Imperial Oil reports dip in profit as it takes charges on restructuring, office sale

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CALGARY — Imperial Oil Ltd. reported a drop in third-quarter profit as it took charges related to a major overhaul at its Calgary headquarters.

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The oil producer and refiner, majority owned by U.S. major ExxonMobil Corp., had said in September it plans to cut 20 per cent of its workforce by the end of 2027, representing a reduction in 900 corporate positions, mostly in Calgary.

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“As a company, our legacy is defined by change and adaptation to ever-evolving business environments, technology and customer needs,” president and CEO John Whelan, who took on the top role in the spring, told an analyst conference call Friday.

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“That ability to evolve is one of our greatest strengths. We have done it time and time again, and it is key to our success and leading position.”

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Imperial reported net income of $539 million, or $1.07 per diluted share, for the three months ended Sept. 30, compared to $1.24 billion, or $2.33 per diluted share, a year earlier.

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The results included an after-tax charge of $249 million related to the restructuring.

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“This charge largely consists of employee severance costs, which will be paid out over the next two years as we migrate activities to business and technology centres and achieve efficiency,” said Daniel Lyons, senior vice-president of finance and administration.

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There was also a $306-million after-tax impairment charge related to the sale of Imperial’s sprawling corporate campus in suburban Calgary. That agreement includes a leaseback, which enables staff to remain in those offices throughout the transition.

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Whelan said the latest restructuring builds on Imperial’s efforts to outsource work to “global capability centres” over the past decade on an “opportunity by opportunity” basis.

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“Now, we’ve looked at this from a companywide perspective and, as we’ve kind of crawled and walked, we see the opportunity to run.”

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Global firms have been taking advantage of such centres _ largely based in India — to consolidate IT, engineering and other functions. ExxonMobil has what it calls “energy technology centres” around the globe, including ones in India and Malaysia that support its broader business.

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“We’re doing just as much or more in terms of what we’re operating, what we’re executing, but with less people doing it in a more efficient manner,” Whelan said.

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Some staff will also be retained at Imperial operating sites, mainly its Strathcona refinery in Edmonton.

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In its quarterly results, Imperial said total revenue and other income amounted to $12.05 billion, down from $13.26 billion in the same quarter last year.

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Upstream production averaged 462,000 gross oil-equivalent barrels per day, the highest quarterly production in over 30 years, up from 447,000 in the third quarter of 2024.

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Its Kearl oilsands mine north of Fort McMurray, Alta., had record gross production of 316,000 barrels a day.