Imperial Oil Ltd., the country's largest largest integrated oil firm, posted weaker second-quarter earnings compared with a year earlier, pointing to lower natural gas prices, reduced production of crude oil and sluggish market conditions.

But the results came in stronger than its first-quarter results, which saw profit plunge nearly 70 per cent.

Toronto-based Imperial said it made $306-million or 81 cents a share during the three-month period ended June 30, down from its record $467-million or $1.18 a share during the second quarter of 2001.

Imperial is 70-per-cent owned by U.S. energy giant Exxon Mobile Corp. of Irving, Tex., the world's largest oil producer.

Revenue for the quarter neared $4.2-billion, compared with $4.8-billion during the same period last year.

"I'm encouraged by these latest results, which represent a substantial improvement over the first quarter," Tim Hearn, the company's chairman, president and CEO, said in a statement.

"The company's financial strength enables us to continue pursuing our broad range of attractive growth opportunities."

During its first quarter, Imperial said weak prices and shrinking margins caused profit to tumble by 69 per cent. Imperial had a profit of $106-million or 28 cents a share in the first quarter, down from $340-million or 85 cents a year ago. Revenue for the quarter was $3.5-billion, compared with $4.7-billion a year earlier.

Cash flow — an indicator of an energy firm's ability to fund future development — fell to $575-million in the second quarter from almost $1.9-billion at the end of 2001's second quarter.

Shares of Imperial, meanwhile, climbed 27 cents in afternoon trade on the Toronto Stock Exchange to $40.50, retreating from an intraday top of $41.10. They remain at the bottom end of their 52-week range of $39.50 to $49.38.