Phillips 66 Fourth-Quarter Earnings Conference Call

PHILLIPS 66 FOURTH QUARTER CONFERENCE CALL January 29, 2016

This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and

Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Words and

phrases such as “is anticipated,” “is estimated,” “is expected,” “is planned,” “is scheduled,” “is targeted,” “believes,” “intends,” “objectives,” “projects,”

“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 relating to Phillips 66’s operations (including joint venture operations) are based on

management’s expectations, estimates and projections about the company, its interests and the energy industry in general on the date this

presentation was prepared. These statements are not guarantees of future performance and 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

fluctuations in NGL, crude oil, petroleum products and natural gas prices, and refining, marketing and petrochemical margins; unexpected changes in

costs for constructing, modifying or operating our facilities; unexpected difficulties in manufacturing, refining or transporting our products; lack of, or

disruptions in, adequate and reliable transportation for our NGL, crude oil, natural gas and refined products; potential liability from litigation or for

remedial actions, including removal and reclamation obligations, under environmental regulations; limited access to capital or significantly higher cost

of capital related to illiquidity or uncertainty in the domestic or international financial markets; and other economic, business, competitive and/or

regulatory factors affecting Phillips 66’s businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 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.

This presentation includes non-GAAP financial measures. You can find the reconciliations to comparable GAAP financial measures at the end of the

presentation materials or in the “Investors” section of our website.

CAUTIONARY STATEMENT

2

3

EXECUTING STRATEGY

4

OVERVIEW 4Q 2015

Adjusted Earnings $710 MM

Adjusted EPS $1.31

Operating cash flow excluding working capital $1.8 B

Capital expenditures and investments 1 $1.0 B

Shareholder distributions 2 $704 MM

DCP equity contribution $1.5 B

(2) Shareholder distributions include dividends and share repurchases

(1) Capital expenditures and investments exclude DCP equity contribution of $1.5 B

1,647

710

(49)(90)

(676)(117) (5)

3Q 2015

Adjusted

Earnings

Midstream Chemicals Refining Marketing

& Specialties

Corporate

& Other

4Q 2015

Adjusted

Earnings

4Q 2015 Adjusted Earnings

$MM

42 (117) 376 182 227

ADJUSTED EARNINGS 4Q 2015 VS. 3Q 2015

5

6

MIDSTREAM OVERVIEW 4Q 2015

Transportation Higher volumes

NGL Sweeny Fractionator One in production

PSXP Earnings contribution up 19%

DCP Midstream Low commodity prices

2015 Adjusted ROCE 5%

91

42

1

(34)

(16)

3Q 2015

Adjusted

Earnings

Transportation NGL DCP

Midstream

4Q 2015

Adjusted

Earnings

$MM

MIDSTREAM 4Q 2015 VS. 3Q 2015

78 (2) (34)


7

8

CHEMICALS OVERVIEW 4Q 2015

Olefins & Polyolefins Lower cash chain margins

Specialties, Aromatics & Styrenics Planned turnaround impacts


272

182

(80) (8) (2)

3Q 2015

Adjusted

Earnings

Olefins &

Polyolefins

Specialties,

Aromatics &

Styrenics

Other 4Q 2015

Adjusted

Earnings

$MM

CHEMICALS 4Q 2015 VS. 3Q 2015

9


181 (8) 9

10

REFINING OVERVIEW 4Q 2015

Realized margin $9.41/BBL

Market capture 74%

Crude utilization 94%

Clean product yield 85%


1,052

376

(96)

(138)

(251)

(191)

3Q 2015

Adjusted

Earnings

Atlantic

Basin /

Europe

Gulf Coast Central

Corridor

Western /

Pacific

4Q 2015

Adjusted

Earnings

$MM

REFINING 4Q 2015 VS. 3Q 2015

11

97 121 147 11


12.77

9.41

(2.13)

(2.19)

1.28

(0.32)

Market

3:2:1

Configuration Secondary

Products

Feedstock Other Realized

Margin

WORLDWIDE REFINING $/BBL

REFINING MARGINS – MARKET VS. REALIZED 4Q 2015

12

Average Market Crude $43.31/BBL 94% Crude Capacity Utilization 74% Market Capture

13

MARKETING AND SPECIALTIES OVERVIEW 4Q 2015

Marketing Favorable global margins

Specialties Lower margins


344

227

(93)(24)

3Q 2015

Adjusted

Earnings

Marketing

& Other

Specialties 4Q 2015

Adjusted

Earnings

$MM

MARKETING AND SPECIALTIES 4Q 2015 VS. 3Q 2015

14

198 29


(112) (117)

(4) (1)

3Q 2015

Adjusted

Net Loss

Net Interest

Expense

Corporate

Overhead

& Other

4Q 2015

Adjusted

Net Loss

$MM

CORPORATE AND OTHER 4Q 2015 VS. 3Q 2015

15

16

OVERVIEW 2015

Adjusted Earnings $4.2 B

Adjusted EPS $7.67

Operating cash flow excluding working capital $5.9 B

Capital expenditures and investments 1 $4.3 B

Shareholder distributions 2 $2.7 B

Adjusted net debt-to-capital ratio 3 17%

Adjusted ROCE 14%

(2) Shareholder distributions include dividends and share repurchases

(3) Adjusted net debt-to-capital ratio excludes the impacts of PSXP

(1) Capital expenditures and investments exclude DCP equity contribution of $1.5 B

DCP equity contribution $1.5 B

3,782 4,193

(260)(257)

951 65

(88)

2014

Adjusted

Earnings


& Specialties

Corporate

& Other

2015

Adjusted

Earnings

2015 Adjusted Earnings

$MM

248 (481) 2,527 952 947

ADJUSTED EARNINGS 2015 VS. 2014

17

Adjusted EPS

$6.62

Adjusted EPS

$7.67

5.2

3.1

1.5

(4.3)

(1.5) 5.9

(0.2)(0.8)

(5.8)

(2.7)

December

2014 CashBalance*

CFO

(excludingworking

capital)

Working

Capital

PSXP Bond &

Equity Proceeds

Debt

Repayment

Capital

Expenditures& Investments

Shareholder

Distributions

December

2015 CashBalance*

$B

CASH FLOW 2015

18

* Includes cash and cash equivalents

DCP Equity Contribution

19

Global Olefins & Polyolefins utilization Mid-90%

Refining crude utilization Mid-90%

Depreciation and amortization $1.2 B

Effective income tax rate Mid-30%

Corporate & Other costs (after-tax) $120 MM - $125 MM

OUTLOOK

Refining turnaround expenses (pre-tax) ~$150 MM

2016

Refining turnaround expenses (pre-tax) $525 MM - $575 MM

Corporate & Other costs (after-tax) $480 MM - $500 MM

1Q 2016

PHILLIPS 66 FOURTH QUARTER 2015 CONFERENCE CALL

Questions and Answers

PHILLIPS 66 FOURTH QUARTER 2015 CONFERENCE CALL

Appendix

ESTIMATED SENSITIVITIES 2016

22 Sensitivities shown above are independent and are only valid within a limited price range

Midstream - DCP (net to Phillips 66)

10¢/Gal Increase in NGL price 25

$1/MMBtu Increase in Natural Gas price 20

$10/BBL Increase in WTI price 10

Chemicals - CPChem (net to Phillips 66)

1¢/Lb Increase in Chain Margin (Ethylene, Polyethylene, NAO) 35

Worldwide Refining

$1/BBL Increase in Gasoline Margin 230

$1/BBL Increase in Distillate Margin 200

$1/BBL Widening LLS / Maya Differential (LLS less Maya) 45

$1/BBL Widening WTI / WCS Differential (WTI less WCS) 40

$1/BBL Widening WTI / WTS Differential (WTI less WTS) 20

$1/BBL Widening LLS / Medium Sour Differential (LLS less Medium Sour) 15

$1/BBL Widening ANS / WCS Differential (ANS less WCS) 10

10¢/MMBtu Increase in Natural Gas price (10)

Impacts due to Actual Crude Feedstock Differing from Feedstock Assumed in Market Indicators:

Annual Net Income $MM

22.4 22.0

22.6

23.2

24.0 23.9

22.0 21.6

21.8

22.4

23.2 23.1

6.1

8.6 8.9 8.9 8.9 8.9

6.1

8.6 7.8 7.8 7.8 7.8

5.4 5.2 5.4 5.1 4.8 3.1

5.0 5.2 5.3 5.0 4.7 3.0

21%

28% 28%28%

27% 27%

22%

28%

26% 26%25% 25%

2013 2014 1Q

2015

2Q

2015

3Q

2015

4Q

2015

2013 2014 1Q

2015

2Q

2015

3Q

2015

4Q

2015

Equity $B Debt $B Cash & Cash Equivalents $B Debt-to-Capital

20%-30%

CAPITAL STRUCTURE 2013 – 2015

23

Consolidated PSX Excluding PSXP

12.11

7.18

(1.95)(1.07)

(1.96)

0.05

Market

3:2:1


Products


Margin

ATLANTIC BASIN / EUROPE $/BBL


24

Market 3:2:1 – Dated Brent / Gasoline 83.7 RBOB NYH / Diesel 15ppm NYH

Brent $43.69/BBL 101% Crude Capacity Utilization 59% Market Capture

8.56 8.59

(1.42)

(2.74)

2.57

1.62

Market

3:2:1


Products


Margin

GULF COAST $/BBL


25

Market 3:2:1 – LLS / Gasoline 85 CBOB / Diesel 61 8ppm

LLS $43.57/BBL 93% Crude Capacity Utilization 100% Market Capture

13.82 11.43

(1.49)

(2.68)

3.20

(1.42)

Market

3:2:1


Products


Margin

CENTRAL CORRIDOR $/BBL


26

Market 3:2:1 – WTI / Gasoline Unl Sub Octane Group 3 / ULSD Group 3

WTI $42.10/BBL 93% Crude Capacity Utilization 83% Market Capture

21.03

12.51

(4.08)

(2.44)

1.77

(3.77)

Market

3:2:1


Products


Margin

WESTERN / PACIFIC $/BBL


27

Market 3:2:1 – ANS Spot / Los Angeles CARBOB / Los Angeles No. 2 CARB

ANS $43.79/BBL 87% Crude Capacity Utilization 59% Market Capture

913

710

(55)

(88)

54

(97) (17)

4Q 2014

Adjusted

Earnings


& Specialties

Corporate

& Other

4Q 2015

Adjusted

Earnings


$MM

42 (117) 376 182 227

ADJUSTED EARNINGS 4Q 2015 VS. 4Q 2014

28

97

42

25

(57)

(23)

4Q 2014

Adjusted

Earnings

Transportation NGL DCP

Midstream

4Q 2015

Adjusted

Earnings

$MM

MIDSTREAM 4Q 2015 VS. 4Q 2014

29

78 (2) (34)


270

182

(67)(18) (3)

4Q 2014

Adjusted

Earnings

Olefins &

Polyolefins

Specialties,

Aromatics &

Styrenics

Other 4Q 2015

Adjusted

Earnings

$MM

CHEMICALS 4Q 2015 VS. 4Q 2014

30

181 (8) 9


322 376

(92)

155

(78)

69

4Q 2014

Adjusted

Earnings

Atlantic

Basin /

Europe

Gulf

Coast

Central

Corridor

Western /

Pacific

4Q 2015

Adjusted

Earnings

$MM

REFINING 4Q 2015 VS. 4Q 2014

31

97 121 147 11


324

227

(58)

(39)

4Q 2014

Adjusted

Earnings

Marketing

& Other

Specialties 4Q 2015

Adjusted

Earnings

$MM

MARKETING AND SPECIALTIES 4Q 2015 VS. 4Q 2014

32

198 29


(100)(117)

(3)

(14)

4Q 2014

Adjusted

Net Loss

Net Interest

Expense

Corporate

Overhead

& Other

4Q 2015

Adjusted

Net Loss

$MM

CORPORATE AND OTHER 4Q 2015 VS. 4Q 2014

33

4.8

3.1

(0.3)

(1.0)

1.8

(2.5)

(0.7)

(1.5)

September 30

CashBalance*

CFO

(excludingworking

capital)

Working

Capital

Capital

Expenditures&

Investments

Shareholder

Distributions

December 31

CashBalance*

$B

CASH FLOW 4Q 2015

34

* Includes cash and cash equivalents

DCP Equity Contribution

35

NON-GAAP RECONCILIATIONS

Year 4Q 3Q Year 4Q

Phillips 66

Net Income (Loss) Attributable to Phillips 66 4,227$ 650$ 1,578$ 4,762$ 1,147$

Adjustments:

Asset dispositions (265) - (18) (494) (385)

Pension settlement expense 49 3 46 - -

Impairments - - - 131 131

Impairments by equity affiliates 256 108 22 69 -

Certain tax impacts (84) (84) - - -

Pending claims and settlements (23) - 19 (10) (10)

Lower-of-cost-or-market inventory adjustments 33 33 - 30 30

Discontinued Operations - - - (706) -

Adjusted Net Income (Loss) Attributable to Phillips 66 4,193$ 710$ 1,647$ 3,782$ 913$

Net Income (Loss) Attributable to Phillips 66 Per Share of Common Stock (dollars) 7.73$ 1.20$ 2.90$ 8.33$ 2.05$

Adjusted Net Income (Loss) Attributable to Phillips 66 Per Share of Common Stock (dollars) 7.67$ 1.31$ 3.02$ 6.62$ 1.63$

Millions of Dollars

Except as Indicated

2015 2014

36


Year 4Q 3Q Year 4Q

Midstream

Net Income (Loss) Attributable to Phillips 66 13$ (77)$ 101$ 507$ 96$

Adjustments:

Pension settlement expense 6 - 6 - -

Impairments by equity affiliates 232 104 2 - -

Asset dispositions (18) - (18) - -

Certain tax impacts 15 15 - - -

Lower-of-cost-or-market inventory adjustments - - - 1 1

Adjusted Net Income (Loss) Attributable to Phillips 66 248$ 42$ 91$ 508$ 97$

Chemicals

Net Income (Loss) Attributable to Phillips 66 962$ 212$ 252$ 1,137$ 267$

Adjustments:

Impairments by equity affiliates 24 4 20 69 -



Adjusted Net Income (Loss) Attributable to Phillips 66 952$ 182$ 272$ 1,209$ 270$

Millions of Dollars

Except as Indicated

2015 2014

37


Year 4Q 3Q Year 4Q

Refining

Net Income (Loss) Attributable to Phillips 66 2,555$ 410$ 1,003$ 1,771$ 517$

Adjustments:

Asset dispositions (5) - - (369) (369)

Impairments - - - 131 131



Pending claims and settlements (19) - 19 17 17


Adjusted Net Income (Loss) Attributable to Phillips 66 2,527$ 376$ 1,052$ 1,576$ 322$

Marketing & Specialties

Net Income (Loss) Attributable to Phillips 66 1,187$ 231$ 338$ 1,034$ 367$

Adjustments:



Pending claims and settlements - - - (27) (27)



Corporate and Other

Net Income (Loss) Attributable to Phillips 66 (490)$ (126)$ (116)$ (393)$ (100)$

Adjustments:



Pending claims and settlements (4) - - - -

Adjusted Net Income (Loss) Attributable to Phillips 66 (481)$ (117)$ (112)$ (393)$ (100)$

Millions of Dollars

Except as Indicated

2015 2014

38


Year 4Q 3Q Year 4Q

Midstream - Transportation

Net Income (Loss) Attributable to Phillips 66 288$ 81$ 77$ 233$ 53$

Adjustments:



Midstream - NGL


Adjustments:



Adjusted Net Income (Loss) Attributable to Phillips 66 52$ (2)$ 32$ 139$ 55$

Midstream - DCP Midstream

Net Income (Loss) Attributable to Phillips 66 (324)$ (159)$ (2)$ 135$ (12)$

Adjustments:

Impairments by equity affiliates 232 104 2 - -

Asset dispositions (18) - (18) - -



Adjusted Net Income (Loss) Attributable to Phillips 66 (89)$ (34)$ (18)$ 136$ (11)$

Millions of Dollars

Except as Indicated

2015 2014

39


Year 4Q 3Q Year 4Q

Refining - Atlantic Basin / Europe


Adjustments:


Pending claims and settlements (33) - 5 1 1

Impariments - - - 131 131



Refining - Gulf Coast

Net Income (Loss) Attributable to Phillips 66 551$ 128$ 269$ 252$ (11)$

Adjustments:


Pending claims and settlements 6 - 6 3 3


Adjusted Net Income (Loss) Attributable to Phillips 66 586$ 147$ 285$ 255$ (8)$

Millions of Dollars

Except as Indicated

2015 2014

40


Year 4Q 3Q Year 4Q

Refining - Central Corridor


Adjustments:






Refining - Western / Pacific


Adjustments:






Adjusted Net Income (Loss) Attributable to Phillips 66 582$ 11$ 202$ 7$ (58)$

Millions of Dollars

Except as Indicated

2015 2014

41


Year 4Q 3Q Year 4Q

Marketing & Specialties - Marketing & Other

Net Income (Loss) Attributable to Phillips 66 1,004$ 199$ 285$ 836$ 299$

Adjustments:



Pending claims and settlements - - - (27) (27)



Marketing & Specialties - Specialties


Adjustments:



Millions of Dollars

Except as Indicated

20142015

2015 YTD Phillips 66 Midstream Chemicals RefiningMarketing

& Specialties

Numerator ($MM)

Net Income 4,280 74 962 2,555 1,187

After-tax interest expense 201 - - - -

GAAP ROCE earnings 4,481 74 962 2,555 1,187

Special Items (34) 235 (10) (28) (240)

Adjusted ROCE earnings 4,447 309 952 2,527 947

Denominator ($MM)

GAAP average capital employed* 31,749 6,793 4,921 13,582 2,735

2015 Adjusted ROCE 14% 5% 19% 19% 35%

2015 GAAP ROCE 14% 1% 20% 19% 43%

42 * Total equity plus total debt


43


Phillips 66

Consolidated

Phillips 66

Partners

Adjusted

Phillips 66

Total Debt 8,887$ 1,091$ 7,796$

Total Equity 23,938$ 809$ 23,129$

Debt-to-Capital Ratio 27% 25%

Total Cash 3,074$ 48$ 3,026$

Net-Debt-to-Capital Ratio 20% 17%

2015

4Q

Millions of Dollars

44


Growth Sustaining Total

Capital expenditures and investments

Midstream * 2,801$ 1,656$ 4,457$

Chemicals -$ -$ -$

Refining 201$ 868$ 1,069$

Marketing & Specialties 66$ 56$ 122$

Corporate and Other 10$ 106$ 116$

Total 3,078$ 2,686$ 5,764$

* Midstream Sustaining expenditures includes DCP equity contribution of $1.5 B

Millions of Dollars

2015

45


Millions of Dollars

2015

4Q

Effective Tax Rates

Income before taxes 832$

Special items 226$

Adjusted income before taxes 1,058$

Provision for taxes 166$

Special items 166$

Adjusted provision for taxes 332$

GAAP effective tax rate 20%

Adjusted effective tax rate 31%

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Phillips 66 Fourth-Quarter Earnings Conference Call

Investor Relations