Phillips 66 · NYSE:PSX
Phillips 66 — Q1 2013 Earnings Presentation
38 slides from Phillips 66's earnings presentation, May 1, 2013
Slide 1: First Quarter 2013 Conference Call
First Quarter 2013 Conference Call May 1, 2013
Slide 2: Cautionary Statement
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. Wo
Slide 3: Executing Strategy
Executing Strategy Photo: Gulf Coast Fractionator in Mont Belvieu, Texas. 3
Slide 4: First-Quarter Overview
First-Quarter Overview $1.4 B adjusted earnings $2.19 adjusted EPS $1.8 B operating cash flow excluding working capital changes $194 MM in dividends paid $382 MM of common shares repurchased Return on Capital Employed 22% 20% 14% 7% 2010 2011 2012 2013 YTD Annualized Photo: Sand Hills Pipe
Slide 5: Company Adjusted Earnings
Company Adjusted Earnings 1Q 2013 vs. 1Q 2012 $MM 147 455 (25) 65 (25) 1,381 764 1Q 2012 Midstream Chemicals Refining Marketing Corporate 1Q 2013 Adjusted & Specialties & Other Adjusted Earnings Earnings 83 282 909 202 (95) 1Q 2013 Adjusted Earnings 5
Slide 6: Company Cash Flow
Company Cash Flow 1Q 2013 $B 0.4 1.8 (0.4) 0.1 (0.6) 4.8 3.5 December 31 CFO Working Capital Dividends Other March 31 Cash (excluding Capital Expenditures & Share Cash Balance* working & Investments Repurchases Balance* capital) * Includes cash and cash equivalents 6
Slide 7: Capital Structure
Capital Structure Equity ($B) Debt ($B) Debt-to-Capital 20.6 20.8 21.4 19.0 30% 28% 25% 25% 8.0 8.0 7.0 7.0 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2012 2012 2012 2013 2012 2012 2012 2013 2012 2012 2012 2013 9% Net-Debt-to-Capital* * Net-Debt-to-Capital reduces debt and capital by cash and cash equivale
Slide 8: Midstream Overview
Midstream Overview 1Q 2013 DCP Midstream NGL Operations Transportation Return on Capital Employed 17% 12% 12% 11% 2010 2011 2012 2013 YTD Annualized Photo: DCP Midstream plant in Platteville, Colo. 8
Slide 9: Midstream Adjusted Earnings
Midstream Adjusted Earnings 1Q 2013 vs. 1Q 2012 $MM 16 108 (31) (10) 83 1Q 2012 DCP NGL Transportation 1Q 2013 Adjusted Midstream Operations Adjusted Earnings Earnings 9
Slide 10: Chemicals Overview
Chemicals Overview 1Q 2013 Olefins and Polyolefins • Strong margins • 91% capacity utilization Specialties, Aromatics and Styrenics • Improved benzene margins • Increased turnaround activity Return on Capital Employed 31% 31% 28% 21% 2010 2011 2012 2013 YTD Annualized Photo: CPChem’s Cedar Bayou
Slide 11: Chemicals Adjusted Earnings
Chemicals Adjusted Earnings 1Q 2013 vs. 1Q 2012 $MM 12 54 (1) 282 217 1Q 2012 Olefins & Specialties, Corporate 1Q 2013 Adjusted Polyolefins Aromatics & & Other Adjusted Earnings Styrenics Earnings 11
Slide 12: Refining Overview
Refining Overview 1Q 2013 $13.94/BBL realized refining margin 90% refining crude utilization 84% clean product yield 68% advantaged U.S. crude slate Return on Capital Employed 27% 25% 13% 4% 2010 2011 2012 2013 YTD Annualized Photo: Lake Charles Refinery in Westlake, La. 12
Slide 13: Refining Adjusted Earnings
Refining Adjusted Earnings 1Q 2013 vs. 1Q 2012 $MM 65 61 181 89 59 909 454 1Q 2012 Atlantic Gulf Central Western / Other 1Q 2013 Adjusted Basin / Coast Corridor Pacific Refining Adjusted Earnings Europe Earnings 13
Slide 14: Refining Crack Spreads – Market vs. Realized
Refining Crack Spreads – Market vs. Realized 1Q 2013 $/BBL Worldwide Refining 5.08 0.16 (1.67) 15.50 13.94 (5.13) Market Configuration Secondary Feedstock Other Realized 3:2:1 Products Crack Avg Market Crude: $108.81/BBL 90% Crude Capacity Utilization 90% Market Capture 14
Slide 15: Refining Operations
Refining Operations U.S. Crude Slate Worldwide Clean Product Yield Advantaged 52% 62% 68% 83.6% 83.8% 84.0% Total 1.9% 2.1% 2.1% Other 32% 38% Brent Based 48% 39.4% 39.7% 40.2% Distillate 7% 14% Shale* 2% 27% 23% Other Heavy 27% 10% 12% 42.0% 41.5% 42.5% Gasoline Canadian Heavy 7% WTI Based 16% 18%
Slide 16: Marketing and Specialties Overview
Marketing and Specialties Overview 1Q 2013 Marketing and Other • 3 cpg worldwide marketing margin Specialties • Flow improver sales volumes increased 16% Return on Capital Employed 22% 17% 17% 12% 2010 2011 2012 2013 YTD Annualized Photo: Lubricants plant in Los Angeles, Calif. 16
Slide 17: Marketing and Specialties Adjusted Earnings
Marketing and Specialties Adjusted Earnings 1Q 2013 vs. 1Q 2012 $MM 153 (6) 202 55 1Q 2012 Marketing Specialties 1Q 2013 Adjusted & Other Adjusted Earnings Earnings 17
Slide 18: 2013 Outlook
2013 Outlook Photo: East St. Louis Terminal in St. Louis, Ill. 18 18
Slide 19: First Quarter 2013 Conference Call – Questions and Answers
First Quarter 2013 Conference Call Questions and Answers 19
Slide 20: Appendix
Appendix 20
Slide 21: 2013 Sensitivities
2013 Sensitivities Net Income Midstream $MM 1¢/Gal Increase in NGL price 4 10¢/MMBtu Increase in Natural Gas price 2 $1/BBL Increase in WTI price 2 Chemicals 1¢/Lb Increase in Olefins Chain Margin (Ethylene, Polyethylene, NAO) 35 Worldwide Refining (assuming 95% refining utilization) $1/BBL Increase
Slide 22: Corporate and Other Adjusted Costs
Corporate and Other Adjusted Costs 1Q 2013 $MM (43) (95) (34) (12) (6) Net Interest Corporate Technology Other Corporate Expense Overhead 22
Slide 23: Refining Crack Spreads – Atlantic Basin / Europe
Refining Crack Spreads – Market vs. Realized 1Q 2013 $/BBL Atlantic Basin / Europe Brent: $112.55/BBL 97% Crude Capacity Utilization 68% Market Capture (0.87) (2.24) 0.92 12.72 (1.92) 8.61 Market Configuration Secondary Feedstock Other Realized 3:2:1 Products Crack Market 3:2:1 – Dated Brent / Gasol
Slide 24: Refining Crack Spreads – Gulf Coast
Refining Crack Spreads – Market vs. Realized 1Q 2013 $/BBL Gulf Coast LLS: $113.92/BBL 80% Crude Capacity Utilization 114% Market Capture 2.27 (0.14) 4.61 8.54 7.49 (5.69) Market Configuration Secondary Feedstock Other Realized 3:2:1 Products Crack Market 3:2:1 – LLS / Gasoline 85 CBOB / Diesel 61 8
Slide 25: Refining Crack Spreads – Central Corridor
Refining Crack Spreads – Market vs. Realized 1Q 2013 $/BBL Central Corridor WTI: $94.29/BBL 96% Crude Capacity Utilization 98% Market Capture 13.98 (5.41) (2.96) (6.25) 27.93 27.29 Market Configuration Secondary Feedstock Other Realized 3:2:1 Products Crack Market 3:2:1 – WTI / Gasoline Unl 87 Group
Slide 26: Refining Crack Spreads – Western / Pacific
Refining Crack Spreads – Market vs. Realized 1Q 2013 $/BBL Western / Pacific ANS: $111.02/BBL 91% Crude Capacity Utilization 50% Market Capture (2.99) 5.20 19.12 (3.98) (7.71) 9.64 Market Configuration Secondary Feedstock Other Realized 3:2:1 Products Crack Market 3:2:1 – ANS Spot / Los Angeles CARB
Slide 27: Company Adjusted Earnings 1Q 2013 vs. 4Q 2012
Company Adjusted Earnings 1Q 2013 vs. 4Q 2012 $MM 75 36 (3) 12 (51) 1,381 1,312 4Q 2012 Midstream Chemicals Refining Marketing Corporate 1Q 2013 Adjusted & Specialties & Other Adjusted Earnings Earnings 83 282 909 202 (95) 1Q 2013 Adjusted Earnings 27
Slide 28: Midstream Adjusted Earnings 1Q 2013 vs. 4Q 2012
Midstream Adjusted Earnings 1Q 2013 vs. 4Q 2012 $MM 31 (9) (10) 83 71 4Q 2012 DCP NGL Transportation 1Q 2013 Adjusted Midstream Operations Adjusted Earnings Earnings 28
Slide 29: Chemicals Adjusted Earnings 1Q 2013 vs. 4Q 2012
Chemicals Adjusted Earnings 1Q 2013 vs. 4Q 2012 $MM 24 20 (8) 282 246 4Q 2012 Olefins & Specialties, Corporate 1Q 2013 Adjusted Polyolefins Aromatics & & Other Adjusted Earnings Styrenics Earnings 29
Slide 30: Refining Adjusted Earnings 1Q 2013 vs. 4Q 2012
Refining Adjusted Earnings 1Q 2013 vs. 4Q 2012 $MM 82 (59) 75 (18) (131) 960 909 4Q 2012 Atlantic Gulf Central Western / Other 1Q 2013 Adjusted Basin / Coast Corridor Pacific Refining Adjusted Earnings Europe Earnings 30
Slide 31: Marketing and Specialties Adjusted Earnings 1Q 2013 vs. 4Q 2012
Marketing and Specialties Adjusted Earnings 1Q 2013 vs. 4Q 2012 $MM 70 5 202 127 4Q 2012 Marketing Specialties 1Q 2013 Adjusted & Other Adjusted Earnings Earnings 31
Slide 32: Non-GAAP Reconciliations
Non-GAAP Reconciliations Millions of Dollars Millions of Dollars Except as Indicated Except as Indicated 2013 2012 2012 2011 2010 1Q 1Q 4Q Year Year Year Phillips 66 Earnings (loss) $ 1,407 $ 636 $ 708 $ 4,124 $ 4,775 $ 735 Adjustments: Net (gain) loss on asset sales - - - (106) (1,545) (116) Gain o
Slide 33: Non-GAAP Reconciliations
Non-GAAP Reconciliations Millions of Dollars Millions of Dollars Except as Indicated Except as Indicated 2013 2012 2012 2011 2010 1Q 1Q 4Q Year Year Year Midstream Earnings (loss) $ 110 $ 108 $ 92 $ 53 $ 2,149 $ 386 Adjustments: Net (gain) loss on asset sales - - - - (1,618) - Impairments - - - 330
Slide 34: Non-GAAP Reconciliations
Non-GAAP Reconciliations Millions of Dollars Millions of Dollars Except as Indicated Except as Indicated 2013 2012 2012 2011 2010 1Q 1Q 4Q Year Year Year Refining Earnings (loss) $ 922 $ 393 $ 363 $ 3,217 $ 1,529 $ (545) Adjustments: Net (gain) loss on asset sales - - - (104) 96 - Impairments - 42 5
Slide 35: Non-GAAP Reconciliations
Non-GAAP Reconciliations 2010 2011 2012 2013 YTD Phillips 66 - ROCE Numerator ($MM) Net Income 740 4,780 4,131 1,410 After-tax interest expense 1 11 160 46 GAAP ROCE earnings 741 4,791 4,291 1,456 Special Items 1,024 (1,184) 1,263 (26) Adjusted ROCE earnings 1,765 3,607 5,554 1,430 Denominator ($MM)
Slide 36: Non-GAAP Reconciliations
Non-GAAP Reconciliations 2010 2011 2012 2013 YTD Midstream - ROCE Numerator ($MM) Net Income 391 2,154 60 113 After-tax interest expense 0 0 0 0 GAAP ROCE earnings 391 2,154 60 113 Special Items 0 (1,614) 309 (27) Adjusted ROCE earnings 391 540 369 86 Denominator ($MM) GAAP average capital employed*
Slide 37: Non-GAAP Reconciliations
Non-GAAP Reconciliations 2010 2011 2012 2013 YTD Refining - ROCE Numerator ($MM) Net Income (545) 1,529 3,217 922 After-tax interest expense 0 0 0 0 GAAP ROCE earnings (545) 1,529 3,217 922 Special Items 1,167 453 627 (13) Adjusted ROCE earnings 622 1,982 3,844 909 Denominator ($MM) GAAP average cap
Slide 38: Non-GAAP Reconciliations
Non-GAAP Reconciliations Millions of Dollars 2013 1Q Cash Flows from Operating Activities Net Cash Provided by Operating Activities, excluding working capital $ 1,808 Working capital adjustments Decrease (increase) in accounts and notes receivable 285 Decrease (increase) in inventories (2,442) Decre