $5.1 billion
and non-cash provisions of $5.0 billion for depreciation and depletion.
Cash used in investing activities totaled $5.4 billion in 1994, down from
$6.1 billion in 1993 as a result of lower additions to property, plant and
equipment and increased proceeds from asset dispositions.
Cash used in financing activities was $4.2 billion in 1994. Dividend
payments on common shares were increased from $2.88 per share to $2.91 per share
and totaled $3.6 billion, a payout of 71 percent. Total consolidated debt
increased $0.1 billion to $12.7 billion.
Shareholders' equity increased by $2.6 billion to $37.4 billion, resulting
in a decline in the ratio of debt to capital to 24 percent in 1994 compared to
25 percent in 1993.
As discussed in note 11 to the consolidated financial statements, the
corporation's financial derivative activities are limited to simple risk
management strategies. The corporation does not trade in financial derivatives
nor does it use financial derivatives with leveraged features. The corporation
maintains a system of controls that includes a policy covering the
authorization, reporting and monitoring of derivative activity. The
corporation's derivative activities pose no material credit or market risks to
Exxon's operations, financial condition or liquidity.
As discussed in note 14 to the consolidated financial statements, a number
of lawsuits, including class actions, have been brought in various courts
against Exxon Corporation and certain of its subsidiaries relating to the
accidental release of crude oil from the grounding of the tanker Exxon Valdez in
1989. During 1994, a Federal District Court jury in Anchorage, Alaska returned
compensatory and punitive damage verdicts in the civil litigation resulting from
the grounding. The District Court has denied motions by the corporation to
overturn or reduce the punitive verdict, and the corporation plans to appeal
this verdict following entry of a final judgment by the District Court. The
corporation believes that the $5 billion punitive damages verdict is unjustified
and should be set aside or substantially reduced by appellate courts. The
compensatory award is subject to a number of adjustments by the District Court,
and is subject to appeal. Since it is impossible to estimate what the ultimate
earnings impact will be, no charge was taken in 1994 or 1995 related to these
verdicts.
<PAGE>
F7
The U.S. Tax Court has decided the issue with respect to the pricing of
crude oil purchased from Saudi Arabia for the years 1979 to 1981 in favor of the
corporation. This decision is subject to appeal. Ultimate resolution of this tax
issue and several other legal issues, notably a settlement of gas lifting
imbalances in the common border area between the Netherlands and Germany, is not
expected to have a materially adverse effect upon the corporation's operations,
financial condition or liquidity.
There are no events or uncertainties known to management beyond those
already included in reported financial information that would indicate a
material change in future operating results or future financial condition.
In 1995, the corporation strengthened its financial position and
flexibility to meet future financial needs. Although the corporation issues
long-term debt from time to time and maintains a revolving commercial paper
program, internally generated funds cover the majority of its financial
requirements.
CAPITAL AND EXPLORATION EXPENDITURES
Capital and exploration expenditures in 1995 were $9.0 billion compared to $7.8
billion in 1994.
Exploration and production spending totaled $4.7 billion in 1995, up 18
percent from $4.0 billion in 1994, reflecting increased spending for gas
distribution and storage facilities in Europe and developments in the North Sea.
Investments in refining and marketing totaled $2.1 billion in 1995, essentially
the same as in 1994.
Chemicals capital expenditures were $1.1 billion in 1995, up nearly $500
million from $0.6 billion in 1994, with the increase about equally split between
investments in the U.S. and Asia-Pacific area.
Investments in Hong Kong Power increased 18 percent in 1995 to $0.7
billion, as construction activity continued at the Black Point power station
project.
Capital and exploration expenditures in the U.S. totaled $2.1 billion in
1995. Spending outside the U.S. increased 17 percent to $6.9 billion primarily
in Europe and the Asia-Pacific area. Total capital and exploration expenditures
in 1996 should exceed the 1995 level as Exxon maintains its focus on profitable
growth opportunities in each of the major operating segments.
Firm commitments related to capital projects underway at year-end 1995
totaled approximately $3.2 billion, with the largest single commitment being
$0.7 billion associated with the Hong Kong Power Black Point project. Similar
commitments were $2.4 billion at the end of 1994. The corporation expects to
fund the majority of these commitments through internally generated funds.
- --------------------------------------------------------------------------------
+++++++ +++++++ +++++++ +++++++ +++++++ +++++++
+ + + + + +
+ + + + + +
+ GRAPH #1 + + GRAPH #2 + + GRAPH #3 +
+ + + + + +
+ + + + + +
+++++++ +++++++ +++++++ +++++++ +++++++ +++++++
GRAPH #1 - FUNCTIONAL EARNINGS. Five-year history of earnings by function
(Exploration & Production, Refining & Marketing, Chemicals and
Other) and net income.
GRAPH #2 - SOURCES AND USES OF CASH. Five-year history of cash sources (Cash
from Operations and Asset Sales) compared to cash uses (Plant
Additions and Dividends/Changes in Debt/Other).
GRAPH #3 - CAPITAL AND EXPLORATION EXPENDITURES. Five-year history of capital
and exploration expenditures by function (Exploration & Production,
Refining & Marketing, Chemicals and Other).
<PAGE>
F8
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
Dec. 31 Dec. 31
1995 1994
- --------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
Assets
Current assets
Cash and cash equivalents $ 1,508 $ 1,157
Other marketable securities 281 618
Notes and accounts receivable, less
estimated doubtful amounts 8,925 8,073
Inventories
Crude oil, products and merchandise 4,865 4,717
Materials and supplies 816 824
Prepaid taxes and expenses 923 1,071
------------------------
Total current assets $ 17,318 $ 16,460
Investments and advances 5,697 5,394
Property, plant and equipment, at cost,
less accumulated depreciation and depletion 65,446 63,425
Other assets, including intangibles, net 2,835 2,583
------------------------
Total assets $ 91,296 $ 87,862
========================
Liabilities
Current liabilities
Notes and loans payable $ 2,247 $ 3,858
Accounts payable and accrued liabilities 14,113 13,391
Income taxes payable 2,376 2,244
------------------------
Total current liabilities $ 18,736 $ 19,493
Long-term debt 7,778 8,831
Annuity reserves and accrued liabilities 8,770 7,792
Deferred income tax liabilities 12,431 11,435
Deferred credits 975 728
Equity of minority and preferred shareholders
in affiliated companies 2,170 2,168
------------------------
Total liabilities $ 50,860 $ 50,447
------------------------
Shareholders' Equity
Preferred stock without par value (authorized
200 million shares) $ 454 $ 554
Guaranteed LESOP obligation (501) (613)
Common stock without par value (authorized
2 billion shares, 1,813 million issued) 2,822 2,822
Earnings reinvested 53,539 50,821
Cumulative foreign exchange translation
adjustment 1,339 848
Common stock held in treasury (571 million
shares in 1995 and 1994) (17,217) (17,017)
------------------------
Total shareholders' equity $ 40,436 $ 37,415
------------------------
Total liabilities and shareholders'
equity $ 91,296 $ 87,862
========================
</TABLE>
The information on pages F11 through F20 is an integral part of these
statements.
<PAGE>
F9
CONSOLIDATED STATEMENT OF INCOME
<TABLE>
<CAPTION>
1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C>
Revenue
Sales and other operating revenue, including excise taxes $121,804 $112,128 $109,532
Earnings from equity interests and other revenue 2,116 1,776 1,679
----------------------------------------
Total revenue $123,920 $113,904 $111,211
----------------------------------------
Costs and other deductions
Crude oil and product purchases $ 49,695 $ 46,430 $ 46,124
Operating expenses 11,964 12,128 12,111
Selling, general and administrative expenses 7,629 7,226 7,009
Depreciation and depletion 5,386 5,015 4,884
Exploration expenses, including dry holes 693 666 648
Interest expense 571 773 681
Excise taxes 13,911 12,445 11,707
Other taxes and duties 23,328 21,184 19,745
Income applicable to minority and preferred interests 301 233 250
----------------------------------------
Total costs and other deductions $113,478 $106,100 $103,159
----------------------------------------
Income before income taxes $ 10,442 $ 7,804 $ 8,052
Income taxes 3,972 2,704 2,772
----------------------------------------
Net income $ 6,470 $ 5,100 $ 5,280
----------------------------------------
Net income per common share (dollars) $ 5.18 $ 4.07 $ 4.21
</TABLE>
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
1995 1994 1993
-----------------------------------------------------------------------
Shares Dollars Shares Dollars Shares Dollars
- -----------------------------------------------------------------------------------------------------------------------
(millions)
<S> <C> <C> <C> <C> <C> <C>
Preferred stock outstanding at end of year 7 $ 454 9 $ 554 11 $ 668
====== ===== =====
Guaranteed LESOP obligation (501) (613) (716)
Common stock issued at end of year 1,813 2,822 1,813 2,822 1,813 2,822
Earnings reinvested
At beginning of year $ 50,821 $ 49,365 $ 47,697
Net income for year 6,470 5,100 5,280
Dividends - common and preferred shares (3,752) (3,644) (3,612)
----------------------------------------------------------------------
At end of year $ 53,539 $ 50,821 $ 49,365
----------------------------------------------------------------------
Cumulative foreign exchange translation
adjustment
At beginning of year $ 848 $ (370) $ 192
Change during the year 491 1,218 (562)
----------------------------------------------------------------------
At end of year $ 1,339 $ 848 $ (370)
----------------------------------------------------------------------
Common stock held in treasury
At beginning of year (571) $(17,017) (571) $(16,977) (571) $(16,887)
Acquisitions, at cost (9) (628) (4) (220) (5) (323)
Dispositions 9 428 4 180 5 233
----------------------------------------------------------------------
At end of year (571) $(17,217) (571) $(17,017) (571) $(16,977)
----------------------------------------------------------------------
Shareholders' equity at end of year $ 40,436 $ 37,415 $ 34,792
----------------------------------------------------------------------
Common shares outstanding at end of year 1,242 1,242 1,242
======================================================================
</TABLE>
The information on pages F11 through F20 is an integral part of these
statements.
<PAGE>
CONSOLIDATED STATEMENT OF CASH FLOWS F10
<TABLE>
<CAPTION>
1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C>
Cash flows from operating activities
Net income
Accruing to Exxon shareholders $ 6,470 $ 5,100 $ 5,280
Accruing to minority and preferred interests 301 233 250
Adjustments for non-cash transactions
Depreciation and depletion 5,386 5,015 4,884
Deferred income tax charges 1,043 260 64
Annuity and accrued liability provisions 843 (662) 255
Dividends received which were less than equity in current earnings of equity companies (22) (3) (9)
Changes in operational working capital, excluding cash and debt
Reduction/(increase) - Notes and accounts receivable (702) (923) 965
- Inventories 37 180 156
- Prepaid taxes and expenses 109 (111) (4)
Increase/(reduction) - Accounts and other payables 546 565 (93)
All other items - net (164) 197 (245)
---------------------------------------
Net cash provided by operating activities $13,847 $ 9,851 $11,503
---------------------------------------
Cash flows from investing activities
Additions to property, plant and equipment $(7,128) $(6,643) $(6,956)
Sales of subsidiaries and property, plant and equipment 666 1,359 1,095
Additional investments and advances (530) (309) (331)
Sales of investments and collection of advances 285 158 168
Additions to other marketable securities (380) (1,341) (1,323)
Sales of other marketable securities 732 1,354 1,246
---------------------------------------
Net cash used in investing activities $(6,355) $(5,422) $(6,101)
---------------------------------------
Net cash generation before financing activities $ 7,492 $ 4,429 $ 5,402
---------------------------------------
Cash flows from financing activities
Additions to long-term debt $ 1,092 $ 1,221 $ 1,635
Reductions in long-term debt (1,492) (377) (313)
Additions to short-term debt 423 330 249
Reductions in short-term debt (901) (1,205) (1,168)
Additions/(reductions) in debt with less than 90 day maturity (1,827) 5 (1,112)
Cash dividends to Exxon shareholders (3,765) (3,659) (3,630)
Cash dividends to minority interests (282) (420) (249)
Changes in minority interests and sales/(redemptions) of affiliate preferred stock (84) 25 (500)
Common stock acquired (628) (220) (323)
Common stock sold 328 66 131
---------------------------------------
Net cash used in financing activities $(7,136) $(4,234) $(5,280)
---------------------------------------
Effects of exchange rate changes in cash $ (5) $ (21) $ (37)
---------------------------------------
Increase in cash and cash equivalents $ 351 $ 174 $ 85
Cash and cash equivalents at beginning of year 1,157 983 898
---------------------------------------
Cash and cash equivalents at end of year $ 1,508 $ 1,157 $ 983
=======================================
</TABLE>
The information on pages F11 through F20 is an integral part of these
statements.
<PAGE>
F11
REPORT OF INDEPENDENT ACCOUNTANTS
Price Waterhouse LLP
Dallas, Texas
February 28, 1996
To the Shareholders of Exxon Corporation
In our opinion, the consolidated financial statements appearing on pages F8
through F20 present fairly, in all material respects, the financial position of
Exxon Corporation and its subsidiary companies at December 31, 1995 and 1994,
and the results of their operations and their cash flows for each of the three
years in the period ended December 31, 1995, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Corporation's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally accepted
auditing standards which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for the opinion expressed above.
/S/ Price Waterhouse LLP
- --------------------------------------------------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The company's principal business is energy involving the worldwide
exploration, production, transportation and sale of crude oil and natural gas
and the manufacture, transportation and sale of petroleum products. The company
is also a major worldwide manufacturer and marketer of petrochemicals, and
participates in coal and minerals mining and electric power generation.
The preparation of financial statements in conformity with United States
generally accepted accounting principles requires management to make estimates
that affect the reported amounts of assets, liabilities, revenues and expenses,
and the disclosure of contingent assets and liabilities. Actual results could
differ from these estimates.
The accompanying consolidated financial statements and the supporting
and supplemental material are the responsibility of the management of Exxon
Corporation.
1. Summary of Accounting Policies
Principles of Consolidation. The consolidated financial statements include
the accounts of those significant subsidiaries owned directly or indirectly
more than 50 percent.
Amounts representing the corporation's percentage interest in the
underlying net assets of less than majority-owned companies in which a
significant equity ownership interest is held are included in "Investments and
advances." The corporation's share of the net income of these companies is
included in the consolidated statement of income caption "Earnings from equity
interests and other revenue."
Investments in all other companies, none of which is signifi-
cant, are included in "Investments and advances" at cost or less. Dividends
from these companies are included in income as received.
Financial Instruments. Interest rate swap agreements are used to modify the
interest rates on certain debt obligations. The interest differentials to be
paid or received under such swaps are recognized over the life of the
agreements as adjustments to interest expense. Currency exchange contracts are
used to reduce the risk of adverse foreign currency movements related to
certain foreign currency debt obligations. The gains or losses arising from
currency exchange contracts offset foreign exchange gains or losses on the
underlying assets or liabilities and are recognized as offsetting adjustments
to the carrying amounts. Commodity swap and futures contracts are used to
mitigate the risk of unfavorable price movements on certain crude and petroleum
product purchases and sales. Gains or losses on these contracts are recognized
as adjustments to purchase costs or to sales revenue. Related amounts payable
to or receivable from counterparties are included in current assets and
liabilities.
Investments in marketable debt securities are expected to be held to
maturity and are stated at amortized cost.
The fair value of financial instruments is determined by reference to
various market data and other valuation techniques as appropriate.
Inventories. Crude oil, products and merchandise inventories are carried at
the lower of current market value or cost (generally determined under the
last-in, first-out method-LIFO). Costs include applicable purchase costs and
operating expenses, but not general and administrative expenses or research and
development costs. Inventories of materials and supplies are valued at cost or
less.
<PAGE>
F12
Property, Plant and Equipment. Depreciation, depletion and amortization,
based on cost less estimated salvage value of the asset, are primarily
determined under either the unit of production method or the straight-line
method. Unit of production rates are based on oil, gas and other mineral
reserves estimated to be recoverable from existing facilities. The
straight-line method of depreciation is based on estimated asset service life
taking obsolescence into consideration.
Maintenance and repairs are expensed as incurred. Major renewals and
improvements are capitalized, and the assets replaced are retired.
The corporation's exploration and production activities are accounted
for under the "successful efforts" method. Under this method, costs of
productive wells and development dry holes, both tangible and intangible, as
well as productive acreage are capitalized and amortized on the unit of
production method. Costs of that portion of undeveloped acreage likely to be
unproductive, based largely on historical experience, are amortized over the
period of exploration. Other exploratory expenditures, including geophysical
costs, other dry hole costs and annual lease rentals, are expensed as incurred.
In March 1995, the Financial Accounting Standards Board issued Statement
No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of." This Statement had no impact on the corporation's
results of operations or financial position upon adoption in January 1996.
Environmental Conservation and Site Restoration Costs. Liabilities for
environmental conservation are recorded when it is probable that obligations
have been incurred and the amounts can be reasonably estimated. These
liabilities are not reduced by possible recoveries from third parties, and
projected cash expenditures are not discounted.
Site restoration costs that may be incurred by the corporation at the
end of the operating life of certain of its facilities and properties are
reserved ratably over the asset's productive life.
Foreign Currency Translation. The "functional currency" for translating the
accounts of the majority of refining, marketing and chemical operations outside
the U.S. is the local currency. Local currency is also used for exploration and
production operations that are relatively self-contained and integrated within
a particular country, such as in Australia, Canada, the United Kingdom, Norway
and Continental Europe. The U.S. dollar is used for operations in highly
inflationary economies and for some exploration and production operations,
primarily in Malaysia and the Middle East.
2. Miscellaneous Financial Information
Research and development costs totaled $525 million in 1995, $558 million in
1994 and $593 million in 1993.
Net income included aggregate foreign exchange transaction gains of $26
million in 1995, losses of $30 million in 1994 and gains of $61 million in 1993.
In 1995, 1994 and 1993, net income included gains of $12 million, $8
million and $86 million, respectively, attributable to the combined effects of
LIFO inventory accumulations and draw-downs. The aggregate replacement cost of
inventories was estimated to exceed their LIFO carrying values by $2,902
million and $2,430 million at December 31, 1995 and 1994, respectively.
3. Cash Flow Information
The consolidated statement of cash flows provides information about changes
in cash and cash equivalents. All short-term marketable securities, with
original maturities of three months or less, that are readily convertible to
known amounts of cash and are so near maturity that they present insignificant
risk of changes in value because of changes in interest rates, are classified
as cash equivalents.
Cash payments for interest were: 1995 - $776 million; 1994 - $839
million; 1993 - $742 million. Cash payments for income taxes were: 1995 - $2,797
million; 1994 - $2,548 million; 1993 - $2,470 million.
4. Additional Working Capital Data
<TABLE>
<CAPTION>
Dec. 31 Dec. 31
1995 1994
- ------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
Notes and accounts receivable
Trade, less reserves of $76 million
and $75 million $ 6,979 $ 6,292
Other, less reserves of $28 million
and $31 million 1,946 1,781
-----------------------
$ 8,925 $ 8,073
=======================
Notes and loans payable
Bank loans $ 1,194 $ 1,175
Commercial paper 525 2,025
Long-term debt due within one year 495 624
Other 33 34
-----------------------
$ 2,247 $ 3,858
=======================
Accounts payable and accrued liabilities
Trade payables $ 8,470 $ 7,466
Obligations to equity companies 813 803
Accrued taxes other than income taxes 2,662 2,760
Other 2,168 2,362
-----------------------
$14,113 $13,391
=======================
</TABLE>
On December 31, 1995, unused credit lines for short-term financing totaled
approximately $6.5 billion. Of this total, $4.7 billion support commercial
paper programs under terms negotiated when drawn. The weighted average interest
rate on short-term borrowings outstanding at December 31, 1995 and 1994 was 6.2
percent and 6.3 percent, respectively.
<PAGE>
F13
5. Equity Company Information
The summarized financial information below includes those less than
majority-owned companies for which Exxon's share of net income is included in
consolidated net income (see note 1). These companies are primarily engaged in
natural gas production and distribution in the Netherlands and Germany,
refining and marketing operations in Japan and several chemical operations.
<TABLE>
<CAPTION>
1995 1994 1993
-----------------------------------------------------------------
Exxon Exxon Exxon
Total share Total share Total share
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
(millions of dollars)
Total revenues
Percent of revenues from companies included in the Exxon
consolidation was 16% in 1995, 18% in 1994 and 18% in 1993 $32,187 $10,506 $26,078 $8,535 $25,295 $8,118
-----------------------------------------------------------------
Income before income taxes $ 4,227 $ 1,974 $ 3,099 $1,396 $ 3,255 $1,441
Less: Related income taxes (1,306) (596) (1,101) (487) (1,237) (528)
-----------------------------------------------------------------
Net income $ 2,921 $ 1,378 $ 1,998 $ 909 $ 2,018 $ 913
=================================================================
Current assets $ 9,789 $ 3,261 $ 9,692 $3,254 $ 8,800 $2,892
Property, plant and equipment, less accumulated depreciation 14,272 5,671 13,230 5,380 11,930 4,877
Other long-term assets 3,633 1,312 3,219 1,127 2,981 1,059
-----------------------------------------------------------------
Total assets $27,694 $10,244 $26,141 $9,761 $23,711 $8,828
-----------------------------------------------------------------
Short-term debt $ 1,233 $ 371 $ 1,343 $ 390 $ 1,657 $ 480
Other current liabilities 8,128 2,864 7,368 2,651 6,588 2,388
Long-term debt 2,660 839 2,543 817 2,279 756
Other long-term liabilities 4,424 1,818 4,274 1,832 3,709 1,591
Advances from shareholders 1,000 577 881 448 819 408
-----------------------------------------------------------------
Net assets $10,249 $ 3,775 $ 9,732 $3,623 $ 8,659 $3,205
=================================================================
</TABLE>
6. Investments and Advances
<TABLE>
<CAPTION>
Dec. 31 Dec. 31
1995 1994
- -------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
In less than majority-owned companies
Carried at equity in underlying assets
Investments $3,775 $3,623
Advances 577 448
--------------------
$4,352 $4,071
Carried at cost or less 139 158
--------------------
$4,491 $4,229
Long-term receivables and miscellaneous
investments at cost or less 1,206 1,165
--------------------
Total $5,697 $5,394
====================
</TABLE>
7. Investment in Property, Plant and Equipment
<TABLE>
<CAPTION>
Dec. 31, 1995 Dec. 31, 1994
- --------------------------------------------------------------------------------
Cost Net Cost Net
- --------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C>
Petroleum and natural gas
Exploration and production $ 66,797 $32,170 $ 64,483 $32,177
Refining and marketing 32,106 18,152 30,389 17,422
-----------------------------------------
Total petroleum and natural gas $ 98,903 $50,322 $ 94,872 $49,599
Chemicals 10,018 5,370 9,124 4,892
Other 13,416 9,754 12,330 8,934
-----------------------------------------
Total $122,337 $65,446 $116,326 $63,425
=========================================
</TABLE>
Accumulated depreciation and depletion totaled $56,891 million at the end of
1995 and $52,901 million at the end of 1994. Interest capitalized in 1995, 1994
and 1993 was $533 million, $405 million and $374 million, respectively.
<PAGE>
F14
8. Leased Facilities
At December 31, 1995, the corporation and its consolidated subsidiaries held
non-cancelable operating charters and leases covering drilling equipment,
tankers, service stations and other properties with minimum lease commitments
as follows:
<TABLE>
<CAPTION>
Minimum Related
commitment rental income
- -------------------------------------------
(millions of dollars)
<S> <C> <C>
1996 $ 734 $ 39
1997 581 30
1998 352 20
1999 260 16
2000 216 14
2001 and beyond 1,183 104
</TABLE>
Net rental expenditures for 1995, 1994 and 1993 totaled $1,212 million,
$1,173 million and $1,130 million, respectively, after being reduced by related
rental income of $157 million, $147 million and $134 million, respectively.
Minimum rental expenditures totaled $1,280 million in 1995, $1,239 million in
1994 and $1,184 million in 1993.
9. Capital
In 1989, the corporation sold 16.3 million shares of a new issue of
convertible Class A Preferred Stock to its leveraged employee stock ownership
plan (LESOP) trust for $61.50 per share. The proceeds of the issuance were used
by the corporation for general corporate purposes. The corporation recorded a
"Guaranteed LESOP Obligation" of $1,000 million as debt and as a reduction in
shareholders' equity, representing company-guaranteed borrowings by the LESOP
trust to purchase the preferred stock. As the debt is repaid, the Guaranteed
LESOP Obligation will be extinguished. The stock can be converted into common
stock at the lower of common stock market value or $61.50. Dividends are
cumulative and payable in an amount per share equal to $4.68 per annum.
Dividends paid per preferred share were $4.68 in 1995, 1994 and 1993.
Dividends paid per common share were $3.00 in 1995, $2.91 in 1994 and
$2.88 in 1993.
Earnings per common share are based on net income less preferred stock
dividends and the weighted average number of outstanding common shares during
each year, adjusted for stock splits.
10. Leveraged Employee Stock Ownership Plan (LESOP)
In 1989, the corporation's employee stock ownership plan trustee borrowed
$1,000 million under the terms of notes guaranteed by the corporation maturing
between 1990 and 1999. The principal due on the notes increases from $75
million in 1990 to $125 million in 1999. As further described in note 9, the
LESOP trustee used the proceeds of the borrowing to purchase shares of
convertible Class A Preferred Stock.
Employees eligible to participate in the corporation's thrift plan may
elect to participate in the LESOP. Corporation contributions to the plan, plus
dividends, are used to make principal and interest payments on the notes. As
contributions and dividends are credited, shares of preferred stock are
proportionately converted into common stock, with no cash flow impact to the
corporation, and allocated to participants' accounts. In 1995, 1994 and 1993,
1.6 million, 1.8 million and 1.7 million shares of preferred stock totaling
$100 million, $114 million and $102 million, respectively, were converted to
common stock and allocated. Preferred dividends of $38 million, $46 million and
$54 million were paid during 1995, 1994 and 1993, respectively, and covered
interest payments on the notes. The 1995, 1994 and 1993 principal payments were
made from employer contributions and dividends reinvested within the LESOP
trust and payments, if any, by Exxon as guarantor.
Accounting for the plan follows the principles which were in effect in
1989 when the plan was established. The amount of compensation expense recorded
by the corporation for contributions to the plan was $73 million in 1995, $80
million in 1994 and $70 million in 1993. The LESOP trust held 7.4 million and
9.0 million shares of preferred stock, and 19.3 million and 18.3 million shares
of common stock at the end of 1995 and 1994, respectively.
11. Interest Rate Swap, Currency Exchange and Commodity Contracts
The corporation limits its use of financial derivative instruments to simple
risk management activities. The corporation does not hold or issue financial
derivative instruments for trading purposes nor does it use financial
derivatives with leveraged features. Derivative instruments are matched to
existing assets, liabilities or transactions with the objective of mitigating
the impact of adverse movements in interest rates, currency exchange rates or
commodity prices. These instruments normally equal the amount of the underlying
assets, liabilities or transactions and are held to maturity. Instruments are
either traded over authorized exchanges or with counterparties of high credit
standing. As a result of the above factors, the corporation's exposure to
market and credit risks from financial derivative instruments is considered to
be negligible.
Interest rate swap agreements are used to adjust the ratio of fixed and
floating rates in the corporation's debt portfolio. Interest rate swap
agreements, maturing 1996-1999, had an aggregate notional principal amount of
$510 million and $604 million at year-end 1995 and 1994, respectively. Currency
exchange contracts are used to reduce the risk of adverse foreign currency
movements related to certain foreign currency debt
<PAGE>
F15
obligations. Currency exchange contracts, maturing 1996-2005, totaled $1,795
million at year-end 1995 and $2,998 million at year-end 1994. These amounts
included contracts in which affiliates held positions which were effectively
offsetting totaling $810 million in 1995 and $2,209 million in 1994. Excluding
these, the remaining currency exchange contracts totaled $985 million and $789
million at year-end 1995 and 1994, respectively.
The corporation makes limited use of commodity swap and futures
contracts of short duration to mitigate the risk of unfavorable price movements
on certain crude and petroleum product purchases and sales. These contracts had
an aggregate notional amount of $4 million at year-end 1995, maturing in 1996,
and $37 million at year-end 1994.
12. Fair Value of Financial Instruments
The fair value of financial instruments is determined by reference to
various market data and other valuation techniques as appropriate. Long-term
debt is the only category of financial instruments whose fair value has
differed materially from the recorded book value. The estimated fair value of
total long-term debt, including capitalized lease obligations, at December 31,
1995 and 1994 was $8.8 billion and $8.9 billion, respectively, as compared to
recorded book values of $7.8 billion and $8.8 billion.
13. Long-Term Debt
At December 31, 1995, long-term debt consisted of $6,761 million due in U.S.
dollars and $1,017 million representing the U.S. dollar equivalent at year-end
exchange rates of amounts payable in foreign currencies. These amounts exclude
that portion of long-term debt, totaling $495 million, which matures within one
year and is included in current liabilities. The amounts of long-term debt
maturing, together with sinking fund payments required, in each of the four
years after December 31, 1996, in millions of dollars, are: 1997 - $452; 1998 -
$626; 1999 - $655; 2000 - $210. Certain of the borrowings described may from
time to time be assigned to other Exxon affiliates. At December 31, 1995, the
corporation had $1.3 billion in unused long-term credit lines.
In 1995, debt totaling $442 million was removed from the balance sheet
as a result of the deposit of U.S. government securities in irrevocable trusts.
Together with amounts defeased prior to 1995, the total outstanding balance of
defeased debt at year-end 1995 was $490 million.
Summarized long-term borrowings at year-end 1995 and 1994 were as
follows:
<TABLE>
<CAPTION>
Dec. 31 Dec. 31
1995 1994
- --------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
Exxon Capital Corporation
7.875% Guaranteed notes due 1996 $ - $ 250
7.75% Guaranteed notes due 1996 - 250
4.5% Guaranteed notes due 1996 - 243
7.875% Guaranteed notes due 1997 - 250
8.0% Guaranteed notes due 1998** - 249
6.5% Guaranteed notes due 1999 - 249
8.25% Guaranteed notes due 1999 26 200
7.45% Guaranteed notes due 2001 246 250
6.625% Guaranteed notes due 2002 217 250
6.15% Guaranteed notes due 2003 196 250
Guaranteed zero coupon notes due 2004
-Face value ($1,146) net of
unamortized discount 432 387
6.0% Guaranteed notes due 2005 246 250
6.125% Guaranteed notes due 2008 250 250
Exxon Funding B.V.
8.0% Guaranteed notes due 1998** 249 -
SeaRiver Maritime Financial Holdings, Inc.
Guaranteed debt securities due 1997-2011 150 150
Guaranteed deferred interest
debentures due 2012
-Face value ($771) net of
unamortized discount 472 424
Exxon Energy Limited
8.3% Hong Kong dollar loan due 1996-2008 174 192
7.16% Guaranteed loan due 1996-2012 243 64
8.5% British pound loans due 1999-2002 70 70
Floating rate term loan due 1999-2006 531 228
6.87% notes due 2003 173 173
Imperial Oil Limited
9.875% Canadian dollar notes due 1999 174 172
8.3% notes due 2001 200 199
Variable rate notes due 2004 1,000 1,000
8.75% notes due 2019 219 219
Industrial revenue bonds due 2012-2033 926 871
Guaranteed LESOP notes due 1996-1999 386 509
Other U.S. dollar obligations 599 601
Other foreign currency obligations 542 558
Capitalized lease obligations* 57 73
-----------------
Total long-term debt $7,778 $8,831
=================
</TABLE>
*At an average imputed interest rate of 9.1% in 1995 and 9.8% in 1994.
**Assigned from Exxon Capital Corporation to Exxon Funding B.V. in 1995.
<PAGE>
F16
14. Litigation and Other Contingencies
A number of lawsuits, including class actions, have been brought in various
courts against Exxon Corporation and certain of its subsidiaries relating to
the accidental release of crude oil from the tanker Exxon Valdez in 1989. Most
of these lawsuits seek unspecified compensatory and punitive damages. Several
lawsuits seek damages in varying specified amounts.
A civil trial in the United States District Court for the District of
Alaska commenced on May 2, 1994 on punitive damage claims made by a class
composed of all persons and entities seeking punitive damages from the
corporation as a result of the Exxon Valdez grounding. On September 16, 1994,
the jury returned a verdict awarding the class punitive damages of $5 billion.
The verdict is not final. The corporation plans to appeal this verdict
following entry of a final judgment by the District Court. The corporation
believes that this verdict is unjustified and should be set aside or
substantially reduced by the District Court or appellate courts.
Many of the claims of individuals have been dismissed by the courts but
have been appealed. A number of claims have been settled. With respect to the
remaining compensatory damage claims against the corporation arising from the
grounding, many of these claims have been or will be addressed in the same
federal civil trial proceeding, which is still ongoing. On August 11, 1994, the
jury returned a verdict finding that fisher plaintiffs were damaged in the
amount of $286.8 million. On August 31, 1995, the District Court issued an
order that reduced this verdict to about $70 million to reflect payments
already made to the plaintiffs by the corporation and others. The corporation
expects this lesser amount to be further reduced. Additional claims for
compensatory damages, scheduled for determination in the final phase of the
trial, have been settled. The remaining class action claims are included in a
$3.5 million settlement of this final phase. The class settlement is subject to
approval by the court. The total amount of the settlement will be satisfied by
recognition of prior payments made to the plaintiffs by the corporation and
others. If the settlement is approved, the federal trial will be concluded.
There are a number of additional cases pending in state court in Alaska where
the compensatory damages claimed have not been fully specified.
The ultimate cost to the corporation from the lawsuits arising from the
Exxon Valdez grounding is not possible to predict and may not be resolved for a
number of years.
German and Dutch affiliated companies are the concessionaires of a
natural gas field subject to a treaty between the governments of Germany and the
Netherlands under which the gas reserves in an undefined border or common area
are to be shared equally. Entitlement to the reserves is determined by
calculating the amounts of gas which can be recovered from this area. Based on
the final reserve determination, the German affiliate has lifted more gas than
its entitlement. Arbitration proceedings, as provided in the agreements, have
commenced to determine the manner of resolving the imbalance in liftings between
the German and Dutch affiliated companies. Financial effects to the corporation
related to resolution of this imbalance would be influenced by different tax
regimes and ownership interests. The net impact of the ultimate outcome is not
expected to have a materially adverse effect upon the corporation's operations
or financial condition.
The U.S. Tax Court has decided the issue with respect to the pricing of
crude oil purchased from Saudi Arabia for the years 1979 to 1981 in favor of
the corporation. This decision is subject to appeal. Certain other issues for
the years 1979-1982 remain pending before the Tax Court. The ultimate
resolution of these issues is not expected to have a materially adverse effect
upon the corporation's operations or financial condition.
Claims for substantial amounts have been made against Exxon and certain
of its consolidated subsidiaries in other pending lawsuits, the outcome of which
is not expected to have a materially adverse effect upon the corporation's
operations or financial condition.
The corporation and certain of its consolidated subsidiaries were
contingently liable at December 31, 1995 for $1,463 million, primarily relating
to guarantees for notes, loans and performance under contracts. This includes
$1,109 million representing guarantees of non-U.S. excise taxes and customs
duties of other companies, entered into as a normal business practice, under
reciprocal arrangements. Not included in this figure are guarantees by
consolidated affiliates of $1,175 million, representing Exxon's share of
obligations of certain equity companies.
Additionally, the corporation and its affiliates have numerous long-term
sales and purchase commitments in their various business activities, all of
which are expected to be fulfilled with no adverse consequences material to the
corporation's operations or financial condition.
The operations and earnings of the corporation and its affiliates
throughout the world have been, and may in the future be, affected from time to
time in varying degree by political developments and laws and regulations, such
as forced divestiture of assets; restrictions on production, imports and
exports; price controls; tax increases and retroactive tax claims;
expropriation of property; cancellation of contract rights and environmental
regulations. Both the likelihood of such occurrences and their overall effect
upon the corporation vary greatly from country to country and are not
predictable.
15. Annuity Benefits
Exxon and most of its affiliates have defined benefit retirement plans which
cover substantially all of their employees. Plan benefits are generally based
on years of service and employees' compensation during their last years of
employment.
Assets are contributed to trustees and insurance companies to provide
benefits for many of Exxon's retirement plans and are primarily invested in
equity and fixed income securities. All funded U.S. plans meet the full funding
requirements of the Department of Labor and the Internal Revenue Service as
detailed in the table at the end of this note. Certain smaller U.S. plans, and
a number of non-U.S. plans, are not funded because of local tax conventions and
regulatory practices which do not encourage funding in these plans. Book
reserves have been established for these plans to provide for future benefit
payments.
<PAGE>
F17
<TABLE>
<CAPTION>
U.S. Plans Non-U.S. Plans
------------------------------ ------------------------------
Annuity plans net pension cost/(credit) 1995 1994 1993 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
Cost of benefits earned by employees during the year $ 111 $ 146 $ 111 $ 148 $ 163 $ 144
Interest accrual on benefits earned in prior years 362 354 350 540 483 482
Actual (gain)/loss on plan assets (796) (44) (463) (625) 76 (742)
Deferral of actual versus assumed return on assets 486 (286) 146 254 (423) 437
Amortization of actuarial (gain)/loss and prior service cost (23) 10 (35) 20 67 52
Net pension enhancement and curtailment/settlement expense (9) 9 (13) 11 35 6
----------------------------------------------------------------
Net pension cost for the year $ 131 $ 189 $ 96 $ 348 $ 401 $ 379
================================================================
</TABLE>
<TABLE>
<CAPTION>
U.S. Plans Non-U.S. Plans
-------------------- ---------------------
Dec. 31 Dec. 31 Dec. 31 Dec. 31
Annuity plans status 1995 1994 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C>
Actuarial present value of benefit obligations
Benefits based on service to date and present pay levels
Vested $4,047 $3,357 $ 5,921 $ 5,080
Non-vested 527 378 195 243
------------------- ---------------------
Total accumulated benefit obligation $4,574 $3,735 $ 6,116 $ 5,323
Additional benefits related to projected pay increases 784 647 953 738
------------------- ---------------------
Total projected benefit obligation $5,358 $4,382 $ 7,069 $ 6,061
------------------- ---------------------
Funded assets (market values) 3,753 3,298 4,547 3,980
Book reserves 1,178 1,098 2,226 2,015
------------------- ---------------------
Total funded assets and book reserves $4,931 $4,396 $ 6,773 $ 5,995
------------------- ---------------------
Assets and reserves in excess of/(less than) projected benefit obligation $ (427) $ 14 $ (296) $ (66)
Unrecognized net gain at transition $ 243 $ 312 $ 21 $ 26
Unrecognized net actuarial gain/(loss) since transition (568) (186) (16) 194
Unrecognized prior service costs incurred since transition (102) (112) (301) (286)
Assets and reserves in excess of accumulated benefit obligation $ 357 $ 661 $ 657 $ 672
Assumptions in projected benefit obligation and expense (percent)
Discount rate 7.00 8.75 5.0- 9.0 5.0-10.0
Long-term rate of compensation increase 4.50 5.00 3.0- 7.0 3.0- 7.0
Long-term annual rate of return on funded assets 10.00 10.00 6.0-10.0 5.0-10.0
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Pension data, as shown above, is reported as required by current
accounting standards which specify use of a discount rate at which pension
liabilities could be effectively settled. The discount rate stipulated for use
in calculating year-end pension liabilities is based on the year-end rate of
interest on high quality bonds. For determining the funding requirements of U.S.
pension plans in accordance with applicable federal government regulations,
Exxon has elected to use the expected long-term rate of return of the pension
fund's actual portfolio as the discount rate. This rate, approximately 10
percent, has historically been higher than bonds as the majority of pension
assets is invested in equities. On this basis, all of Exxon's U.S. funded plans
meet the full funding requirements of the government as shown below. In fact,
the actual rate earned over the past decade has been 12 percent.
<TABLE>
<CAPTION>
Dec. 31 Dec. 31
Status of U.S. plans subject to federal government funding requirements 1995 1994
- ------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
Funded assets at market value less total projected benefit obligation $(1,605) $(1,084)
Differences between accounting and funding basis:
Certain smaller plans unfunded due to lack of tax and regulatory incentives 520 424
Use of long term rate of return on fund assets as the discount rate 1,170 455
Use of government regulations and other actuarial adjustments (85) 212
--------------------------
Funded assets in excess of obligations under government regulations $ - $ 7
</TABLE>
<PAGE>
F18
16. Other Postretirement Benefits
The corporation and several of its affiliates make contributions toward the
cost of providing certain health care and life insurance benefits to retirees,
their beneficiaries and covered dependents. The corporation determines the
level of its contributions to these plans annually; no commitments have been
made regarding the level of such contributions in the future.
The accumulated postretirement benefit obligation is based on the
existing level of the corporation's contribution toward these plans. Plan assets
include investments in equity and fixed income securities.
<TABLE>
<CAPTION>
1995 1994 1993
-------------------------- -------------------------- --------------------------
Other postretirement benefits expense Total Health Life/Other Total Health Life/Other Total Health Life/Other
- ----------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Service cost $ 22 $11 $ 11 $ 27 $12 $ 15 $ 22 $10 $ 12
Interest cost 133 46 87 128 45 83 127 49 78
Actual (gain) on plan assets (99) - (99) - - - (36) - (36)
Deferral of actual versus assumed return
on assets 71 - 71 (28) - (28) 11 - 11
Amortization of actuarial loss 1 - 1 14 4 10 1 1 -
--------------------------------------------------------------------------------------
Net expense $128 $57 $ 71 $141 $61 $80 $125 $60 $65
======================================================================================
</TABLE>
<TABLE>
<CAPTION>
Dec. 31, 1995 Dec. 31, 1994
-------------------------- --------------------------
Other postretirement benefit plans status Total Health Life/Other Total Health Life/Other
- ----------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
Accumulated postretirement benefit obligation
Retirees $1,375 $463 $ 912 $1,211 $408 $ 803
Fully eligible participants 120 41 79 96 35 61
Other active participants 394 147 247 262 109 153
----------------------------------------------------------
$1,889 $651 $1,238 $1,569 $552 $1,017
Funded assets (market values) (375) - (375) (286) - (286)
Unrecognized prior service costs (24) (24) - (27) (27) -
Unrecognized net gain/(loss) (207) (93) (114) 33 34 (1)
----------------------------------------------------------
Book reserves $1,283 $534 $ 749 $1,289 $559 $ 730
==========================================================
Assumptions in accumulated postretirement benefit
obligation and expense (percent)
Discount rate 7.00 8.75
Long-term rate of compensation increase 4.50 5.00
Long-term annual rate of return on funded assets 10.00 10.00
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
17. Incentive Program
The 1993 Incentive Program provides for grants of stock options, stock
appreciation rights (SARs), restricted stock and other forms of award. Awards
may be granted over the 10-year period ending April 28, 2003 to eligible
employees of the corporation and those affiliates at least 50 percent owned.
The number of shares of stock which may be awarded each year under the 1993
Incentive Program may not exceed seven tenths of one percent (0.7%) of the
total number of shares of common stock of the corporation outstanding on
December 31 of the preceding year. If the total number of shares effectively
granted in any year is less than the maximum number of shares allowable, the
balance may be carried over to the following year. Outstanding awards are
subject to certain forfeiture provisions contained in the program or award
instrument.
As under earlier programs, options and SARs may be granted at prices not
less than 100 percent of market value on the date of grant. Options and SARs
thus far granted are exercisable after one year of continuous employment
following the date of grant. Options for 37,754,909 and 39,035,102 common
shares were outstanding at December 31, 1995 and 1994, respectively. Of those
options, 4,310,381 and 7,306,949 at December 31, 1995 and 1994, respectively,
included SARs. In anticipation of settlement of SARs at market value of the
shares covered by the options to which they are attached, $1 million, $4
million and $23 million was credited to earnings in 1995, 1994 and 1993,
respectively. Exercise of either a related option or a related SAR cancels the
other to the extent exercised. No SARs were granted in 1995.
Changes that occurred during 1995 in options outstanding are summarized
below:
<TABLE>
<CAPTION>
1993 1988 1983
Program Program Program
- -------------------------------------------------------------------------
(number of common shares)
<S> <C> <C> <C>
Outstanding at
December 31, 1994 11,596,625 23,863,348 3,575,129
Granted at $78.94
average per share 5,892,710 - -
Less: Exercised at $46.24
average per share 256,752 4,820,809 1,914,086
Expired/Canceled 108,850 67,006 5,400
-----------------------------------------
Outstanding at
December 31, 1995 17,123,733 18,975,533 1,655,643
=========================================
Options exercisable at
December 31, 1995 11,231,023 18,975,533 1,655,643
=========================================
</TABLE>
<PAGE>
F19
Shares available for granting at the beginning of 1995 were 14,293,467
and 8,252,456 at the end of 1995. The weighted average option price per common
share of the options outstanding at December 31, 1995 under the 1993 Incentive
Program and earlier programs was $59.40.
The effect on net income per common share from the assumed exercise of
stock options outstanding at year-end 1995, 1994 or 1993 would be insignificant.
In October 1995, the Financial Accounting Standards Board issued
Statement No. 123, "Accounting for Stock-Based Compensation." As permitted by
the Statement, Exxon plans to retain its current method of accounting for stock
compensation upon adoption of this Statement in 1996.
At December 31, 1995 and 1994, respectively, 170,500 and 164,500 shares
of restricted common stock were outstanding.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
18. Income, Excise and Other Taxes
1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
United Non- United Non- United Non-
States U.S. Total States U.S. Total States U.S. Total
- ------------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Income taxes
Federal or non-U.S.
Current $ 854 $ 1,966 $ 2,820 $ 380 $ 2,036 $ 2,416 $ 622 $ 1,941 $ 2,563
Deferred - net 199 789 988 153 93 246 73 50 123
U.S. tax on non-U.S. operations 45 - 45 (8) - (8) (16) - (16)
--------------------------------------------------------------------------------------------------
$1,098 $ 2,755 $ 3,853 $ 525 $ 2,129 $ 2,654 $ 679 $ 1,991 $ 2,670
State 119 - 119 50 - 50 102 - 102
--------------------------------------------------------------------------------------------------
Total income tax expense $1,217 $ 2,755 $ 3,972 $ 575 $ 2,129 $ 2,704 $ 781 $ 1,991 $ 2,772
Excise taxes 2,356 11,555 13,911 2,266 10,179 12,445 2,179 9,528 11,707
Other taxes and duties 870 22,458 23,328 874 20,310 21,184 987 18,758 19,745
--------------------------------------------------------------------------------------------------
Total $4,443 $36,768 $41,211 $3,715 $32,618 $36,333 $3,947 $30,277 $34,224
==================================================================================================
</TABLE>
The above provisions for deferred income taxes include net (charges)/credits
for the effect of changes in tax laws and rates of $(83) million in 1995, $43
million in 1994 and $146 million in 1993. Income taxes of $(14) million in
1995, $(10) million in 1994 and $109 million in 1993, were (charged)/credited
directly to shareholders' equity.
- --------------------------------------------------------------------------------
The reconciliation between income tax expense and a theoretical U.S. tax
computed by applying a rate of 35 percent for 1995, 1994 and 1993, is as
follows:
<TABLE>
<CAPTION>
1995 1994 1993
- --------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C>
Earnings before Federal and
non-U.S. income taxes
United States $ 2,619 $1,924 $1,893
Non-U.S. 7,704 5,830 6,057
------------------------------------
Total $10,323 $7,754 $7,950
------------------------------------
Theoretical tax $ 3,613 $2,714 $2,783
Effect of equity method accounting (482) (318) (320)
Adjustment for non-U.S. taxes in
excess of theoretical U.S. tax 541 407 191
U.S. tax on non-U.S. operations 45 (8) (16)
Other U.S. 136 (141) 32
------------------------------------
Federal and non-U.S. income
tax expense $ 3,853 $2,654 $2,670
====================================
Total effective tax rate 41.4% 38.5% 38.5%
</TABLE>
The effective income tax rate includes state income taxes and the
corporation's share of income taxes of equity companies. Equity company taxes
totaled $596 million in 1995, $487 million in 1994 and $528 million in 1993,
essentially all outside the U.S.
Deferred income taxes reflect the impact of temporary differences
between the amount of assets and liabilities recognized for financial reporting
purposes and such amounts recognized for tax purposes.
Deferred tax liabilities (assets) are comprised of the following at
December 31:
<TABLE>
<CAPTION>
Tax effects of temporary differences for: 1995 1994
- --------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C>
Depreciation $ 9,938 $ 8,944
Intangible development costs 3,088 3,116
Capitalized interest 1,074 944
Other liabilities 1,296 1,250
-----------------------
Total deferred tax liabilities $15,396 $14,254
-----------------------
Pension and other postretirement benefits $(1,072) $(1,032)
Site restoration reserves (794) (787)
Tax loss carryforwards (583) (598)
Other assets (1,035) (1,089)
-----------------------
Total deferred tax assets $(3,484) $(3,506)
-----------------------
Asset valuation allowances 314 293
-----------------------
Net deferred tax liabilities $12,226 $11,041
=======================
</TABLE>
The corporation had $8.5 billion of indefinitely reinvested,
undistributed earnings from subsidiary companies outside the U.S. Unrecognized
deferred taxes on remittance of these funds are not expected to be material.
<PAGE>
F20
19. Distribution of Earnings and Assets
<TABLE>
<CAPTION>
Segment 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------------------------------
Corporate Corporate Corporate
Petroleum Chemicals total Petroleum Chemicals total Petroleum Chemicals total
----------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Sales and operating revenue
Non-affiliated $107,749 $11,737 $121,804 $100,409 $ 9,544 $112,128 $ 98,808 $ 8,641 $109,532
Intersegment 2,539 1,609 - 2,327 1,419 - 2,411 1,383 -
----------------------------------------------------------------------------------------------------
Total $110,288 $13,346 $121,804 $102,736 $10,963 $112,128 $101,219 $10,024 $109,532
====================================================================================================
Operating profit $ 6,654 $ 2,734 $ 10,185 $ 5,935 $ 1,262 $ 7,897 $ 7,445 $ 638 $ 8,390
Add/(deduct):
Income taxes (3,060) (896) (4,065) (2,538) (344) (2,992) (2,938) (207) (3,156)
Minority interests (129) (27) (365) (119) (7) (307) (136) (8) (302)
Earnings of
equity companies 1,219 207 1,426 893 43 936 957 (12) 945
Corporate and financing - - (711) - - (434) - - (597)
----------------------------------------------------------------------------------------------------
Earnings $ 4,684 $ 2,018 $ 6,470 $ 4,171 $ 954 $ 5,100 $ 5,328 $ 411 $ 5,280
====================================================================================================
Identifiable assets $ 68,852 $ 9,595 $ 91,296 $ 67,017 $ 8,778 $ 87,862 $ 64,336 $ 8,478 $ 84,145
Depreciation and depletion $ 4,474 $ 399 $ 5,386 $ 4,178 $ 399 $ 5,015 $ 4,033 $ 408 $ 4,884
Additions to plant $ 5,055 $ 782 $ 7,201 $ 4,884 $ 473 $ 6,568 $ 5,392 $ 542 $ 6,919
</TABLE>
<TABLE>
<CAPTION>
Geographic Sales and other operating revenue Earnings Identifiable assets
- ----------------------------------------------------------------------------------------------------------------------------------
Non-affiliated Interarea Total
-----------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C>
1995 Petroleum and chemicals
United States $ 24,024 $ 854 $ 24,878 $2,307 $24,606
Other Western Hemisphere 18,354 328 18,682 444 10,664
Eastern Hemisphere 77,108 1,842 78,950 3,951 43,177
Other/eliminations 2,318 (3,024) (706) (232) 12,849
---------------------------------------------------------------------------
Corporate total $121,804 - $121,804 $6,470 $91,296
===========================================================================
1994 Petroleum and chemicals
United States $ 22,651 $ 834 $ 23,485 $1,560 $24,926
Other Western Hemisphere 16,875 500 17,375 370 10,693
Eastern Hemisphere 70,429 1,868 72,297 3,195 40,176
Other/eliminations 2,173 (3,202) (1,029) (25) 12,067
---------------------------------------------------------------------------
Corporate total $112,128 - $112,128 $5,100 $87,862
===========================================================================
1993 Petroleum and chemicals
United States $ 22,285 $ 741 $ 23,026 $1,667 $25,369
Other Western Hemisphere 17,098 416 17,514 317 11,541
Eastern Hemisphere 68,069 2,095 70,164 3,755 35,904
Other/eliminations 2,080 (3,252) (1,172) (459) 11,331
---------------------------------------------------------------------------
Corporate total $109,532 - $109,532 $5,280 $84,145
===========================================================================
</TABLE>
Transfers between business activities or areas are at estimated market
prices.
<PAGE>
F21
QUARTERLY INFORMATION
<TABLE>
<CAPTION>
1995 1994
-------------------------------------------------------------------------------------------------------
First Second Third Fourth First Second Third Fourth
Quarter Quarter Quarter Quarter Year Quarter Quarter Quarter Quarter Year
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Volumes (thousands of barrels daily)
Production of crude oil
and natural gas liquids 1,772 1,742 1,684 1,706 1,726 1,742 1,694 1,666 1,734 1,709
Refinery crude oil runs 3,408 3,229 3,455 3,595 3,422 3,342 3,385 3,456 3,463 3,412
Petroleum product sales 5,043 4,896 5,099 5,264 5,076 4,961 4,940 5,039 5,170 5,028
Natural gas production (millions of cubic feet daily)
available for sale 7,187 5,119 4,717 7,046 6,013 7,277 5,364 4,632 6,659 5,978
Summarized financial data (millions of dollars)
Sales and other operating
revenue $29,197 31,084 30,577 30,946 121,804 $25,624 27,102 29,237 30,165 112,128
Gross profit* $12,579 13,353 13,930 14,897 54,759 $11,010 11,237 12,596 13,712 48,555
Net income $ 1,660 1,630 1,500 1,680 6,470 $ 1,160 885 1,155 1,900 5,100
Per share data (dollars per share)
Net income per common share $ 1.33 1.30 1.20 1.35 5.18 $ 0.92 0.70 0.92 1.53 4.07
Dividends per common share $ 0.75 0.75 0.75 0.75 3.00 $ 0.72 0.72 0.72 0.75 2.91
Dividends per preferred share $ 1.17 1.17 1.17 1.17 4.68 $ 1.17 1.17 1.17 1.17 4.68
Common Stock prices
High $67.000 72.375 74.250 86.000 86.000 $67.375 63.625 60.625 63.250 67.375
Low $60.125 66.000 68.125 71.375 60.125 $61.500 56.125 56.500 56.250 56.125
</TABLE>
*Gross profit equals sales and other operating revenue less estimated costs
associated with products sold.
The price range of Exxon Common Stock is based on the composite tape of the
several U.S. exchanges where Exxon Common Stock is traded. The principal market
where Exxon Common Stock (XON) is traded is the New York Stock Exchange,
although the stock is traded on most major exchanges in the United States, as
well as on the London, Tokyo and other foreign exchanges.
At January 31, 1996, there were 603,207 holders of record of Exxon Common
Stock.
On January 31, 1996, the corporation declared a $0.75 dividend per common
share, payable March 11, 1996.
<PAGE>
F22
<TABLE>
SUPPLEMENTAL INFORMATION ON OIL AND GAS EXPLORATION AND PRODUCTION ACTIVITIES
<CAPTION>
Consolidated Subsidiaries
---------------------------------------------------------------
Non-
United Consolidated Total
Results of Operations States Canada Europe Asia-Pacific Other Total Interests Worldwide
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
(millions of dollars)
1995 - Revenue
Sales to third parties $1,021 $ 320 $2,188 $1,724 $ 138 $ 5,391 $2,657 $ 8,048
Transfers 3,140 715 1,782 734 113 6,484 159 6,643
--------------------------------------------------------------------------------------
$4,161 $1,035 $3,970 $2,458 $ 251 $11,875 $2,816 $14,691
Production costs excluding taxes 1,138 366 1,180 390 88 3,162 254 3,416
Exploration expenses 108 55 166 168 194 691 83 774
Depreciation and depletion 1,245 380 1,060 464 126 3,275 250 3,525
Taxes other than income 434 26 101 349 1 911 899 1,810
Related income tax 457 89 791 477 36 1,850 540 2,390
--------------------------------------------------------------------------------------
Results of producing activities $ 779 $ 119 $ 672 $ 610 $ (194) $ 1,986 $ 790 $ 2,776
Other earnings* 277 - 271 40 (3) 585 51 636
--------------------------------------------------------------------------------------
Total earnings $1,056 $ 119 $ 943 $ 650 $ (197) $ 2,571 $ 841 $ 3,412
======================================================================================
1994 - Revenue
Sales to third parties $1,365 $ 351 $2,093 $1,623 $ 115 $ 5,547 $1,944 $ 7,491
Transfers 2,581 651 1,430 704 135 5,501 300 5,801
--------------------------------------------------------------------------------------
$3,946 $1,002 $3,523 $2,327 $ 250 $11,048 $2,244 $13,292
Production costs excluding taxes 1,228 397 1,192 411 84 3,312 347 3,659
Exploration expenses 134 34 209 106 183 666 86 752
Depreciation and depletion 1,158 412 919 457 132 3,078 210 3,288
Taxes other than income 393 20 83 358 2 856 620 1,476
Related income tax 344 74 572 344 32 1,366 415 1,781
--------------------------------------------------------------------------------------
Results of producing activities $ 689 $ 65 $ 548 $ 651 $ (183) $ 1,770 $ 566 $ 2,336
Other earnings* 158 (2) 214 24 10 404 42 446
--------------------------------------------------------------------------------------
Total earnings $ 847 $ 63 $ 762 $ 675 $ (173) $ 2,174 $ 608 $ 2,782
======================================================================================
1993 - Revenue
Sales to third parties $1,275 $ 346 $2,336 $1,655 $ 106 $ 5,718 $2,167 $ 7,885
Transfers 2,829 712 1,063 876 166 5,646 326 5,972
--------------------------------------------------------------------------------------
$4,104 $1,058 $3,399 $2,531 $ 272 $11,364 $2,493 $13,857
Production costs excluding taxes 1,204 430 1,114 412 64 3,224 369 3,593
Exploration expenses 132 41 250 81 144 648 77 725
Depreciation and depletion 1,196 480 700 404 136 2,916 196 3,112
Taxes other than income 479 21 60 532 2 1,094 809 1,903
Related income tax 459 19 435 378 38 1,329 438 1,767
--------------------------------------------------------------------------------------
Results of producing activities $ 634 $ 67 $ 840 $ 724 $ (112) $ 2,153 $ 604 $ 2,757
Other earnings* 296 (35) 194 26 45 526 30 556
--------------------------------------------------------------------------------------
Total earnings $ 930 $ 32 $1,034 $ 750 $ (67) $ 2,679 $ 634 $ 3,313
======================================================================================
</TABLE>
<TABLE>
<CAPTION>
Average sales prices and production costs per unit of production
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
During 1995
Average sales prices
Crude oil and NGL, per barrel $13.09 $12.92 $16.37 $18.19 $17.16 $15.09 $16.73 $15.15
Natural gas, per thousand cubic feet 1.64 0.95 2.84 1.44 - 1.85 3.81 2.42
Average production costs, per barrel** 3.31 4.09 4.92 2.41 5.87 3.72 1.97 3.49
During 1994
Average sales prices
Crude oil and NGL, per barrel $12.00 $11.48 $15.07 $16.53 $15.28 $13.83 $15.26 $13.88
Natural gas, per thousand cubic feet 1.92 1.37 2.51 1.32 1.64 1.91 2.85 2.20
Average production costs, per barrel** 3.74 4.31 5.10 2.47 5.12 3.96 2.60 3.77
During 1993
Average sales prices
Crude oil and NGL, per barrel $13.19 $11.71 $16.68 $18.19 $16.04 $15.07 $16.07 $15.12
Natural gas, per thousand cubic feet 2.11 1.33 2.49 1.21 0.95 1.98 2.78 2.26
Average production costs, per barrel** 3.90 4.45 5.30 2.52 3.72 4.05 2.45 3.80
</TABLE>
*Earnings related to transportation of oil and gas, sale of third party
purchases, oil sands operations and technical services agreements, and reduced
by minority interests.
**Natural gas included by conversion to crude oil equivalent; production costs
exclude all taxes.
<PAGE>
F23
Oil and Gas Exploration and Production Costs
The amounts shown for net capitalized costs of consolidated subsidiaries are
$3,116 million less at year-end 1995 and $3,223 million less at year-end 1994
than the amounts reported as investments in property, plant and equipment for
exploration and production in note 7, page F13. This is due to the exclusion
from capitalized costs of certain transportation and research assets and assets
relating to the oil sands operations, and to inclusion of accumulated provisions
for site restoration costs, all as required in Statement of Financial Accounting
Standards No. 19.
The amounts reported as costs incurred include both capitalized costs and
costs charged to expense during the year. Total worldwide costs incurred in 1995
were $4,317 million, up $606 million from 1994, due primarily to higher
development costs. 1994 costs were $3,711 million, down $412 million from 1993,
due primarily to lower development costs.
<TABLE>
<CAPTION>
Consolidated Subsidiaries
-----------------------------------------------------------------------
Non-
United Consolidated Total
Capitalized costs States Canada Europe Asia-Pacific Other Total Interests Worldwide
- ------------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
As of December 31, 1995
Property (acreage) costs
- Proved $ 3,433 $3,088 $ 49 $ 582 $ 752 $ 7,904 $ 5 $ 7,909
- Unproved 428 100 65 230 63 886 30 916
--------------------------------------------------------------------------------------------------
Total property costs $ 3,861 $3,188 $ 114 $ 812 $ 815 $ 8,790 $ 35 $ 8,825
Producing assets 22,477 3,734 17,069 6,450 948 50,678 2,898 53,576
Support facilities 373 88 493 689 41 1,684 92 1,776
Incomplete construction 323 78 2,292 857 132 3,682 167 3,849
--------------------------------------------------------------------------------------------------
Total capitalized
costs $27,034 $7,088 $19,968 $8,808 $1,936 $64,834 $3,192 $68,026
Accumulated depreciation
and depletion 15,453 3,340 10,771 4,993 1,223 35,780 2,291 38,071
--------------------------------------------------------------------------------------------------
Net capitalized costs $11,581 $3,748 $ 9,197 $3,815 $ 713 $29,054 $ 901 $29,955
==================================================================================================
As of December 31, 1994
Property (acreage) costs
- Proved $ 3,495 $3,067 $ 46 $ 596 $ 686 $ 7,890 $ 5 $ 7,895
- Unproved 435 108 65 250 69 927 20 947
--------------------------------------------------------------------------------------------------
Total property costs $ 3,930 $3,175 $ 111 $ 846 $ 755 $ 8,817 $ 25 $ 8,842
Producing assets 22,519 3,612 15,625 5,975 1,057 48,788 2,688 51,476
Support facilities 369 106 406 571 36 1,488 109 1,597
Incomplete construction 317 6 1,625 921 106 2,975 156 3,131
--------------------------------------------------------------------------------------------------
Total capitalized
costs $27,135 $6,899 $17,767 $8,313 $1,954 $62,068 $2,978 $65,046
Accumulated depreciation
and depletion 14,846 2,943 9,480 4,604 1,241 33,114 2,159 35,273
--------------------------------------------------------------------------------------------------
Net capitalized costs $12,289 $3,956 $ 8,287 $3,709 $ 713 $28,954 $ 819 $29,773
==================================================================================================
</TABLE>
<TABLE>
<CAPTION>
Costs incurred in property acquisitions, exploration and development activities
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
During 1995
Property acquisition costs
- Proved $ 1 $ 6 $ 2 $ - $ 87 $ 96 $ 1 $ 97
- Unproved 19 3 1 3 2 28 - 28
Exploration costs 131 60 251 200 207 849 89 938
Development costs 624 139 1,653 551 60 3,027 227 3,254
---------------------------------------------------------------------------------------------------
Total $ 775 $ 208 $ 1,907 $754 $356 $4,000 $317 $4,317
===================================================================================================
During 1994
Property acquisition costs
- Proved $ - $ 11 $ - $ 2 $ - $ 13 $ - $ 13
- Unproved 8 13 21 - 23 65 - 65
Exploration costs 168 35 234 127 201 765 101 866
Development costs 663 113 1,279 554 49 2,658 109 2,767
---------------------------------------------------------------------------------------------------
Total $ 839 $ 172 $ 1,534 $683 $273 $3,501 $210 $3,711
===================================================================================================
During 1993
Property acquisition costs
- Proved $ 3 $ 10 $ - $ - $ - $ 13 $ 1 $ 14
- Unproved 12 - 2 8 45 67 - 67
Exploration costs 150 41 284 110 176 761 113 874
Development costs 1,001 207 1,213 576 68 3,065 103 3,168
---------------------------------------------------------------------------------------------------
Total $1,166 $ 258 $ 1,499 $694 $289 $3,906 $217 $4,123
===================================================================================================
</TABLE>
<PAGE>
F24
Oil and Gas Reserves
The following information describes changes during the years and balances of
proved oil and gas reserves at year-end 1993, 1994 and 1995.
The definitions used are in accordance with applicable Securities and
Exchange Commission regulations.
Proved reserves are the estimated quantities of oil and gas which
geological and engineering data demonstrate with reasonable certainty to be
recoverable in future years from known reservoirs under existing economic and
operating conditions. In some cases, substantial new investments in additional
wells and related facilities will be required to recover these proved reserves.
Proved reserves include 100 percent of each majority-owned affiliate's
participation in proved reserves and Exxon's ownership percentage of the proved
reserves of equity companies, but exclude royalties and quantities due others
when produced. Gas reserves exclude the gaseous equivalent of liquids expected
to be removed from the gas on leases, at field facilities and at gas processing
plants. These liquids are included in net proved reserves of crude oil and
natural gas liquids.
<TABLE>
<CAPTION>
Consolidated Subsidiaries
-----------------------------------------------------------
Non-
United Consolidated Total
Crude Oil and Natural Gas Liquids States Canada Europe Asia-Pacific Other Total Interests Worldwide
- ------------------------------------------------------------------------------------------------------------------------------------
(millions of barrels)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net proved developed and undeveloped reserves
January 1, 1993 2,393 1,221 1,478 822 100 6,014 464 6,478
Revisions 116 2 43 92 5 258 51 309
Purchases 10 4 - - - 14 - 14
Sales (20) (18) - (2) - (40) - (40)
Improved recovery 16 3 - - 1 20 - 20
Extensions and discoveries 11 - 28 19 2 60 2 62
Production (202) (77) (149) (123) (17) (568) (25) (593)
--------------------------------------------------------------------------------
December 31, 1993 2,324 1,135 1,400 808 91 5,758 492 6,250
Revisions 129 (2) 32 31 5 195 5 200
Purchases 4 4 1 - - 9 - 9
Sales (14) (5) - - - (19) - (19)
Improved recovery 53 107 12 3 - 175 - 175
Extensions and discoveries 34 3 67 34 - 138 2 140
Production (206) (74) (171) (117) (16) (584) (23) (607)
--------------------------------------------------------------------------------
December 31, 1994 2,324 1,168 1,341 759 80 5,672 476 6,148
Revisions 124 (29) 16 67 1 179 (11) 168
Purchases - - - - 47 47 - 47
Sales (8) (5) (1) - (5) (19) (7) (26)
Improved recovery 3 71 9 - - 83 - 83
Extensions and discoveries 93 9 297 31 2 432 - 432
Production (219) (73) (176) (109) (15) (592) (22) (614)
--------------------------------------------------------------------------------
December 31, 1995 2,317 1,141 1,486 748 110 5,802 436 6,238
Oil sands reserves
At December 31, 1993 - 314 - - - 314 - 314
At December 31, 1994 - 448 - - - 448 - 448
At December 31, 1995 - 432 - - - 432 - 432
===================================================================================================================================
Worldwide net proved developed and
undeveloped reserves (including oil sands)
At December 31, 1993 2,324 1,449 1,400 808 91 6,072 492 6,564
At December 31, 1994 2,324 1,616 1,341 759 80 6,120 476 6,596
At December 31, 1995 2,317 1,573 1,486 748 110 6,234 436 6,670
===================================================================================================================================
Developed reserves, included above
(excluding oil sands)
At December 31, 1993 1,821 524 859 624 81 3,909 458 4,367
At December 31, 1994 1,945 571 841 561 72 3,990 437 4,427
At December 31, 1995 1,942 526 805 610 60 3,943 410 4,353
</TABLE>
<PAGE>
F25
Net proved developed reserves are those volumes which are expected to be
recovered through existing wells with existing equipment and operating methods.
Undeveloped reserves are those volumes which are expected to be recovered as a
result of future investments to drill new wells, to recomplete existing wells
and/or to install facilities to collect and deliver the production from existing
and future wells.
Reserves attributable to certain oil and gas discoveries were not
considered proved as of year-end 1995 due to geological, technological or
economic uncertainties and therefore are not included in the tabulation.
Crude oil and natural gas liquids and natural gas production quantities
shown are the net volumes withdrawn from Exxon's oil and gas reserves. The
natural gas quantities differ from the quantities of gas delivered for sale by
the producing function as reported on page F27 due to volumes consumed or flared
and inventory changes. Such quantities amounted to approximately 213 billion
cubic feet in 1993, 200 billion cubic feet in 1994 and 189 billion cubic feet in
1995.
<TABLE>
<CAPTION>
Consolidated Subsidiaries
-----------------------------------------------------------------------
Non-
United Consolidated Total
Natural Gas States Canada Europe Asia-Pacific Other Total Interests Worldwide
- ----------------------------------------------------------------------------------------------------------------------------------
(billions of cubic feet)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net proved developed and
undeveloped reserves
January 1, 1993 9,732 2,651 7,251 5,110 21 24,765 16,648 41,413
Revisions 131 13 253 601 100 1,098 230 1,328
Purchases 54 39 - - - 93 - 93
Sales (57) (90) - (1) - (148) - (148)
Improved recovery 17 4 - - - 21 - 21
Extensions and
discoveries 350 76 258 886 - 1,570 313 1,883
Production (697) (188) (413) (276) (9) (1,583) (756) (2,339)
--------------------------------------------------------------------------------------------------
December 31, 1993 9,530 2,505 7,349 6,320 112 25,816 16,435 42,251
Revisions 405 (60) 262 (188) 1 420 753 1,173
Purchases - 4 - - - 4 - 4
Sales (25) (61) (16) - - (102) - (102)
Improved recovery 17 59 36 2 - 114 25 139
Extensions and
discoveries 398 17 265 74 - 754 391 1,145
Production (787) (162) (427) (334) (9) (1,719) (663) (2,382)
--------------------------------------------------------------------------------------------------
December 31, 1994 9,538 2,302 7,469 5,874 104 25,287 16,941 42,228
Revisions 838 (72) 65 175 (1) 1,005 228 1,233
Purchases - - - - 10 10 - 10
Sales (27) (79) - - (3) (109) (88) (197)
Improved recovery - 19 56 - - 75 - 75
Extensions and
discoveries 407 104 375 67 - 953 117 1,070
Production (809) (156) (412) (352) (8) (1,737) (646) (2,383)
--------------------------------------------------------------------------------------------------
December 31, 1995 9,947 2,118 7,553 5,764 102 25,484 16,552 42,036
================================================================================================================================
Worldwide net proved
developed and undeveloped
reserves
At December 31, 1993 9,530 2,505 7,349 6,320 112 25,816 16,435 42,251
At December 31, 1994 9,538 2,302 7,469 5,874 104 25,287 16,941 42,228
At December 31, 1995 9,947 2,118 7,553 5,764 102 25,484 16,552 42,036
================================================================================================================================
Developed reserves,
included above
At December 31, 1993 7,935 2,022 4,098 4,009 112 18,176 8,067 26,243
At December 31, 1994 8,120 1,861 4,451 3,628 103 18,163 7,588 25,751
At December 31, 1995 8,394 1,586 4,555 4,349 92 18,976 7,210 26,186
</TABLE>
<PAGE>
F26
Standardized Measure of Discounted Future Cash Flows
As required by the Financial Accounting Standards Board, the standardized
measure of discounted future net cash flows is computed by applying year-end
prices and costs and a discount factor of 10 percent to net proved reserves. The
corporation believes that the standardized measure is not meaningful and may be
misleading.
<TABLE>
<CAPTION>
Consolidated Subsidiaries
---------------------------------------------------------------------
Non-
United Consolidated Total
States Canada Europe Asia-Pacific Other Total Interests Worldwide
- --------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
As of December 31, 1993
Future cash inflows
from sales of oil and
gas $38,261 $11,816 $33,639 $ 18,190 $ 1,234 $103,140 $49,276 $152,416
Future production and
development costs 19,980 6,677 18,295 11,287 593 56,832 25,954 82,786
Future income tax
expenses 4,566 2,016 5,467 2,515 345 14,909 9,098 24,007
------------------------------------------------------------------------------------------------
Future net cash flows $13,715 $ 3,123 $ 9,877 $ 4,388 $ 296 $ 31,399 $14,224 $ 45,623
Effect of discounting
net cash flows at 10% 6,695 1,552 4,387 1,951 79 14,664 9,098 23,762
------------------------------------------------------------------------------------------------
Discounted future net
cash flows $ 7,020 $ 1,571 $ 5,490 $ 2,437 $ 217 $ 16,735 $ 5,126 $ 21,861
================================================================================================
As of December 31, 1994
Future cash inflows
from sales of oil and
gas $41,430 $15,646 $37,265 $ 18,974 $ 1,201 $114,516 $53,163 $167,679
Future production and
development costs 21,095 6,579 19,175 10,966 485 58,300 23,611 81,911
Future income tax
expenses 6,143 3,713 7,033 2,911 325 20,125 11,938 32,063
------------------------------------------------------------------------------------------------
Future net cash flows $14,192 $ 5,354 $11,057 $ 5,097 $ 391 $ 36,091 $17,614 $ 53,705
Effect of discounting
net cash flows at 10% 6,883 2,668 4,525 2,276 100 16,452 11,251 27,703
------------------------------------------------------------------------------------------------
Discounted future net
cash flows $ 7,309 $ 2,686 $ 6,532 $ 2,821 $ 291 $ 19,639 $ 6,363 $ 26,002
================================================================================================
As of December 31, 1995
Future cash inflows
from sales of oil and
gas $49,920 $15,418 $43,602 $ 21,214 $ 2,015 $132,169 $63,444 $195,613
Future production and
development costs 19,871 6,353 19,647 10,084 836 56,791 28,521 85,312
Future income tax
expenses 10,204 3,840 11,298 4,117 456 29,915 13,928 43,843
------------------------------------------------------------------------------------------------
Future net cash flows $19,845 $ 5,225 $12,657 $ 7,013 $ 723 $ 45,463 $20,995 $ 66,458
Effect of discounting
net cash flows at 10% 9,616 2,592 4,445 3,292 353 20,298 13,089 33,387
------------------------------------------------------------------------------------------------
Discounted future net
cash flows $10,229 $ 2,633 $ 8,212 $ 3,721 $ 370 $ 25,165 $ 7,906 $ 33,071
================================================================================================
</TABLE>
Change in Standardized Measure of Discounted Future Net Cash Flows Relating
to Proved Oil and Gas Reserves
<TABLE>
<CAPTION>
Consolidated Subsidiaries 1995 1994 1993
- ------------------------------------------------------------------------------------------------------------------------------------
(millions of dollars)
<S> <C> <C> <C>
Value of reserves added during the year due to extensions, discoveries,
improved recovery and net purchases less related costs $ 3,057 $ 1,245 $ 527
Changes in value of previous-year reserves due to:
Sales and transfers of oil and gas produced during the year, net
of production (lifting) costs (8,101) (7,219) (6,975)
Development costs incurred during the year 2,850 2,629 2,947
Net change in prices, lifting and development costs 9,257 6,340 (10,229)
Revisions of previous reserves estimates 1,581 1,307 1,137
Accretion of discount 2,495 1,969 2,817
Net change in income taxes (5,613) (3,367) 4,499
-------------------------------------
Total change in the standardized measure during the year $ 5,526 $ 2,904 $ (5,277)
=====================================
</TABLE>
<PAGE>
F27
OPERATING SUMMARY
<TABLE>
<CAPTION>
1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985
- ---------------------------------------------------------------------------------------------------------------------
(thousands of barrels daily)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Production of crude oil
and natural gas liquids
Net production
United States 600 562 553 591 619 640 693 760 756 761 768
Canada 242 251 254 268 278 302 312 249 222 196 145
Europe 498 484 423 396 363 313 351 444 456 473 431
Asia-Pacific 302 325 347 346 342 331 328 345 338 313 337
Other Non-U.S. 84 87 90 104 113 126 120 121 63 53 39
--------------------------------------------------------------------------------------
Worldwide 1,726 1,709 1,667 1,705 1,715 1,712 1,804 1,919 1,835 1,796 1,720
======================================================================================
(millions of cubic feet daily)
Natural gas production
available for sale
Net production
United States 2,055 2,021 1,764 1,607 1,655 1,778 1,827 1,805 1,698 1,919 2,085
Canada 281 286 328 326 355 413 417 209 147 142 141
Europe 2,804 2,842 3,049 3,097 3,010 2,694 2,707 2,787 3,012 2,946 3,114
Asia-Pacific 873 827 678 577 411 369 376 332 308 267 250
Other Non-U.S. - 2 6 54 66 64 58 59 62 55 71
--------------------------------------------------------------------------------------
Worldwide 6,013 5,978 5,825 5,661 5,497 5,318 5,385 5,192 5,227 5,329 5,661
======================================================================================
(thousands of barrels daily)
Refinery crude oil runs
United States 965 931 841 911 937 868 999 968 1,026 1,080 1,054
Canada 414 422 408 391 432 489 487 350 351 332 344
Europe 1,353 1,425 1,389 1,387 1,401 1,327 1,257 1,200 1,116 1,112 1,003
Asia-Pacific 579 521 515 507 464 498 463 430 397 415 399
Other Non-U.S. 111 113 116 107 99 94 93 94 91 93 103
--------------------------------------------------------------------------------------
Worldwide 3,422 3,412 3,269 3,303 3,333 3,276 3,299 3,042 2,981 3,032 2,903
======================================================================================
Petroleum product sales
United States 1,198 1,196 1,152 1,203 1,210 1,109 1,147 1,113 1,057 1,106 1,123
Canada 526 520 517 513 527 597 625 433 430 396 404
Latin America 441 426 422 411 391 384 383 386 388 380 377
Europe 1,869 1,898 1,872 1,847 1,863 1,796 1,718 1,680 1,634 1,636 1,629
Asia-Pacific and
other Eastern
Hemisphere 1,042 988 962 935 878 869 847 784 619 607 633
--------------------------------------------------------------------------------------
Worldwide 5,076 5,028 4,925 4,909 4,869 4,755 4,720 4,396 4,128 4,125 4,166
======================================================================================
Aviation fuels 414 403 379 376 372 382 382 344 338 317 326
Gasoline, naphthas 1,903 1,849 1,818 1,822 1,821 1,742 1,708 1,572 1,488 1,461 1,423
Heating oils, kerosene,
diesel oils 1,655 1,644 1,569 1,557 1,561 1,491 1,498 1,424 1,344 1,365 1,367
Heavy fuels 488 530 558 546 535 543 507 466 419 463 561
Specialty petroleum
products 616 602 601 608 580 597 625 590 539 519 489
--------------------------------------------------------------------------------------
Worldwide 5,076 5,028 4,925 4,909 4,869 4,755 4,720 4,396 4,128 4,125 4,166
======================================================================================
(thousands of metric tons)
Chemical prime
product sales 13,481 13,192 12,605 12,685 11,790 11,693 11,714 11,472 10,993 10,028 9,546
======================================================================================
(millions of metric tons)
Coal production 16 36 36 37 39 40 36 32 30 27 26
======================================================================================
(thousands of metric tons)
Copper production 202 191 183 133 108 112 119 134 101 79 77
======================================================================================
</TABLE>
Operating statistics include 100 percent of operations of majority-owned
subsidiaries; for other companies, gas, crude production and petroleum product
sales include Exxon's ownership percentage, and crude runs include quantities
processed for Exxon. Net production excludes royalties and quantities due others
when produced, whether payment is made in kind or cash.
<PAGE>
EXHIBIT 21
Subsidiaries of the Registrant (1), (2) and (3)
AT DECEMBER 31, 1995
<TABLE>
<CAPTION>
PERCENTAGE OF
VOTING SECURITIES
OWNED BY
IMMEDIATE STATE OR COUNTRY OF
PARENT(S) ORGANIZATION
----------------- --------------------
<S> <C> <C>
Ancon Insurance Company, Inc. ...................... 100 Vermont
Esso Australia Resources Ltd. ...................... 100 Delaware
Delhi Petroleum Pty. Ltd. ......................... 100 Australia
Esso Eastern Inc. .................................. 100 Delaware
Esso Malaysia Berhad............................... 65 Malaysia
Esso Production Malaysia Inc. ..................... 100 Delaware
Esso Sekiyu Kabushiki Kaisha....................... 100 Japan
Esso Singapore Private Limited..................... 100 Singapore
Esso Standard Thailand Ltd. ....................... 87.5 Thailand
Exxon Energy Limited............................... 100 Hong Kong
Exxon Trading Asia Pacific Private Limited......... 100 Singapore
Exxon Yemen Inc.................................... 100 Delaware
General Sekiyu K.K.(5)(6).......................... 49 Japan
Tonen Kabushiki Kaisha(5).......................... 25 Japan
Esso Exploration and Production Norway AS........... 100 Norway
Esso Italiana S.p.A.(7)............................. 100 Italy
Esso Norge AS ...................................... 100 Norway
Esso Sociedad Anonima Petrolera Argentina........... 100 Argentina
Esso Standard Oil S.A. Limited...................... 100 Bahamas
Exxon Asset Management Company...................... 75.5 Delaware
Exxon Capital Holdings Corporation.................. 100 Delaware
Exxon Capital Corporation.......................... 100 New Jersey
Exxon Capital Investment, Inc..................... 100 Delaware
Exxon Chemical Asset Management Partnership(8)...... 100 Delaware
Exxon Mobile Bay Limited Partnership(9)............ 100 Delaware
Exxon Chemical China Inc............................ 100 Delaware
Exxon Chemical International Services Ltd.(10)..... 100 Hong Kong
Exxon Chemical Eastern Inc.......................... 100 Delaware
Exxon Chemical Asia Private Limited................ 100 Singapore
Exxon Chemical Singapore Private Limited.......... 100 Singapore
Exxon Coal USA, Inc. ............................... 100 Delaware
Exxon Credit Corporation............................ 100 Delaware
Exxon Foreign Sales Corporation..................... 100 Guam
Exxon International Holdings, Inc. ................. 100 Delaware
Esso Aktiengesellschaft(11)........................ 100 Germany
BRIGITTA Erdgas und Erdoel GmbH, Hannover(4)(5)... 50 Germany
Elwerath Erdgas und Erdoel GmbH, Hannover(4)(5)... 50 Germany
Esso Austria Aktiengesellschaft(12)................ 100 Austria
Esso Holding Company Holland Inc................... 100 Delaware
Esso Holding B.V. ................................ 100 Netherlands/Delaware
Esso N.V./S.A. .................................. 100 Belgium/Delaware
Esso Nederland B.V. .............................. 100 Netherlands
Exxon Chemical Holland Inc. ...................... 100 Delaware
Exxon Chemical Holland B.V. ..................... 100 Netherlands
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
PERCENTAGE OF
VOTING SECURITIES
OWNED BY
IMMEDIATE STATE OR COUNTRY OF
PARENT(S) ORGANIZATION
----------------- -------------------
<S> <C> <C>
N. V. Nederlandse Gasunie(5)...................... 25 Netherlands
Nederlandse Aardolie Maatschappij B.V. (4)(5)..... 50 Netherlands
Esso Holding Company U.K. Inc. .................... 100 Delaware
Esso UK plc....................................... 100 England
Esso Exploration and Production UK Limited....... 100 England
Esso Petroleum Company, Limited.................. 100 England
Exxon Chemical Limited............................ 100 England
Exxon Chemical Olefins Inc. ...................... 100 Delaware
Esso Societe Anonyme Francaise..................... 81.548 France
Esso (Switzerland)................................. 100 Switzerland
Exxon Minerals International Inc.................... 100 Delaware
Compania Minera Disputada de Las Condes S.A. ...... 99.9252 Chile
Exxon Overseas Corporation.......................... 100 Delaware
Exxon Chemical Arabia Inc.......................... 100 Delaware
Al-Jubail Petrochemical Company(4)(5)............. 50 Saudi Arabia
Exxon Overseas Investment Corporation.............. 100 Delaware
Exxon Equity Holding Company...................... 100 Delaware
Exxon Financial Services Company Limited.......... 100 Bahamas
Mediterranean Standard Oil Co...................... 100 Delaware
Esso Trading Company of Abu Dhabi................. 100 Delaware
Exxon Pipeline Company.............................. 100 Delaware
Exxon Rio Holding Inc............................... 100 Delaware
Esso Brasileira de Petroleo Limitada(13)........... 100 Brazil
Exxon San Joaquin Production Company................ 100 Louisiana
Friendswood Development Company(14)................. 100 Arizona
Imperial Oil Limited................................ 69.6 Canada
International Colombia Resources Corporation(15).... 100 Delaware
SeaRiver Maritime Financial Holdings, Inc. ......... 100 Delaware
SeaRiver Maritime, Inc. ........................... 100 Delaware
Societe Francaise EXXON CHEMICAL.................... 99.359 France
Exxon Chemical France.............................. 100 France
Exxon Chemical Polymeres SNC(16)................... 100 France
</TABLE>
- ---------------------
NOTES:
(1) For purposes of this list, if the registrant owns directly or indirectly
approximately 50 percent of the voting securities of any person and
approximately 50 percent of the voting securities of such person is owned
directly or indirectly by another interest, or if the registrant includes
its share of net income of any other unconsolidated person in
consolidated net income, such person is deemed to be a subsidiary.
(2) With respect to certain companies, shares in names of nominees and
qualifying shares in names of directors are included in the above
percentages.
(3) The names of other subsidiaries have been omitted from the above list
since considered in the aggregate, they would not constitute a
significant subsidiary.
(4) The registrant owns directly or indirectly approximately 50 percent of
the securities of this person and approximately 50 percent of the voting
securities of this person is owned directly or indirectly by another
single interest.
(5) The investments in this unconsolidated person is represented by the
registrant's percentage interest in the underlying net assets of such
person.
2
<PAGE>
(6) Dual ownership; of the 49%, 47.468% is owned by Esso Eastern Inc. and
1.532% is owned by Esso Sekiyu Kabushiki Kaisha.
(7) Dual ownership; of the 100%, 90% is owned by Exxon Corporation and 10% by
Exxon Overseas Corporation.
(8) Dual ownership; of the 100%, 68.4% is owned by Exxon Corporation and
31.6% is owned by Exxon Asset Management Company.
(9) Dual ownership; of the 100%, 81.4% is owned by Exxon Chemical Asset
Management Partnership and 18.6% is owned by Exxon Corporation.
(10) Dual ownership; of the 100%, 99.99999% is owned by Exxon Chemical China
Inc. and 0.00001% is owned by Exxon Corporation.
(11) Dual ownership; of the 100%, 99.998% is owned by Exxon International
Holdings, Inc. and 0.002% is owned by Exxon Corporation.
(12) Dual ownership; of the 100%, 99.9996% is owned by Exxon International
Holdings, Inc. and 0.0004% is owned by Exxon Corporation.
(13) Dual ownership; of the 100%, 90% is owned by Exxon Rio Holding Inc. and
10% is owned by Exxon Sao Paulo Holding Inc.
(14) Effective January 4, 1996, name changed to Exxon Land Development, Inc.
(15) Dual ownership; of the 100%, 55% is owned by Exxon Corporation and 45% is
owned by Esso Holding Company Holland Inc.
(16) Dual ownership; of the 100%, 98% is owned by Societe Francaise EXXON
CHEMICAL and 2% is owned by Societe Paris-Niel.
3
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Exxon's
consolidated balance sheet at December 31, 1995, Exxon's consolidated statement
of income for the year 1995 and the related notes to these consolidated
financial statements, that are contained in Exxon's 1995 Annual Report on Form
10-K. The schedule and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 1,508
<SECURITIES> 281
<RECEIVABLES> 7,055
<ALLOWANCES> 104
<INVENTORY> 5,681
<CURRENT-ASSETS> 17,318
<PP&E> 122,337
<DEPRECIATION> 56,891
<TOTAL-ASSETS> 91,296
<CURRENT-LIABILITIES> 18,736
<BONDS> 7,778
0
454
<COMMON> 2,822
<OTHER-SE> 37,160
<TOTAL-LIABILITY-AND-EQUITY> 91,296
<SALES> 121,804
<TOTAL-REVENUES> 123,920
<CGS> 49,695
<TOTAL-COSTS> 49,695
<OTHER-EXPENSES> 18,043
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 571
<INCOME-PRETAX> 10,442
<INCOME-TAX> 3,972
<INCOME-CONTINUING> 6,470
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,470
<EPS-PRIMARY> 5.18
<EPS-DILUTED> 0
</TABLE>
