Phillips 66 (PSX) Q1 Profit Doubles On Better Margins

Phillips 66 (NYSE:PSX) posted its first quarter earnings of $1.4 billion or $2.23 a share versus $636 million in the first quarter of 2012. The company’s earnings soared owing to improved margins at refining and chemicals divisions. The earnings beat the analyst estimates of $1.89 a share on revenue of $41.44 billion. Revenue was down 9 percent to $42.33 billion.

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“We achieved strong financial results in the first quarter by capturing favorable chemicals and refining margins,” said Greg Garland, chairman and chief executive officer.

The Midstream segment, which includes the company’s transportation business, reported earnings of $110 million, and adjusted earnings for the division came in at $83 million, compared with $108 million in the prior year. For the Chemicals segment earnings came in at $282 million, which were $65 million higher compared to a year ago quarter. Joint venture Chevron Phillips Chemical Company (CPChem) earned $64 million during the quarter compared to $52 million last year. Refining division’s adjusted earnings came in at $909 million, which were 455 million higher than a year ago. The adjusted earnings for Marketing and Specialties (M&S) segment came in at $202 million, up $147 million from the same quarter last year owing to improved margins.

The energy company’s worldwide refining utilization was 90 percent in the first quarter owing to turnaround activity in the Gulf Coast and Central Corridor regions.

The energy and logistics company generated 2.2 billion in cash from operations for the first quarter and had 7.0 billion of debt and $4.8 billion of cash and cash equivalent. The company’s debt-to-capital ratio stood at 25 percent. For the quarter, Phillips 66 (NYSE:PSX) reported capital expenditure of $387 million with investments primarily in Refining, Midstream and M&S.

During the quarter, the company returned $576 million to shareholders, which comes to 26 percent of its cash from operations. The energy company paid 194 million as dividends compared to $157 million paid in the fourth quarter. Phillips 66 (NYSE:PSX) repurchased 6.4 million shares for $382 million, during the quarter, compared to 5.0 million stocks totaling $245 million in the previous quarter. Till the end of the first quarter, the company has repurchased 14.0 million stocks of the total authorized $2 billion by the board.

In pre-market trading, shares were up 2.3 percent to $62.32. For the past twelve month, the company’s stock has gained 86 percent.