10-QPeriod: Q1 FY2013

Phillips 66 Quarterly Report for Q1 Ended Mar 31, 2013

Filed May 2, 2013For Securities:PSX

Summary

Phillips 66 reported a strong first quarter in 2013, with net income attributable to Phillips 66 nearly tripling year-over-year to $1.41 billion, or $2.23 per diluted share. This significant improvement was primarily driven by robust performance in the Refining and Marketing & Specialties segments, fueled by higher refining margins and improved marketing profitability. The company also saw a notable increase in equity earnings from its affiliates, particularly WRB Refining LP and Chevron Phillips Chemical Company LLC (CPChem), contributing to the overall positive financial results. Operationally, Phillips 66 generated substantial cash flow from operating activities, amounting to $2.21 billion, a significant turnaround from the prior year's first quarter which experienced a cash outflow. This strong cash generation allowed the company to fund its capital expenditures, repurchase shares, and initiate dividend payments, demonstrating a commitment to returning value to shareholders. The company maintains a healthy balance sheet with a debt-to-capital ratio of 25%, indicating a solid financial foundation for future growth and operations.

Financial Highlights

42 data points
Beta

Revenue

$41.21B

Net Income

$1.41B

3.4% Net Margin

EPS (Diluted)

$2.23

Total Assets

$51.15B

Cash & Equivalents

$4.75B

Free Cash Flow

$2.19B

Financial Statements
Beta
Revenue$41.21B
SG&A Expenses$327.00M
Operating Income$1.39B
Net Income$1.41B
EPS (Basic)$2.25
EPS (Diluted)$2.23
Shares Outstanding (Basic)625.03M
Shares Outstanding (Diluted)631.29M

Key Highlights

  • 1Net income attributable to Phillips 66 surged to $1.41 billion in Q1 2013, a 121% increase compared to $636 million in Q1 2012.
  • 2Diluted Earnings Per Share (EPS) rose significantly to $2.23 in Q1 2013 from $1.00 in Q1 2012.
  • 3Operating cash flow improved dramatically, generating $2.21 billion in Q1 2013 compared to a use of $361 million in Q1 2012.
  • 4The Refining segment was a major contributor to profitability, with net income increasing substantially year-over-year.
  • 5Phillips 66 initiated dividend payments in Q1 2013, declaring $0.3125 per common share.
  • 6The company repurchased $382 million of its common stock in Q1 2013 as part of its share repurchase program.
  • 7Total assets increased to $51.15 billion at March 31, 2013, from $48.07 billion at December 31, 2012, reflecting growth and strategic positioning.

Frequently Asked Questions

The primary drivers were improved results from the Refining and Marketing & Specialties segments, largely due to higher refining margins and improved marketing profitability. Additionally, stronger equity earnings from affiliates like WRB Refining LP and CPChem contributed significantly to the overall increase.

Phillips 66 experienced a dramatic improvement in cash flow from operating activities. In the first quarter of 2013, the company generated $2.21 billion in operating cash flow, a substantial increase from the $361 million cash used in operations during the same period in 2012. This strong performance allowed the company to fund investments, share repurchases, and dividends.

Yes, Phillips 66 returned capital to shareholders through two main avenues: initiating dividend payments with a quarterly cash dividend of $0.3125 per common share, and repurchasing approximately $382 million of its common stock during the quarter as part of its ongoing share repurchase program.

Phillips 66 maintained a total debt of $7.0 billion as of March 31, 2013. The debt-to-capital ratio was 25%, which is within the company's target range of 20-30%, indicating a stable leverage position.