PHILLIPS 66 PARTNERS LP - FORM 8-K - EX-99.2 - EXHIBIT 99.2

Attached files

file	filename
EX-99.1 - EXHIBIT 99.1 - PHILLIPS 66 PARTNERS LP	mlp-2016930_erxex991.htm
8-K - 8-K - PHILLIPS 66 PARTNERS LP	mlp-2016930_erx8xk.htm

Exhibit 99.2



Phillips 66 Partners LP Earnings Release Supplemental Data

Factors Affecting Comparability

The following tables present our financial results and operating data for each quarterly period of the current and prior fiscal years. During the periods covered by this report, we acquired businesses from Phillips 66 that were considered transfers of businesses between entities under common control, which requires them to be accounted for as if the transfers had occurred at the beginning of the period of transfer, with financial statements for prior periods retrospectively adjusted to furnish comparative information. Accordingly, the consolidated financial and operating information included in the following tables has been retrospectively adjusted to include the historical financial and operating results of these acquired businesses prior to the effective date of acquisition. We refer to the results of these pre-acquisition periods as those of our “Predecessors” in the tables below. Tables labeled “Phillips 66 Partners LP” exclude Predecessors, while tables labeled “Consolidated” include Predecessors. The statements of income provided on pages 1 through 3 are designed to enable users to evaluate the financial effect of these business combinations in accordance with Accounting Standard Codification 805-10-50-1.

STATEMENT OF INCOME


PHILLIPS 66 PARTNERS LP

	Millions of Dollars
	2015						2016
	1st Qtr	2nd Qtr		3rd Qtr	4th Qtr	YTD	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Revenues
Operating revenues—related parties	62.8	62.3		65.4	70.1	260.6	76.5	106.5	108.4		291.4
Operating revenues—third parties	1.1	0.9		0.7	2.3	5.0	2.0	2.1	1.8		5.9
Equity in earnings of affiliates	6.1	20.6		25.2	25.2	77.1	24.8	29.9	33.8		88.5
Other income	0.1	—		0.1	5.2	5.4	—	0.3	0.3		0.6
Total revenues and other income	70.1	83.8		91.4	102.8	348.1	103.3	138.8	144.3		386.4

Costs and Expenses
Operating and maintenance expenses	14.8	17.5		15.5	14.4	62.2	17.6	27.9	25.5		71.0
Depreciation	5.1	5.3		5.7	5.7	21.8	8.4	14.4	15.1		37.9
General and administrative expenses	7.4	6.4		6.2	6.6	26.6	8.1	7.8	9.2		25.1
Taxes other than income taxes	1.3	3.1		2.4	2.2	9.0	3.8	5.5	1.2		10.5
Interest and debt expense	5.9	9.5		9.2	9.3	33.9	9.9	11.0	9.9		30.8
Other expenses	—	0.1		—	—	0.1	—	—	0.1		0.1
Total costs and expenses	34.5	41.9		39.0	38.2	153.6	47.8	66.6	61.0		175.4
Income before income taxes	35.6	41.9		52.4	64.6	194.5	55.5	72.2	83.3		211.0
Provision for income taxes	0.2	(0.1	)	0.1	0.1	0.3	0.2	0.4	0.2		0.8
Net Income	35.4	42.0		52.3	64.5	194.2	55.3	71.8	83.1		210.2
Less: Net income attributable to noncontrolling interests	—	—		—	—	—	3.0	4.3	—		7.3
Net income attributable to the Partnership	35.4	42.0		52.3	64.5	194.2	52.3	67.5	83.1		202.9
Less: General partner’s interest in net income attributable to the Partnership	6.4	9.0		11.5	14.1	41.0	15.8	21.1	26.0		62.9
Limited partners’ interest in net income attributable to the Partnership	29.0	33.0		40.8	50.4	153.2	36.5	46.4	57.1		140.0

Adjusted EBITDA	48.9	56.9		73.3	87.0	266.1	73.8	97.3	110.9		282.0

Distributable Cash Flow	41.9	47.8		64.5	74.0	228.2	64.1	84.4	101.9		250.4

Page 1

Exhibit 99.2

STATEMENT OF INCOME (continued)


PREDECESSORS

	Millions of Dollars
	2015								2016
	1st Qtr	2nd Qtr	3rd Qtr		4th Qtr		YTD		1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Revenues
Operating revenues—related parties	3.8	4.0	5.7		16.4		29.9		22.7	1.6	—		24.3
Other income	—	—	—		—		—		0.2	—	—		0.2
Total revenues	3.8	4.0	5.7		16.4		29.9		22.9	1.6	—		24.5

Costs and Expenses
Operating and maintenance expenses	1.6	2.1	4.8		14.5		23.0		5.4	—	—		5.4
Depreciation	0.2	0.1	0.4		3.7		4.4		5.5	0.1	—		5.6
General and administrative expenses	0.9	1.1	1.2		1.3		4.5		0.9	—	—		0.9
Taxes other than income taxes	0.7	0.7	0.7		0.9		3.0		1.7	0.1	—		1.8
Total costs and expenses	3.4	4.0	7.1		20.4		34.9		13.5	0.2	—		13.7
Income before income taxes	0.4	—	(1.4	)	(4.0	)	(5.0	)	9.4	1.4	—		10.8
Provision for income taxes	—	—	—		—		—		—	—	—		—
Net Income (Loss)	0.4	—	(1.4	)	(4.0	)	(5.0	)	9.4	1.4	—		10.8
Net income attributable to noncontrolling interests	—	—	—		—		—		3.0	4.3	—		7.3
Net income attributable to the Predecessor	0.4	—	(1.4	)	(4.0	)	(5.0	)	12.4	5.7	—		18.1

EBITDA attributable to Predecessors	0.6	0.1	(1.0	)	(0.3	)	(0.6	)	19.9	8.5	—		28.4

Page 2

Exhibit 99.2

STATEMENT OF INCOME (continued)


CONSOLIDATED

	Millions of Dollars, Except as Indicated
	2015									2016
	1st Qtr	2nd Qtr		3rd Qtr		4th Qtr		YTD		1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Revenues
Operating revenues—related parties	66.6	66.3		71.1		86.5		290.5		99.2	108.1	108.4		315.7
Operating revenues—third parties	1.1	0.9		0.7		2.3		5.0		2.0	2.1	1.8		5.9
Equity in earnings of affiliates	6.1	20.6		25.2		25.2		77.1		24.8	29.9	33.8		88.5
Other income	0.1	—		0.1		5.2		5.4		0.2	0.3	0.3		0.8
Total revenues and other income	73.9	87.8		97.1		119.2		378.0		126.2	140.4	144.3		410.9

Costs and Expenses
Operating and maintenance expenses	16.4	19.6		20.3		28.9		85.2		23.0	27.9	25.5		76.4
Depreciation	5.3	5.4		6.1		9.4		26.2		13.9	14.5	15.1		43.5
General and administrative expenses	8.3	7.5		7.4		7.9		31.1		9.0	7.8	9.2		26.0
Taxes other than income taxes	2.0	3.8		3.1		3.1		12.0		5.5	5.6	1.2		12.3
Interest and debt expense	5.9	9.5		9.2		9.3		33.9		9.9	11.0	9.9		30.8
Other expenses	—	0.1		—		—		0.1		—	—	0.1		0.1
Total costs and expenses	37.9	45.9		46.1		58.6		188.5		61.3	66.8	61.0		189.1
Income before income taxes	36.0	41.9		51.0		60.6		189.5		64.9	73.6	83.3		221.8
Provision for income taxes	0.2	(0.1	)	0.1		0.1		0.3		0.2	0.4	0.2		0.8
Net Income	35.8	42.0		50.9		60.5		189.2		64.7	73.2	83.1		221.0
Less: Net income (loss) attributable to Predecessors	0.4	—		(1.4	)	(4.0	)	(5.0	)	12.4	5.7	—		18.1
Net income attributable to the Partnership	35.4	42.0		52.3		64.5		194.2		52.3	67.5	83.1		202.9
Less: General partner’s interest in net income attributable to the Partnership	6.4	9.0		11.5		14.1		41.0		15.8	21.1	26.0		62.9
Limited partners’ interest in net income attributable to the Partnership	29.0	33.0		40.8		50.4		153.2		36.5	46.4	57.1		140.0

Net Income Attributable to the Partnership Per Limited Partner Unit—Basic and Diluted (dollars)
Common units	0.39	0.50		0.50		0.61		2.02		0.44	0.51	0.57		1.53
Subordinated units—Phillips 66	0.35	—		—		—		1.24		—	—	—		—

Average Limited Partner Units Outstanding—Basic and Diluted (thousands)
Common units—public	21,047	24,139		24,139		24,139		23,376		24,139	31,397	40,392		32,007
Common units—Phillips 66	21,468	41,489		57,743		57,947		44,797		58,490	59,562	60,163		59,408
Subordinated units—Phillips 66	35,217	16,254		—		—		12,736		—	—	—		—

Page 3

Exhibit 99.2

SELECTED OPERATING DATA


PHILLIPS 66 PARTNERS LP

	2015					2016
	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Pipeline, Terminal and Storage Volumes (MB/D)
Pipelines⁽¹⁾
Pipeline throughput volumes
Wholly-Owned Pipelines
Crude oil	283	282	306	283	289	281	287	257		275
Refined products	462	446	438	522	467	520	606	619		582
Total	745	728	744	805	756	801	893	876		857

Select Joint Venture Pipelines⁽²⁾
Natural gas liquids	97	285	280	280	236	306	346	346		333

Terminals
Terminaling throughput and storage volumes⁽³⁾
Crude oil⁽⁴⁾	558	518	536	464	519	502	559	541		534
Refined products	431	424	441	443	435	427	450	442		440
Total	989	942	977	907	954	929	1,009	983		974
⁽¹⁾Represents the sum of volumes transported through each separately tariffed pipeline segment.
⁽²⁾Total post-acquisition pipeline system throughput volumes for the Sand Hills and Southern Hills pipelines (100 percent basis) per day for each period presented.
⁽³⁾Terminaling throughput and storage volumes include leased capacity converted to a MBD-equivalent based on capacity divided by days in the period.
⁽⁴⁾Crude oil terminals include Bayway and Ferndale rail rack volumes.

Revenue Per Barrel ($/BBL)
Average pipeline revenue*	0.44	0.44	0.45	0.51	0.46	0.46	0.48	0.46		0.46
Average terminaling and storage revenue	0.38	0.39	0.39	0.42	0.40	0.40	0.38	0.39		0.39
* Excludes average pipeline revenue per barrel from equity affiliates.

Page 4

Exhibit 99.2



SELECTED OPERATING DATA (continued)

CONSOLIDATED

	2015					2016
	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Pipeline, Terminal and Storage Volumes (MB/D)
Pipelines⁽¹⁾
Pipeline throughput volumes
Wholly-Owned Pipelines
Crude oil	283	282	306	283	289	281	287	257		275
Refined products	502	487	485	560	508	570	622	619		604
Total	785	769	791	843	797	851	909	876		879

Select Joint Venture Pipelines⁽²⁾
Natural gas liquids	97	285	280	280	236	306	346	346		333

Terminals
Terminaling throughput and storage volumes⁽³⁾
Crude oil⁽⁴⁾	558	518	536	464	519	502	559	541		534
Refined products	431	424	441	443	435	427	450	442		440
Total	989	942	977	907	954	929	1,009	983		974
⁽¹⁾Represents the sum of volumes transported through each separately tariffed pipeline segment.
⁽²⁾Total post-acquisition pipeline system throughput volumes for the Sand Hills and Southern Hills pipelines (100 percent basis) per day for each period presented.
⁽³⁾Terminaling throughput and storage volumes include leased capacity converted to a MBD-equivalent based on capacity divided by days in the period.
⁽⁴⁾Crude oil terminals include Bayway and Ferndale rail rack volumes.

Revenue Per Barrel ($/BBL)
Average pipeline revenue^†	0.47	0.48	0.49	0.53	0.49	0.50	0.49	0.46		0.48
Average terminaling and storage revenue	0.38	0.39	0.39	0.42	0.40	0.40	0.38	0.39		0.39
^† Excludes average pipeline revenue per barrel from equity affiliates.

Page 5

Exhibit 99.2



CAPITAL EXPENDITURES AND INVESTMENTS

	Millions of Dollars
	2015					2016
	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD
Partnership Capital Expenditures and Investments
Expansion	31.2	63.0	38.1	65.0	197.3	31.6	57.9	109.8		199.3
Maintenance	1.7	1.5	2.2	2.3	7.7	1.2	3.0	3.4		7.6
Total Partnership	32.9	64.5	40.3	67.3	205.0	32.8	60.9	113.2		206.9

Predecessors	180.1	234.0	117.6	79.3	611.0	12.4	10.1	—		22.5
Total Consolidated	213.0	298.5	157.9	146.6	816.0	45.2	71.0	113.2		229.4



CASH DISTRIBUTIONS

	2015					2016
	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD	1st Qtr	2nd Qtr	3rd Qtr	4th Qtr	YTD

Cash Distribution Per Unit (Dollars)	0.3700	0.4000	0.4280	0.4580	1.6560	0.4810	0.5050	0.5310		1.5170

Cash Distributions^† ($ Millions)
Common units—public	8.9	9.7	10.3	11.1	40.0	11.6	18.7	22.9		53.2
Common units—Phillips 66	8.4	23.0	24.8	26.7	82.9	28.3	30.4	34.0		92.7
Subordinated units—Phillips 66	13.0	—	—	—	13.0	—	—	—		—
General partner—Phillips 66	6.4	8.8	11.1	13.6	39.9	15.7	20.7	25.6		62.0
Total	36.7	41.5	46.2	51.4	175.8	55.6	69.8	82.5		207.9

Coverage Ratio*	1.14x	1.15x	1.40x	1.44x	1.30x	1.15x	1.21x	1.24x		1.20x
^†Cash distributions declared attributable to the indicated periods. * Calculated as distributable cash flow divided by total cash distributions. Used to indicate the Partnership’s ability to pay cash distributions from current earnings.

Page 6

Exhibit 99.2



NON-GAAP FINANCIAL MEASURES RECONCILIATION

CONSOLIDATED

	Millions of Dollars
	2015								2016
	1st Qtr		2nd Qtr		3rd Qtr	4th Qtr		YTD	1st Qtr		2nd Qtr		3rd Qtr	4th Qtr	YTD
Reconciliation to Net Income
Net Income	35.8		42.0		50.9	60.5		189.2	64.7		73.2		83.1		221.0
Plus:
Depreciation	5.3		5.4		6.1	9.4		26.2	13.9		14.5		15.1		43.5
Net interest expense	5.8		9.5		9.1	9.2		33.6	9.7		10.9		9.9		30.5
Provision for (benefit from) income taxes	0.2		(0.1	)	0.1	0.1		0.3	0.2		0.4		0.2		0.8
EBITDA	47.1		56.8		66.2	79.2		249.3	88.5		99.0		108.3		295.8
Distributions in excess of equity earnings	0.7		0.2		4.6	6.6		12.1	4.1		2.2		0.3		6.6
Expenses indemnified or prefunded by Phillips 66	0.3		—		1.1	0.5		1.9	0.1		3.9		0.1		4.1
Transaction costs associated with acquisitions	1.4		—		0.4	0.4		2.2	1.0		0.7		2.2		3.9
EBITDA attributable to Predecessors	(0.6	)	(0.1	)	1.0	0.3		0.6	(19.9	)	(8.5	)	—		(28.4	)
Adjusted EBITDA	48.9		56.9		73.3	87.0		266.1	73.8		97.3		110.9		282.0
Plus:
Deferred revenue impacts*	1.2		2.3		2.5	(1.6	)	4.4	1.4		1.3		4.3		7.0
Less:
Net interest	6.5		9.5		9.1	9.2		34.3	9.9		10.9		9.9		30.7
Income taxes paid	—		0.4		—	(0.1	)	0.3	—		0.3		—		0.3
Maintenance capital expenditures	1.7		1.5		2.2	2.3		7.7	1.2		3.0		3.4		7.6
Distributable Cash Flow	41.9		47.8		64.5	74.0		228.2	64.1		84.4		101.9		250.4
*Difference between cash receipts and revenue recognition.

Page 7

Exhibit 99.2



NON-GAAP FINANCIAL MEASURES RECONCILIATION (continued)

CONSOLIDATED

	Millions of Dollars
	2015										2016
	1st Qtr		2nd Qtr		3rd Qtr		4th Qtr		YTD		1st Qtr		2nd Qtr		3rd Qtr		4th Qtr	YTD
Reconciliation to Net Cash Provided by Operating Activities
Net Cash Provided by Operating Activities	32.9		64.6		49.0		97.1		243.6		71.4		94.6		84.3			250.3
Plus:
Net interest expense	5.8		9.5		9.1		9.2		33.6		9.7		10.9		9.9			30.5
Provision for income taxes	0.2		(0.1	)	0.1		0.1		0.3		0.2		0.4		0.2			0.8
Changes in working capital	3.2		(15.0	)	13.9		(16.4	)	(14.3	)	14.4		(1.8	)	12.0			24.6
Undistributed equity earnings	5.8		(2.2	)	(0.9	)	(2.6	)	0.1		(0.6	)	1.7		2.7			3.8
Accrued environmental costs	—		(0.1	)	(0.5	)	(0.2	)	(0.8	)	—		0.1		(0.2	)		(0.1	)
Other*	(0.8	)	0.1		(4.5	)	(8.0	)	(13.2	)	(6.6	)	(6.9	)	(0.6	)		(14.1	)
EBITDA	47.1		56.8		66.2		79.2		249.3		88.5		99.0		108.3			295.8
Distributions in excess of equity earnings	0.7		0.2		4.6		6.6		12.1		4.1		2.2		0.3			6.6
Expenses indemnified or prefunded by Phillips 66	0.3		—		1.1		0.5		1.9		0.1		3.9		0.1			4.1
Transaction costs associated with acquisitions	1.4		—		0.4		0.4		2.2		1.0		0.7		2.2			3.9
EBITDA attributable to Predecessors	(0.6	)	(0.1	)	1.0		0.3		0.6		(19.9	)	(8.5	)	—			(28.4	)
Adjusted EBITDA	48.9		56.9		73.3		87.0		266.1		73.8		97.3		110.9			282.0
Plus:
Deferred revenue impacts^†	1.2		2.3		2.5		(1.6	)	4.4		1.4		1.3		4.3			7.0
Less:
Net interest	6.5		9.5		9.1		9.2		34.3		9.9		10.9		9.9			30.7
Income taxes paid	—		0.4		—		(0.1	)	0.3		—		0.3		—			0.3
Maintenance capital expenditures	1.7		1.5		2.2		2.3		7.7		1.2		3.0		3.4			7.6
Distributable Cash Flow	41.9		47.8		64.5		74.0		228.2		64.1		84.4		101.9			250.4
* Primarily deferred revenue. ^†Difference between cash receipts and revenue recognition.

Page 8

PHILLIPS 66 PARTNERS LP - FORM 8-K - EX-99.2 - EXHIBIT 99.2 - October 28, 2016

Attached files

PHILLIPS 66 PARTNERS LP Reports