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Credit Suisse 21st Annual Energy Summit – Phillips 66

Phillips 66 · Feb 23, 2016 · 43 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 1
    Credit Suisse Energy Summit February 23, 2016 Vail, CO Tim G. Taylor President
  2. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 2
    Strategy Operating Committed to safety, reliability and environmental stewardship while Excellence protecting shareholder value Reshaping our portfolio by capturing growth opportunities in Midstream Growth and Chemicals Enhancing…
  3. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 3
    Operating Excellence See appendix for footnotes. 3
  4. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 4
    Energy Landscape See appendix for footnotes. 4
  5. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 5
    Premium Valuation Allocating capital efficiently Leveraging existing portfolio Creating value across downstream Expanding multiple See appendix for footnotes. 5
  6. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 6
    Midstream DCP EBITDA excluded. See appendix for additional footnotes. 6
  7. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 7
    Phillips 66 Partners Fee-based assets Growth opportunities Organic Drop downs Selective acquisitions Funds Midstream growth Coverage Ratio 1.13x 1.10x 1.10x 1.44x 1.32x 1.28x 1.14x 1.15x 1.40x 1.44x See appendix for…
  8. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 8
    DCP Midstream Strengthened balance sheet Significant self-help initiatives Cash flow breakeven reduction from 60 to 35 cpg NGL Operating improvements Contract realignment System rationalization Capital discipline 90%…
  9. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 9
    Chemicals Petrochemical demand driven by global economic growth Cost-advantaged feedstocks CPChem Projects Update NAO expansion complete USGC Petrochemicals Project planned startup mid-2017 Source: Wood Mackenzie. 9
  10. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 10
    Refining Strong free cash flow generation High-return projects creating sustainable earnings increases Footprint provides opportunities for Midstream growth See appendix for footnotes. 10
  11. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 11
    Marketing and Specialties 35% ROCE U.S. Marketing Wholesale model Enhancing fuels brands Volume growth International Marketing Retail / wholesale model Adding 100+ sites Specialties Grow Lubricants earnings and international…
  12. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 12
    Capital Structure Strong balance sheet BBB+/A3 credit rating Positioned to manage through cycles Net Debt to EBITDA 0.5x 0.1x 0.5x 0.8x Net Debt to Capital 14% 3% 14% 20% See appendix for footnotes. 12
  13. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 13
    Cash Flow Diversified cash generation Funding transformational growth Growing distributions Strong free cash flow yield See appendix for footnotes. 13
  14. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 14
    Capital Allocation Funding reinvestment Cash from operations PSXP proceeds Returning capital to shareholders Dividend growth Ongoing share repurchases See appendix for footnotes. 14
  15. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 15
    Capital Budget 2.6 B Growth capital Fee-based assets suitable for PSXP drop down Quick payout Refining projects 1.3 B Sustaining capital Maintaining safe, reliable assets 15
  16. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 16
    Distributions Double-digit dividend growth 37% dividend CAGR since spin Ongoing share repurchase program 110 MM shares repurchased and exchanged 2.6 B authorization remaining Cumulative distributions include distributions…
  17. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 17
    Compelling Investment PSX +165% Shareholder returns Disciplined capital allocation Unique portfolio Peers +37% EBITDA growth S&P 100 +47% Multiple expansion 17
  18. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 18
    Institutional Investors Contact Rosy Zuklic InvestorRelationsp66.com General Manager, Investor Relations 832-765-2297 C.W. Mallon Manager, Investor Relations
  19. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 19
    Appendix 19
  20. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 20
    Segment Strategy Marketing and Refining: Midstream: Growth Chemicals: Growth Specialties: Enhance Returns Selective Growth Execute Sweeny hub Grow CPChem organically Optimize crude slate Expand European retail Grow integrated…
  21. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 21
    Midcontinent Integrated Growth Midstream Palermo rail terminal/Sacagawea pipeline (PSXP) Dakota Access/ETCO crude pipelines Refining, Marketing & Specialties Ponca City Yield improvement project Tight oil processing flexibility…
  22. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 22
    Western Gulf Creating a World-Class Energy Complex Midstream Sweeny Fractionator One Freeport LPG export terminal Eagle Ford crude pipeline Sweeny Fractionator Two Refining, Marketing & Specialties Sweeny Strategic asset…
  23. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 23
    Eastern Gulf Refining Logistics and Midstream Growth Midstream Beaumont terminal expansion: +7 MMBbls Bayou Bridge pipeline Alliance clean products dock Refining, Marketing & Specialties Lake Charles Increase feedstock…
  24. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 24
    West Coast Enhancing Returns Midstream Los Angeles waterborne crude tank Santa Maria rail rack Refining, Marketing & Specialties San Francisco Yield improvements Los Angeles FCC energy reduction Marketing & Specialties Grow…
  25. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 25
    Atlantic Basin Enhancing Returns Midstream Bayway LPG loading facility Refining, Marketing & Specialties Bayway FCC reactor modernization Yield improvements Marketing & Specialties Grow JET and COOP brands in Europe…
  26. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 26
    Earnings Variance Adjusted EBITDA and Adjusted Net Income are adjusted for special items Adjusted EBITDA adjusted for non-controlling interest and proportional share of equity affiliates income taxes, net interest and D&A Cash from…
  27. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 27
    Free Cash Flow 2013 2015 Average CFO excludes working capital. Sustaining capex excludes capital leases. Midstream adjusted CFO excludes PSXP. PSXP contributions are calculated as consideration paid by PSXP to PSX in a drop down…
  28. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 28
    2015 Adjusted ROCE 28
  29. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 29
    Capital Structure 20- 30% Excludes PSXP. 29
  30. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 30
    Debt and Liquidity Debt Maturity Profile Liquidity (B) (B) As of 12/31/2015. Excludes PSXP. Debt maturity profile excludes capital leases. Undrawn Revolving Credit Facility includes 5.0 B revolving credit facility less 51 MM in…
  31. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 31
    2016 Sensitivities Sensitivities shown above are independent and are only valid within a limited price range. 31
  32. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 32
    Phillips 66 Capital Program Millions of Dollars 2016 Budget Sustaining Growth Total Consolidated Capital Expenditures and Investments Midstream(1) 227 2,119 2,346 Chemicals - - - Refining 833 384 1,217 Marketing and Specialties 57…
  33. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 33
    Non-GAAP Reconciliations Forecasted EBITDA We are unable to present reconciliations of the various forecasted EBITDA included in this presentation, because certain elements of net income, including interest, depreciation and income…
  34. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 34
    Non-GAAP Reconciliations Millions of Dollars Average 2013-2015 Refining FCF Numerator Cash From Operations GAAP 2,615 Less: Change in Non-Cash Working Cap. (407) Cash From Operations (excluding WC) 3,022 Less: P66 Equity…
  35. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 35
    Non-GAAP Reconciliations Millions of Dollars 2013 2014 2015 Refining ROCE Numerator Net Income 1,747 1,771 2,554 After-tax interest expense - - - GAAP ROCE earnings 1,747 1,771 2,554 Special Items (13) (195) (28) Adjusted ROCE…
  36. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 36
    Non-GAAP Reconciliations Millions of Dollars 2015 Marketing & Specialties (M&S) ROCE Numerator Net Income 1,187 After-tax interest expense - GAAP ROCE earnings 1,187 Special Items (240) Adjusted ROCE earnings 947 Denominator…
  37. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 37
    Non-GAAP Reconciliations Millions of Dollars 2012 2013 2014 2015 Phillips 66 Short-term debt 13 24 842 44 Long-term debt 6,961 6,131 7,842 8,843 Total Debt 6,974 6,155 8,684 8,887 Less: Cash and cash equivalents 3,474 5,400 5,207…
  38. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 38
    Non-GAAP Reconciliations Millions of Dollars 2013 2014 2015 Phillips 66 Available Cash Cash From Continuing Operations GAAP 5,942 3,527 5,713 Less: Change in Non-Cash Working Cap. 880 (1,020) (221) Cash From Operations (excluding…
  39. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 39
    Non-GAAP Reconciliations Millions of Dollars 2009 2010 2011 2012 2013 2014 2015 Phillips 66 Cash from Operations Cash From Continuing Operations GAAP 917 2,054 4,953 4,259 5,942 3,527 5,713 Less: Change in Non-Cash Working Cap. 393…
  40. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 40
    Non-GAAP Reconciliations Millions of Dollars Except as Indicated 2009 2010 2011 2012 2013 2014 2015 Reconciliation of Earnings to Adjusted Earnings Consolidated Earnings 476 735 4,775 4,124 3,726 4,762 4,227 Adjustments: Gain on…
  41. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 41
    Non-GAAP Reconciliations Millions of Dollars Average 2013-2015 Marketing & Midstream Chemicals Refining Specialties FCF Numerator Cash From Operations GAAP 859 571 2,615 1,385 Less: Change in Non-Cash Working Cap. (46) 0 (407)…
  42. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 42
    Non-GAAP Reconciliations Millions of Dollars 2015 Marketing & Phillips 66 Midstream Chemicals Refining Specialties Corporate ROCE Numerator Net Income 4,280 74 962 2,554 1,187 (497) After-tax interest expense 201 - - - - 201 GAAP…
  43. Credit Suisse 21st Annual Energy Summit – Phillips 66 – slide 43
    Non-GAAP Reconciliations Millions of Dollars Adjusted Phillips 66 Phillips 66 Phillips 66 Partners Consolidated 2013 Cash and cash equivalents 4,975 425 5,400 Total Debt 6,155 - 6,155 Total Equity 21,983 409 22,392 Debt-to-capital…

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