Phillips 66 · NYSE:PSX
Phillips 66 — Investor Presentation (August 2023)
51 slides from Phillips 66's investor presentation, Aug 22, 2023
Slide 1: Investor Update August 2023
PROVIDING ENERGY. IMPROVING LIVES. Investor Update AUGUST 2023 es ol ma Ce. pp Ce Sor Bre
Slide 2: Cautionary Statement
a Cautionary Statement This presentation contains forward-looking statements within the meaning of the federal securities laws. Words such as “anticipated,” “estimated,” “expected,” “planned,” “scheduled,” “targeted,” “believe,” “continue,” “intend,” “will,” “would,” “objective,” “goal,” “project,”
Slide 3: Integrated Network of Businesses and Assets
— Integrated Network of Businesses and Assets (ra Midstream thousand miles of 71 U.S. pipeline systems Provides crude oil and refined product transportation, terminaling and processing services, as well as natural gas and NGL transportation, storage, fractionation, gathering and processing and marke
Slide 4: Diversified, Integrated Portfolio
a Diversified, Integrated Portfolio Ferndale al ran, San Francisco ww" © conn eee) Los Angeles Pecan Ge ena M\ sane \\cismene caverns \ out Creek Sweonya. Se GLOBAL ASSETS MAP LEGEND @ Batteries" @ Coke Facility @ cechem All cPChem Facility (08) @ /— Crude Terminal/Pipeline @ Fractionator & Gas Plan
Slide 5: Executing the Strategy
a Executing the Strategy Enabling Long-Term Value Creation and Positioning for the Future Mission Strategy Providing Energy. Improving Lives. Operating Excellence Committed to safety, environmental stewardship, sustainability, reliability and cost efficiency, while protecting shareholder value Value
Slide 6: Operating Excellence
a Operating Excellence Total Recordable Rates Industry Safety Metrics . Industry Average . (Incidents per 200,000 hours worked) y ge @ (Incidents per 200,000 hours worked) Phillips 66" cPChem Bo = one — Food Agricul., All Construction Petchem. Prof. Petroleum Phillips 66! Manufact. Crop Manufact. Ma
Slide 7: Strategic Priorities
Strategic Priorities Deliver Shareholder Returns Second Quarter Highlights $5.4 B shareholder distributions since July 2022 On track to meet $10 B - $12 B by YE 2024 Improve Refining Performance Above industry-average crude utilization Lower operating costs in 2Q 2023 Completed acquisition of DCP pu
Slide 8: Sustainably Transform Our Cost Structure
Sustainably Transform Our Cost Structure Cost Savings $800 $800 $550 $400, $260. | On track to realize $800 MM $120 — — | a 1Q 2023 2@ 2023 YE 2023 2024 sams Freight and Other Costs’ = Adjusted Operating mmm Turnaround Expense’ ——=Run-Rate & SG&A Expenses* 5 Historical and projected savings presente
Slide 9: Adjusted EBITDA Growth
a Adjusted EBITDA Growth 2022 - 2025 Mid-Cycle Adjusted EBITDA Mid-cycle adjusted EBITDA growth of over $3 B ($8) by 2025 _ $13 Capture value from Wellhead-to-Market through $10 | DCP EBITDA uplift and synergies Business Transformation cost savings Mid-Cycle Midstream Cost Savings Rodeo Chemicals Mi
Slide 10: Value Creation Supports Distributions
a Value Creation Supports Distributions Strong balance sheet and investment grade = Sustaining Capital credit ratings Adjusted CFO Capital Allocation = Dividends ($B) Discretionary Sustaining capital for asset integrity, safety $10 and environmental projects Secure, competitive and growing dividend
Slide 11: Midstream
Midstream
Slide 12: Enhanced Midstream Business
| Enhanced Midstream Business Top-quartile safety performance Adjusted EBITDA' @ Transportation ($B) = NGL & Other DCP assets increase NGL operational size and 27 scale, expect over $400 MM in synergies 2.2 19 24 s Full NGL value chain bo i bs ; 19 20 a 22 1H23° Assets backed by long-term, fee-based
Slide 13: Integrated Value Chain
Integrated Value Chain Ferndale al Farndale coma © Nox Seg ee eee NEN sacramento > Q'san Francisco Richmond (7 @ Lune 409) * Los angetes ao Los Angeles Spokane Terminal root Falls ro Ape oO ‘uit coast Expreat Bayway Tonia 009 Boyway Ral fermion MIDSTREAM LEGEND e ‘—— Crude Terminal/Pipeline ®@ Fract
Slide 14: Midstream NGL Assets
a Midstream NGL Assets Volume and margin portfolio supported by long-term agreements with diverse, high-quality producers in key regions Permian th Bilings @ heyenne Connector Mont Belviow | Freeport |) Clemens caverns Sweeny 1.2,5,4 Delaware, Midland & Other DJ & Other Basins Eagle Ford, East Texas
Slide 15: NGL Value Chain
a NGL Value Chain @-@-@®-®@ Gas Gathering & Pipelines Fractionation NGL Processing Markets ~48,000 miles ~6,000 miles’ 719 MBD capacity 260 MBD export capacity 5.5 BCFD capacity ~900 MBD long-haul to Sweeny 2" largest U.S. market capacity? Hub Domestic markets 36 plants Long-term fee-based Long-term
Slide 16: Midstream Guidance
| Midstream Guidance Financial Guidance Commodity Mid-Cycle Estimated Adjusted sen EBITDA’ Annual Run Rate ~$3,300 MM Estimated Synergies? Included in ~$200 MM ~80% Adjusted EBITDA Fee based 2023 Sustaining Capital Budget $329 MM 2023 Growth Capital Budget $310 MM Fee based Mid-Cycle Commodity Price
Slide 17: CPChem Ethylene Unit, Cedar Bayou, TX
(CPChem Ethylene Unit CEDAR BAYOU, TX.
Slide 18: Chevron Phillips Chemical
— Chevron Phillips Chemical Industry-leading safety performance Proprietary technology Advantaged feedstock portfolio Global marketing network Debottleneck opportunities Capital Expenditures and Investments! = Sustaining ($B) = Growth Adjusted EBITDA! ($B) 19 20 21 22 Olefins and Polyolefins Capacit
Slide 19: Chemicals Fundamentals
| Chemicals Fundamentals CPChem portfolio well-positioned for 2019-2022 Ethylene Production Cost Curve access to advantaged feedstock with (Cents per pound) heavy footprint in North America and «o SE Asia Middle East N.A. Naphtha Expanding global middle class is 30 N.E. Asia increasing demand foreca
Slide 20: Demand Growth Drives World-Scale Projects
a Demand Growth Drives World-Scale Projects Golden Triangle Polymer Project * World-scale ethylene and polyethylene facilities on US Gulf Coast expected to start up in 2026 CPChem 51% equity interest toile scones) Demand aes LDPE * 4.6 B pounds per year ethane cracker; two high-density polyethylene
Slide 21: Refining
Slide 22: Improve Refining Performance
Improve Refining Performance Maintain operating excellence Increase asset availability Enhance market capture Reduce operating costs by $0.75/bbl Manage the portfolio Low-capital, high-return projects Adjusted EBITDA ($B) 0.1 19 20 21 22 1H23 Capital Expenditures and Investments m Sustaining ($B) mR
Slide 23: Enhance Market Capture
Enhance Market Capture Western Canadian Eastern Canadian Crude +5% market capture +$400 MM realized margin improvement in mid-cycle conditions West Coast > wl hs 319 MB 6 Atlantic AA San Francisco all ny Basin / Europ "* ood River 537 MBD x », "Central Corridor 4 » Hiipguta city 531 MBD Los Angeles
Slide 24: Rodeo Renewed
Rodeo Renewed One of the World’s Largest Renewable Fuels facilities expected to begin commercial operations in 1Q 2024 ) Constructing pre-treatment units and repurposing existing hydro-processing units to process renewable feedstocks * Capital efficient project that leverages existing units. Capital
Slide 25: Marketing & Specialties
Marketing & Specialties
Slide 26: Optimizing M&S Returns
a Optimizing M&S Returns Consistent high-return, low-capital business adjusted EBITDA ($B) Product placement for Refining Expanded U.S. retail presence through JV’s js | oe pos a | | 19 20 21 22 Distribution of renewable fuels m Capital Expenditures and Investments Leverage brand strength $8) 0.4 In
Slide 27: Financial Strategy
Financial Strategy
Slide 28: Financial Strength and Flexibility
Financial Strength and Flexibility Peer-leading investment grade credit rating Disciplined capital allocation Secure, competitive and growing dividend Intrinsic value approach to share repurchases Well-laddered debt maturities Target net debt-to-capital ratio of 25-30% mas Equity $B Consolidated PSX
Slide 29: Consolidated Debt and Liquidity
Consolidated Debt and Liquidity $19.9 B Total Debt as of June 30, 2023 $8.6 B in available liquidity * $3.0 Bcash ° $5.6 B capacity on credit facilities Peer leading A3/BBB+ Credit Rating Total debt includes capital leases, commercial paper and is net of unamortized discounts and debt issuance costs
Slide 30: Sustaining Refining & Marketing
• Sustaining • Midstream Refining & PSXP Marketing
Slide 31: Distributions
| Distributions Progressing toward our target of $10 B to $12B in the 10-quarter period ending 2024 ¢ $5.4 B returned to shareholders through 4 quarters Secure, competitive and growing dividend * 17% CAGR with twelve increases? ° Increased quarterly dividend by 8% in 1Q Committed to shareholder dist
Slide 32: Sustainable Business Practices
Sustainable Business Practices Environmental Targets to lower GHG emissions intensity from 2019 baseline 50% scope 1 and 2 by 2030 15% scope 3 by 2030 50% scope 1 and 2 by 2050 Social 680,000 hours volunteered since 2012 $280 MM invested in our communities since 2012 42% of our U.S. hires were from
Slide 33: Appendix
Appendix
Slide 34: 2023 Sensitivities
| 2023 Sensitivities Annual EBITDA $MM © 10¢/Gal Increase in NGL price 100 10¢/MMBtu Increase in Natural Gas price 6 $1/BBL Increase in WTI price 5 Chemicals - CPChem (net to Phillips 66) 1¢/Lb Increase in Chain Margin (Ethylene, Polyethylene, NAO) 65 Worldwide Refining $1/BBL Increase in Gasoline M
Slide 35: Economic Interests in DCP Midstream
| Economic Interests in DCP Midstream On August 17, 2022, Phillips 66 previously realigned economic and : de Jove tinance interests and assumed tidsitom, Economic InterestsinDCP oversight and management of DCP. Before Post | post | Transactions Realignment i Public Buy-In H 8/17/2022 i 6/15/2023 H O
Slide 36: Our Energy In Action
— Our Energy In Action 36
Slide 37: Footnotes
| Footnotes General Information disclosed is as of June 30, 2023, unless noted otherwise. Numbers may not appear to tie due to rounding. Chevron Phillips Chemical may be abbreviated as CPChem. Marketing and Specialties may be abbreviated as M&S. Date Conventions 22 is as of December 31, 2022, or the
Slide 38: Footnotes
| Footnotes Operating Excellence Industry averages are from: Phillips 66 - American Fuel & Petrochemical Manufacturers (AFPM) refining data, Chevron Phillips Chemical LLC (CPChem) - American Fuel & Petrochemical Manufacturers (AFPM) chemicals data, DCP Midstream, LLC (DCP Midstream) - Gas Processors
Slide 39: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Phillips 66 Net Income (Loss) to Adjusted EBITDA Phillips 66 net income (loss) $ 3,377 (3,714) 1,594 11,391 3,811 Plus: Income tax expense (benefit) 801 (1,250) 146 3,248 1,084 Net interest expense 415 485 583 537
Slide 40: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Phillips 66 Net Income (Loss) to Adjusted EBITDA (cont'd) Phillips 66 EBITDA, Adjusted for Special Items and Change in Fair Value of NOVONIX Investment 1,4 6,771 1,105 5,159 14,493 6,284 Other Adjustments (pre-tax
Slide 41: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Midstream Pre-Tax Income (Loss) to Adjusted EBITDA Midstream pre-tax income (loss) $ 597 (116) 1,500 4,734 1,306 Plus: Depreciation and amortization 291 313 425 568 458 Midstream EBITDA1 888 197 1,925 5,302 1,764
Slide 42: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Midstream - Transportation Pre-Tax Income to Adjusted EBITDA Midstream pre-tax income $ 947 508 678 1,176 590 Plus: Depreciation and amortization 152 159 234 174 80 Midstream EBITDA1 1,099 667 912 1,350 670 Specia
Slide 43: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Midstream - NGL & Other Pre-Tax Income (Loss) to Adjusted EBITDA Midstream pre-tax income (loss) $ (350) (624) 452 4,000 743 Plus: Depreciation and amortization 140 154 191 394 378 Midstream EBITDA1 (210) (470) 64
Slide 44: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Chemicals Pre-Tax Income to Adjusted EBITDA Chemicals pre-tax income $ 879 635 1,844 856 390 Plus: None — — — — — Chemicals EBITDA 879 635 1,844 856 390 Special Item Adjustments (pre-tax): Impairments by equity af
Slide 45: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Refining Pre-Tax Income (Loss) to Adjusted EBITDA Refining pre-tax income (loss) $ 2,132 (6,022) (2,353) 7,816 2,742 Plus: Depreciation and amortization 867 896 984 866 407 Refining EBITDA1 2,999 (5,126) (1,369) 8
Slide 46: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Marketing & Specialties Pre-Tax Income to Adjusted EBITDA Marketing and Specialties pre-tax income $ 1,374 1,421 1,723 2,402 1,070 Plus: Depreciation and amortization 103 103 113 110 57 Marketing & Specialties EBI
Slide 47: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 2022 1H23 Reconciliation of Corporate & Other Pre-Tax Loss to Adjusted EBITDA Corporate and Other pre-tax loss $ (804) (881) (974) (1,169) (613) Plus: Net interest expense 415 485 583 537 306 Depreciation and amortization 80 82 83 85 49 Corp
Slide 48: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2023 2019 2020 2021 2022 Budget Proportional Share of Select Equity Affiliates Capital Expenditures and Investments* CPChem (Chemicals) Growth 155 104 191 499 702 Sustaining 227 180 176 202 223 Total 382 284 367 701 925 WRB (Refining) 175 175 229 177 216 S
Slide 49: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2023 2019 2020 2021 2022 Budget Phillips 66 Capital Expenditures and Investments Midstream1,2 Growth 1,549 1,471 501 744 310 Sustaining 251 204 232 299 329 Total 1,800 1,675 733 1,043 639 Refining2 Growth 464 328 280 477 729 Sustaining 606 499 504 451 389
Slide 50: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars (Except as Indicated) 2019 2020 2021 2022 1H23 Total Debt 11,763 15,893 14,448 17,190 19,866 Total Equity 27,169 21,523 21,637 34,106 31,060 Debt-to-Capital Ratio 30 % 42 % 40 % 34 % 39 % Total Cash 1,614 2,514 3,147 6,133 3,029 Net Debt-to-Capital Ratio 2
Slide 51: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars Except as Indicated 2019 2020 2021 2022 1H23 Phillips 66 ROCE Numerator Net income (loss) 3,377 (3,714) 1,594 11,391 3,811 After-tax interest expense 362 394 459 489 362 GAAP ROCE earnings (loss) 3,739 (3,320) 2,053 11,880 4,173 After-tax special items 581