Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Phillips 66 Partners Reports Fourth-Quarter 2021 Financial Results By: Phillips 66 Partners LP via Business Wire January 28, 2022 at 07:20 AM EST Fourth-quarter earnings of $286 million and adjusted EBITDA of $400 million Reached agreement for Phillips 66 to acquire all publicly held units Phillips 66 Partners LP (NYSE: PSXP) announces fourth-quarter 2021 earnings of $286 million, or $1.19 per diluted common unit. Cash from operations was $302 million, and distributable cash flow was $267 million. Adjusted EBITDA was $400 million in the fourth quarter, compared with $367 million in the prior quarter. On Jan. 18, 2022, the general partner’s board of directors declared a fourth-quarter 2021 cash distribution of $0.875 per common unit. Financial Results Phillips 66 Partners’ fourth-quarter 2021 earnings were $286 million, compared with $242 million in the third quarter. The Partnership reported adjusted EBITDA of $400 million in the fourth quarter, compared with $367 million in the prior quarter. The increases in fourth-quarter earnings and adjusted EBITDA mainly reflect the recognition of deferred revenue and increased volumes. Liquidity, Capital Expenditures and Investments As of Dec. 31, 2021, total debt outstanding was $3.9 billion. The Partnership had $62 million in cash and cash equivalents and $749 million available under its revolving credit facility. The Partnership’s capital expenditures and investments for the quarter were $74 million. Merger Agreement with Phillips 66 In October, Phillips 66 entered into an agreement to acquire all of the limited partner interests in Phillips 66 Partners not already owned by Phillips 66 and its affiliates. The transaction is expected to close in the first quarter of 2022. Upon closing, the Partnership will be a wholly owned subsidiary of Phillips 66 and will no longer be a publicly traded partnership. About Phillips 66 Partners Headquartered in Houston, Phillips 66 Partners is a master limited partnership formed by Phillips 66 to own, operate, develop and acquire primarily fee-based crude oil, refined petroleum products and natural gas liquids pipelines, terminals and other midstream assets. For more information, visit www.phillips66partners.com. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This news release contains certain forward-looking statements as defined under the federal securities laws. Words and phrases such as “is anticipated,” “is estimated,” “is expected,” “is planned,” “is scheduled,” “is targeted,” “believes,” “continues,” “intends,” “will,” “would,” “objectives,” “goals,” “projects,” “efforts,” “strategies” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future performance and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: the continued ability of Phillips 66 to satisfy its obligations under our commercial and other agreements; the volume of crude oil, refined petroleum products and NGL we or our equity affiliates transport, fractionate, terminal and store; the tariff rates with respect to volumes transported through our regulated assets, which are subject to review and possible adjustment by federal and state regulators; fluctuations in the prices for crude oil, refined petroleum products and NGL; the continuing effects of the COVID-19 pandemic and its negative impact on the demand for refined products; changes in governmental policies relating to crude oil, refined petroleum products or NGL pricing, regulation, taxation, or exports; liabilities associated with the risks and operational hazards inherent in transporting, fractionating, terminaling and storing crude oil, refined petroleum products and NGL; curtailment of operations due to accidents, severe weather (including as a result of climate change) or natural disasters, riots, strikes or lockouts; the inability to obtain or maintain permits, in a timely manner or at all, and the possible revocation or modification of permits; the operation, financing and distribution decisions of our equity affiliates; costs to comply with environmental laws and safety regulations; failure of information technology due to various causes, including unauthorized access or attacks; changes to the costs to deliver and transport crude oil, refined petroleum products and NGL; potential liability from litigation or for remedial actions, including removal and reclamation obligations under environmental regulations; the failure to complete construction of capital projects on time and within budget; general domestic and international economic and political developments including armed hostilities, expropriation of assets, and other political, economic or diplomatic developments, including those caused by public health issues; our ability to comply with our debt covenants and to incur additional indebtedness on favorable terms; changes in tax, environmental and other laws and regulations; and other economic, business, competitive and/or regulatory factors affecting Phillips 66 Partners’ businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 Partners is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Information—This news release includes the terms “EBITDA,” “adjusted EBITDA,” “distributable cash flow” and “coverage ratio.” These are non-GAAP financial measures. EBITDA and adjusted EBITDA are included to help facilitate comparisons of operating performance of the Partnership with other companies in our industry. EBITDA and distributable cash flow help facilitate an assessment of our ability to generate sufficient cash flow to make distributions to our partners. We believe that the presentation of EBITDA, adjusted EBITDA and distributable cash flow provides useful information to investors in assessing our financial condition and results of operations. Our coverage ratio is calculated as distributable cash flow divided by total cash distributions and is included to help indicate the Partnership’s ability to pay cash distributions from current earnings. The GAAP performance measure most directly comparable to EBITDA and adjusted EBITDA is net income (loss). The GAAP liquidity measure most comparable to EBITDA and distributable cash flow is net cash provided by operating activities. The GAAP financial measure most comparable to our coverage ratio is calculated as net cash provided by operating activities divided by total cash distributions. These non-GAAP financial measures should not be considered as alternatives to their comparable GAAP measures. They have important limitations as analytical tools because they exclude some but not all items that affect their corresponding GAAP measures. They should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP. Additionally, because EBITDA, adjusted EBITDA, distributable cash flow and coverage ratio may be defined differently by other companies in our industry, our definition of those measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. Reconciliations of these non-GAAP measures to their comparable GAAP measures are included in this release. References in the release to earnings or losses refer to net income or losses attributable to the Partnership. References to EBITDA refer to earnings before interest, income taxes, depreciation and amortization. Results of Operations (Unaudited) Summarized Financial Statement Information Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Selected Income Statement Data Total revenues and other income $ 503 452 Net income 299 255 Net income attributable to the Partnership 286 242 Adjusted EBITDA 400 367 Distributable cash flow 267 268 Net Income Attributable to the Partnership Per Limited Partner Unit—Diluted (Dollars) Common units $ 1.19 1.00 Selected Balance Sheet Data Cash and cash equivalents $ 62 71 Equity investments 2,929 2,941 Total assets 7,101 7,077 Total debt 3,897 3,896 Equity held by public Preferred units 729 729 Common units 2,676 2,657 Equity held by Phillips 66 Common units (743) (798) Statement of Income Millions of Dollars Q4 2021 Q3 2021 Revenues and Other Income Operating revenues—related parties $ 322 275 Operating revenues—third parties 9 8 Equity in earnings of affiliates 166 163 Other income 6 6 Total revenues and other income 503 452 Costs and Expenses Operating and maintenance expenses 106 89 Depreciation 35 38 Impairments — 10 General and administrative expenses 19 17 Taxes other than income taxes 10 10 Interest and debt expense 31 32 Other expenses — 1 Total costs and expenses 201 197 Income before income taxes 302 255 Income tax expense 3 — Net Income 299 255 Less: Net income attributable to noncontrolling interest 13 13 Net Income Attributable to the Partnership 286 242 Less: Preferred unitholders’ interest in net income attributable to the Partnership 12 12 Limited Partners’ Interest in Net Income Attributable to the Partnership $ 274 230 Selected Operating Data Q4 2021 Q3 2021 Wholly Owned Operating Data Pipelines Pipeline revenues (millions of dollars) $ 144 121 Pipeline volumes(1) (thousands of barrels daily) Crude oil 981 954 Refined petroleum products and NGL 1,072 994 Total 2,053 1,948 Average pipeline revenue per barrel (dollars) $ 0.76 0.67 Terminals Terminal revenues (millions of dollars) $ 53 40 Terminal throughput (thousands of barrels daily) Crude oil(2) 424 446 Refined petroleum products 856 780 Total 1,280 1,226 Average terminaling revenue per barrel (dollars) $ 0.44 0.36 Storage, processing and other revenues (millions of dollars) $ 134 122 Total Operating Revenues (millions of dollars) $ 331 283 Joint Venture Operating Data(3) Crude oil, refined petroleum products and NGL (thousands of barrels daily) 1,342 1,294 (1) Represents the sum of volumes transported through each separately tariffed pipeline segment. (2) Bayway and Ferndale rail rack volumes included in crude oil terminals. (3) Proportional share of total pipeline and terminal volumes of joint ventures consistent with recognized equity in earnings of affiliates. Cash Distributions Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Cash Distributions† Common units—public $ 51 51 Common units—Phillips 66 149 149 Total $ 200 200 Cash Distribution Per Common Unit (Dollars) $ 0.875 0.875 Coverage Ratio* 1.34 1.34 †Cash distributions declared attributable to the indicated periods. *Calculated as distributable cash flow divided by total cash distributions. Used to indicate the Partnership’s ability to pay cash distributions from current earnings. Net cash provided by operating activities divided by total cash distributions was 1.51x and 1.69x at Q4 2021 and Q3 2021, respectively. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Income Attributable to the Partnership Millions of Dollars 2021 Year Q4 Q3 Net Income Attributable to the Partnership $ 735 286 242 Plus: Net income attributable to noncontrolling interest 42 13 13 Net Income 777 299 255 Plus: Depreciation 141 35 38 Net interest expense 127 31 31 Income tax expense 4 3 — EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Cash Provided by Operating Activities Millions of Dollars 2021 Year Q4 Q3 Net Cash Provided by Operating Activities $ 1,153 302 338 Plus: Net interest expense 127 31 31 Income tax expense 4 3 — Changes in working capital (29) 29 (36) Undistributed equity earnings 4 4 2 Impairments (208) — (10) Deferred revenues and other liabilities 4 2 — Other (6) (3) (1) EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. View source version on businesswire.com: https://www.businesswire.com/news/home/20220126006024/en/Contacts Jeff Dietert (investors) 832-765-2297 jeff.dietert@p66.com Shannon Holy (investors) 832-765-2297 shannon.m.holy@p66.com Thaddeus Herrick (media) 855-841-2368 thaddeus.f.herrick@p66.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Phillips 66 Partners Reports Fourth-Quarter 2021 Financial Results By: Phillips 66 Partners LP via Business Wire January 28, 2022 at 07:20 AM EST Fourth-quarter earnings of $286 million and adjusted EBITDA of $400 million Reached agreement for Phillips 66 to acquire all publicly held units Phillips 66 Partners LP (NYSE: PSXP) announces fourth-quarter 2021 earnings of $286 million, or $1.19 per diluted common unit. Cash from operations was $302 million, and distributable cash flow was $267 million. Adjusted EBITDA was $400 million in the fourth quarter, compared with $367 million in the prior quarter. On Jan. 18, 2022, the general partner’s board of directors declared a fourth-quarter 2021 cash distribution of $0.875 per common unit. Financial Results Phillips 66 Partners’ fourth-quarter 2021 earnings were $286 million, compared with $242 million in the third quarter. The Partnership reported adjusted EBITDA of $400 million in the fourth quarter, compared with $367 million in the prior quarter. The increases in fourth-quarter earnings and adjusted EBITDA mainly reflect the recognition of deferred revenue and increased volumes. Liquidity, Capital Expenditures and Investments As of Dec. 31, 2021, total debt outstanding was $3.9 billion. The Partnership had $62 million in cash and cash equivalents and $749 million available under its revolving credit facility. The Partnership’s capital expenditures and investments for the quarter were $74 million. Merger Agreement with Phillips 66 In October, Phillips 66 entered into an agreement to acquire all of the limited partner interests in Phillips 66 Partners not already owned by Phillips 66 and its affiliates. The transaction is expected to close in the first quarter of 2022. Upon closing, the Partnership will be a wholly owned subsidiary of Phillips 66 and will no longer be a publicly traded partnership. About Phillips 66 Partners Headquartered in Houston, Phillips 66 Partners is a master limited partnership formed by Phillips 66 to own, operate, develop and acquire primarily fee-based crude oil, refined petroleum products and natural gas liquids pipelines, terminals and other midstream assets. For more information, visit www.phillips66partners.com. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This news release contains certain forward-looking statements as defined under the federal securities laws. Words and phrases such as “is anticipated,” “is estimated,” “is expected,” “is planned,” “is scheduled,” “is targeted,” “believes,” “continues,” “intends,” “will,” “would,” “objectives,” “goals,” “projects,” “efforts,” “strategies” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future performance and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: the continued ability of Phillips 66 to satisfy its obligations under our commercial and other agreements; the volume of crude oil, refined petroleum products and NGL we or our equity affiliates transport, fractionate, terminal and store; the tariff rates with respect to volumes transported through our regulated assets, which are subject to review and possible adjustment by federal and state regulators; fluctuations in the prices for crude oil, refined petroleum products and NGL; the continuing effects of the COVID-19 pandemic and its negative impact on the demand for refined products; changes in governmental policies relating to crude oil, refined petroleum products or NGL pricing, regulation, taxation, or exports; liabilities associated with the risks and operational hazards inherent in transporting, fractionating, terminaling and storing crude oil, refined petroleum products and NGL; curtailment of operations due to accidents, severe weather (including as a result of climate change) or natural disasters, riots, strikes or lockouts; the inability to obtain or maintain permits, in a timely manner or at all, and the possible revocation or modification of permits; the operation, financing and distribution decisions of our equity affiliates; costs to comply with environmental laws and safety regulations; failure of information technology due to various causes, including unauthorized access or attacks; changes to the costs to deliver and transport crude oil, refined petroleum products and NGL; potential liability from litigation or for remedial actions, including removal and reclamation obligations under environmental regulations; the failure to complete construction of capital projects on time and within budget; general domestic and international economic and political developments including armed hostilities, expropriation of assets, and other political, economic or diplomatic developments, including those caused by public health issues; our ability to comply with our debt covenants and to incur additional indebtedness on favorable terms; changes in tax, environmental and other laws and regulations; and other economic, business, competitive and/or regulatory factors affecting Phillips 66 Partners’ businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 Partners is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Information—This news release includes the terms “EBITDA,” “adjusted EBITDA,” “distributable cash flow” and “coverage ratio.” These are non-GAAP financial measures. EBITDA and adjusted EBITDA are included to help facilitate comparisons of operating performance of the Partnership with other companies in our industry. EBITDA and distributable cash flow help facilitate an assessment of our ability to generate sufficient cash flow to make distributions to our partners. We believe that the presentation of EBITDA, adjusted EBITDA and distributable cash flow provides useful information to investors in assessing our financial condition and results of operations. Our coverage ratio is calculated as distributable cash flow divided by total cash distributions and is included to help indicate the Partnership’s ability to pay cash distributions from current earnings. The GAAP performance measure most directly comparable to EBITDA and adjusted EBITDA is net income (loss). The GAAP liquidity measure most comparable to EBITDA and distributable cash flow is net cash provided by operating activities. The GAAP financial measure most comparable to our coverage ratio is calculated as net cash provided by operating activities divided by total cash distributions. These non-GAAP financial measures should not be considered as alternatives to their comparable GAAP measures. They have important limitations as analytical tools because they exclude some but not all items that affect their corresponding GAAP measures. They should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP. Additionally, because EBITDA, adjusted EBITDA, distributable cash flow and coverage ratio may be defined differently by other companies in our industry, our definition of those measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. Reconciliations of these non-GAAP measures to their comparable GAAP measures are included in this release. References in the release to earnings or losses refer to net income or losses attributable to the Partnership. References to EBITDA refer to earnings before interest, income taxes, depreciation and amortization. Results of Operations (Unaudited) Summarized Financial Statement Information Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Selected Income Statement Data Total revenues and other income $ 503 452 Net income 299 255 Net income attributable to the Partnership 286 242 Adjusted EBITDA 400 367 Distributable cash flow 267 268 Net Income Attributable to the Partnership Per Limited Partner Unit—Diluted (Dollars) Common units $ 1.19 1.00 Selected Balance Sheet Data Cash and cash equivalents $ 62 71 Equity investments 2,929 2,941 Total assets 7,101 7,077 Total debt 3,897 3,896 Equity held by public Preferred units 729 729 Common units 2,676 2,657 Equity held by Phillips 66 Common units (743) (798) Statement of Income Millions of Dollars Q4 2021 Q3 2021 Revenues and Other Income Operating revenues—related parties $ 322 275 Operating revenues—third parties 9 8 Equity in earnings of affiliates 166 163 Other income 6 6 Total revenues and other income 503 452 Costs and Expenses Operating and maintenance expenses 106 89 Depreciation 35 38 Impairments — 10 General and administrative expenses 19 17 Taxes other than income taxes 10 10 Interest and debt expense 31 32 Other expenses — 1 Total costs and expenses 201 197 Income before income taxes 302 255 Income tax expense 3 — Net Income 299 255 Less: Net income attributable to noncontrolling interest 13 13 Net Income Attributable to the Partnership 286 242 Less: Preferred unitholders’ interest in net income attributable to the Partnership 12 12 Limited Partners’ Interest in Net Income Attributable to the Partnership $ 274 230 Selected Operating Data Q4 2021 Q3 2021 Wholly Owned Operating Data Pipelines Pipeline revenues (millions of dollars) $ 144 121 Pipeline volumes(1) (thousands of barrels daily) Crude oil 981 954 Refined petroleum products and NGL 1,072 994 Total 2,053 1,948 Average pipeline revenue per barrel (dollars) $ 0.76 0.67 Terminals Terminal revenues (millions of dollars) $ 53 40 Terminal throughput (thousands of barrels daily) Crude oil(2) 424 446 Refined petroleum products 856 780 Total 1,280 1,226 Average terminaling revenue per barrel (dollars) $ 0.44 0.36 Storage, processing and other revenues (millions of dollars) $ 134 122 Total Operating Revenues (millions of dollars) $ 331 283 Joint Venture Operating Data(3) Crude oil, refined petroleum products and NGL (thousands of barrels daily) 1,342 1,294 (1) Represents the sum of volumes transported through each separately tariffed pipeline segment. (2) Bayway and Ferndale rail rack volumes included in crude oil terminals. (3) Proportional share of total pipeline and terminal volumes of joint ventures consistent with recognized equity in earnings of affiliates. Cash Distributions Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Cash Distributions† Common units—public $ 51 51 Common units—Phillips 66 149 149 Total $ 200 200 Cash Distribution Per Common Unit (Dollars) $ 0.875 0.875 Coverage Ratio* 1.34 1.34 †Cash distributions declared attributable to the indicated periods. *Calculated as distributable cash flow divided by total cash distributions. Used to indicate the Partnership’s ability to pay cash distributions from current earnings. Net cash provided by operating activities divided by total cash distributions was 1.51x and 1.69x at Q4 2021 and Q3 2021, respectively. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Income Attributable to the Partnership Millions of Dollars 2021 Year Q4 Q3 Net Income Attributable to the Partnership $ 735 286 242 Plus: Net income attributable to noncontrolling interest 42 13 13 Net Income 777 299 255 Plus: Depreciation 141 35 38 Net interest expense 127 31 31 Income tax expense 4 3 — EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Cash Provided by Operating Activities Millions of Dollars 2021 Year Q4 Q3 Net Cash Provided by Operating Activities $ 1,153 302 338 Plus: Net interest expense 127 31 31 Income tax expense 4 3 — Changes in working capital (29) 29 (36) Undistributed equity earnings 4 4 2 Impairments (208) — (10) Deferred revenues and other liabilities 4 2 — Other (6) (3) (1) EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. View source version on businesswire.com: https://www.businesswire.com/news/home/20220126006024/en/Contacts Jeff Dietert (investors) 832-765-2297 jeff.dietert@p66.com Shannon Holy (investors) 832-765-2297 shannon.m.holy@p66.com Thaddeus Herrick (media) 855-841-2368 thaddeus.f.herrick@p66.com
Fourth-quarter earnings of $286 million and adjusted EBITDA of $400 million Reached agreement for Phillips 66 to acquire all publicly held units
Phillips 66 Partners LP (NYSE: PSXP) announces fourth-quarter 2021 earnings of $286 million, or $1.19 per diluted common unit. Cash from operations was $302 million, and distributable cash flow was $267 million. Adjusted EBITDA was $400 million in the fourth quarter, compared with $367 million in the prior quarter. On Jan. 18, 2022, the general partner’s board of directors declared a fourth-quarter 2021 cash distribution of $0.875 per common unit. Financial Results Phillips 66 Partners’ fourth-quarter 2021 earnings were $286 million, compared with $242 million in the third quarter. The Partnership reported adjusted EBITDA of $400 million in the fourth quarter, compared with $367 million in the prior quarter. The increases in fourth-quarter earnings and adjusted EBITDA mainly reflect the recognition of deferred revenue and increased volumes. Liquidity, Capital Expenditures and Investments As of Dec. 31, 2021, total debt outstanding was $3.9 billion. The Partnership had $62 million in cash and cash equivalents and $749 million available under its revolving credit facility. The Partnership’s capital expenditures and investments for the quarter were $74 million. Merger Agreement with Phillips 66 In October, Phillips 66 entered into an agreement to acquire all of the limited partner interests in Phillips 66 Partners not already owned by Phillips 66 and its affiliates. The transaction is expected to close in the first quarter of 2022. Upon closing, the Partnership will be a wholly owned subsidiary of Phillips 66 and will no longer be a publicly traded partnership. About Phillips 66 Partners Headquartered in Houston, Phillips 66 Partners is a master limited partnership formed by Phillips 66 to own, operate, develop and acquire primarily fee-based crude oil, refined petroleum products and natural gas liquids pipelines, terminals and other midstream assets. For more information, visit www.phillips66partners.com. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This news release contains certain forward-looking statements as defined under the federal securities laws. Words and phrases such as “is anticipated,” “is estimated,” “is expected,” “is planned,” “is scheduled,” “is targeted,” “believes,” “continues,” “intends,” “will,” “would,” “objectives,” “goals,” “projects,” “efforts,” “strategies” and similar expressions are used to identify such forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future performance and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: the continued ability of Phillips 66 to satisfy its obligations under our commercial and other agreements; the volume of crude oil, refined petroleum products and NGL we or our equity affiliates transport, fractionate, terminal and store; the tariff rates with respect to volumes transported through our regulated assets, which are subject to review and possible adjustment by federal and state regulators; fluctuations in the prices for crude oil, refined petroleum products and NGL; the continuing effects of the COVID-19 pandemic and its negative impact on the demand for refined products; changes in governmental policies relating to crude oil, refined petroleum products or NGL pricing, regulation, taxation, or exports; liabilities associated with the risks and operational hazards inherent in transporting, fractionating, terminaling and storing crude oil, refined petroleum products and NGL; curtailment of operations due to accidents, severe weather (including as a result of climate change) or natural disasters, riots, strikes or lockouts; the inability to obtain or maintain permits, in a timely manner or at all, and the possible revocation or modification of permits; the operation, financing and distribution decisions of our equity affiliates; costs to comply with environmental laws and safety regulations; failure of information technology due to various causes, including unauthorized access or attacks; changes to the costs to deliver and transport crude oil, refined petroleum products and NGL; potential liability from litigation or for remedial actions, including removal and reclamation obligations under environmental regulations; the failure to complete construction of capital projects on time and within budget; general domestic and international economic and political developments including armed hostilities, expropriation of assets, and other political, economic or diplomatic developments, including those caused by public health issues; our ability to comply with our debt covenants and to incur additional indebtedness on favorable terms; changes in tax, environmental and other laws and regulations; and other economic, business, competitive and/or regulatory factors affecting Phillips 66 Partners’ businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 Partners is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise. Use of Non-GAAP Financial Information—This news release includes the terms “EBITDA,” “adjusted EBITDA,” “distributable cash flow” and “coverage ratio.” These are non-GAAP financial measures. EBITDA and adjusted EBITDA are included to help facilitate comparisons of operating performance of the Partnership with other companies in our industry. EBITDA and distributable cash flow help facilitate an assessment of our ability to generate sufficient cash flow to make distributions to our partners. We believe that the presentation of EBITDA, adjusted EBITDA and distributable cash flow provides useful information to investors in assessing our financial condition and results of operations. Our coverage ratio is calculated as distributable cash flow divided by total cash distributions and is included to help indicate the Partnership’s ability to pay cash distributions from current earnings. The GAAP performance measure most directly comparable to EBITDA and adjusted EBITDA is net income (loss). The GAAP liquidity measure most comparable to EBITDA and distributable cash flow is net cash provided by operating activities. The GAAP financial measure most comparable to our coverage ratio is calculated as net cash provided by operating activities divided by total cash distributions. These non-GAAP financial measures should not be considered as alternatives to their comparable GAAP measures. They have important limitations as analytical tools because they exclude some but not all items that affect their corresponding GAAP measures. They should not be considered in isolation or as substitutes for analysis of our results as reported under GAAP. Additionally, because EBITDA, adjusted EBITDA, distributable cash flow and coverage ratio may be defined differently by other companies in our industry, our definition of those measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility. Reconciliations of these non-GAAP measures to their comparable GAAP measures are included in this release. References in the release to earnings or losses refer to net income or losses attributable to the Partnership. References to EBITDA refer to earnings before interest, income taxes, depreciation and amortization. Results of Operations (Unaudited) Summarized Financial Statement Information Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Selected Income Statement Data Total revenues and other income $ 503 452 Net income 299 255 Net income attributable to the Partnership 286 242 Adjusted EBITDA 400 367 Distributable cash flow 267 268 Net Income Attributable to the Partnership Per Limited Partner Unit—Diluted (Dollars) Common units $ 1.19 1.00 Selected Balance Sheet Data Cash and cash equivalents $ 62 71 Equity investments 2,929 2,941 Total assets 7,101 7,077 Total debt 3,897 3,896 Equity held by public Preferred units 729 729 Common units 2,676 2,657 Equity held by Phillips 66 Common units (743) (798) Statement of Income Millions of Dollars Q4 2021 Q3 2021 Revenues and Other Income Operating revenues—related parties $ 322 275 Operating revenues—third parties 9 8 Equity in earnings of affiliates 166 163 Other income 6 6 Total revenues and other income 503 452 Costs and Expenses Operating and maintenance expenses 106 89 Depreciation 35 38 Impairments — 10 General and administrative expenses 19 17 Taxes other than income taxes 10 10 Interest and debt expense 31 32 Other expenses — 1 Total costs and expenses 201 197 Income before income taxes 302 255 Income tax expense 3 — Net Income 299 255 Less: Net income attributable to noncontrolling interest 13 13 Net Income Attributable to the Partnership 286 242 Less: Preferred unitholders’ interest in net income attributable to the Partnership 12 12 Limited Partners’ Interest in Net Income Attributable to the Partnership $ 274 230 Selected Operating Data Q4 2021 Q3 2021 Wholly Owned Operating Data Pipelines Pipeline revenues (millions of dollars) $ 144 121 Pipeline volumes(1) (thousands of barrels daily) Crude oil 981 954 Refined petroleum products and NGL 1,072 994 Total 2,053 1,948 Average pipeline revenue per barrel (dollars) $ 0.76 0.67 Terminals Terminal revenues (millions of dollars) $ 53 40 Terminal throughput (thousands of barrels daily) Crude oil(2) 424 446 Refined petroleum products 856 780 Total 1,280 1,226 Average terminaling revenue per barrel (dollars) $ 0.44 0.36 Storage, processing and other revenues (millions of dollars) $ 134 122 Total Operating Revenues (millions of dollars) $ 331 283 Joint Venture Operating Data(3) Crude oil, refined petroleum products and NGL (thousands of barrels daily) 1,342 1,294 (1) Represents the sum of volumes transported through each separately tariffed pipeline segment. (2) Bayway and Ferndale rail rack volumes included in crude oil terminals. (3) Proportional share of total pipeline and terminal volumes of joint ventures consistent with recognized equity in earnings of affiliates. Cash Distributions Millions of Dollars Except as Indicated Q4 2021 Q3 2021 Cash Distributions† Common units—public $ 51 51 Common units—Phillips 66 149 149 Total $ 200 200 Cash Distribution Per Common Unit (Dollars) $ 0.875 0.875 Coverage Ratio* 1.34 1.34 †Cash distributions declared attributable to the indicated periods. *Calculated as distributable cash flow divided by total cash distributions. Used to indicate the Partnership’s ability to pay cash distributions from current earnings. Net cash provided by operating activities divided by total cash distributions was 1.51x and 1.69x at Q4 2021 and Q3 2021, respectively. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Income Attributable to the Partnership Millions of Dollars 2021 Year Q4 Q3 Net Income Attributable to the Partnership $ 735 286 242 Plus: Net income attributable to noncontrolling interest 42 13 13 Net Income 777 299 255 Plus: Depreciation 141 35 38 Net interest expense 127 31 31 Income tax expense 4 3 — EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. Reconciliation of Adjusted EBITDA and Distributable Cash Flow to Net Cash Provided by Operating Activities Millions of Dollars 2021 Year Q4 Q3 Net Cash Provided by Operating Activities $ 1,153 302 338 Plus: Net interest expense 127 31 31 Income tax expense 4 3 — Changes in working capital (29) 29 (36) Undistributed equity earnings 4 4 2 Impairments (208) — (10) Deferred revenues and other liabilities 4 2 — Other (6) (3) (1) EBITDA 1,049 368 324 Plus: Proportional share of equity affiliates’ net interest, taxes, depreciation and amortization, and impairments 201 50 51 Expenses indemnified or prefunded by Phillips 66 1 — — Impairments 208 — 10 Less: Adjusted EBITDA attributable to noncontrolling interest 66 18 18 Adjusted EBITDA 1,393 400 367 Plus: Deferred revenue impacts*† (7) (14) 2 Less: Equity affiliate distributions less than proportional adjusted EBITDA 59 28 14 Maintenance capital expenditures† 115 48 44 Net interest expense 127 31 31 Preferred unit distributions 48 12 12 Income taxes paid 2 — — Distributable Cash Flow $ 1,035 267 268 *Difference between cash receipts and revenue recognition. †Excludes Merey Sweeny capital reimbursements and turnaround impacts. 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Jeff Dietert (investors) 832-765-2297 jeff.dietert@p66.com Shannon Holy (investors) 832-765-2297 shannon.m.holy@p66.com Thaddeus Herrick (media) 855-841-2368 thaddeus.f.herrick@p66.com
