Phillips 66 (NYSE:PSX) reported better than expected earnings for the fourth quarter though it dipped YOY driven by margin expansion in gasoline on weak crude oil price. The company’s earnings were also hurt by its midstream, as well as, chemical businesses. Its top line plummeted 38.1% and fell shy of the analysts’ expectations.
Drop In Profit
Phillips 66 (NYSE:PSX) reported that its profit plunged 58.5% to $650 million from $1.58 billion in the third quarter of the calendar year 2015. Excluding special items of $60 million, its earnings would have been $710 million or $1.31 a share. Street analysts were expecting the company to report earnings of $1.25 a share. Its refining achieved 94% utilization while recording 85% clean product yield in the fourth quarter.
The oil and gas firm’s sales and other income dropped 38.1% to $22.03 billion from $35.61 billion in the previous year quarter. This was lower than the Street analysts’ expectations of $22.75 billion. Its CEO, Greg Garland said that the company achieved a key milestone when Sweeny Fractionator One and Clemens Caverns came online. He said that perfect execution helped to generate cash from operations of $1.5 billion in the fourth quarter. As a result, it was able to return $700 million by way of dividends, as well as, share buyback to its shareholders.
Phillips 66 (NYSE:PSX) CEO said that its results demonstrated resilience of its wide portfolio during the tough time of weak commodity prices. He said that the company was creating value through operational efficiencies, delivering midstream, as well as, chemicals growth programs and improving its refining margins. The company would continue to focus on its core priorities in the current year also through a disciplined approach to the allocation of capital as the balance sheet was strong.
Phillips 66 (NYSE:PSX) boosted its quarterly dividend to 56 cents a share representing 12% growth. The company’s refining generated earnings of $2.6 billion while chemicals delivered earnings of $962 million for the year 2015. The company returned $2.7 billion to its shareholders in 2015 through share repurchase program and dividend payments.