Phillips 66 Takes Hit from Lower Demand, DCP Equity Investment

SUGAR LAND--May 4, 2020--Researched by Industrial Info Resources (Sugar Land, Texas)--As demand for refined products fell precipitously beginning in March due the COVID-19 pandemic and subsequent stay-at-home orders, refiner and midstream operator Phillips 66 (NYSE:PSX) (Houston, Texas) felt the sting. Phillip 66 reported a first-quarter 2020 net loss of $2.5 billion, compared with net income of $204 million in the prior-year quarter. The company's major write-downs occurred with a $1.8 billion impairment of goodwill in its Refining segment and a $1.2 billion impairment of Phillip 66's investment in midstream company DCP Midstream Partners LP (NYSE:DCP) (Denver, Colorado), shares of which fell from more than $31 a year ago to less than $3 in March. As of Friday, DCP shares were trading in the $8 range. However, excluding special items, Phillips 66's adjusted earnings were $450 million, compared with $187 million in first-quarter 2019.