Summary
Marathon Petroleum Corporation (MPC) reported mixed financial results for the six months ended June 30, 2017, compared to the same period in 2016. While total revenues and other income saw a significant increase driven by higher sales volumes and prices, net income attributable to MPC declined. This decrease was primarily influenced by a substantial drop in income from the Refining & Marketing segment, impacted by the absence of a prior year inventory valuation benefit and less favorable crude oil acquisition costs and product price realizations. However, the Speedway and Midstream segments showed improved operational performance and contributed positively to the overall results. Strategically, MPC continued its focus on optimizing its midstream assets through "dropdowns" to MPLX, aiming to unlock value and return capital to shareholders. Significant investments were made in midstream infrastructure, including the acquisition of the Ozark pipeline and continued expansion in the Bakken Pipeline system. The company also initiated a substantial share repurchase program, reflecting confidence in its financial position and commitment to shareholder returns. The report highlights ongoing efforts to manage market risks through derivative instruments and maintain an investment-grade credit profile.
Financial Highlights
50 data points| Revenue | $18.18B |
| Cost of Revenue | $16.10B |
| Gross Profit | $2.08B |
| SG&A Expenses | $485.00M |
| Operating Expenses | $17.37B |
| Operating Income | $982.00M |
| Interest Expense | $173.00M |
| Net Income | $483.00M |
| EPS (Basic) | $0.94 |
| EPS (Diluted) | $0.93 |
| Shares Outstanding (Basic) | 513.00M |
| Shares Outstanding (Diluted) | 517.00M |
Key Highlights
- 1Net income attributable to MPC decreased by $289 million to $513 million for the first six months of 2017 compared to $802 million in 2016, largely due to a decline in the Refining & Marketing segment's profitability.
- 2Total revenues and other income increased by approximately $5.1 billion to $34.7 billion for the first six months of 2017, driven by higher sales prices and volumes across segments.
- 3The Refining & Marketing segment income from operations decreased significantly by $447 million in the first six months of 2017, mainly due to the absence of a $345 million inventory LCM benefit recorded in the prior year and less favorable crude oil acquisition costs.
- 4The Midstream segment showed strong growth, with income from operations increasing by $199 million for the first six months of 2017, driven by higher volumes and prices in natural gas and NGL processing, and contributions from newly acquired assets.
- 5Speedway segment income from operations increased by $14 million in the first six months of 2017, benefiting from higher light product gross margins, reduced operating expenses, and contributions from a new joint venture.
- 6MPC repurchased approximately $1.17 billion of its common stock during the first six months of 2017, supported by cash proceeds from asset dropdowns to MPLX, and announced an additional $3.0 billion share repurchase authorization.
- 7MPLX LP, in which MPC has a 27.2% interest, completed significant debt offerings and asset dropdowns, strengthening its midstream platform and contributing to MPC's strategic objectives.