Analysis of Reportable Segments
Marathon Oil Corp. operates in 2 segments: United States (U.S.) and International (Int’l).
Segment Profit Margin
Marathon Oil Corp., profit margin by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 23.94% | -18.91% | 14.67% | 12.44% | -4.78% |
| International (Int’l) | 118.73% | 17.34% | 50.54% | 46.56% | 32.41% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- United States (U.S.) Segment Profit Margin
- The United States segment profit margin exhibited notable volatility over the analyzed periods. It began with a negative margin of -4.78% in 2017, indicating profitability challenges. In 2018 and 2019, there was a recovery, with positive margins of 12.44% and 14.67%, respectively, suggesting improved operational performance. However, 2020 saw a sharp decline to -18.91%, reflecting significant adverse impacts, potentially due to external factors such as market conditions or cost pressures. The margin then rebounded strongly in 2021 to 23.94%, reaching the highest point over the five years and indicating a substantial turnaround in profitability.
- International (Int’l) Segment Profit Margin
- The International segment consistently demonstrated strong profitability throughout the period, with margins remaining positive and generally increasing. Starting at 32.41% in 2017, the margin rose to 46.56% in 2018 and further to 50.54% in 2019, showing steady improvement. Although there was a decline to 17.34% in 2020, this margin remained positive and considerably higher than the U.S. segment’s negative value in the same year. The segment then experienced a remarkable increase in 2021, reaching 118.73%, which represents a significant enhancement in profitability, potentially indicating exceptional operational efficiency or favorable market conditions in that period.
- Overall Observations
- The data reveal that the International segment consistently outperformed the U.S. segment in terms of profit margin across all years. While the U.S. segment showed higher volatility with periods of negative margins, the International segment maintained relatively higher and more stable profitability, despite a dip in 2020. The year 2020 was challenging for both segments, with the U.S. segment suffering negative margins and the International segment experiencing a sizeable decrease, though still positive. The recovery in 2021 was pronounced for both, especially the International segment, which recorded an exceptional margin far exceeding prior years. These trends suggest that the International operations may offer stronger resilience and growth potential compared to the domestic U.S. operations over this timeframe.
Segment Profit Margin: United States (U.S.)
Marathon Oil Corp.; United States (U.S.); segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Segment income (loss) | 1,277) | (553) | 675) | 608) | (148) |
| Revenues from contracts with customers | 5,334) | 2,924) | 4,602) | 4,886) | 3,093) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 23.94% | -18.91% | 14.67% | 12.44% | -4.78% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment profit margin = 100 × Segment income (loss) ÷ Revenues from contracts with customers
= 100 × 1,277 ÷ 5,334 = 23.94%
The financial data reveals several notable trends in the United States (U.S.) reportable segment over the five-year period ending December 31, 2021. The segment income (loss) experienced substantial volatility, with significant fluctuations from a loss of US$148 million in 2017 to a peak profit of US$675 million in 2019, followed by a steep loss of US$553 million in 2020, before rebounding strongly to a profit of US$1,277 million in 2021. This pattern indicates a segment facing challenging market or operational conditions, with marked recovery and growth in the final year of the period analyzed.
Revenues from contracts with customers showed an overall upward trend with some fluctuations. Starting at US$3,093 million in 2017, revenues increased substantially to US$4,886 million in 2018, then dipped slightly to US$4,602 million in 2019. A noticeable decrease to US$2,924 million occurred in 2020, which could reflect adverse market circumstances or lower sales volumes during that year. However, revenues recovered robustly in 2021, reaching the highest value in the period at US$5,334 million, indicating enhanced sales performance or market demand improvement.
The segment profit margin percentage mirrored the volatility seen in segment income. Initially negative at -4.78% in 2017, the margin improved significantly to 12.44% in 2018 and further to 14.67% in 2019, demonstrating improving profitability. The margin then dropped sharply to -18.91% in 2020, reflecting the loss incurred, before a strong recovery to 23.94% in 2021, suggesting effective cost management or higher revenue realization relative to costs in that year.
- Key Observations:
- - The segment experienced considerable income volatility, with losses turning into substantial profits and vice versa, indicating sensitivity to external or internal factors.
- - Revenue trends indicate recovery from a dip in 2020, surpassing previous highs by 2021.
- - Profit margins fluctuate widely, highlighting variable operational efficiency or market impacts, yet end with a strong positive figure in 2021.
In summary, the segment displayed resilience with a marked recovery in both revenues and profitability in 2021 after a downturn in 2020, suggesting improvement in market conditions or the effectiveness of strategic initiatives. The overall pattern suggests a segment prone to economic or industry cyclicality but capable of rapid turnaround.
Segment Profit Margin: International (Int’l)
Marathon Oil Corp.; International (Int’l); segment profit margin calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Segment income (loss) | 317) | 30) | 233) | 473) | 374) |
| Revenues from contracts with customers | 267) | 173) | 461) | 1,016) | 1,154) |
| Segment Profitability Ratio | |||||
| Segment profit margin1 | 118.73% | 17.34% | 50.54% | 46.56% | 32.41% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment profit margin = 100 × Segment income (loss) ÷ Revenues from contracts with customers
= 100 × 317 ÷ 267 = 118.73%
- Segment Income (Loss)
- The segment income demonstrates significant fluctuations over the analyzed period. Beginning at $374 million in 2017, it increased notably to $473 million in 2018. However, a substantial decline occurred in 2019, reducing income to $233 million, followed by a further steep drop to $30 million in 2020. The income recovered significantly in 2021, rising to $317 million, though it remains below the 2018 peak.
- Revenues from Contracts with Customers
- Revenues show a clear downward trend from 2017 through 2020. Starting at $1,154 million in 2017, revenues decreased to $1,016 million in 2018, followed by a more pronounced decline to $461 million in 2019 and further to $173 million in 2020. In 2021, a modest recovery is observed with revenues increasing to $267 million, but these figures remain well below the levels recorded in 2017 and 2018.
- Segment Profit Margin
- The segment profit margin reveals considerable variability and an overall rising trend, especially in the latter years. The margin increased from 32.41% in 2017 to 46.56% in 2018 and further to 50.54% in 2019. A decline occurred in 2020, when the margin dropped to 17.34%. Remarkably, in 2021, the segment experienced an exceptionally high profit margin of 118.73%, indicating a sharp improvement in profitability relative to revenues despite the lower revenue base.
- Summary
- Overall, the segment displays volatility in income and revenues with revenue generally declining until 2020 and partially recovering in 2021. Income follows a similar trajectory but recovers more strongly in 2021. The profit margin, despite some fluctuations, notably peaked in 2021 at an exceptionally high level, suggesting enhanced cost efficiencies or other factors improving profitability despite subdued revenue compared to earlier years.
Segment Return on Assets (Segment ROA)
Marathon Oil Corp., ROA by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 8.33% | -3.44% | 3.80% | 3.51% | -0.88% |
| International (Int’l) | 31.89% | 2.78% | 15.23% | 22.71% | 8.90% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- United States (U.S.) Segment ROA Trends
- The return on assets (ROA) for the United States segment demonstrates a fluctuating pattern over the five-year period. Initially, in 2017, the ROA was negative at -0.88%, indicating inefficiency or losses relative to assets. The following years of 2018 and 2019 saw improvements, with positive ROA values of 3.51% and 3.8%, respectively. However, this upward trend reversed in 2020, as the ROA dropped sharply to -3.44%, reflecting reduced profitability or asset utilization challenges during that year. Notably, the segment rebounded strongly in 2021, achieving the highest ROA of this period at 8.33%, signifying enhanced efficiency or profitability in asset use.
- International (Int’l) Segment ROA Trends
- The international segment consistently exhibited positive ROA values throughout the period, with a notable upward trend overall, albeit with some volatility. Starting at 8.9% in 2017, the ROA peaked significantly in 2018 at 22.71%, suggesting a highly efficient use of assets or strong profitability. In 2019, the ROA decreased to 15.23%, yet remained at a robust level. A pronounced decline is observed in 2020, where the ROA fell substantially to 2.78%, indicating a temporary downturn in asset performance or earnings. This decline was followed by a sharp recovery in 2021, with ROA reaching a new high of 31.89%, reflecting exceptional profitability or asset utilization during that year.
- Comparative Insights and Overall Observations
- Comparing the two segments, the international segment consistently outperformed the United States segment in terms of ROA across the examined years, typically by a significant margin. Both segments experienced a dip in 2020, likely related to broader economic or industry challenges impacting asset returns negatively. Despite the volatility, the international segment demonstrated greater resilience and stronger upward momentum, culminating in a notably high ROA in 2021. Meanwhile, the U.S. segment showed more volatility with two periods of negative returns, but evidenced strong recovery by the end of the period under review.
Segment ROA: United States (U.S.)
Marathon Oil Corp.; United States (U.S.); segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Segment income (loss) | 1,277) | (553) | 675) | 608) | (148) |
| Total assets | 15,339) | 16,063) | 17,781) | 17,321) | 16,863) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 8.33% | -3.44% | 3.80% | 3.51% | -0.88% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment ROA = 100 × Segment income (loss) ÷ Total assets
= 100 × 1,277 ÷ 15,339 = 8.33%
The segment income (loss) for the United States (U.S.) reportable segment demonstrates considerable volatility over the five-year period. Starting with a loss of $148 million in 2017, the segment reversed to positive income in 2018 and 2019, recording $608 million and $675 million respectively. However, this trend was interrupted in 2020 with a significant loss of $553 million, followed by a substantial recovery in 2021 with income rising sharply to $1,277 million.
Total assets associated with this segment depict a moderate decline over the reported years. Beginning at $16,863 million in 2017, assets experienced a gradual increase through 2019, peaking at $17,781 million. Thereafter, a downward trend was observed, with totals decreasing to $16,063 million in 2020 and further to $15,339 million in 2021.
The segment return on assets (ROA) aligns closely with the income performance and asset base changes. A negative ROA of -0.88% was recorded in 2017, improving significantly to 3.51% in 2018 and slightly increasing to 3.8% in 2019. The profitability sharply declined again in 2020, reflecting a -3.44% ROA, before rebounding to the highest rate of 8.33% in 2021.
Overall, the data reveal a pattern of cyclical profitability within the U.S. segment, characterized by strong income and high returns in 2018 and 2019, followed by a downturn in 2020 coinciding with reduced asset values. The notable recovery in 2021 emphasizes improved operational effectiveness and possibly market conditions contributing to enhanced earnings and asset utilization efficiency. The decline in total assets over the latter years may indicate strategic asset management or divestitures, impacting the capital base against which returns are measured.
Segment ROA: International (Int’l)
Marathon Oil Corp.; International (Int’l); segment ROA calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Segment income (loss) | 317) | 30) | 233) | 473) | 374) |
| Total assets | 994) | 1,081) | 1,530) | 2,083) | 4,201) |
| Segment Profitability Ratio | |||||
| Segment ROA1 | 31.89% | 2.78% | 15.23% | 22.71% | 8.90% |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment ROA = 100 × Segment income (loss) ÷ Total assets
= 100 × 317 ÷ 994 = 31.89%
The analysis of the International segment data over the five-year period reveals several noteworthy trends in financial performance and asset utilization.
- Segment Income (Loss)
- The segment income exhibited notable volatility. Beginning at $374 million in 2017, it increased to $473 million in 2018, indicating strong growth. However, there was a significant decline in 2019 down to $233 million, followed by a further drastic drop to $30 million in 2020, reflecting considerable earnings pressure or operational challenges. In 2021, the income rebounded substantially to $317 million, signaling partial recovery.
- Total Assets
- Total assets within the segment showed a consistent downward trajectory throughout the period. From $4,201 million in 2017, assets decreased sharply to $2,083 million in 2018 and continued declining steadily each year to $994 million by the end of 2021. This trend suggests divestitures, asset impairments, or strategic downsizing affecting the asset base.
- Segment Return on Assets (ROA)
- Return on assets fluctuated markedly, reflecting changes in profitability relative to asset size. The ROA rose steeply from 8.9% in 2017 to 22.71% in 2018, implying improved efficiency or profitability. It then declined to 15.23% in 2019 and sharply dropped to 2.78% in 2020, consistent with the decreased segment income and possibly underutilization of assets. In 2021, ROA surged to 31.89%, indicating efficient use of a smaller asset base with improved earnings.
Overall, the data depicts a segment undergoing significant restructuring or market challenges with declining assets, volatile earnings, and ultimately a marked recovery in profitability and asset efficiency by 2021.
Segment Asset Turnover
Marathon Oil Corp., asset turnover by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 0.35 | 0.18 | 0.26 | 0.28 | 0.18 |
| International (Int’l) | 0.27 | 0.16 | 0.30 | 0.49 | 0.27 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- United States (U.S.) Segment Asset Turnover
- The asset turnover ratio for the U.S. segment exhibits notable fluctuations over the five-year period. It began at a low level of 0.18 in 2017, experienced an increase to 0.28 in 2018, and then slightly declined to 0.26 in 2019. In 2020, the ratio decreased significantly back to 0.18, matching the initial value from 2017. However, in 2021, the U.S. segment saw a strong rebound with the ratio reaching 0.35, the highest value in the analyzed period. This pattern indicates volatility with a significant dip in 2020 followed by substantial recovery in 2021.
- International (Int’l) Segment Asset Turnover
- The international segment's asset turnover ratio demonstrates a pattern of initial growth followed by a decline and a partial recovery. Starting at 0.27 in 2017, the ratio increased markedly to 0.49 in 2018, representing a peak and indicating improved efficiency in asset utilization during that year. Subsequently, the ratio dropped sharply to 0.30 in 2019, and further decreased to its lowest point of 0.16 in 2020. A partial recovery is observed in 2021 with the ratio rising to 0.27, returning to the same level as 2017 but still well below the 2018 peak.
- Comparative Insights Between Segments
- Comparing the two segments reveals that the international segment achieved higher asset turnover than the U.S. segment only in 2018. In other years, the U.S. segment maintained either similar or higher ratios. Both segments showed declines in 2020, indicating potential operational challenges or reduced efficiency during that year. The U.S. segment illustrated a stronger recovery in 2021, surpassing previous years' ratios, while the international segment only returned to its 2017 levels.
- Overall Trends and Implications
- Both segments experienced volatility with peak performances in different years—2018 for international and 2021 for U.S. The sharp declines in 2020 for both segments may reflect external factors affecting asset utilization efficiency. The rebound in 2021 in both segments, especially the U.S., suggests efforts to improve asset deployment or a recovery in operational activities. These trends highlight the importance of monitoring segment-specific performance to understand the drivers behind asset turnover changes and to identify areas requiring strategic attention.
Segment Asset Turnover: United States (U.S.)
Marathon Oil Corp.; United States (U.S.); segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Revenues from contracts with customers | 5,334) | 2,924) | 4,602) | 4,886) | 3,093) |
| Total assets | 15,339) | 16,063) | 17,781) | 17,321) | 16,863) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.35 | 0.18 | 0.26 | 0.28 | 0.18 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment asset turnover = Revenues from contracts with customers ÷ Total assets
= 5,334 ÷ 15,339 = 0.35
- Revenues from contracts with customers
- The revenue experienced significant fluctuations over the five-year period. Starting at $3,093 million in 2017, there was a notable increase in 2018 reaching $4,886 million. This was followed by a decrease in 2019 to $4,602 million and a further decline in 2020 to $2,924 million, likely impacted by external factors in that year. In 2021, revenue rebounded strongly to $5,334 million, marking the highest value in the observed timeframe.
- Total assets
- Total assets showed a gradual decline over the period. The assets increased slightly from $16,863 million in 2017 to a peak of $17,781 million in 2019. However, after 2019, assets declined consecutively, falling to $16,063 million in 2020 and further to $15,339 million in 2021. This downward trend suggests a reduction in asset base or possible asset optimization efforts in the later years.
- Segment asset turnover
- The segment asset turnover ratio reflects the efficiency in using assets to generate revenue and showed variability across the years. The ratio was relatively low at 0.18 in 2017, increased significantly to 0.28 in 2018, then slightly declined to 0.26 in 2019. In 2020, the ratio dropped back to 0.18, paralleling the decrease in revenue. A strong recovery occurred in 2021, reaching 0.35, the highest ratio recorded in this period, indicating improved utilization of assets to generate revenue.
Segment Asset Turnover: International (Int’l)
Marathon Oil Corp.; International (Int’l); segment asset turnover calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Revenues from contracts with customers | 267) | 173) | 461) | 1,016) | 1,154) |
| Total assets | 994) | 1,081) | 1,530) | 2,083) | 4,201) |
| Segment Activity Ratio | |||||
| Segment asset turnover1 | 0.27 | 0.16 | 0.30 | 0.49 | 0.27 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment asset turnover = Revenues from contracts with customers ÷ Total assets
= 267 ÷ 994 = 0.27
- Revenues from contracts with customers
- The revenues demonstrated a significant declining trend from 2017 through 2020. Beginning at $1,154 million in 2017, revenues decreased steadily each year to reach a low of $173 million by the end of 2020. In 2021, there was a modest recovery to $267 million, though this level remained substantially below the figures reported in the earlier years.
- Total assets
- Total assets also showed a marked downward trajectory over the period under review. Assets were recorded at $4,201 million in 2017, then consistently declined year-over-year to $994 million in 2021. The most pronounced decrease occurred between 2017 and 2018, after which the decline continued at a slower yet steady pace towards 2021.
- Segment asset turnover
- The segment asset turnover ratio experienced considerable fluctuation. It started at 0.27 in 2017, almost doubling to 0.49 in 2018, reflecting improved efficiency in generating revenues from the asset base during that year. However, this efficiency sharply declined in subsequent years, falling to 0.30 in 2019 and reaching a low of 0.16 in 2020. In 2021, the ratio partially recovered to 0.27, matching the initial level observed in 2017.
- Summary of trends
- Overall, the data reveal a contraction in both revenues and total assets from 2017 to 2021, indicative of a downsizing or divestiture phase within the segment. The segment asset turnover ratio's volatility suggests a period of operational adjustment, with a notable peak in efficiency in 2018 followed by a decline and slight recovery by 2021. The partial rebound in revenues and asset turnover ratio in the final year may signify initial stages of stabilization or recovery efforts after significant declines earlier in the period.
Segment Capital Expenditures to Depreciation
Marathon Oil Corp., capital expenditures to depreciation by reportable segment
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 0.52 | 0.51 | 1.13 | 1.18 | 1.03 |
| International (Int’l) | 0.00 | 0.01 | 0.13 | 0.20 | 0.13 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the annual reportable segment capital expenditures to depreciation ratios reveals distinct trends across the United States and International segments over the reviewed period.
- United States Segment
- The U.S. segment exhibits ratios consistently above 1.0 during the initial three years from 2017 to 2019, with values of 1.03, 1.18, and 1.13 respectively. This indicates that capital expenditures slightly exceeded depreciation, suggesting ongoing investment to sustain or grow asset bases during this period.
- However, from 2020 onwards, a marked decline is observed, with the ratio dropping significantly to 0.51 in 2020 and remaining nearly flat at 0.52 in 2021. This indicates capital expenditures were approximately half the depreciation amount, reflecting a substantial reduction in investment relative to asset consumption. Such a decline may signal a strategic shift towards cost containment, asset optimization, or a response to external economic factors.
- International Segment
- The international segment shows generally low ratios compared to the U.S., starting at 0.13 in 2017, increasing modestly to 0.20 in 2018, then retreating again to 0.13 in 2019. This pattern indicates consistently lower capital investment relative to depreciation, pointing to limited reinvestment or potential divestment in international assets during these years.
- A pronounced decrease is evident in 2020, where the ratio falls sharply to 0.01, suggesting minimal capital expenditures against depreciation. The lack of data for 2021 precludes conclusions about subsequent trends, but the sharp decline in 2020 could reflect challenging market conditions internationally or strategic reallocation of resources.
Overall, the data reveal a contraction in capital expenditures relative to depreciation in both segments beginning in 2020, more pronounced internationally. This pattern could imply a conservative spending approach or response to market pressures. The significant divergence between the U.S. and International segments highlights differing investment focuses or operational strategies across regions during the period analyzed.
Segment Capital Expenditures to Depreciation: United States (U.S.)
Marathon Oil Corp.; United States (U.S.); segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Capital expenditures | 1,018) | 1,137) | 2,550) | 2,620) | 2,081) |
| Depreciation, depletion and amortization | 1,972) | 2,211) | 2,250) | 2,217) | 2,011) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.52 | 0.51 | 1.13 | 1.18 | 1.03 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation, depletion and amortization
= 1,018 ÷ 1,972 = 0.52
- Capital Expenditures
- The capital expenditures demonstrate a rising trend from 2017 to 2018, increasing from 2,081 million USD to 2,620 million USD. A slight decrease follows in 2019, with expenditures at 2,550 million USD. Subsequently, there is a significant decline in 2020 to 1,137 million USD, which continues into 2021, declining further to 1,018 million USD. This indicates a marked reduction in investment spending over the last two years in the data set.
- Depreciation, Depletion, and Amortization (DD&A)
- DD&A figures increase from 2,011 million USD in 2017 to a peak of 2,250 million USD in 2019. Following this peak, there is a gradual decline in DD&A amounts, decreasing to 2,211 million USD in 2020 and further to 1,972 million USD in 2021. This suggests a reduction in asset usage or amortization charges in the latter period.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation indicates the level of reinvestment relative to asset consumption. This ratio increases from 1.03 in 2017 to 1.18 in 2018, maintaining a similar level at 1.13 in 2019. However, there is a sharp decrease starting in 2020, with the ratio falling to 0.51 and remaining low at 0.52 in 2021. This decline signals that capital expenditures are significantly lower relative to depreciation, suggesting reduced reinvestment in maintaining or expanding asset base during the recent years.
Segment Capital Expenditures to Depreciation: International (Int’l)
Marathon Oil Corp.; International (Int’l); segment capital expenditures to depreciation calculation
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | |||||
| Capital expenditures | —) | 1) | 16) | 39) | 42) |
| Depreciation, depletion and amortization | 68) | 82) | 121) | 197) | 328) |
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | 0.00 | 0.01 | 0.13 | 0.20 | 0.13 |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 2021 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation, depletion and amortization
= 0 ÷ 68 = 0.00
- Capital expenditures
- The capital expenditures in the International segment show a clear, consistent decline over the reported periods. Starting at 42 million USD in 2017, there was a slight decrease to 39 million USD in 2018, followed by a more substantial reduction to 16 million USD in 2019. This decline continued sharply to just 1 million USD in 2020, and there is no data reported for 2021. The trend indicates a significant scaling back of investment in this segment over time, particularly from 2019 onward.
- Depreciation, depletion and amortization
- Depreciation, depletion, and amortization expenses declined markedly across the periods. Beginning at 328 million USD in 2017, the figure dropped substantially to 197 million USD in 2018, and continued to decrease in subsequent years, reaching 121 million USD in 2019, 82 million USD in 2020, and 68 million USD in 2021. This steady decline suggests a reduction in asset base or a shift in asset composition over time, consistent with lower capital expenditures and potentially accelerated asset retirement or impairments.
- Segment capital expenditures to depreciation ratio
- The ratio of segment capital expenditures to depreciation exhibits a fluctuating yet downward trend. In 2017, the ratio stood at 0.13, increased to 0.20 in 2018, indicating relatively higher reinvestment compared to asset consumption that year. However, it dropped back to 0.13 in 2019 and then sharply fell to 0.01 in 2020, reflecting a dramatic reduction in capital expenditure relative to depreciation. The absence of data for 2021 limits further analysis, but the overall trend implies declining capital reinvestment relative to asset depreciation, which may affect the segment's asset renewal and future capacity.
- Overall insights
- The data collectively indicates a pronounced contraction in investment activity within the International segment over the five-year span, accompanied by steadily declining depreciation expenses. The falling capital expenditure suggests a strategic shift possibly aimed at reducing operational scale or reallocating resources, while the decreasing depreciation expense may result from asset disposals, impairments, or aging of the asset base. The capital expenditure to depreciation ratio further underscores the deceleration in asset reinvestment. These trends portend potential impacts on future production capacity and operational sustainability in this segment.
Revenues from contracts with customers
Marathon Oil Corp., revenues from contracts with customers by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 5,334) | 2,924) | 4,602) | 4,886) | 3,093) |
| International (Int’l) | 267) | 173) | 461) | 1,016) | 1,154) |
| Total | 5,601) | 3,097) | 5,063) | 5,902) | 4,247) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- United States Segment Revenues
- The United States segment shows a generally upward trend in revenues over the five-year period. Revenues increased significantly from 3,093 million US dollars in 2017 to 4,886 million US dollars in 2018, marking a notable rise. However, there was a slight decline to 4,602 million US dollars in 2019. In 2020, revenues decreased more markedly to 2,924 million US dollars, which may reflect adverse market conditions or operational challenges during that year. By 2021, revenues rebounded strongly to 5,334 million US dollars, reaching the highest point within the period and exceeding previous highs.
- International Segment Revenues
- The International segment experienced a downward trend from 2017 to 2020, with revenues starting at 1,154 million US dollars in 2017 and decreasing consistently to 173 million US dollars in 2020. This represents a steep decline over these four years. In 2021, there was a modest recovery to 267 million US dollars, though this level remains well below the initial figures observed in 2017 and 2018.
- Total Revenues
- Total revenues reflect the combined trends of the domestic and international segments. The total revenues increased from 4,247 million US dollars in 2017 to peak at 5,902 million US dollars in 2018. Following this peak, there was a decline over the next two years, with total revenues falling to 3,097 million US dollars by 2020. The year 2021 saw a strong recovery in total revenues, reaching 5,601 million US dollars, closely approaching the 2018 peak. This pattern indicates volatility but an overall recovery in the later period.
- Summary Insights
- Overall, the data suggests that domestic operations largely drive revenue performance for the company, showing greater volumes and more significant variation that strongly influence total revenue fluctuations. The international segment has faced persistent challenges, with revenues diminishing substantially until a slight recovery in the last year observed. The years 2020 and 2021 present contrasting movements, likely reflecting external factors such as market disruptions, with a sharp decline in 2020 followed by a robust recovery in 2021.
Depreciation, depletion and amortization
Marathon Oil Corp., depreciation, depletion and amortization by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 1,972) | 2,211) | 2,250) | 2,217) | 2,011) |
| International (Int’l) | 68) | 82) | 121) | 197) | 328) |
| Not allocated to segments | 26) | 23) | 26) | 27) | 33) |
| Total | 2,066) | 2,316) | 2,397) | 2,441) | 2,372) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the depreciation, depletion, and amortization expenses over the five-year period reveals distinct trends across the United States, International, and unallocated segments.
- United States (U.S.) Segment
- The values in this segment exhibit an initial increase from 2017 to 2019, rising from 2011 million US dollars to 2250 million US dollars. Following this peak, there is a slight decline observed in 2020, with amounts decreasing to 2211 million US dollars, and a more notable drop in 2021 to 1972 million US dollars. Overall, the U.S. segment demonstrates a peak around 2019 with a gradual downward correction thereafter.
- International (Int’l) Segment
- The international segment shows a consistent and significant decline throughout the entire period. Starting at 328 million US dollars in 2017, the expenses decreased sharply year-over-year to 197 million in 2018, 121 million in 2019, 82 million in 2020, and finally reaching 68 million in 2021. This clearly indicates a substantial reduction in this segment's depreciation, depletion, and amortization charges over the five years.
- Not Allocated to Segments
- Expenses not attributed to specific segments remain relatively stable, with a slight decreasing trend from 33 million US dollars in 2017 to 23 million in 2020, before increasing marginally to 26 million in 2021. The fluctuations are minor and appear to be within a narrow range.
- Total
- The aggregate depreciation, depletion, and amortization expenses fluctuated modestly, climbing from 2372 million US dollars in 2017 to a peak of 2441 million in 2018. Thereafter, a gradual decline is evident, falling to 2397 million in 2019, 2316 million in 2020, and more sharply decreasing to 2066 million in 2021. The overall trend indicates a peak in the middle of the period with subsequent reductions, largely influenced by decreases in both the U.S. and international segments.
Segment income (loss)
Marathon Oil Corp., segment income (loss) by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 1,277) | (553) | 675) | 608) | (148) |
| International (Int’l) | 317) | 30) | 233) | 473) | 374) |
| Not allocated to segments | (648) | (928) | (428) | 15) | (1,056) |
| Total | 946) | (1,451) | 480) | 1,096) | (830) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- United States (U.S.) Segment Income (Loss)
- The U.S. segment experienced significant volatility over the five-year period. Starting with a substantial loss of $148 million in 2017, it turned to a profit of $608 million in 2018 and further increased to $675 million in 2019. However, in 2020, the segment reported a sharp loss of $553 million before recovering strongly in 2021 with a significant profit of $1,277 million. This indicates a highly variable performance likely influenced by external market conditions or operational factors.
- International (Int’l) Segment Income (Loss)
- The International segment showed positive earnings throughout the period, though with a declining trend from 2017 to 2020. Starting at $374 million in 2017, profits increased to $473 million in 2018 but then decreased to $233 million in 2019 and further dropped to $30 million in 2020. The segment showed signs of recovery in 2021, with income rising back to $317 million. Overall, the International segment maintained profitability but exhibited fluctuations and a notable dip in 2020.
- Not Allocated to Segments
- The amounts not allocated to any segment were predominantly negative throughout the period, with a large loss of $1,056 million in 2017. This was followed by a small positive amount of $15 million in 2018, then significant losses of $428 million in 2019, $928 million in 2020, and $648 million in 2021. The consistent negative impact in most years suggests significant costs or adjustments outside the main operating segments.
- Total Income (Loss)
- The total income reflected the combined impact of the segments and unallocated amounts, showing considerable volatility. The company reported an overall loss of $830 million in 2017, followed by a strong profit of $1,096 million in 2018 and a smaller profit of $480 million in 2019. In 2020, the total income shifted dramatically into a loss of $1,451 million. This was reversed in 2021 with a substantial profit of $946 million. These fluctuations highlight significant swings in overall company profitability, driven by the combination of segment performances and unallocated costs.
Total assets
Marathon Oil Corp., total assets by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 15,339) | 16,063) | 17,781) | 17,321) | 16,863) |
| International (Int’l) | 994) | 1,081) | 1,530) | 2,083) | 4,201) |
| Not allocated to segments | 661) | 812) | 934) | 1,917) | 948) |
| Total | 16,994) | 17,956) | 20,245) | 21,321) | 22,012) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The annual reportable segment total assets data present several notable trends between 2017 and 2021.
- United States (U.S.) Segment
- The total assets within the U.S. segment demonstrated a gradual increase from 16,863 million USD in 2017 to a peak of 17,781 million USD in 2019. However, after this peak, there was a marked decline to 16,063 million USD in 2020, followed by a further decrease to 15,339 million USD in 2021. This indicates an initial phase of growth succeeded by a consistent reduction over the last two years.
- International (Int’l) Segment
- The international segment experienced a continuous and significant decline in total assets over the five-year period. Starting at 4,201 million USD in 2017, the amount nearly halved by 2018 to 2,083 million USD and continued descending steadily each year, reaching 994 million USD in 2021. This decreasing trend reflects a substantial contraction in international assets.
- Not Allocated to Segments
- Assets not allocated to any specific segment showed volatility during the reported period. Beginning at 948 million USD in 2017, the value peaked sharply at 1,917 million USD in 2018 before declining to 934 million USD in 2019. Subsequently, there was a steady decrease through 2020 and 2021, ending at 661 million USD. This indicates fluctuations with an overall downward trend in unallocated assets after 2018.
- Total Assets
- The total assets combined across all segments showed a declining trend from 22,012 million USD in 2017 to 16,994 million USD in 2021. This decrease was gradual from 2017 through 2019 but accelerated after 2019, consistent with reductions observed in both the U.S. and international segments as well as in unallocated assets.
In summary, the data reveal a contraction in total assets over the five-year period, primarily driven by consistent asset reductions in the international segment and a downward trend in U.S. and unallocated assets following earlier peaks. This pattern suggests a strategic shift or response to external factors impacting asset allocation and holdings during these years.
Capital expenditures
Marathon Oil Corp., capital expenditures by reportable segment
US$ in millions
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | |
|---|---|---|---|---|---|
| United States (U.S.) | 1,018) | 1,137) | 2,550) | 2,620) | 2,081) |
| International (Int’l) | —) | 1) | 16) | 39) | 42) |
| Not allocated to segments | 14) | 13) | 25) | 26) | 27) |
| Total | 1,032) | 1,151) | 2,591) | 2,685) | 2,150) |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of annual reportable segment capital expenditures reveals several notable trends over the five-year period ending December 31, 2021.
- United States (U.S.) Segment
- Capital expenditures in the U.S. segment exhibited an overall declining trend following a peak in 2018. Starting at $2,081 million in 2017, expenditures rose to $2,620 million in 2018, indicating an increase in investment activity. However, subsequent years saw a reduction, with $2,550 million in 2019, a more pronounced decline to $1,137 million in 2020, and a further decrease to $1,018 million in 2021. This pattern suggests a strategic scaling back of capital spending in the U.S. segment, particularly evident in the sharp drop between 2019 and 2020.
- International (Int’l) Segment
- International capital expenditures were markedly lower compared to the U.S. segment throughout the period. Starting at $42 million in 2017, the spending slightly decreased to $39 million in 2018, followed by a steeper decline to $16 million in 2019. The reduction continued dramatically, reaching $1 million in 2020. There was no reported capital expenditure in 2021, indicating either a cessation or a negligible level of investment outside the U.S. segment by the final year.
- Not Allocated to Segments
- Capital expenditures not allocated to segments remained relatively stable but low throughout the analyzed period. The amounts hovered around $25-$27 million from 2017 to 2019, before dropping to $13 million in 2020 and slightly increasing to $14 million in 2021. This segment represents a minor portion of total capital spending.
- Total Capital Expenditures
- Total capital expenditures mirrored the trends observed in segment expenditures, with a peak of $2,685 million in 2018, followed by a gradual decrease to $2,591 million in 2019, then a significant contraction to $1,151 million in 2020, and further down to $1,032 million in 2021. The considerable reduction after 2019 aligns with the decreased investments primarily in the U.S. and International segments.
Overall, the data demonstrates a strategic reduction in capital expenditures beginning in 2019, which is particularly stark in the International segment, while the U.S. segment, despite remaining the dominant area of investment, has substantially scaled back spending in recent years.