2003 Summary Annual Report To Our Shareholders Inside In 2003, ExxonMobil delivered Several major upstream projects the strongest earnings performance commenced production, including To Our Shareholders 1 in the corporation’s history. We those in Norway, Chad, Angola and Technology 3 achieved net income of $21.5 billion Equatorial Guinea. Still other major Upstream 5 and cash flow from operations projects are being progressed to Downstream 15 and asset sales of $30.8 billion. deliver profitable long-term hydrocar- Return on capital employed stood bon resources for the corporation, Chemical 23 at an industry-leading 21 percent. including those in Qatar, Angola, Corporate Citizenship 27 Our strong business performance Russia, Norway, Malaysia and the Financial Summary 31 continues to provide leading returns United States. In the downstream Investor Information 42 to shareholders while advancing the business, earnings improved dramati- corporation’s core strategies with our cally. We made significant progress ongoing investments in the business. in expanding our capacity to produce Note: The term upstream refers to exploration, development, production, gas and power mar- low-sulfur gasolines and strengthened keting, and U.S. coal businesses or activities. The corporation has paid a dividend our position as the world’s foremost Downstream refers to the refining and market- ing of petroleum products such as motor fuels every year for more than a century. supplier and marketer of motor fuels and lubricants. During 2003, we increased annual and lubricants. Our chemical business Projections, targets, estimates and business dividend payments for the 21st con- continued to improve profitability plans in this report are forward-looking state- ments. Actual future results, including effi- secutive year and distributed more while outperforming the competition ciency gains, cost reductions, project dates and capacities, production rates and resource than $6.5 billion to our shareholders. and posting the best earnings results in recoveries, could differ materially due to, for Together with share purchases made the past five years in a very challeng- example, changes in market conditions affect- ing the oil and gas industry; the outcome of during the year, we returned a total of ing industry environment. commercial negotiations; unforeseen technical difficulties; political events and disturbances; $11.5 billion to shareholders in 2003. and other factors discussed under the caption The combination of dividend distribu- In managing the corporation’s day-to- "Factors Affecting Future Results” in Item 1 of ExxonMobil’s most recent Form 10-K. tions and share purchases represents day activities throughout the world, Definitions of certain financial and operating more than 70 percent of our net we work to ensure that all our opera- measures and other key terms used in this report income over the past 20 years. tions are safe and environmentally can be found on the corporation’s Internet Web site (exxonmobil.com) in the “Frequently Used responsible. We are mindful that Terms” pages located in the Investor Information section. In the case of financial measures that Underpinning our plans to sustain nothing is more important than the we believe constitute “non-GAAP financial and improve ExxonMobil’s prof- safety and health of our employees measures” under SEC Regulation G, the defini- tions also include a reconciliation to the most itability, we invested more than and the people and communities with comparable GAAP measure and other informa- $15 billion in the business during whom we come in contact. tion required by that rule. the year and made substantial Certain reclassifications to prior years have been made to conform to the 2003 presentation. progress in advancing our significant We also remain steadfast in our com- portfolio of high-quality projects. mitment to outstanding environmental Year-End Stock Price Long-Term Returns Dollars per Common Share Value of $1,000 invested with dividends reinvested . 50 $4,000 $20,000 $80,000 40 3,000 15,000 60,000 30 2,000 10,000 40,000 20 1,000 5,000 20,000 10 0 0 0 0 2001 2002 2003 . over 10 years . over 20 years . over 30 years XOM S&P 500 performance. Our goal is to prevent enables us to take on the world’s environmental incidents and to toughest energy challenges. Your improve energy efficiency in all our company and its employees operations. remain steadfast in our commit- ment to business strategies that ExxonMobil’s industry-leading tech- have yielded favorable results for nology plays a critical role in decades: investment selectivity and our success. In addition to pursuing discipline, operational excellence, research in support of existing busi- cost efficiency, development and nesses, a significant portion of our application of state-of-the-art tech- effort is focused on developing pro- nology, and adherence to prietary breakthrough technology that the highest standards of safety, will have a significant and lasting health, environmental care and benefit for the corporation. corporate citizenship. In more than 200 countries and terri- Your company’s achievements tories, we operate a highly diversified and financial results are ulti- business at the highest levels of ethi- mately made possible by the tal- cal standards. In keeping with our ents, dedication and extraordinary long-standing and clearly articulated performance of the thousands of vital energy supplies, ExxonMobil approach to ethics, we are committed ExxonMobil employees around will play a central role in helping to to candor, honesty and integrity in the world. To each of them, I sustain economic growth in both reporting our business results to our extend my thanks and apprecia- the developed and developing shareholders and the public. We tion for another outstanding year countries. Through our overarching believe our business experience and and a job well done. commitment to excellence in every- our scientific and technical expertise thing we do, I have every confidence provide useful insights that can bene- In the coming decades, meeting that we will be equal to that respon- fit and help inform those responsible the expected increase in global sibility as we continue to meet any for formulating and executing sound energy demand will require a future challenges. public policy. broad portfolio of energy options, and hydrocarbon fuels are ExxonMobil is dedicated to creating expected to remain the dominant long-term, sustainable value and energy source through at least the Lee R. Raymond growth for shareholders. We have middle of the century. In fulfill- Chairman and CEO unmatched financial strength, which ing our mission to provide these Capital and Exploration Expenditures Return on Capital Employed Net Income Billions of Dollars Percent Billions of Dollars 16 25 25 20 20 12 15 15 8 10 10 4 5 5 0 0 0 2001 2002 2003 2001 2002 2003 2001 2002 2003 Technology World-scale technology Larger, more efficient to reduce LNG cost LNG ships Industry-leading tank technology State-of-the-art (from left) turbines, compressors and heat exchangers ExxonMobil’s Competitive Edge ExxonMobil has nearly 20,000 engineers and scien- ExxonMobil’s unparalleled commitment to develop tists applying advanced technology throughout our and apply industry-leading technology continuously operations and working to develop new technology creates profitable opportunities. We match technol- in our research facilities. They represent some of the ogy efforts to our business needs and emphasize brightest minds from top schools worldwide and a proprietary research. We balance investments variety of disciplines. About 10 percent of them hold between technology extensions, which can be rap- Ph.D. degrees. Over the past decade, ExxonMobil idly deployed to existing operations, and break- has received more than 10,000 patents in the United through research that can have a significant and States and Europe. lasting effect on ExxonMobil and the industry. ExxonMobil-developed technology helps us find more From skyscraper-sized drilling platforms that float oil and natural gas at lower cost, even as geological, in water nearly a mile deep to tiny miracle catalysts environmental and logistical challenges become more that help create thousands of consumer products, to complex. New technology will continue to revolution- higher-performing fuels and lubricants with signifi- ize the industry and how it responds to the world’s cantly reduced emissions, to refineries and chemical ever-growing demand for oil and natural gas. plants that run safely, cleanly and efficiently, ExxonMobil is a pacesetter in developing leading- ExxonMobil is capturing substantial cost savings edge technology. We invest about $600 million from a growing suite of proprietary technologies that annually in research and technology. allow us to optimize the designs of wells and associ- ated subsurface completions in our field developments. Drilling and well completions typically constitute We seek technology that can improve existing operations, and we conduct fundamental research that can lead to significant technological breakthroughs. ExxonMobil is using new technology to more economically manufacture, transport and store liquefied natural gas (LNG) for worldwide markets. These advances will enable us to Traditional substantially grow our LNG business. Onshore Terminal Larger Liquefaction Trains Cut LNG Cost EPC* Cost Train Size Dollars per Ton per Year Millions of Metric Tons per Year EPC* Cost 400 8 Train Size