Analysis of Exxon Mobil (Exxon Mobil 2017)

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Table of Contents
Part A...............................................................................................................................................2
Part B...............................................................................................................................................7
Part C...............................................................................................................................................9
References......................................................................................................................................14

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Part A
i) Analysis for the Exxon Mobil Company was done in the year 2017 thereby analysing the
financial performance of the company. Relevant data for the period 2017 was analysed for the
purpose of the analysis of Exon Mobil (ExxonMobil 2017). The financial analysis of the Exxon
Mobil Company was done by using the DuPont Analysis, which was examined with the help of
key financial ratios like Net Profitability Ratio, Total Asset Ratio and Gearing Ratio for the
company (Chang, Chichernea and HassabElnaby 2014).
Net Profitability Margin Ratio: Profitability margin of the company shows the profitability
earned by a entity in the form of net income earned from the various operations of the company.
The net profit margin of the company was around 4.02% in the year 2016 and was around 8.12%
in the year 2017. Increase in the net profitability of the company has been seen due to the
efficiency of the company in operating the assets of the company (Curtis, Lewis-Western, and
Toynbee 2015).
Total Asset Turnover: Total asset turnover ratio for the Exxon Mobil Company was reflected
by showing the efficiency of the company in generating revenue for company thereby utilizing
the total assets of the company. The return on total assets for the company shows the efficiency
for Exxon Mobil and the same could be well reflected with the help of the increasing revenue of
the company. The total asset turnover for Exxon Mobil was around 63% for the year 2016 that
increased consistently for the company to around 70.08% in the year 2017. The increase in the
revenue of the company could be well reflected for the increase in the total asset turnover ratio of
the company (Padake and Soni 2015).

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Gearing Ratio: Debt ratio reflects the debt exposure of the company in the total capital structure
for an entity. The debt ratio shows the exposure and the level of debt in a company and the
financial risk associate with the company in correspondence to the same. The gearing ratio was
calculated with the help of the debt divided by the total shareholder’s equity of the company. The
gearing ratio for the company in the year 2016 was around 1.90 which decreased slightly to
around 1.79 in the year 2017 implying that the company has tried to almost maintain the same
level of debt associated with the company. As it is crucial to note that increasing the financial
risk of the company may significantly affect the overall position and the financial position of the
company.
Particulars 2017 2016
Net Income 19848 8375
Sales 244363 208114
Net Profit Margin 8.12% 4.02%
Sales 244363 208114
Total Assets 348691 330314
Total Assets Turnover 70.08% 63.00%
Total Long Term Debt 348697 330214
Shareholder's Equity 194500 173830
Gearing Ratio 1.79 1.90
The evaluation of all the three ratios will be based on the basis of above ratio that will be
helping in calculating and evaluating the return on owners’ equity of the Exxon Mobil Company.
From the Du Pont Analysis and above ratio calculated it is crucial to note that both the financial
performance and the financial position of the company has increased and that can be well related
to the increasing efficiency and optimum utilisation done by the company (Kijewska 2016).