Edgar Filing: EXXON MOBIL CORP

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2018

☐ 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 MOBIL CORPORATION

(Exact name of registrant as specified in its charter)

NEW JERSEY		13-5409005
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

5959 LAS COLINAS BOULEVARD, IRVING, TEXAS 75039-2298

(Address of principal executive offices) (Zip Code)

(972) 940-6000

(Registrant's telephone number, including area code)

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 ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class		Outstanding as of June 30, 2018
Common stock, without par value		4,233,810,348

EXXON MOBIL CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2018

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements
Condensed Consolidated Statement of Income Three and six months ended June 30, 2018 and 2017	3
Condensed Consolidated Statement of Comprehensive Income Three and six months ended June 30, 2018 and 2017	4
Condensed Consolidated Balance Sheet As of June 30, 2018 and December 31, 2017	5

Condensed Consolidated Statement of Cash Flows Six months ended June 30, 2018 and 2017	6
Condensed Consolidated Statement of Changes in Equity Six months ended June 30, 2018 and 2017	7
Notes to Condensed Consolidated Financial Statements	8
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3. Quantitative and Qualitative Disclosures About Market Risk	24
Item 4. Controls and Procedures	24

PART II. OTHER INFORMATION
Item 1. Legal Proceedings	25
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	26
Item 6. Exhibits	26
Index to Exhibits	27
Signature	28

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(millions of dollars)

			Three Months Ended		Six Months Ended
			June 30,		June 30,
			2018	2017	2018	2017
Revenues and other income
	Sales and other operating revenue		71,456	56,026	136,892	112,500
	Income from equity affiliates		1,729	1,525	3,639	3,235
	Other income		316	526	1,181	1,013
		Total revenues and other income	73,501	58,077	141,712	116,748
Costs and other deductions
	Crude oil and product purchases		41,327	30,194	77,615	60,553
	Production and manufacturing expenses		8,918	8,060	17,409	15,626
	Selling, general and administrative expenses		2,993	2,556	5,740	5,061
	Depreciation and depletion		4,589	4,652	9,059	9,171
	Exploration expenses, including dry holes		332	514	619	803
	Non-service pension and postretirement benefit expense		308	419	645	792
	Interest expense		147	158	351	304
	Other taxes and duties		8,375	7,368	16,522	14,364
		Total costs and other deductions	66,989	53,921	127,960	106,674
Income before income taxes			6,512	4,156	13,752	10,074
	Income taxes		2,526	892	4,983	2,720
Net income including noncontrolling interests			3,986	3,264	8,769	7,354
	Net income attributable to noncontrolling interests		36	(86)	169	(6)
Net income attributable to ExxonMobil			3,950	3,350	8,600	7,360


Earnings per common share (dollars)			0.92	0.78	2.01	1.73

Earnings per common share - assuming dilution (dollars)			0.92	0.78	2.01	1.73


Dividends per common share (dollars)			0.82	0.77	1.59	1.52

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(millions of dollars)

				Three Months Ended		Six Months Ended
				June 30,		June 30,
				2018	2017	2018	2017

Net income including noncontrolling interests				3,986	3,264	8,769	7,354
Other comprehensive income (net of income taxes)
	Foreign exchange translation adjustment			(2,040)	1,674	(2,844)	3,082
	Adjustment for foreign exchange translation (gain)/loss
			included in net income	18	234	186	234
	Postretirement benefits reserves adjustment
			(excluding amortization)	43	(159)	(391)	(184)
	Amortization and settlement of postretirement benefits reserves
			adjustment included in net periodic benefit costs	229	283	466	539
		Total other comprehensive income		(1,750)	2,032	(2,583)	3,671
Comprehensive income including noncontrolling interests				2,236	5,296	6,186	11,025
	Comprehensive income attributable to
			noncontrolling interests	(97)	169	(106)	328
Comprehensive income attributable to ExxonMobil				2,333	5,127	6,292	10,697

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(millions of dollars)

				June 30,	Dec. 31,
				2018	2017
Assets
	Current assets
		Cash and cash equivalents		3,430	3,177
		Notes and accounts receivable – net		26,993	25,597
		Inventories
			Crude oil, products and merchandise	14,373	12,871
			Materials and supplies	4,110	4,121
		Other current assets		1,649	1,368
			Total current assets	50,555	47,134
	Investments, advances and long-term receivables			39,691	39,160
	Property, plant and equipment – net			248,209	252,630
	Other assets, including intangibles – net			10,335	9,767
			Total assets	348,790	348,691

Liabilities
	Current liabilities
		Notes and loans payable		20,500	17,930
		Accounts payable and accrued liabilities		38,490	36,796
		Income taxes payable		3,457	3,045
			Total current liabilities	62,447	57,771
	Long-term debt			20,720	24,406
	Postretirement benefits reserves			21,504	21,132
	Deferred income tax liabilities			26,783	26,893
	Long-term obligations to equity companies			4,575	4,774
	Other long-term obligations			19,228	19,215
			Total liabilities	155,257	154,191

Commitments and contingencies (Note 3)

Equity
	Common stock without par value
		(9,000 million shares authorized, 8,019 million shares issued)		15,086	14,656
	Earnings reinvested			416,418	414,540
	Accumulated other comprehensive income			(18,609)	(16,262)
	Common stock held in treasury
		(3,785 million shares at June 30, 2018 and
		3,780 million shares at December 31, 2017)		(225,673)	(225,246)
			ExxonMobil share of equity	187,222	187,688
	Noncontrolling interests			6,311	6,812
			Total equity	193,533	194,500
			Total liabilities and equity	348,790	348,691

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(millions of dollars)

				Six Months Ended
				June 30,
				2018	2017
Cash flows from operating activities
	Net income including noncontrolling interests			8,769	7,354
	Depreciation and depletion			9,059	9,171
	Changes in operational working capital, excluding cash and debt			(982)	(228)
	All other items – net			(547)	(1,177)
			Net cash provided by operating activities	16,299	15,120

Cash flows from investing activities
	Additions to property, plant and equipment			(8,276)	(5,988)
	Proceeds associated with sales of subsidiaries, property, plant and
		equipment, and sales and returns of investments		1,748	841
	Additional investments and advances			(704)	(1,793)
	Other investing activities including collection of advances			277	301
			Net cash used in investing activities	(6,955)	(6,639)

Cash flows from financing activities
	Additions to long-term debt			-	60
	Additions to short-term debt			-	1,735
	Reductions in short-term debt			(4,256)	(2,722)
	Additions/(reductions) in commercial paper, and debt with three
		months or less maturity (1)		2,902	(321)
	Cash dividends to ExxonMobil shareholders			(6,793)	(6,423)
	Cash dividends to noncontrolling interests			(135)	(91)
	Changes in noncontrolling interests			(275)	(29)
	Common stock acquired			(429)	(514)
			Net cash used in financing activities	(8,986)	(8,305)
Effects of exchange rate changes on cash				(105)	209
Increase/(decrease) in cash and cash equivalents				253	385
Cash and cash equivalents at beginning of period				3,177	3,657
Cash and cash equivalents at end of period				3,430	4,042

Supplemental Disclosures
	Income taxes paid			4,426	3,247
	Cash interest paid			477	587

2017 Noncash Transactions

In the first six months of 2017, the Corporation completed the acquisitions of InterOil Corporation and of companies that own certain oil and gas properties in the Permian Basin and other assets. These transactions included a significant noncash component associated with the issuance of a combined 96 million shares of Exxon Mobil Corporation common stock in acquisition consideration.

(1) Includes a net addition of commercial paper with a maturity of over three months of $0.9 billion in 2018 and a net addition of $0.2 billion in 2017. The gross amount of commercial paper with a maturity of over three months issued was $2.2 billion in both 2018 and 2017, while the gross amount repaid was $1.3 billion in 2018 and $2.0 billion in 2017.

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

	EXXON MOBIL CORPORATION
	CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
	(millions of dollars)

			ExxonMobil Share of Equity
							Accumulated
								Other		Common
								Compre-		Stock		ExxonMobil		Non-
			Common		Earnings			hensive		Held in		Share of		controlling		Total
			Stock		Reinvested			Income		Treasury		Equity		Interests		Equity

Balance as of December 31, 2016				12,157		407,831			(22,239)		(230,424)		167,325		6,505		173,830
	Amortization of stock-based awards			467		-			-		-		467		-		467
	Other			(85)		-			-		-		(85)		(53)		(138)
	Net income for the period			-		7,360			-		-		7,360		(6)		7,354
	Dividends			-		(6,423)			-		-		(6,423)		(91)		(6,514)
	Other comprehensive income			-		-			3,337		-		3,337		334		3,671
	Acquisitions, at cost			-		-			-		(595)		(595)		(29)		(624)
	Issued for acquisitions			2,078		-			-		5,711		7,789		-		7,789
	Dispositions			-		-			-		3		3		-		3
Balance as of June 30, 2017				14,617		408,768			(18,902)		(225,305)		179,178		6,660		185,838

Balance as of December 31, 2017				14,656		414,540			(16,262)		(225,246)		187,688		6,812		194,500
	Amortization of stock-based awards			436		-			-		-		436		-		436
	Other			(6)		-			-		-		(6)		(7)		(13)
	Net income for the period			-		8,600			-		-		8,600		169		8,769
	Dividends			-		(6,793)			-		-		(6,793)		(135)		(6,928)
	Cumulative effect of accounting
		change		-		71			(39)		-		32		15		47
	Other comprehensive income			-		-			(2,308)		-		(2,308)		(275)		(2,583)
	Acquisitions, at cost			-		-			-		(429)		(429)		(268)		(697)
	Dispositions			-		-			-		2		2		-		2
Balance as of June 30, 2018				15,086		416,418			(18,609)		(225,673)		187,222		6,311		193,533



			Six Months Ended June 30, 2018									Six Months Ended June 30, 2017
					Held in									Held in
	Common Stock Share Activity		Issued		Treasury			Outstanding				Issued		Treasury		Outstanding
			(millions of shares)									(millions of shares)

	Balance as of December 31			8,019		(3,780)			4,239				8,019		(3,871)		4,148
		Acquisitions		-		(5)			(5)				-		(7)		(7)
		Issued for acquisitions		-		-			-				-		96		96
		Dispositions		-		-			-				-		-		-
	Balance as of June 30			8,019		(3,785)			4,234				8,019		(3,782)		4,237

The information in the Notes to Condensed Consolidated Financial Statements is an integral part of these statements.

EXXON MOBIL CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Financial Statement Preparation

These unaudited condensed consolidated financial statements should be read in the context of the consolidated financial statements and notes thereto filed with the Securities and Exchange Commission in the Corporation's 2017 Annual Report on Form 10-K. In the opinion of the Corporation, the information furnished herein reflects all known accruals and adjustments necessary for a fair statement of the results for the periods reported herein. All such adjustments are of a normal recurring nature. Prior data has been reclassified in certain cases to conform to the current presentation basis.

The Corporation's exploration and production activities are accounted for under the "successful efforts" method.

2. Accounting Changes

Effective January 1, 2018, ExxonMobil adopted the Financial Accounting Standards Board’s standard, Revenue from Contracts with Customers (Topic 606), as amended. The standard establishes a single revenue recognition model for all contracts with customers, eliminates industry and transaction specific requirements, and expands disclosure requirements. The standard was adopted using the Modified Retrospective method, under which prior year results are not restated, but supplemental information is provided for any material impacts of the standard on 2018 results. The adoption of the standard did not have a material impact on any of the lines reported in the Corporation’s financial statements. The cumulative effect of adoption of the standard was de minimis. The Corporation did not elect any practical expedients that require disclosure. See Note 9.

Effective January 1, 2018, ExxonMobil adopted the Financial Accounting Standards Board’s Update, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The standard requires investments in equity securities other than consolidated subsidiaries and equity method investments to be measured at fair value with changes in the fair value recognized through net income. The Corporation elected a modified approach for equity securities that do not have a readily determinable fair value. This modified approach measures investments at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The cumulative effect adjustment related to the adoption of this standard increased equity $47 million. The portion of unrealized gains and losses recognized during the reporting period on equity securities still held at June 30, 2018 and the carrying value of equity securities without readily determinable fair values at June 30, 2018 were not significant to the Corporation. The standard also expanded disclosures related to financial instruments. See Note 7.

Effective January 1, 2018, ExxonMobil adopted the Financial Accounting Standards Board’s Update, Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The update requires separate presentation of the service cost component from other components of net benefit costs. The other components are reported in a new line on the Corporation’s Statement of Income, “Non-service pension and postretirement benefit expense.” The Corporation elected to use the practical expedient which uses the amounts disclosed in the pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements, as it is impracticable to determine the amounts capitalized in those periods. Beginning in 2018, the other components of net benefit costs are included in the Corporate and financing segment. The estimated after-tax impact from the change in segmentation is an increase in Corporate and financing expenses of about $100 million for the second quarter and $200 million for the first six months of 2018. The increase in the Corporate and financing expenses is offset by lower expenses across the operating segments. Additionally, only the service cost component of net benefit costs is eligible for capitalization in situations where it is otherwise appropriate to capitalize employee costs in connection with the construction or production of an asset.

The impact of the retrospective presentation change on ExxonMobil's Consolidated Statement of Income for the three months and six months ended June 30, 2017, is shown below.

	Three Months Ended			Six Months Ended
	June 30, 2017			June 30, 2017
	As Reported	Change	As Adjusted	As Reported	Change	As Adjusted
	(millions of dollars)

Production and manufacturing expenses	8,407	(347)	8,060	16,252	(626)	15,626
Selling, general and administrative expenses	2,628	(72)	2,556	5,227	(166)	5,061
Non-service pension and postretirement benefit expense	-	419	419	-	792	792

Effective January 1, 2019, ExxonMobil will adopt the Financial Accounting Standards Board’s standard, Leases (Topic 842), as amended. The standard requires all leases with an initial term greater than one year to be recorded on the balance sheet as a right of use asset and a lease liability. The Corporation acquired lease accounting software to facilitate implementation, and is currently installing, configuring and testing the software. Based on leases outstanding at the end of 2017, the Corporation estimates the operating lease right of use asset and lease liability would have been in the range of $4 billion to $5 billion at that time. The effect on the Corporation’s balance sheet as a result of implementing the standard on January 1, 2019, could differ considerably depending on operating leases commenced in 2018 as well as interest rates and other factors such as the expiry or renewal of leases during the year.

3. Litigation and Other Contingencies

Litigation

A variety of claims have been made against ExxonMobil and certain of its consolidated subsidiaries in a number of pending lawsuits. Management has regular litigation reviews, including updates from corporate and outside counsel, to assess the need for accounting recognition or disclosure of these contingencies. The Corporation accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated. If a range of amounts can be reasonably estimated and no amount within the range is a better estimate than any other amount, then the minimum of the range is accrued. The Corporation does not record liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated or when the liability is believed to be only reasonably possible or remote. For contingencies where an unfavorable outcome is reasonably possible and which are significant, the Corporation discloses the nature of the contingency and, where feasible, an estimate of the possible loss. For purposes of our contingency disclosures, “significant” includes material matters, as well as other matters which management believes should be disclosed. ExxonMobil will continue to defend itself vigorously in these matters. Based on a consideration of all relevant facts and circumstances, the Corporation does not believe the ultimate outcome of any currently pending lawsuit against ExxonMobil will have a material adverse effect upon the Corporation's operations, financial condition, or financial statements taken as a whole.

Other Contingencies

The Corporation and certain of its consolidated subsidiaries were contingently liable at June 30, 2018, for guarantees relating to notes, loans and performance under contracts. Where guarantees for environmental remediation and other similar matters do not include a stated cap, the amounts reflect management’s estimate of the maximum potential exposure. These guarantees are not reasonably likely to have a material effect on the Corporation’s financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

As of June 30, 2018

Equity

Other

Company

Third Party

Obligations (1)

Obligations

Total

(millions of dollars)

Guarantees

Debt-related

408

466

Other

1,188

4,678

5,866

Total

1,596

4,736

6,332

(1) ExxonMobil share

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.

In accordance with a nationalization decree issued by Venezuela’s president in February 2007, by May 1, 2007, a subsidiary of the Venezuelan National Oil Company (PdVSA) assumed the operatorship of the Cerro Negro Heavy Oil Project. This Project had been operated and owned by ExxonMobil affiliates holding a 41.67 percent ownership interest in the Project. The decree also required conversion of the Cerro Negro Project into a “mixed enterprise” and an increase in PdVSA’s or one of its affiliate’s ownership interest in the Project, with the stipulation that if ExxonMobil refused to accept the terms for the formation of the mixed enterprise within a specified period of time, the government would “directly assume the activities” carried out by the joint venture. ExxonMobil refused to accede to the terms proffered by the government, and on June 27, 2007, the government expropriated ExxonMobil’s 41.67 percent interest in the Cerro Negro Project.

On September 6, 2007, affiliates of ExxonMobil filed a Request for Arbitration with the International Centre for Settlement of Investment Disputes (ICSID). The ICSID Tribunal issued a decision on June 10, 2010, finding that it had jurisdiction to proceed on the basis of the Netherlands-Venezuela Bilateral Investment Treaty. On October 9, 2014, the ICSID Tribunal issued its final award finding in favor of the ExxonMobil affiliates and awarding $1.6 billion as of the date of expropriation, June 27, 2007, and interest from that date at 3.25 percent compounded annually until the date of payment in full. The Tribunal also noted that one of the Cerro Negro Project agreements provides a mechanism to prevent double recovery between the ICSID award and all or part of an earlier award of $908 million to an ExxonMobil affiliate, Mobil Cerro Negro, Ltd., against PdVSA and a PdVSA affiliate, PdVSA CN, in an arbitration under the rules of the International Chamber of Commerce.

On February 2, 2015, Venezuela filed a Request for Annulment of the ICSID award. On March 9, 2017, the ICSID Committee hearing the Request for Annulment issued a decision partially annulling the award of the Tribunal issued on October 9, 2014. The Committee affirmed the compensation due for the La Ceiba Project and for export curtailments at the Cerro Negro Project, but annulled the portion of the award relating to the Cerro Negro Project’s expropriation ($1.4 billion) based on its determination that the prior Tribunal failed to adequately explain why the cap on damages in the indemnity owed by PdVSA did not affect or limit the amount owed for the expropriation of the Cerro Negro Project. As a result, ExxonMobil retained an award for $260 million (including accrued interest). In accordance with an agreement between ExxonMobil and Venezuela the $260 million has been fully paid. The agreement does not impact ExxonMobil’s ability to re-arbitrate the issue that was the basis for the annulment in a new ICSID arbitration proceeding.

The net impact of these matters on the Corporation’s consolidated financial results cannot be reasonably estimated. Regardless, the Corporation does not expect the resolution to have a material effect upon the Corporation’s operations or financial condition.

An affiliate of ExxonMobil is one of the Contractors under a Production Sharing Contract (PSC) with the Nigerian National Petroleum Corporation (NNPC) covering the Erha block located in the offshore waters of Nigeria. ExxonMobil's affiliate is the operator of the block and owns a 56.25 percent interest under the PSC. The Contractors are in dispute with NNPC regarding NNPC's lifting of crude oil in excess of its entitlement under the terms of the PSC. In accordance with the terms of the PSC, the Contractors initiated arbitration in Abuja, Nigeria, under the Nigerian Arbitration and Conciliation Act. On October 24, 2011, a three-member arbitral Tribunal issued an award upholding the Contractors' position in all material respects and awarding damages to the Contractors jointly in an amount of approximately $1.8 billion plus $234 million in accrued interest. The Contractors petitioned a Nigerian federal court for enforcement of the award, and NNPC petitioned the same court to have the award set aside. On May 22, 2012, the court set aside the award. The Contractors appealed that judgment to the Court of Appeal, Abuja Judicial Division. On July 22, 2016, the Court of Appeal upheld the decision of the lower court setting aside the award. On October 21, 2016, the Contractors appealed the decision to the Supreme Court of Nigeria. In June 2013, the Contractors filed a lawsuit against NNPC in the Nigerian federal high court in order to preserve their ability to seek enforcement of the PSC in the courts if necessary. Following dismissal by this court, the Contractors appealed to the Nigerian Court of Appeal in June 2016. In October 2014, the Contractors filed suit in the United States District Court for the Southern District of New York to enforce, if necessary, the arbitration award against NNPC assets residing within that jurisdiction. NNPC has moved to dismiss the lawsuit. At this time, the net impact of this matter on the Corporation's consolidated financial results cannot be reasonably estimated. However, regardless of the outcome of enforcement proceedings, the Corporation does not expect the proceedings to have a material effect upon the Corporation's operations or financial condition.

4. Other Comprehensive Income Information

		Cumulative	Post-
		Foreign	retirement
		Exchange	Benefits
ExxonMobil Share of Accumulated Other		Translation	Reserves
Comprehensive Income		Adjustment	Adjustment	Total
		(millions of dollars)

Balance as of December 31, 2016		(14,501)	(7,738)	(22,239)
Current period change excluding amounts reclassified
	from accumulated other comprehensive income	2,849	(172)	2,677
Amounts reclassified from accumulated other
	comprehensive income	140	520	660
Total change in accumulated other comprehensive income		2,989	348	3,337
Balance as of June 30, 2017		(11,512)	(7,390)	(18,902)

Balance as of December 31, 2017		(9,482)	(6,780)	(16,262)
Current period change excluding amounts reclassified
	from accumulated other comprehensive income	(2,573)	(409)	(2,982)
Amounts reclassified from accumulated other
	comprehensive income	186	449	635
Total change in accumulated other comprehensive income		(2,387)	40	(2,347)
Balance as of June 30, 2018		(11,869)	(6,740)	(18,609)

Three Months Ended

Six Months Ended

Amounts Reclassified Out of Accumulated Other

June 30,

Comprehensive Income - Before-tax Income/(Expense)

2018

2017

2018

2017

(millions of dollars)

Foreign exchange translation gain/(loss) included in net income

(Statement of Income line: Other income)

(18)

(234)

(186)

(234)

Amortization and settlement of postretirement benefits reserves

adjustment included in net periodic benefit costs

(Statement of Income Line: Non-service pension and

postretirement benefit expense)

(290)

(406)

(610)

(765)

			Three Months Ended		Six Months Ended
Income Tax (Expense)/Credit For			June 30,		June 30,
Components of Other Comprehensive Income			2018	2017	2018	2017
		(millions of dollars)

Foreign exchange translation adjustment			5	(8)	5	(26)
Postretirement benefits reserves adjustment
	(excluding amortization)		(58)	75	66	80
Amortization and settlement of postretirement benefits reserves
	adjustment included in net periodic benefit costs		(61)	(123)	(144)	(226)
Total			(114)	(56)	(73)	(172)

5. Earnings Per Share

		Three Months Ended		Six Months Ended
		June 30,		June 30,
		2018	2017	2018	2017

Earnings per common share
Net income attributable to ExxonMobil (millions of dollars)		3,950	3,350	8,600	7,360

Weighted average number of common shares
	outstanding (millions of shares)	4,271	4,271	4,270	4,244

Earnings per common share (dollars) (1)		0.92	0.78	2.01	1.73

(1) The calculation of earnings per common share and earnings per common share – assuming dilution are the same in each period shown.

6. Pension and Other Postretirement Benefits

					Three Months Ended		Six Months Ended
					June 30,		June 30,
					2018	2017	2018	2017

				(millions of dollars)
Components of net benefit cost
	Pension Benefits - U.S.
		Service cost			204	186	413	383
		Interest cost			181	200	361	399
		Expected return on plan assets			(181)	(194)	(363)	(388)
		Amortization of actuarial loss/(gain) and prior
			service cost		92	112	183	222
		Net pension enhancement and
			curtailment/settlement cost		63	158	126	263
		Net benefit cost			359	462	720	879

	Pension Benefits - Non-U.S.
		Service cost			154	145	312	290
		Interest cost			186	189	386	376
		Expected return on plan assets			(237)	(244)	(489)	(483)
		Amortization of actuarial loss/(gain) and prior
			service cost		113	126	231	253
		Net pension enhancement and
			curtailment/settlement cost		-	-	33	(5)
		Net benefit cost			216	216	473	431

	Other Postretirement Benefits
		Service cost			35	30	71	56
		Interest cost			76	67	151	139
		Expected return on plan assets			(6)	(5)	(12)	(11)
		Amortization of actuarial loss/(gain) and prior
			service cost	&