Phillips 66 · NYSE:PSX
Phillips 66 — Investor Presentation (February 2022)
61 slides from Phillips 66's investor presentation, Feb 7, 2022
Slide 1: Investor Update February 2022
Humber Refinery, NORTH LINOLNSHIRE, UK PROVIDING ENERGY. IMPROVING LIVES. Investor Update FEBRUARY 2022
Slide 2: Cautionary Statement
a Cautionary Statement “This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby.
Slide 3: Global manufacturing facilities and capacity at a glance
global manufacturing research and development facilities centers in the U.S. million BPD of crude branded branded throughput capacity U.S. outlets international outlets
Slide 4: Integrated, Diversified Portfolio
— Integrated, Diversified Portfolio GLOBAL ASSETS MAP LEGEND ©) Batteries @ Coke Facility @ cPchem (| cPChem Facility (0&P) © Crude Terminal in Progress @ — Crude Terminal/Pipeline DCP Gathering @ = Fractionator © Fractionator in Progress Hydrogen © Lubricants Facility — Natural Gas Pipeline @ — NGL
Slide 5: Executing the Strategy
a Executing the Strategy Enabling Long-Term Value Creation and Positioning for the Future Vision Strategy Providing Energy. Improving Lives. Operating Excellence Committed to sustainability, safety, environmental stewardship, reliability and cost efficiency Values Safety. Honor. Commitment. Growth ;
Slide 6: Operating Excellence
a Operating Excellence Total Recordable Rates Industry A e Industry Safety Metrics (Incidents per 200,000 hours worked) neustry Average (Incidents per 200,000 hours worked) Ee = = 12 = Food Agricul., All Construction Petchem. Prof. Petroleum Phillips 66 Manufact. Crop Manufact. Manufact. &Bus. Refin
Slide 7: Long-Term Capital Allocation Framework
Long-Term Capital Allocation Framework $6-7 B mid-cycle CFO Sustaining capital for asset integrity, safety and environmental projects Strong balance sheet and investment grade credit ratings Secure, competitive and growing dividend Near-term debt repayment priority Growth investments with attractive
Slide 8: ESG Summary
a ESG Summary Sustainability & ESG is at the heart of our vision to provide energy in ways that improve lives, and recent enhancements to our ESG strategy and disclosures demonstrate our commitment to deliver on this vision Environmental Social Governance sais Environmental impact reduced through ai
Slide 9: Greenhouse Gas Emissions Reduction Targets
Greenhouse Gas Emissions Reduction Targets Lower-Carbon Solutions Drive Progress Consistent with our Strategy and Disciplined Capital Allocation Approach Emissions Reduction Targets Intend to lower GHG emissions intensity by 2030 from 2019 baseline ie) 30% Manufacturing-related emissions (Scope 1 an
Slide 10: Emerging Energy
Emerging Energy Building a Robust Platform Developing lower-carbon business opportunities Targeting $2 billion of EBITDA contribution by 2030 Commercializing and implementing new technology Leveraging commercial acumen and leadership in research and innovation Continuing capital discipline and empha
Slide 11: Energy Research & Innovation
Energy Research & Innovation Research Advancing Solutions for a Lower-Carbon Future Fuel Cell Research at Phillfmbe Research Center BARTL 1) Number of patents as of December 31, 2021. Focus areas include solid oxide fuel cells, organic photovoltaic polymers, next-generation battery materials and ren
Slide 12: Midstream
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Midstream |
Slide 13: Midstream Portfolio
| Midstream Portfolio Transportation NGL and Other DCP Midstream 22,000+ miles of U.S. pipeline systems 500,000+ BPD fractionation capacity 35 natural gas processing facilities 39 product terminals 260,000 BPD LPG export capacity 5.4 BCFD net natural gas processing 20 crude oil terminals 150,000 BPD
Slide 14: Premier Midstream Business
| Premier Midstream Business Top-quartile safety performance Adjusted EBITDA oe PSXP ($B) = NOVONIX Diversified portfolio of assets integrated with 2.6 2.3 21 Refining and Marketing a 1S nH Crude system allows optionality for producers, | 1 Co 7 18 19 : refiners and exporters 7 7 Advantaged USGC sto
Slide 15: DCP Midstream
| DCP Midstream Logistics & Marketing and Gathering & Processing 1 ort! 1.6 BCFD gj Wood River Diversified portfolio in premier basins Ponca al city Large-scale U.S. NGL producer and gas processor Mid-Continent Permian 11 BCFD 1.1 BCFD Integrated NGL supply feeds Phillips 66 Sweeny Hub Optimizing co
Slide 16: Midstream Project Execution
Midstream Project Execution Sweeny Hub 150 MBD fourth fractionator will bring total Sweeny Hub fractionation capacity to 550 MBD by 4Q 2022 Secured y-grade feedstock supply agreements with firm volume commitments Fractionators fully integrated with 260 MBD Freeport LPG Export Terminal Provides ethan
Slide 17: Chemicals
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Chemicals |
Slide 18: Feedstock Advantaged Chemicals Portfolio
Feedstock Advantaged Chemicals Portfolio . } ay J > [wes e b Q-Chem | & Il SPCo & S-Chem / Cedar Bayou Orange el ra Port Arthur ™sweeny/Old Ocean High density polyethylene (HDPE), Normal alpha olefins (NAO). Metrics shown net of JV capacity and sourced from IHS, Nexant, and company filings. See appe
Slide 19: Macro Chemicals Outlook
Macro Chemicals Outlook Portfolio well-positioned in North America and Middle East Expanding global middle class is increasing demand forecast for polyethylene at a 4% CAGR Meeting strong demand for food packaging, medical supplies and other consumer products Source: IHS; Polyethylene demand based o
Slide 20: Chevron Phillips Chemical
a Chevron Phillips Chemical Industry-leading safety performance Adjusted EBITDA! ($B) Proprietary technology Advantaged feedstock portfolio Global marketing network Debottleneck opportunities — 7 18 19 20 21 Capital Expenditures and Investments! ®= Sustaining Olefins and Polyolefins Capacity Utiliza
Slide 21: 2020 CPChem Sustainability Report
2020 CPChem Sustainability Report Enhancing efforts to eliminate plastic pellet spills by joining Operation Clean Sweep Blue and investing in Circulate Capital Ocean Fund Continuing to combat plastic waste and Product communicate value of plastics Sustainability & Circularity Founding member of Alli
Slide 22: CPChem Circular Polyethylene
CPChem Circular Polyethylene Completed first commercial sales of circular polyethylene from difficult-to-recycle plastic waste CPChem successfully processed pyrolysis oil in a certified commercial-scale trial and is working to further expand production volumes, targeting annual production of 1 billi
Slide 23: CPChem Growth Projects
a CPChem Growth Projects U.S. Gulf Coast II World-scale ethylene and polyethylene facility on US Gulf Coast CPChem 51% equity interest Final investment decision expected in 2022 Ras Laffan Petchem Project World-scale ethylene and polyethylene facility in Qatar CPChem 30% equity interest Other Growth
Slide 24: Refining
Refining | a wu 2 a oso = e 6 n” = a. = = = — > = = a wi = wu cs = 2 => o c a
Slide 25: Enhancing Refining Returns
Enhancing Refining Returns Top-quartile HSE performance Capital and cost discipline Selectively investing for clean product yield and crude flexibility Investing in renewable diesel Diverse geographic footprint Adjusted EBITDA ($B) ma 7 18 19 20 2 Capital Expenditures and Investments m Sustaining ($
Slide 26: Refining crude feedstock slate and capacities
WESTERN CANADIAN EASTERN CANADIAN CRUDE West Coast .” 4 a 364 MBD : y wee Atlantic - s ete __ Basin / Europ B vooa River 537 MBD Crude Feedstock Slate (% Total Crude Runs) San Francisco \ Central Corridor. 531 MBD L Los Angeles = Other Foreign (non-Canadian) Canadian = Other Domestic (non-sweet) m=
Slide 27: Renewable Fuels
| Renewable Fuels Enhancing Our Business Model for a Sustainable Future Rodeo capacity to produce 8 MBD; full refinery conversion to produce 50+ MBD by 2024 Humber co-processing capacity to produce 3 MBD from used cooking oil; 5 MBD by 2024 Nevada 3 MBD supply and offtake agreements 1 billion gallon
Slide 28: Rodeo Renewed
| Rodeo Renewed Transformation to Large-Scale Renewable Transportation Fuels Production Facility Constructing pre-treatment units and repurposing existing hydro-processing units to process renewable feedstocks * Capital efficient project that leverages existing units Capable of processing most renew
Slide 29: Marketing & Specialties
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Marketing & Specialties
Slide 30: Enhancing M&S Returns
— Enhancing M&S Returns Consistent high-return, low-capital business Adjusted EBITDA ($B) Product placement for Refining Expand U.S. retail presence through JV’s La | a | a a 7 18 19 20 2) Distribution of renewable fuels Leverage brand strength Capital Expenditures and Investments ($B) Site reimagin
Slide 31: Secure Product Placement
| Secure Product Placement United States ~6,250 sites reimaged since program inception All eligible sites are mobile enabled Direct consumer engagement Extend participation in retail value chain Europe Proven low-cost, high-volume model Reimaging and high-grading the JET brand Adding new sites in Ge
Slide 32: Financial Strategy
PHILLIPS PROVIDING ENERGY. IMPROVING LIVES. Financial Strategy
Slide 33: 45% 40% 35% 30% 25% 20% 15% 10% 5% 0 0%
45 45% 40 40% 35 35% 30 30% 25 25% 20 20% 15 15% 10 10% 5 5% 0 0%
Slide 34: Consolidated Debt and Liquidity
Consolidated Debt and Liquidity Debt Maturity Profile as of December 31, 2021 ($B) =PSX Revolving Credit Facility =PSXP Revolving Credit Facility PSXP Term Loan mPSXP Senior Notes mPSX Senior Notes 2022 2024 2026 2028 2030 2032 $14.4 B Total Debt as of December 31, 2021 $8.8 B Total liquidity ($5.7
Slide 35: Adjusted EBITDA and Returns
Adjusted EBITDA and Returns Adjusted EBITDA ($B) Adjusted Earnings ($ per share) | . Ps 7 18 19 20 1.71 5.70 (0.89) as a1 v7 18 19 20 21 Adjusted ROCE (% After-Tax) Peer ROCE 2018-2021 Average (% After-Tax) Peer Avg 1% 7 18 19 20 See appendix for footnotes 9% 21 Peer Avg 35
Slide 36: Sustaining capital allocation priorities
Sustaining Midstream Refining & PSXP Marketing
Slide 37: Distributions
| Distributions Secure, competitive and growing dividend * 18% CAGR with ten increases!2 Committed to shareholder distributions * Repurchased / exchanged 34% of shares initially outstanding2 Returned over $29 B to shareholders through dividends, share repurchases and exchanges? 1) Dividend CAGR calc
Slide 38: Total Shareholder Return
Total Shareholder Return Operating Excellence ap Growth Returns Distributions (oy) High-Performing Organization — “@v-2 “ay-13 May-14 May-I5 May-16 May-17 May-18 May-19 May-20 Jan-22 e5 Share price as of January 31, 2022. See appendix for additional footnotes. Total Shareholder Return Since IPO (%)
Slide 39: Phillips to Acquire Phillips Partners
— Phillips 66 to Acquire Phillips 66 Partners PSX has entered into an agreement to acquire all of the limited partner interests in PSXP not already owned by PSX and its affiliates All-stock transaction at a fixed exchange ratio of 0.50 PSX shares for each PSXP common unit PSXP preferred units will c
Slide 40: Slide 40
Slide 41: 2022 Sensitivities
| 2022 Sensitivities Annual EBITDA $MM Midstream - DCP (net to Phillips 66) 10¢/Gal Increase in NGL price 17 Chemicals - CPChem (net to Phillips 66) 1¢/Lb Increase in Chain Margin (Ethylene, Polyethylene, NAO) 65 Worldwide Refining $1/BBL Increase in Gasoline Margin 320 $1/BBL Increase in Distillate
Slide 42: Value Chain
| Value Chain Liquids and Natural Gas NGL and Natural Gas aneli Fractionation Gathering and Pipelines and Storage Processing Wellhead Crude Pipelines, Product Pipelines, Marine, Shipping J} )) Refineries » Terminals and . and Rail Marine Crude Oil Used Oils, Animal Renewable Fats and Greases Raw Mat
Slide 43: Outlook
| Outlook 1Q 2022 Global Olefins & Polyolefins utilization Refining crude utilization Refining turnaround expenses (pre-tax) Corporate & Other costs (pre-tax) 2022 Refining turnaround expenses (pre-tax) Corporate & Other costs (pre-tax) Depreciation and amortization Effective income tax rate Mid-90%
Slide 44: Our Energy In Action
— Our Energy In Action
Slide 45: General
General Information disclosed is as of December 31, 2021, 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 21 is as of December 31, 2021, or the twelve-
Slide 46: Footnotes: industry averages and capital allocation
Slide 6 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 Association (GPA). Phill
Slide 47: Footnotes: emissions
Slide 9 1. Manufacturing-related emissions include Scope 1 and 2. Scope 1 includes all direct emissions by the company such as fuel combustion and fugitive emissions, calculated per the EPA’s Mandatory Greenhouse Gas Reporting Program (GHGRP). Scope 2 includes indirect emissions from imported electr
Slide 48: Footnotes: ROCE and shareholder return
Slide 35 Adjusted ROCE is defined as (Adjusted Net Income + after-tax interest expense + minority interest) / (Average total debt + average equity). Peer ROCE calculations are based on the simple average of 2018 – Sep YTD 2021 ROCE. Source: Company filings adjusted to facilitate comparisons of opera
Slide 49: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars Except as Indicated 2017 2018 2019 2020 2021 Reconciliation of Consolidated Earnings (Loss) to Adjusted Earnings (Loss) Consolidated Earnings (Loss) 5,106 5,595 3,076 (3,975) 1,317 Pre-tax adjustments: Pending claims and settlements (60) 21 (21) (37) — Pen
Slide 50: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 Reconciliation of Phillips 66 Net Income (Loss) to Adjusted EBITDA Phillips 66 net income (loss) 4,131 3,743 4,797 4,280 1,644 5,248 5,873 Less: Income from discontinued operations 48 61 706 — — — — Plus: Income tax expen
Slide 51: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2019 2020 2021 Reconciliation of Phillips 66 Net Income (Loss) to Adjusted EBITDA Phillips 66 net income (loss) 3,377 (3,714) 1,594 Less: Income from discontinued operations — — — Plus: Income tax expense (benefit) 801 (1,250) 146 Net interest expense 415
Slide 52: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2017 2018 2019 2020 2021 Reconciliation of Midstream Pre-Tax Income (Loss) to Adjusted EBITDA Midstream pre-tax income (loss) 638 1,181 684 (9) 1,610 Plus: Interest revenue (1) — — — — Depreciation and amortization 299 320 304 331 443 Midstream EBITDA 936
Slide 53: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2017 2018 2019 2020 2021 Reconciliation of Chemicals Pre-Tax Income to Adjusted EBITDA Chemicals pre-tax income 716 1,025 879 635 1,844 Plus: None — — — — — Chemicals EBITDA 716 1,025 879 635 1,844 Special Item Adjustments (pre-tax): Impairments by equity
Slide 54: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Reconciliation of Refining Pre-Tax Income (Loss) to Adjusted EBITDA Refining pre-tax income (loss) 5,089 2,782 2,467 3,659 436 2,076 4,535 1,986 (6,155) (2,549) Plus: Depreciation and amortization 655 685 7
Slide 55: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Reconciliation of Marketing & Specialties Pre-Tax Income to Adjusted EBITDA Marketing and Specialties pre-tax income 863 1,327 1,475 1,652 1,261 1,020 1,557 1,433 1,446 1,809 Plus: Interest revenue — — — (2
Slide 56: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Reconciliation of Corporate & Other Pre-Tax Loss to Adjusted EBITDA Corporate and Other pre-tax loss $ (673) (694) (680) (729) (747) (895) (853) (804) (881) (974) Plus: Net interest expense 231 258 246 285
Slide 57: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2017 2018 2019 2020 2021 Reconciliation of DCP Midstream Pre-Tax Income (Loss) to Adjusted EBITDA DCP Midstream pre-tax income (loss) 76 106 (784) (958) 185 Plus: None — — — — — DCP Midstream EBITDA 76 106 (784) (958) 185 Special Item Adjustments (pre-tax)
Slide 58: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2018 2019 2020 2021 Phillips 66 Capital Expenditures and Investments Midstream Growth 1,360 1,605 1,470 501 Sustaining 188 264 216 237 Total 1,548 1,869 1,686 738 Refining Growth 267 409 329 279 Sustaining 559 592 487 500 Total 826 1,001 816 779 Marketing
Slide 59: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars 2017 2018 2019 2020 2021 Proportional Share of Select Equity Affiliates Capital Expenditures and Investments* DCP Midstream (Midstream) 268 484 472 119 55 CPChem (Chemicals) Growth 571 131 155 104 191 Sustaining 205 208 227 180 176 Total 776 339 382 284 36
Slide 60: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars Except as Indicated 2017 2018 2019 2020 2021 Total Debt 10,110 11,160 11,763 15,893 14,448 Total Equity 27,428 27,153 27,169 21,523 21,637 Debt-to-Capital Ratio 27 % 29 % 30 % 42 % 40 % Total Cash 3,119 3,019 1,614 2,514 3,147 Net Debt-to-Capital Ratio 20
Slide 61: Non-GAAP Reconciliation
Non-GAAP Reconciliation Millions of Dollars (Except as Indicated) 2017 2018 2019 2020 2021 Phillips 66 ROCE Numerator Net income (loss) 5,248 5,873 3,377 (3,714) 1,594 After-tax interest expense 285 398 362 394 459 GAAP ROCE earnings (loss) 5,533 6,271 3,739 (3,320) 2,053 Special items (2,837) (51)