Phillips 66 beats 2Q results estimates on midstream unit strength
Refiner Phillips 66 reported quarterly results that beat analysts' estimates, helped in part by strength at its midstream unit, even as it grappled with lower margins due to a tepid summer driving season.
The midstream segment, which transports natural gas and crude oil, posted a 2Q income that increased 23.7%. Phillips 66's shares rose nearly 5% to $147.29 on Tuesday.
Refiners process crude oil into gasoline, diesel, jet fuel and other products. They ramped up processing capacity to 93.5% in 2Q, compared with 91% in the same period last year, according to the U.S. Energy Information Administration, on expectations of an uptick in demand that did not materialize.
Phillips 66's realized margins fell to $10.01/bbl in 2Q from $15.32/bbl a year earlier. The refining segment's overall earnings slumped 74.3%.
Last week, rival Valero reported a lower quarterly profit but also managed to beat earnings estimates as strong processing volumes offset a slump in margins.
Phillips 66's renewable fuels segment posted a loss of $55 MM, compared with a profit of $68 MM last year, amid a glut in renewable diesel production capacity in the United States.
On an adjusted basis, the Houston, Texas-based company earned $2.31 per share in 2Q, beating estimates of $1.98, according to LSEG data.
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