Phillips 66 reported adjusted earnings of $1.02bn (AED3.74bn) for the third quarter of 2025, up from $973mn in the second quarter. Net income stood at $133mn, impacted by $241mn in pre-tax charges related to accelerated depreciation of assets at the Los Angeles refinery, which is now in the process of shutting down. Adjusted earnings per share came in at $2.52, compared to $2.38 in the previous period.
Industrial resilience and strategic streamlining
The group completed the acquisition of the remaining 50% stake in WRB Refining LP, becoming the sole owner of the Wood River and Borger refineries. This move aims to simplify its capital structure while enhancing margin capture in the central corridor. Refining capacity utilisation reached 99%, the highest since 2018, with clean product yield maintained at 86%.
The Midstream segment delivered adjusted EBITDA of $964mn, supported by record volumes of Y-grade transport at 999,000 barrels per day and fractionation at 930,000 barrels per day. The Chemicals segment also improved, posting adjusted EBITDA of $308mn, driven by stronger margins and reduced maintenance costs.
Margin pressure in the marketing segment
Marketing and Specialties saw its adjusted EBITDA fall to $525mn from $718mn in the previous quarter, due to weaker margins. The Refining segment, however, benefited from improved market crack spreads, generating adjusted EBITDA of $904mn despite increased environmental costs tied to the phased shutdown of the Los Angeles site.
Capital expenditures totalled $541mn, slightly down from $587mn in the previous quarter. Operating cash flow reached $1.18bn, or $1.92bn excluding changes in working capital. Net debt represented 41% of capital, with total debt amounting to $21.76bn.
Asset reallocation and strengthened liquidity
The group expects to complete the sale of its majority stake in its retail marketing operations in Germany and Austria by year-end. Remaining units at the Los Angeles refinery are set to be fully idled by December, in line with the announced timeline.
Financially, Phillips 66 returned $751mn to shareholders during the third quarter, including $267mn in share repurchases and $484mn in dividends. Available cash stood at $1.95bn at the end of September, supported by $5.2bn in committed credit facilities.
