(Reuters) -Phillips 66 missed quarterly revenue estimates dueto a decline in refining margins led by underperformance at its Gulf Coast operations, sending the refiner’s shares down 5.5% in premarket buying and selling on Friday.
Refiner margins have scaled again from the peaks achieved after Russia’s invasion of Ukraine in 2022, amid an increase in world refining capability that has led to a drop in gasoline costs.
The firm mentioned its realized margins fell about 47% to $10.91 per barrel within the first quarter from a 12 months earlier, led by practically a 50% decline in Gulf Coast margins.
Its market seize, a measure of refining revenue in contrast with business benchmarks, fell to 69% from 93%.
The decline comes amid a push from activist investor Elliott, which revealed a $1 billion stake within the firm final 12 months, to deal with underperformance in refining and velocity up price cuts.
“Our results were affected by maintenance that limited our ability to make higher-value products. We were also impacted by the renewable fuels conversion at Rodeo, as well as the effect of rising commodity prices on our inventory hedge positions,” CEO Mark Lashier mentioned.
Its crude capability utilization stood at 92%, larger than final 12 months.
Lashier added that the heavy upkeep it noticed within the first quarter was largely full.
Phillips 66 (NYSE:) mentioned it has launched a gross sales strategy of its retail advertising and marketing enterprise in Germany and Austria as a part of its plan to divest non-core belongings of about $3 billion.
The Houston-based firm reported adjusted earnings of $1.90 per share for the three months ended March 31, in contrast with analysts’ estimates of $2.17 per share, based on LSEG information.
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