HOUSTON (Reuters) - Exxon Mobil Corp XOM.N is "very close" to completing its workforce appraisals in the United States and Canada and expects to unveil job cuts, its chief executive told employees in an email on Wednesday.
The second-largest U.S. oil company by market value lost nearly $1.7 billion in the first six months and is expected to post another loss when third quarter results are released on Oct. 30.
The job cuts are part of a plan unveiled this spring to redesign how Exxon works and to increase competitiveness, CEO Darren Woods said in an email to its nearly 75,000-person workforce.
Exxon has exceeded a target of reducing operating expenses by $1 billion and capital budget spending by $10 billion, he wrote. But the COVID-19 pandemic has cut oil demand by about 20%, he said, delivering a “devastating impact” on the oil business.
Woods told employees that “we are very close” to completing the jobs review and that they could expect details soon after the company’s board of directors is briefed.
“I wish I could say we were finished, but we are not. We still have some significant headwinds, more work to do and, unfortunately, further reductions are necessary,” he said in the email.
Exxon was slower than rivals to react to this year’s oil price decline and borrowed $23 billion to shore up a balance sheet strained by the losses and a nearly $15 billion annual dividend payment to shareholders.
Its dividend yield, the percent of the share price paid annually to holders was 10.3%, the largest among major oil companies and another sign of Exxon’s weak finances.
Shares fell 1.6% to $33.14 on Wednesday as oil prices declined on worries that the COVID-19 infections are on the rise globally. The stock is trading near a 18-year low.
The oil industry’s convulsions have shaken energy cores. Royal Dutch Shell and BP have outlined up to 15% workforce cuts while Chevron has asked employees to reapply for their jobs.
Reporting by Gary McWilliams; Editing by Chris Reese and Peter Cooney
https://www.reuters.com/article/us-exxon-mobil-cutbacks/exxon-mobil-very-close-to-disclosing-u-s-canada-job-cuts-ceo-says-idUSKBN2763AR
2020-10-21 22:36:00Z
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