Phillips 66 Earns $14.08 A Share In Third Quarter, Up From $9.55, As Refining Margins Jump
Refining pre-tax income roughly doubled from the second quarter while debt fell $2.0 billion and the other businesses slipped.
Phillips 66, the refiner and pipeline operator, earned $5.6 billion, or $14.08 a share, in the third quarter, up from $9.55 a share in the second, as wider market crack spreads (the gap between crude cost and fuel prices) lifted refining margins. The company reported the results Wednesday in an 8-K.
Refining carries the quarter
Adjusted earnings were $5,619 million against $3,788 million in the second quarter, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) rose to $8,068 million from $5,891 million. Adjusted earnings per share were $14.08, versus $9.41.
Refining adjusted pre-tax income climbed to $6,060 million from $3,086 million. Realized margins reached $38.00 a barrel, up from $24.08, and crude capacity utilization was 98%, compared with 96%. The company said higher margins and volumes drove the gain, with margins mainly reflecting higher market crack spreads.
Other segments moved the other way:
- Marketing and Specialties adjusted pre-tax income fell to $245 million from $514 million, on lower global marketing fuel margins in a rising price environment.
- Renewable Fuels dropped to $191 million from $544 million, on lower margins and higher costs.
- Chemicals slipped to $311 million from $404 million, on lower polyethylene margins.
- Midstream eased to $702 million from $785 million, on lower gas transportation margins.
Debt down $2.0 billion, buybacks up
Total debt fell by $2.0 billion to $18.5 billion, and net debt fell to $12.7 billion. The debt-to-capital ratio dropped to 34% from 39%.
The company returned $2.8 billion to shareholders, with share repurchases of $2,273 million against $379 million in the second quarter and dividends of $504 million. It ended September with $5.8 billion of cash and $6.4 billion of committed credit capacity.
"Phillips 66 delivered strong operating performance in the third quarter and is executing on its financial and operating commitments," said Mark Lashier, chairman and CEO.
Projects and the road ahead
Phillips 66 refines crude into fuels, runs pipelines and processing, makes chemicals through its 50% stake in Chevron Phillips Chemical, and markets fuels and lubricants. It also made a final investment decision on the proposed Western Gateway Pipeline, expected in service in 2029.
The Coastal Bend expansion is expected to deliver initial volumes in the fourth quarter of 2026, with a ramp-up to 350 MBD in early 2027.
Management hosts a webcast at noon ET Wednesday on strategic initiatives and third-quarter performance.
Sources
- 8-K Filing — Phillips 66 (PSX) — SEC EDGAR
- Exhibit psx-2026930_ex991.htm — Phillips 66 8-K exhibit — SEC EDGAR
- Exhibit psx-20260930_erxsuppinfoxe.htm — Phillips 66 8-K exhibit — SEC EDGAR
- Phillips 66 (PSX) Falls More Steeply Than Broader Market: What Investors Need to Know — Yahoo Finance
