Phillips 66 (PSX, Financial), a diversified energy company, announced its third-quarter results and updates to the strategic priorities on October 27, 2023. The company reported third-quarter earnings of $2.1 billion or $4.69 per share, and adjusted earnings of $2.1 billion or $4.63 per share. The company generated $2.7 billion of operating cash flow, $2.4 billion excluding working capital.
Financial Performance and Achievements
Phillips 66 (PSX, Financial) returned $1.2 billion to shareholders through dividends and share repurchases. The company also continued strong Refining operations with a crude utilization rate of 95%, the highest since 2019. The company's strategic priorities update includes raising the shareholder distributions target to a range of $13 billion to $15 billion, supported by a $5 billion increase in share repurchase authorization.
Income Statement Highlights
For the third quarter 2023, Phillips 66 (PSX, Financial) reported earnings of $2.1 billion compared with earnings of $1.7 billion in the second quarter. Excluding special items of $27 million, the company had adjusted earnings of $2.1 billion in the third quarter, compared with second-quarter adjusted earnings of $1.8 billion.
Balance Sheet and Cash Flow Statement Highlights
Phillips 66 (PSX, Financial) generated $2.7 billion in cash from operations in the third quarter of 2023. Excluding working capital impacts, operating cash flow was $2.4 billion. During the third quarter, Phillips 66 funded $855 million of capital expenditures and investments, $752 million of share repurchases, and $465 million in dividends. The company ended the quarter with 440 million shares outstanding. As of September 30, 2023, the company had $3.5 billion of cash and cash equivalents and $6.3 billion of committed capacity available under credit facilities.
Company's Performance Analysis
Phillips 66 (PSX, Financial) has shown a strong performance in Q3 2023, with significant improvement in earnings and cash generation. The company's focus on strong operating performance and execution on strategic priorities, coupled with favorable market conditions, has enabled it to achieve these results. The company is on track to exceed its original strategic priority targets and is successfully executing operational enhancements in Refining and delivering business transformation cost reductions.
Other Pertinent Details
Phillips 66 (PSX, Financial) plans to monetize over $3 billion of non-core assets and return at least 50% of operating cash flow to shareholders. The company's business transformation is expected to deliver over $1 billion in run-rate cost and capital reductions by the end of 2023. The company is now targeting a $1.4 billion run-rate by the end of 2024.
Explore the complete 8-K earnings release (here) from Phillips 66 for further details.
