As reported by the Wall Street Journal…
Phillips 66 posted better-than-expected earnings and revenue in its fourth quarter as the refinery company benefits from the flood of cheap crude oil that has sent oil prices tumbling.
As oil prices have plummeted since last summer, U.S. refiners have been sucking up as much of the abnormally inexpensive crude as they can, turning it into gasoline, diesel and other fuels. Phillips 66â€™s U.S. refinery margins have been buoyed by the cheap oil from places like North Dakota and Texas.
In the latest quarter, Phillips, which was spun off from ConocoPhillips in 2012, said it processed a record 375,000 barrels of tight oil a day in the quarter. About 95% of the companyâ€™s U.S. crude slate was advantaged in the quarter, unchanged from the third quarterâ€™s record rate.
Meanwhile, total expenses fell 19.7% to $34.25 billion as the companyâ€™s crude oil and products costs fell 23%.
Overall, Phillips 66 reported a profit of $1.15 billion, or $2.05 a share, up from $826 million, or $1.37 a share, a year earlier. Excluding asset-sale gains, write-downs and other items, earnings rose to $1.63 from $1.34 a share.
Revenue fell 18.8% to $35.61 billion.
Analysts polled by Thomson Reuters expected a per-share profit of $1.37 and revenue of $35.2 billion.
While Phillips 66 had earned most of its profits from refining, its chemical production business has recently taken on a larger role.
The chemicals segment, which includes its interest in Chevron Phillips Chemical Company LLC, posted a 2.3% increase in earnings to $267 million in the latest quarter.
Earnings for the refining segment, meanwhile, grew 23.7% to $517 million.