Phillips 66 Q4 Profit Rises - Update

(RTTNews) - Oil refiner and chemical maker Phillips 66 (PSX), Wednesday said its fourth-quarter profit increased despite weak refining margins in almost all regions, as last year's profit was impacted by a heavy impairment charge.

The Houston, Texas-based company's fourth-quarter profit improved to $826 million or 1.37 a share from $708 million or $1.11 a share last year. Excluding one-time items, which includes an impairment charge of $580 million last year, earnings declined to $1.34 a share from $2.04 a share last year.

On average, 16 analysts polled by Thomson Reuters expected earnings of $1.10 a share for the quarter. Analysts' estimates typically exclude one-time items.

"We ran well during the fourth quarter, allowing us to capitalize on favorable crude differentials while exporting a record volume of refined products," said CEO Greg Garland.

Refining segments profit for the period improved to $450 million from $363 million last year, but dropped from last year' adjusted earnings of $960 million. Lower margins across all regions except Gulf coast hurt adjusted profit of the segment.

Midstream earnings rose to $121 million from $92 million last year. Chemical unit's earnings for the period rose to $261 million from $246 million last year. Chemicals segment reflects Phillips 66's investment in Chevron Phillips Chemical Company.

Earnings from Marketing and Specialties dropped to $73 million from $113 million last year, reflecting the sale of the U.K. power generation business and lower marketing margins.

Phillips also said it expects to close the deal to swap Phillips Special Products unit for its own shares in the first half of 2014. Last month, Phillips 66 agreed to sell its Phillips Special Products unit to Warren Buffett's Berkshire Hathaway Inc. for the 19 million shares of Phillips 66 that Berkshire owned. The enterprise value of the deal would amount to about $1.4 billion.

PSX is currently trading at $74.48, down $0.60 or 0.80%, on the New York Stock Exchange.