Diversified downstream operator, Phillips 66 (PSX) has entered into an agreement to acquire Pinnacle Midland in an all-cash deal worth $550 million. Pinnacle Midland is a midstream energy company owned by a private equity firm, Energy Spectrum Capital. Pinnacle Midland’s assets in the Midland Basin will complement and expand PSX’s processing capabilities in one of the most prolific oil and natural gas regions in the United States.Notably, the Dos Picos natural gas complex, owned by Pinnacle Midland, has a p ...

Core Viewpoint - Phillips 66 has experienced a significant decline in stock performance, with a return of -15.5% over the past month, underperforming the Zacks S&P 500 composite and the broader Oil and Gas - Refining and Marketing industry [1] Earnings Estimate Revisions - The consensus earnings estimate for Phillips 66 is $3.88 per share for the current quarter, reflecting a year-over-year increase of +0.3% and a +4.5% change over the last 30 days [3] - The consensus earnings estimate for the current fiscal year is $13.13, indicating a year-over-year decrease of -17%, with a +1.7% change over the last month [3] - For the next fiscal year, the consensus estimate is $14.63, showing an increase of +11.4% year-over-year, with a +9.8% change in the last month [3] - Phillips 66 holds a Zacks Rank 3 (Hold), influenced by recent changes in earnings estimates and other related factors [3] Revenue Growth Forecast - The consensus sales estimate for Phillips 66 is $34.22 billion for the current quarter, indicating a year-over-year decline of -4.2% [5] - The sales estimates for the current and next fiscal years are $136.66 billion and $136.57 billion, reflecting changes of -8.8% and -0.1%, respectively [5] Last Reported Results and Surprise History - In the last reported quarter, Phillips 66 generated revenues of $36.44 billion, a year-over-year increase of +3.8%, while EPS was $1.90 compared to $4.21 a year ago [6] - The reported revenues exceeded the Zacks Consensus Estimate of $31.05 billion by +17.35%, although the EPS fell short by -7.32% [6] - Over the last four quarters, Phillips 66 surpassed consensus EPS estimates twice and revenue estimates three times [7] Valuation - Phillips 66 is graded A on the Zacks Value Style Score, indicating it is trading at a discount compared to its peers [9] - Valuation multiples such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF) are essential for assessing whether the stock is fairly valued [8]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-35349 Phillips 66 (Exact name of registrant as specified in its charter) Delaware 45-3779385 (State or other ...

Financial Performance - Adjusted earnings were $822 million[31], resulting in adjusted earnings per share (EPS) of $1.90[31] - Operating cash flow, excluding working capital, reached $1.211 billion[31] - Shareholder distributions totaled $1.612 billion[31] - Adjusted EBITDA in 1Q 2024 was $1.9 billion[50] Strategic Initiatives - Commenced operations at Rodeo Renewable Energy Complex[26, 50] - The company is on track to realize $1 billion in controllable cost reductions in 2024[29] - Achieved $250 million run-rate synergies from DCP Midstream as of March 31[50] - Realized $1.24 billion run-rate business transformation savings as of March 31[50] Refining Operations - Refining crude utilization was in the mid-90% range[45] - Refining turnaround expense is estimated between $100 million and $120 million[45] - The company achieved above-industry-average crude utilization for five consecutive quarters[50]

Financial Data and Key Metrics Changes - Adjusted earnings for Q1 2024 were $822 million, or $1.90 per share, with operating cash flow (excluding working capital) at $1.2 billion [14] - Capital spending for the quarter was $628 million, with $1.6 billion returned to shareholders through share repurchases and dividends [14][18] - Net debt to capital ratio stood at 38% [14] Business Line Data and Key Metrics Changes - Refining adjusted pre-tax income was $228 million, down $569 million from the previous quarter, primarily due to lower realized margins and maintenance activities [16] - Midstream adjusted pre-tax income decreased by $141 million to $613 million, reflecting lower results in transportation and NGL [15] - Chemicals adjusted pre-tax income increased by $99 million to $205 million, driven by higher polyethylene margins and lower turnaround costs [16] Market Data and Key Metrics Changes - The refining market capture rate was 69%, below the target of 75%, impacted by maintenance and the renewable fuels conversion at Rodeo [20][21] - Global O&P utilization in chemicals was reported at 96% [16] Company Strategy and Development Direction - The company plans to monetize assets that no longer meet long-term objectives, targeting over $3 billion in proceeds to support strategic priorities [9] - A 10% increase in quarterly dividends was announced, reflecting confidence in cash flow generation and capital allocation [10] - The Rodeo Renewable Energy Complex is being transformed into one of the world's largest renewable fuels facilities, with production expected to ramp up to 50,000 barrels per day by the end of Q2 2024 [12][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the market fundamentals and the company's ability to achieve strategic priorities and grow cash flows [13] - The impact of rising commodity prices on inventory hedge positions was noted as a challenge [6] - Management highlighted the importance of ongoing maintenance and conversion activities for long-term success [21] Other Important Information - The company has distributed nearly $10 billion through share repurchases and dividends since July 2022 [9] - The Rodeo facility's conversion resulted in a $180 million loss in adjusted pre-tax income for the quarter, attributed to the transition from crude processing to renewable fuels [24][75] Q&A Session Summary Question: Refining capture rates and confidence in progression - Management acknowledged challenges in refining capture rates due to maintenance and conversion activities but expressed confidence in future improvements as operations stabilize [20][21] Question: Balance sheet and net debt capital targets - Management discussed working capital impacts and the goal to return to a net debt to capital ratio of 25% to 30%, emphasizing confidence in share repurchases despite current leverage levels [28][32] Question: Operational expenditures and cost reductions - Management confirmed that the majority of cost reductions are expected to manifest in refining, with ongoing efforts to achieve a target of $1 per barrel in cost reductions by year-end [36][38] Question: Impact of European retail asset sales - The sale of retail assets in Germany and Austria will not affect the company's ownership in the MiRO refinery, as the retail business does not integrate with core strategic areas [42][66] Question: Future of the Rodeo facility and profitability timeline - Management outlined a timeline for the Rodeo facility to reach full production capacity by the end of Q2 2024, with expectations for improved margins as lower carbon intensity feedstocks are utilized [46][76] Question: Chemical performance drivers - Management attributed improved performance in chemicals to favorable feedstock conditions and operational efficiencies, while cautioning that mid-cycle market conditions are not expected until after 2025 [53][56]

Core Viewpoint - Phillips 66 reported first-quarter 2024 adjusted earnings of $1.90 per share, missing the Zacks Consensus Estimate of $2.05, and significantly lower than the previous year's $4.21 [1] - Total quarterly revenues reached $36.4 billion, exceeding the Zacks Consensus Estimate of $31 billion and improving from $35.1 billion in the same quarter last year [1] Segmental Results Midstream - Adjusted pre-tax quarterly earnings were $613 million, down from $678 million year-over-year, but exceeded the estimate of $577.6 million [2] - The decline was mainly due to reduced throughput and deficiency revenues, partially offset by lower maintenance costs [2] Chemicals - Adjusted pre-tax earnings increased to $205 million from $198 million in the prior-year quarter, surpassing the estimate of $127 million [3] - The profit rise was driven by increased margins in polyethylene, higher sales prices, and decreased feedstock costs [3] Refining - Adjusted pre-tax earnings fell to $228 million from $1.6 billion year-over-year, missing the projection of $1.1 billion [4] - Realized refining margins worldwide dropped to $10.91 per barrel from $20.72, with declines noted in all regions including the Central Corridor and Gulf Coast [4] Marketing & Specialties - Pre-tax earnings decreased to $345 million from $426 million in the year-ago quarter, falling short of the projection of $546 million [5] - Realized marketing fuel margins in the U.S. declined to $1.60 per barrel from $2.30, while international margins increased to $6.92 from $6.45 [5] Costs & Expenses - Total costs and expenses rose to $35.5 billion from $32.4 billion in the previous year, which was below the projected $38.4 billion [6] Financial Condition - Net cash from operations was $236 million, significantly down from $1.2 billion a year ago [7] - Capital expenditures totaled $628 million, and dividends paid amounted to $448 million [8] - As of March 31, 2024, cash and cash equivalents were $1.6 billion, with total debt at $20.2 billion, reflecting a debt-to-capitalization ratio of 40% [8]

Key TakeawaysPhillips 66 reported a drop in first-quarter profits as refining margins thinned.The energy company's realized refining margins were nearly half what they were in the first quarter of 2023.The company noted its results were affected by maintenance, which limited its ability to produce higher-value products. Phillips 66 (PSX) shares dropped in intraday trading Friday after the energy producer’s quarterly profit fell as refining margins thinned. The company reported first-quarter net earnings slu ...

Exhibit 99.2 Phillips 66 Earnings Release Supplemental Data CONSOLIDATED INCOME STATEMENT Millions of Dollars, Except as Indicated 2024 2023 1st 2nd 3rd 4th 1st 2nd 3rd 4th Qtr Qtr Qtr Qtr YTD Qtr Qtr Qtr Qtr YTD Revenues and Other Income Sales and other operating revenues 35,811 35,811 34,396 35,090 39,643 38,270 147,399 Equity in earnings of affiliates 528 528 611 563 562 281 2,017 Net gain (loss) on dispositions — — 34 (12) 102 (9) 115 Other income** 97 97 48 99 15 197 359 Total Revenues and Other Income ...

Company Performance - Phillips 66 reported quarterly earnings of $1.90 per share, missing the Zacks Consensus Estimate of $2.05 per share, and down from $4.21 per share a year ago, representing an earnings surprise of -7.32% [1] - The company posted revenues of $36.44 billion for the quarter ended March 2024, surpassing the Zacks Consensus Estimate by 17.35%, compared to $35.09 billion in the same quarter last year [1] - Over the last four quarters, Phillips 66 has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [1] Stock Performance - Phillips 66 shares have increased approximately 18.1% since the beginning of the year, outperforming the S&P 500's gain of 5.8% [2] - The current consensus EPS estimate for the upcoming quarter is $4.40 on revenues of $34.3 billion, and for the current fiscal year, it is $13.77 on revenues of $134.41 billion [4] Industry Outlook - The Oil and Gas - Refining and Marketing industry is currently ranked in the top 19% of over 250 Zacks industries, indicating a favorable outlook for stocks within this sector [5] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that the industry outlook can significantly impact stock performance [3][5]

Group 1 - The average brokerage recommendation (ABR) for Phillips 66 (PSX) is 1.68, indicating a consensus between Strong Buy and Buy, with 63.2% of recommendations being Strong Buy and 5.3% being Buy [1][2] - Brokerage recommendations may not effectively guide investors, as they often exhibit a positive bias due to the vested interests of brokerage firms, leading to a disproportionate number of favorable ratings [2][4] - The Zacks Rank, which is based on earnings estimate revisions, is a more reliable indicator of a stock's near-term price performance compared to ABR [3][4] Group 2 - The Zacks Consensus Estimate for Phillips 66 has increased by 8.3% over the past month to $13.59, reflecting analysts' growing optimism about the company's earnings prospects [6] - The recent increase in the consensus estimate, along with other factors, has resulted in a Zacks Rank 2 (Buy) for Phillips 66, suggesting potential for stock appreciation [6]