Phillips 66 (NYSE: PSX), an energy manufacturing and logistics company, announces second-quarter earnings of $958 million, compared with earnings of $1.2 billion in the second quarter of 2012. Adjusted earnings were $935 million, compared with $1.4 billion in the same period last year.
“We continued to generate strong cash flows, despite less than favorable market conditions,” said Greg Garland, chairman and CEO of Phillips 66. “This enabled us to return more than $700 million of capital to our shareholders and strengthen our balance sheet, as planned. Reinforcing our commitment to creating shareholder value, our board of directors has authorized another $1.0 billion of share repurchases, in addition to the previously authorized $2.0 billion program.”
“Earnings declined from the previous quarter mostly as a result of the significant reduction in advantaged crude discounts and unplanned downtime in Chemicals and Refining. The company’s strategy remains unchanged. We will continue to enhance refining returns through increasing use of advantaged crudes while growing our higher-valued businesses,” said Garland.
The Midstream segment generated earnings of $90 million in the second quarter of 2013, compared with adjusted earnings of $95 million in the same period last year. In the second quarter of 2012, the segment reported a loss of $75 million.
During the quarter, Phillips 66’s Transportation business generated earnings of $50 million. Excluding special items in the second quarter of 2012, Transportation earnings were $26 million higher than adjusted earnings in the previous year’s quarter. This increase was mostly due to improved throughput fees and higher volumes.
Second-quarter earnings related to the company’s equity investment in DCP Midstream were $30 million, $12 million lower than in the second quarter of 2012. This decrease was primarily attributable to impacts of asset dropdowns to DCP Midstream Partners, partially offset by improved prices and lower operating costs. Compared with the second quarter of 2012, increased natural gas prices more than offset the impact of lower natural gas liquids (NGL) prices.