Phillips 66 (PSX) Q2 Earnings Miss Estimates, Improve Y/Y - Analyst Blog

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Phillips 66 ( PSX ) posted adjusted second-quarter 2014 earnings of $1.51 per share, lagging the Zacks Consensus Estimate of $1.69 by 11%. However, the figure compared favorably with $1.47 per share earned a year ago, owing to higher profits in the midstream and chemicals businesses.


Phillips 66 - Earnings Surprise | FindTheBest




Segment Results

Midstream

The segment generated adjusted quarterly earnings of $108 million against $90 million in the comparable quarter last year. The increase was backed by improved margins, which resulted from higher throughput fees.

Chemicals

The segment generated adjusted earnings of $324 million compared with $181 million in the comparable quarter last year. The increase was led by higher realized Olefins and Polyolefins chain margins, partially offset by higher maintenance costs.

Refining

The segment generated adjusted earnings of $390 million compared with $455 million in the year-ago quarter. The dismal results were owing to lower realized refining margins. During the quarter, the company's refining utilization was 96% and clean product yield was 83%.

Marketing and Specialties (M&S)

Segmental earnings were $162 million, down from $344 million in the comparable quarter last year.

Financial Condition

In the reported quarter, Phillips 66 generated $830 million of cash from operations. It also returned $897 million of capital to shareholders. Out of this, $281 million was disbursed as dividends while $616 million was used to repurchase 7.5 million shares of common stock.

As of Jun 30, 2014, cash and cash equivalents were $5 billion while debt was $6.2 billion. The company's debt-to-capitalization ratio was 22% and return on capital employed was 18%.

Zacks Rank

Phillips 66 has a Zacks Rank #3 (Hold). Investors interested in oil refiners business segment could consider stocks like Helmerich & Payne, Inc. ( HP ), Cameron International Corporation ( CAM ) and CNOOC Ltd ( CEO ). All these stocks sport a Zacks Rank #1 (Strong Buy).


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: PSX , CEO , HP

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