Core Viewpoint - The article discusses the financial performance and outlook of Imperial Oil, highlighting the expectation of continued strong cash flow from operations due to limited expansion options and debt repayment needs [1]. Group 1: Financial Performance - Imperial Oil is anticipated to generate significant cash flow from its operations, which is a positive indicator for the company's financial health [1]. - The company has limited options for expansion, suggesting that the cash generated may be primarily used for shareholder returns or debt repayment rather than growth initiatives [1]. Group 2: Investment Perspective - The author expresses a long position in Imperial Oil shares, indicating confidence in the company's future performance and potential for returns [2]. - The article reflects a personal opinion on the investment potential of Imperial Oil, emphasizing the importance of cash flow in evaluating the company's prospects [2].

Core Viewpoint - Imperial Oil Limited (IMO) is a significant player in Canada's energy sector, involved in the exploration, production, and sale of crude oil and natural gas, and is a subsidiary of Exxon Mobil Corporation [1][2] Group 1: Strengths and Opportunities - Record-breaking production in Q4, averaging 460,000 barrels per day, contributed to a full-year production of 433,000 barrels per day, ensuring revenue stability [4] - Strong operational performance at Kearl, achieving an annual production of 281,000 barrels per day, supports long-term stability and allows capitalizing on favorable crude pricing [5] - Increased quarterly dividend by 20% to 72 Canadian cents per share, reflecting management's confidence in cash flow and long-term profitability, with C$16 billion returned to shareholders over the past three years [6] - Low natural decline rates in oil sands operations at Kearl and Cold Lake ensure long-term revenue stability and reduce capital expenditure needs [7] - Vertical integration across the oil value chain reduces reliance on external suppliers and protects against price shocks, making IMO a lower-risk investment [8] - Investment in advanced recovery techniques like solvent-assisted SAGD at Cold Lake could unlock additional reserves and improve cost structure [10] Group 2: Risks and Challenges - Declining net income in Q4 2024 to C$1.2 billion from C$1.4 billion the previous year raises concerns about growth, with full-year revenues also declining slightly [11] - Weakened refining margins due to increased market supply, with synthetic crude oil realizations falling C$6.27 per barrel, could impact downstream earnings [12] - Dependence on volatile oil prices linked to geopolitical risks and global economic conditions adds uncertainty to profitability [13] - Slower growth compared to U.S. shale producers, which can ramp up production quickly, makes IMO less attractive for growth-focused investors [14] - Current EV/EBITDA ratio of 5.81 is higher than the Canadian Oil and Gas sub-industry average of 3.65, indicating potential overvaluation concerns [15]

Core Viewpoint - Imperial Oil (IMO) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system tracks the Zacks Consensus Estimate, which reflects EPS estimates from sell-side analysts for the current and following years, indicating a company's earnings outlook [1][2]. - A strong correlation exists between changes in earnings estimates and near-term stock price movements, influenced by institutional investors who adjust their valuations based on these estimates [4][6]. Recent Developments for Imperial Oil - Analysts have raised their earnings estimates for Imperial Oil, with the Zacks Consensus Estimate increasing by 15.5% over the past three months [8]. - For the fiscal year ending December 2025, Imperial Oil is expected to earn $5.82 per share, reflecting a year-over-year change of -11.7% [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [7]. - The upgrade of Imperial Oil to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for near-term price increases due to favorable earnings estimate revisions [10].

Core Viewpoint - Imperial Oil (IMO) is currently outperforming the Oils-Energy sector, with a year-to-date gain of 6.6% compared to the sector's average return of -1.8% [4]. Group 1: Company Performance - Imperial Oil is ranked 2 (Buy) in the Zacks Rank, indicating a positive earnings outlook [3]. - The Zacks Consensus Estimate for Imperial Oil's full-year earnings has increased by 15.5% over the past three months, reflecting improving analyst sentiment [3]. - The company belongs to the Oil and Gas - Integrated - Canadian industry, which is currently ranked 88 in the Zacks Industry Rank, with its stocks losing about 8.3% year-to-date [5]. Group 2: Sector Comparison - The Oils-Energy group, which includes 247 companies, is currently ranked 8 within the Zacks Sector Rank [2]. - NextDecade (NEXT), another Oils-Energy stock, has returned 0.7% year-to-date, indicating it has also outperformed the sector [4][6]. - The Oil and Gas - Production Pipeline - MLB industry, to which NextDecade belongs, is ranked 4 and has moved -0.9% year-to-date [6].

Operational Efficiency and Technology - The company completed its multiyear program to convert 81 haul trucks to autonomous operation at the Kearl site, enhancing productivity and reducing costs [175]. - The company's operational efficiency is crucial for competitive performance, requiring continuous management focus on cost control and productivity enhancements [171]. - The company relies on research and development from both its own organization and ExxonMobil to maintain competitive positioning and adapt to technological changes [172]. Economic and Market Factors - Current inflationary pressures have persisted, impacting operating costs such as energy, transportation, and materials, which could adversely affect financial results [168]. - The company’s future business results depend on its ability to manage both external economic factors and internal capital allocation effectively [169]. - Low commodity prices could adversely affect reserves development and overall financial performance [185]. Future Production and Reserves - Future production and cash flows are highly dependent on the company's ability to replace produced reserves through exploration, appraisal, and acquisitions [184]. - Economically recoverable oil and natural gas reserves estimates involve significant uncertainties, including geological and engineering factors [185]. - Future net cash flows are subject to variances that could be material, affecting production, revenues, and operating costs [186]. - Actual production and operating expenditures may differ substantially from initial estimates, leading to financial implications [186]. Regulatory and Compliance Issues - Regulatory changes, including environmental regulations, may impose significant compliance costs and impact project viability [185]. - The company’s capital investment guidance in lower-emission investments is contingent on the availability of opportunities and public policy support [16]. Competition and Market Position - The company faces competition from alternative energy sources and established competitors as it pursues lower-emission business opportunities [182]. - The company’s reputation is a critical asset, influenced by operational incidents, consumer perceptions, and progress in energy transition efforts [183]. Cybersecurity Concerns - Cybersecurity threats are a significant concern, with the company experiencing several cyber-attacks on suppliers and partners in 2024, none of which had a material impact [180]. Financial Implications of Abandonment - Abandonment and reclamation costs, including mining operations, are critical factors in estimating future cash flows [185].

Group 1 - Imperial Oil (IMO) is outperforming the Oils-Energy sector with a year-to-date return of 8.4%, compared to the sector average of 4.5% [4] - The Zacks Rank for Imperial Oil is 2 (Buy), indicating strong analyst sentiment and a positive earnings outlook, with a consensus estimate for full-year earnings increasing by 2.4% over the past quarter [3] - The Oil and Gas - Integrated - Canadian industry, which includes Imperial Oil, is ranked 86 in the Zacks Industry Rank, with an average return of 3.7% this year [5] Group 2 - Kolibri Global Energy Inc. (KGEI) is another Oils-Energy stock that has outperformed the sector, with a year-to-date increase of 41.2% [4] - The consensus estimate for Kolibri Global Energy Inc.'s current year EPS has risen by 28.3% over the past three months, and it also holds a Zacks Rank of 2 (Buy) [5] - The Alternative Energy - Other industry, to which Kolibri Global Energy belongs, is ranked 60 and has gained 13.3% this year [6]

Core Insights - Imperial Oil reported revenue of $9.01 billion for the quarter ended December 2024, a decrease of 6.4% year-over-year, and EPS of $1.69, down from $1.81 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $11.2 billion by 19.54%, while the EPS exceeded the consensus estimate of $1.42 by 19.01% [1] Financial Performance - Total refinery throughput was 411 KBBL, slightly above the average estimate of 405.67 KBBL [4] - Gross crude oil and NGL production per day from Kearl was 212 KBBL, exceeding the average estimate of 209.9 KBBL [4] - Net petroleum products sales were 458 KBBL, below the average estimate of 485.08 KBBL [4] - Refinery capacity utilization was 95%, higher than the average estimate of 93.8% [4] - Gross oil-equivalent production reached 460 KBBL, surpassing the average estimate of 449.15 KBBL [4] - Gross natural gas production was 29 Mcf, slightly below the average estimate of 30.28 Mcf [4] - Total petrochemical sales were 174 KTon, significantly above the average estimate of 128.35 KTon [4] - Net crude oil and NGL production per day from conventional sources was 5 KBBL, exceeding the average estimate of 4.66 KBBL [4] - Net crude oil and NGL production per day from Cold Lake was 118 KBBL, above the average estimate of 111.99 KBBL [4] - Gross crude oil and NGL production per day from Cold Lake was 157 KBBL, exceeding the average estimate of 149.79 KBBL [4] - Gross crude oil and NGL production per day from Syncrude matched the average estimate of 81 KBBL [4] - Gross crude oil and NGL production per day from conventional sources was 5 KBBL, above the average estimate of 3.42 KBBL [4] Market Performance - Shares of Imperial Oil have returned +6.8% over the past month, outperforming the Zacks S&P 500 composite's +2.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Imperial Oil Limited (IMO) reported fourth-quarter 2024 adjusted earnings per share of $1.69, which beat the Zacks Consensus Estimate of $1.42. This increase was driven by higher production levels, improved bitumen realizations and a year-over-year decrease in total expenses. However, the bottom line declined from the year-ago quarter’s $1.81 due to declining downstream margins and lower realized synthetic crude prices.Revenues of $9 billion missed the Zacks Consensus Estimate of $11.2 billion. The top line ...

Imperial Oil (IMO) came out with quarterly earnings of $1.69 per share, beating the Zacks Consensus Estimate of $1.42 per share. This compares to earnings of $1.81 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 19.01%. A quarter ago, it was expected that this oil and gas and petroleum products company would post earnings of $1.48 per share when it actually produced earnings of $1.71, delivering a surprise of 15.54%.Over the l ...

Calgary, January 31, 2025 Exhibit 99.1 Q4 News Release Imperial announces fourth quarter 2024 financial and operating results | | | Fourth quarter | | | Twelve months | | | --- | --- | --- | --- | --- | --- | --- | | millions of Canadian dollars, unless noted | 2024 | 2023 | ∆I | 2024 | 2023 | ∆I | | Net income (loss) (U.S. GAAP) | 1,225 | 1,365 | (140) | 4,790 | 4,889 | (99) | | Net income (loss) per common share, assuming dilution (dollars) | 2.37 | 2.47 | (0.10) | 9.03 | 8.49 | +0.54 | | Capital and expl ...