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Phillips 66 (PSX) Beats Q2 Earnings, Revenue Estimates - Analyst Blog

Zacks Equity Research

Phillips 66 PSX posted adjusted second-quarter 2015 earnings of $1.83 per share beating the Zacks Consensus Estimate of $1.81. The bottom line was also ahead of the year-ago quarter level of $1.51. Robust performance by the company’s Refining and Marketing segments supported the results.

Quarterly revenues of $29.1 billion were significantly lower than the year-ago quarter level of $46.3 billion. Lower contribution from its Midstream and Chemicals segment hampered the revenues. The top line, however, surpassed the Zacks Consensus Estimate of $25.3 billion.

Segment Results

Midstream

The segment generated adjusted quarterly earnings of $48 million compared with $108 million in the year-ago quarter. Lower contribution from the NGL business hampered income.

Chemicals

The segment generated adjusted earnings of $295 million as against $324 million in the comparable quarter last year. Higher planned maintenance costs and lower margins led to the decrease.

Refining

The segment generated adjusted earnings of $604 million compared with earnings of $390 million in the prior-year quarter. Higher realized refining margins led to the improvement. However, it was partially offset by lower volumes. During the quarter, Phillips 66’s refining utilization was 90% and clean product yield was at 84%.

Marketing and Specialties (M&S)

This segment recorded earnings of $182 million, up from $162 million reported in the comparable quarter last year.

Financial Condition

In the reported quarter, Phillips 66 generated $1.4 billion of cash from operations. It also returned capital worth $636 million to shareholders. Of this, $302 million was disbursed as dividends, while $334 million was used to repurchase 4.2 million shares of common stock.

As of Jun 30, 2015, cash and cash equivalents were $5.1 billion alongside $9.0 billion of debt. The company’s debt-to-capitalization ratio was 28% and return on capital employed (ROCE) was 14%.

Zacks Rank

Phillips 66 currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the same space are Linn Energy, LLC LINE, Holly Energy PartnersL.P. HEP and Cheniere Energy, Inc. LNG. Each of these stocks sports a Zacks Rank #1 (Strong Buy).

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PHILLIPS 66 (PSX): Free Stock Analysis Report
 
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