NGL market weakness drives 37% earnings decline for Phillips 66
First-quarter earnings for US-based Phillips 66 dropped 37% as stronger performances in refining and marketing were more than offset by declines in other businesses such as midstream and natural gas liquids (NGLs).
The refining segment, excluding items, recorded earnings growth of 62% to $495 million. Meanwhile, marketing and specialties earnings, excluding items, rose 42% to $194 million.
“Refining market conditions helped us realize the best margins we’ve had over the last two years,” said Greg Garland, chairman and CEO of Phillips 66.
However, adjusted midstream earnings fell 64% to $67 million, and earnings from its Chevron Phillips Chemical joint venture tumbled 36% to $203 million.
"The NGL market environment negatively impacted results from our DCP Midstream investment as well as our own NGL midstream business," said Garland.
Meanwhile, the lower chemicals performance was was mainly due to lower O&P cash chain margins, driven by lower polyethylene sales prices, as well as planned turnarounds in the first quarter, according to company officials.
Phillips 66's overall earnings were $987 million, down from $1.57 billion a year earlier.
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