Phillips 66 earnings at $385 million in Q1
April 29 (Reuters) – U.S. refiner Phillips 66 reported a weaker-than-expected quarterly profit, hurt by lower margins for gasoline and other refined products.
“Crack spreads” – the difference between the cost of crude and refined products often used to estimate refining margins – have slumped as output exceeds demand, causing inventories to swell.
Earnings in the company’s refining business plunged 84 percent in the first quarter.
“Weaker margins impacted our financial results in the first quarter,” said Greg Garland, chairman and CEO of Phillips 66.
“Our businesses ran well, and we remain focused on operating excellence with industry-leading safety performance. During the quarter, we successfully completed planned turnarounds and accelerated some maintenance activities in the low margin environment.”
Rival Marathon Petroleum Corp barely eked out a profit in the first quarter, hurt by weak crack spreads.
Phillips 66’s consolidated earnings fell to $385 million, or 72 cents per share, in the quarter, from $987 million, or $1.79 per share, a year earlier.
Adjusted earnings were 67 cents per share, widely below the average analyst estimate of 87 cents, according to Thomson Reuters I/B/E/S.
The company’s shares were down 1.3 percent at $86.67 in premarket trading on Friday.
Up to Thursday’s close of $87.79, the stock had risen 7 percent so far this year.
(Reporting by Swetha Gopinath in Bengaluru; Editing by Maju Samuel)