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Jun 30, 2023
Phillips 66 Q2 2023 Earnings Report
Reported strong financial results, executed strategic priorities, and completed the acquisition of DCP Midstream, LP public common units.
Key Takeaways
Phillips 66 reported second-quarter earnings of $1.7 billion, or $3.72 per share, and adjusted earnings of $1.8 billion, or $3.87 per share. The company generated $1.0 billion of operating cash flow ($2.0 billion excluding working capital) and returned $1.8 billion to shareholders through dividends and share repurchases. They also completed the $3.8 billion acquisition of DCP Midstream, LP public common units.
Reported second-quarter earnings of $1.7 billion or $3.72 per share; adjusted earnings of $1.8 billion or $3.87 per share
Generated $1.0 billion of operating cash flow, $2.0 billion excluding working capital
Returned $1.8 billion to shareholders through dividends and share repurchases
Completed $3.8 billion acquisition of DCP Midstream, LP public common units
Phillips 66
Phillips 66
Forward Guidance
Phillips 66’s business transformation is on track to deliver $1 billion in run-rate savings by the end of 2023. In Midstream, Phillips 66 now expects to capture over $400 million of commercial and operating synergies across its wellhead-to-market value chain by 2025. The Rodeo Renewed refinery conversion project is expected to begin commercial operations in the first quarter of 2024.
Positive Outlook
- Business transformation is on track to deliver $1 billion in run-rate savings by the end of 2023
- Implemented $750 million of run-rate savings initiatives as of June 30, including $200 million of sustaining capital efficiencies
- Expected to generate an incremental $1 billion of annual adjusted EBITDA from the DCP Midstream, LP acquisition
- Expects to capture over $400 million of commercial and operating synergies across its wellhead-to-market value chain by 2025 in Midstream
- Rodeo Renewed refinery conversion project is expected to begin commercial operations in the first quarter of 2024
Challenges Ahead
- Effects of any widespread public health crisis and its negative impact on commercial activity and demand for refined petroleum products
- Inability to timely obtain or maintain permits necessary for capital projects
- Changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs including the renewable fuel standards program, low carbon fuel standards and tax credits for biofuels
- Fluctuations in NGL, crude oil, and natural gas prices, and petrochemical and refining margins
- Ability to achieve the expected benefits of the integration of DCP Midstream, LP (DCP) and our increased economic ownership of DCP