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Phillips 66 (PSX) Beats Earnings & Revenue Estimates in Q4
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Phillips 66 (PSX - Free Report) has reported fourth-quarter 2023 adjusted earnings of $3.09 per share, which beat the Zacks Consensus Estimate of $2.37. However, the bottom line was lower than the year-ago quarter’s $4.
Total quarterly revenues of $38.74 billion beat the Zacks Consensus Estimate of $34.3 billion. However, the top line declined from the year-ago quarter’s $40.91 billion.
Better-than-expected quarterly results can be primarily attributed to decreased costs and expenses. The positives were partially offset by lower refining margins worldwide.
The segment generated adjusted pre-tax quarterly earnings of $754 million, up from $674 million in the year-ago quarter. The reported figure also surpassed our estimate of $410 million.
Chemicals:
The unit recorded adjusted pre-tax earnings of $106 million, up from $52 million in the prior-year quarter. The reported figure also surpassed our estimate of $88.8 million.
Refining:
The segment reported adjusted pre-tax earnings of $797 million, down from $1,626 million in the year-ago quarter. The reported figure also missed our projection of $977.4 million. The segment was affected by lower realized margins. The negatives were partially offset by the effects of inventory hedging, increased profits from clean products on the Gulf Coast and strong commercial results.
Refining’s realized refining margins worldwide declined to $14.41 per barrel from the year-ago quarter’s $19.73. The same in the Central Corridor and Atlantic Basin/Europe declined to $23.45 and $9.95 per barrel from the year-ago quarter’s $25.03 and $19.58, respectively.
The West Coast’s margins declined to $9.89 per barrel from $16.77 in the year-ago quarter. In the Gulf Coast, the metric declined to $13.96 per barrel from $16.35 a year ago.
Marketing and Specialties
Pre-tax earnings declined to $432 million from $539 million in the year-ago quarter.
Realized marketing fuel margins in the United States declined to $1.62 per barrel from the year-ago quarter’s $2.05. The same in the international markets also declined to $5 from $9.94 a year ago.
Costs and Expenses
Total costs and expenses in the fourth quarter declined to $37 billion from $38.36 billion in the year-ago period. The reported figure is above our projection of $31.84 billion.
Financial Condition
For the reported quarter, Phillips 66 generated $2.19 billion of net cash from operations, significantly down from $4.75 billion a year ago. The company’s capital expenditure and investments totaled $634 million. It paid out dividends of $457 million in the fourth quarter.
As of Dec 31, 2023, cash and cash equivalents were $3.3 billion. Total debt was $19.4 billion, reflecting a net debt to capitalization of 34%.
Zacks Rank & Stocks to Consider
Phillips 66 currently carries a Zacks Rank #3 (Hold).
Vaalco Energy (EGY - Free Report) is an independent energy company principally engaged in the acquisition, exploration, development, and production of crude oil and natural gas.
The Zacks Consensus Estimate for EGY’s 2024 EPS is pegged at $1.49. It has witnessed upward earnings estimate revisions for 2024 in the past 60 days. The company’s earnings for 2024 are expected to surge 325.7% year over year.
Subsea 7 S.A. (SUBCY - Free Report) helps build underwater oil and gas fields. It is a top player in the Oil and Gas Equipment and Services market, which is expected to grow as oil and gas production moves further offshore.
The Zacks Consensus Estimate for SUBCY’s 2024 EPS is pegged at 89 cents. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days. The company’s earnings for 2024 are expected to soar 242.3% year over year.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. It has a Zacks Style Score of A for Growth and B for Value. OII’s earnings for 2024 are expected to surge 76.4% year over year.
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Phillips 66 (PSX) Beats Earnings & Revenue Estimates in Q4
Phillips 66 (PSX - Free Report) has reported fourth-quarter 2023 adjusted earnings of $3.09 per share, which beat the Zacks Consensus Estimate of $2.37. However, the bottom line was lower than the year-ago quarter’s $4.
Total quarterly revenues of $38.74 billion beat the Zacks Consensus Estimate of $34.3 billion. However, the top line declined from the year-ago quarter’s $40.91 billion.
Better-than-expected quarterly results can be primarily attributed to decreased costs and expenses. The positives were partially offset by lower refining margins worldwide.
Phillips 66 Price, Consensus and EPS Surprise
Phillips 66 price-consensus-eps-surprise-chart | Phillips 66 Quote
Segmental Results
Midstream:
The segment generated adjusted pre-tax quarterly earnings of $754 million, up from $674 million in the year-ago quarter. The reported figure also surpassed our estimate of $410 million.
Chemicals:
The unit recorded adjusted pre-tax earnings of $106 million, up from $52 million in the prior-year quarter. The reported figure also surpassed our estimate of $88.8 million.
Refining:
The segment reported adjusted pre-tax earnings of $797 million, down from $1,626 million in the year-ago quarter. The reported figure also missed our projection of $977.4 million. The segment was affected by lower realized margins. The negatives were partially offset by the effects of inventory hedging, increased profits from clean products on the Gulf Coast and strong commercial results.
Refining’s realized refining margins worldwide declined to $14.41 per barrel from the year-ago quarter’s $19.73. The same in the Central Corridor and Atlantic Basin/Europe declined to $23.45 and $9.95 per barrel from the year-ago quarter’s $25.03 and $19.58, respectively.
The West Coast’s margins declined to $9.89 per barrel from $16.77 in the year-ago quarter. In the Gulf Coast, the metric declined to $13.96 per barrel from $16.35 a year ago.
Marketing and Specialties
Pre-tax earnings declined to $432 million from $539 million in the year-ago quarter.
Realized marketing fuel margins in the United States declined to $1.62 per barrel from the year-ago quarter’s $2.05. The same in the international markets also declined to $5 from $9.94 a year ago.
Costs and Expenses
Total costs and expenses in the fourth quarter declined to $37 billion from $38.36 billion in the year-ago period. The reported figure is above our projection of $31.84 billion.
Financial Condition
For the reported quarter, Phillips 66 generated $2.19 billion of net cash from operations, significantly down from $4.75 billion a year ago. The company’s capital expenditure and investments totaled $634 million. It paid out dividends of $457 million in the fourth quarter.
As of Dec 31, 2023, cash and cash equivalents were $3.3 billion. Total debt was $19.4 billion, reflecting a net debt to capitalization of 34%.
Zacks Rank & Stocks to Consider
Phillips 66 currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked companies mentioned below. The three companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Vaalco Energy (EGY - Free Report) is an independent energy company principally engaged in the acquisition, exploration, development, and production of crude oil and natural gas.
The Zacks Consensus Estimate for EGY’s 2024 EPS is pegged at $1.49. It has witnessed upward earnings estimate revisions for 2024 in the past 60 days. The company’s earnings for 2024 are expected to surge 325.7% year over year.
Subsea 7 S.A. (SUBCY - Free Report) helps build underwater oil and gas fields. It is a top player in the Oil and Gas Equipment and Services market, which is expected to grow as oil and gas production moves further offshore.
The Zacks Consensus Estimate for SUBCY’s 2024 EPS is pegged at 89 cents. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days. The company’s earnings for 2024 are expected to soar 242.3% year over year.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. It has a Zacks Style Score of A for Growth and B for Value. OII’s earnings for 2024 are expected to surge 76.4% year over year.