Phillips 66 : Third-Quarter Earnings Conference Call

Sweeny Fractionator 3 OLD OCEAN, TX

THIRD QUARTER 2020 CONFERENCE CALL

October 30, 2020

Third Quarter 2020 Conference Call

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Cautionary Statement

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," "continues," "intends," "will," "would," "objectives," "goals," "projects," "efforts," "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 included in this presentation are based on management's expectations, estimates and projections as of the date they are made. These statements are not guarantees of future performance and you should not unduly rely on them as they 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: the continuing effects of the COVID-19 pandemic and its negative impact on commercial activity and demand for refined petroleum products; the inability to timely obtain or maintain permits necessary for capital projects; changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs like the renewable fuel standards program, low carbon fuel standards and tax credits for biofuels; fluctuations in NGL, crude oil, and natural gas prices, and petrochemical and refining margins; unexpected changes in costs for constructing, modifying or operating our facilities; unexpected difficulties in manufacturing, refining or transporting our products; the level and success of drilling and production volumes around our Midstream assets; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products, renewable fuels or specialty 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; failure to complete construction of capital projects on time and within budget; the inability to comply with governmental regulations or make capital expenditures to maintain compliance; limited access to capital or significantly higher cost of capital related to illiquidity or uncertainty in the domestic or international financial markets; potential disruption of our operations due to accidents, weather events, including as a result of climate change, terrorism or cyberattacks; general domestic and international economic and political developments including armed hostilities, expropriation of assets, and other political, economic or diplomatic developments, including those caused by public health issues and international monetary conditions and exchange controls; changes in governmental policies relating to NGL, crude oil, natural gas, refined petroleum products, or renewable fuels pricing, regulation or taxation, including exports; changes in estimates or projections used to assess fair value of intangible assets, goodwill and property and equipment and/or strategic decisions with respect to our asset portfolio that cause impairment charges; investments required, or reduced demand for products, as a result of environmental rules and regulations; changes in tax, environmental and other laws and regulations (including alternative energy mandates); the operation, financing and distribution decisions of equity affiliates we do not control; the impact of adverse market conditions or other similar risks to those identified herein affecting PSXP, as well as the ability of PSXP to successfully execute its growth plans; 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.

Third Quarter 2020 Conference Call

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Executing the Strategy

San Francisco Refinery RODEO, CA

Third Quarter 2020 Conference Call

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3Q 2020 Overview

$MM (UNLESS OTHERWISE NOTED)

Freeport Marine Terminal FREEPORT, TX

Adjusted loss	$ (1)
Adjusted EPS1	(0.01)
Operating cash flow excluding working capital2	795
Adjusted capital spending3	549
Shareholder distributions4	393
Common shares outstanding at Sept. 30	437	MM

1)	Dollars per share	Third Quarter 2020 Conference Call	4
2)	Excludes working capital impacts of $304 million
3)	Capital expenditures and investments excluding $3 million of capital spending funded by certain joint venture partners	Billings Refinery
4)	Shareholder distributions represent dividends; share repurchases remained suspended
Billings, Montana

3Q 2020 Adjusted Loss

3Q 2020 VS. 2Q 2020 ($MM)

2Q 2020	Midstream	Chemicals	Refining	Marketing	Corporate	Income	Noncontrolling	3Q 2020
Adjusted				& Specialties	& Other	Taxes	Interests	Adjusted
Loss										Loss
						162
							(23)		(1)

(324)43

109

124 11

(103)

354

132

(970)

417

(213)

352

(73)

3Q 2020 Adjusted Pre-Tax Income (Loss)

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3Q 2020 Midstream Adjusted Pre-Tax Income

3Q 2020 VS. 2Q 2020 ($MM)

Higher pipeline and terminal		19	18
volumes	72

Ramp-up of volumes on
Gray Oak Pipeline	354
	245

Recently started operations of Sweeny Fracs 2 and 3

2Q 2020	Transportation	NGL &	DCP	3Q 2020
Adjusted			Other	Midstream	Adjusted
Pre-Tax Income					Pre-Tax Income
	202	102	50
			3Q 2020

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3Q 2020 Chemicals Adjusted Pre-Tax Income

3Q 2020 VS. 2Q 2020 ($MM)

Higher polyethylene margins

94% O&P utilization

Recently announced first U.S. commercial-scale polyethylene production from recycled plastics

42	7

(6)

132

89

2Q 2020	Olefins &	Specialties,	Other	3Q 2020
Adjusted	Polyolefins	Aromatics &		Adjusted
Pre-Tax Income		Styrenics		Pre-Tax Income
	148	5	(21)
		3Q 2020

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3Q 2020 Refining Adjusted Pre-Tax Loss

3Q 2020 VS. 2Q 2020 ($MM)

2Q 2020	Atlantic	Gulf	Central	West	3Q 2020
Adjusted	Basin /	Coast	Corridor	Coast	Adjusted
Pre-Tax Loss	Europe				Pre-Tax Loss

77% crude utilization

85% clean product yield

(867)	(970)

$1.78/BBL realized margin

$41 MM turnaround costs

23

(33) (16) (77)

(197) (389) (129) (255)

3Q 2020

Third Quarter 2020 Conference Call

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3Q 2020 Refining Margins - Market vs. Realized

WORLDWIDE REFINING ($/BBL, UNLESS OTHERWISE NOTED)

(1.47)

	(1.80)
8.17	(0.35)

				(2.77)	1.78
3Q 2020	Configuration	Secondary	Feedstock	Other	3Q 2020
Market		Products			Realized
3:2:1					Margin
	Avg Market Crude: $42.26			22% Market Capture

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3Q 2020 Marketing & Specialties Adjusted Pre-Tax Income

3Q 2020 VS. 2Q 2020 ($MM)

Higher global marketing margins and volumes

Reimaged 315 branded sites worldwide

Refined product exports of 139 MBPD

10717

417

293

2Q 2020	Marketing	Specialties	3Q 2020
Adjusted	& Other		Adjusted
Pre-Tax Income			Pre-Tax Income
	366	51
		3Q 2020

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3Q 2020 Corporate & Other Adjusted Pre-Tax Loss

3Q 2020 VS. 2Q 2020 ($MM)

2Q 2020	Net Interest	Corporate	3Q 2020
Adjusted	Expense	Overhead	Adjusted
Pre-Tax Loss		& Other	Pre-Tax Loss

(224)

(213)

20

(9)

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3Q 2020 Cash Flow

$B

0.8

0.1

(0.3)

(0.5)

(0.4) (0.1)

1.9

1.5

June 30,	CFO	Working	Debt	Adjusted	Shareholder	Other	September 30,
2020	(excluding	Capital		Capital	Distributions		2020
Cash	Working			Spending2			Cash
Balance1	Capital)						Balance1

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1. Includes cash and cash equivalents
2. Capital expenditures and investments excluding $3 million of capital spending funded by certain joint venture partners

4Q 2020 Outlook

Albuquerque International Balloon Fiesta

ALBUQUERQUE, NM

Global Olefins & Polyolefins utilization	Mid-90%
Refining crude utilization	Market Conditions
Refining turnaround expenses (pre-tax)	$80 MM - $100 MM
Corporate & Other costs (pre-tax)	$220 MM - $230 MM

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Phillips 66 Branded Marketing Site ST. LOUIS, MO

Questions

and Answers

Phillips 66 Branded Marketing Site ST. LOUIS, MO

Appendix

2020 Estimated Sensitivities

Midstream - DCP (net to Phillips 66)	Annual EBITDA $MM
10¢/Gal Increase in NGL price	9
10¢/MMBtu Increase in Natural Gas price	2
$1/BBL Increase in WTI price	1
Chemicals - CPChem (net to Phillips 66)
1¢/Lb Increase in Chain Margin (Ethylene, Polyethylene, NAO)	65
Worldwide Refining
$1/BBL Increase in Gasoline Margin	350
$1/BBL Increase in Distillate Margin	300
Impacts due to Actual Crude Feedstock Differing from Feedstock Assumed in Market Indicators:
$1/BBL Widening WTI / WCS Differential (WTI less WCS)	100
$1/BBL Widening LLS / Maya Differential (LLS less Maya)	75
$1/BBL Widening LLS / WTI Differential (LLS less WTI)	35
$1/BBL Widening WTI / WTS Differential (WTI less WTS)	30
10¢/MMBtu Increase in Natural Gas price	(15)

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

YTD 2020 Cash Flow

$B

2.8

2.2

(2.4)

(0.7)

(1.6)

1.6

(0.4)

1.5

December 31,

CFO

Working

Debt

Adjusted

Shareholder

Other

September 30,

2019

(excluding

Capital

Capital

Distributions

2020

Cash

Working

Spending2

Cash

Balance1

Capital)

Balance1

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1. Includes cash and cash equivalents
2. Capital expenditures and investments excluding $64 million of capital spending funded by certain joint venture partners

Capital Structure

		Consolidated PSX					Excluding PSXP
				38%	39%
			35%									35%
									31%	34%
		30%			37%
	29%		35%
27%	33%		25%	25%					32%
				22%		28%	30%
		27%
	23%
20%							22%
						17%
						14%
27.4	27.2	27.2	23.6	23.3	22.3	25.1	24.7	24.9
				21.4	20.7
					19.8
10.1	11.2	11.8	13.0	14.4	14.5						10.7		10.7
						9.4
			7.2	8.1	8.2
			1.2		1.5	1.3	1.1			1.5
3.1	3.0	1.6	1.9		2.9	3.0				1.9
2017	2018	2019	1Q	2Q	3Q	2017	2018	2019	1Q	2Q		3Q
			2020	2020	2020					2020	2020		2020
	Equity $B	Debt $B	Cash & Cash Equivalents $B	Debt-to-Capital		Net Debt-to-Capital
										Third Quarter 2020 Conference Call	18

3Q 2020 Refining Margins - Market vs. Realized

ATLANTIC BASIN / EUROPE ($/BBL, UNLESS OTHERWISE NOTED)

Brent: $43.00

81% crude utilization

19% market capture

(1.96)

(0.45)

8.74

(2.81)

(1.87)

1.65

3Q 2020

Configuration Secondary

Feedstock

Other

3Q 2020

Market

Products

Realized

3:2:1

Margin

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

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3Q 2020 Refining Margins - Market vs. Realized

GULF COAST ($/BBL, UNLESS OTHERWISE NOTED)

LLS: $42.46

(1.33)

5.95

66% crude utilization

1.08

(10)% market capture

(2.67)

			(3.64)		(0.61)
3Q 2020	Configuration Secondary	Feedstock	Other	3Q 2020
Market	Products			Realized
3:2:1					Margin

Market 3:2:1 - LLS / Gasoline 85 CBOB / Diesel 62 10ppm

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3Q 2020 Refining Margins - Market vs. Realized

CENTRAL CORRIDOR ($/BBL, UNLESS OTHERWISE NOTED)

WTI: $40.91

86% crude utilization

54% market capture

	(0.92)			0.69
			(1.85)
8.29
		(1.75)

4.46

3Q 2020	Configuration Secondary	Feedstock	Other	3Q 2020
Market	Products			Realized
3:2:1				Margin

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

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3Q 2020 Refining Margins - Market vs. Realized

WEST COAST ($/BBL, UNLESS OTHERWISE NOTED)

ANS: $42.74

85% crude utilization

19% market capture

	(1.74)
	(2.25)
11.86	(0.83)

			(4.81)	2.23
3Q 2020	Configuration Secondary	Feedstock	Other	3Q 2020
Market	Products			Realized
3:2:1				Margin

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

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3Q 2020 Adjusted Loss

3Q 2020 VS. 3Q 2019 ($MM)

1. 
   (137)

1,402

(1,809) (81)

737 8

(1)

(35)

3Q 2019 Adjusted Earnings

Midstream

Chemicals	Refining	Marketing
		& Specialties

Corporate	Income	Noncontrolling	3Q 2020
& Other	Taxes	Interests	Adjusted
			Loss

354 132 (970) 417

3Q 2020 Adjusted Pre-Tax Income (Loss)

(213)

352

(73)

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3Q 2020 Midstream Adjusted Pre-Tax Income

3Q 2020 VS. 3Q 2019 ($MM)

			27
(46)

(67)

440

354

3Q 2019	Transportation	NGL & Other	DCP	3Q 2020
Adjusted			Midstream	Adjusted
Pre-Tax Income				Pre-Tax Income
	202	102	50
		3Q 2020

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3Q 2020 Chemicals Adjusted Pre-Tax Income

3Q 2020 VS. 3Q 2019 ($MM)

(103)

269

(31)(3)

132

3Q 2019	Olefins &	Specialties,	Other	3Q 2020
Adjusted	Polyolefins	Aromatics &		Adjusted
Pre-Tax Income		Styrenics		Pre-Tax Income
	148	5	(21)
		3Q 2020

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3Q 2020 Refining Adjusted Pre-Tax Loss

3Q 2020 VS. 3Q 2019 ($MM)

839

(476)

(573)

							(970)
			(537)
				(223)
3Q 2019	Atlantic	Gulf	Central	West Coast	3Q 2020
Adjusted	Basin /	Coast	Corridor				Adjusted
Pre-Tax Income	Europe						Pre-Tax Loss
	(197)	(389)	(129)	(255)
			3Q 2020

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3Q 2020 Marketing & Specialties Adjusted Pre-Tax Income

3Q 2020 VS. 3Q 2019 ($MM)

(74)		(7)

498

417

3Q 2019	Marketing	Specialties	3Q 2020
Adjusted	& Other		Adjusted
Pre-Tax Income			Pre-Tax Income
	366	51
		3Q 2020

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3Q 2020 Corporate & Other Adjusted Pre-Tax Loss

3Q 2020 VS. 3Q 2019 ($MM)

3Q 2019	Net Interest	Corporate	3Q 2020
Adjusted	Expense	Overhead	Adjusted
Pre-Tax Loss		& Other	Pre-Tax Loss

(178)

(213)

(33)

(2)

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Phillips 66
Consolidated Earnings (Loss)	$	(3,436)	(799)	(141)			2,340	712
Pre-Tax Adjustments:
Pending claims and settlements		(37)	-	-	(21)	-
Pension settlement expense		55	17	38			-	-
Impairments		4,145	1,139	-	853	853
Impairments by equity affiliates		15	-	15			47	47
Certain tax impacts		(8)	-	(8)			-	-
Asset dispositions		(84)	-	(84)			(17)	(17)
Hurricane-related costs		15	15	-	-	-
Lower-of-cost-or-market inventory adjustments		(29)	(101)	20			42	42
Tax impact of adjustments1		(545)	(262)	(208)			(231)	(235)
Other tax impacts		10	(10)	20			(45)	-
Noncontrolling interests		24	-	24			-	-
Adjusted Earnings (Loss)	$	125	(1)	(324)			2,968	1,402
Earnings (Loss) Per Share of Common Stock (dollars)	$	(7.83)	(1.82)	(0.33)			5.13	1.58
Adjusted Earnings (Loss) Per Share of Common Stock (dollars)2	$	0.27	(0.01)	(0.74)			6.51	3.11

1. We generally tax effect taxable U.S.-based special items using a combined federal and state annual statutory income tax rate of approximately 25%. Taxable special items attributable to foreign locations likewise use a local statutory income tax rate. Nontaxable events reflect zero income tax. These events include, but are not limited to, most goodwill impairments, transactions legislatively exempt from income tax, transactions related to entities for which we have made an assertion that the undistributed earnings are permanently reinvested, or transactions occurring in jurisdictions with a valuation allowance.

2) YTD 2020 is based on adjusted weighted-average diluted shares outstanding of 440,156 thousand, and other periods are based on the same weighted-average diluted shares outstanding as that used in the GAAP

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diluted earnings per share calculation. Income allocated to participating securities, if applicable, in the adjusted earnings per share calculation is the same as that used in the GAAP diluted earnings per share calculation.

Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Midstream
Pre-Tax Income (Loss)	$	(232)	146	324			279	(460)
Pre-Tax Adjustments:
Pension settlement expense		8	3	5			-	-
Lower-of-cost-or-market inventory adjustments		1	-	-	-	-
Hurricane-related costs		1	1	-	-	-
Impairments by equity affiliates		-	-	-	47	47
Impairments		1,365	204	-	853	853
Asset dispositions		(84)	-	(84)			-	-
Adjusted Pre-Tax Income	$	1,059	354	245			1,179	440
Chemicals
Pre-Tax Income	$	442	231	42			729	227
Pre-Tax Adjustments:
Hurricane-related costs		2	2	-	-	-
Lower-of-cost-or-market inventory adjustments		(45)	(101)	32			42	42
Impairments by equity affiliates		15	-	15			-	-
Adjusted Pre-Tax Income	$	414	132	89			771	269

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Refining
Pre-Tax Income (Loss)	$	(5,042)	(1,903)	(878)			1,641	856
Pre-Tax Adjustments:
Pending claims and settlements		-	-	-	(21)	-
Asset dispositions		-	-	-	(17)	(17)
Pension settlement expense		38	12	26			-	-
Hurricane-related costs		11	11	-	-	-
Impairments		2,755	910	-	-	-
Lower-of-cost-or-market inventory adjustments		-	-	(15)			-	-
Adjusted Pre-Tax Income (Loss)	$	(2,238)	(970)	(867)			1,603	839
Marketing & Specialties
Pre-Tax Income	$	1,214	415	286			1,056	498
Pre-Tax Adjustments:
Lower-of-cost-or-market inventory adjustments		15	-	3			-	-
Hurricane-related costs		1	1	-	-	-
Pending claims and settlements		(37)	-	-	-	-
Pension settlement expense		5	1	4			-	-
Adjusted Pre-Tax Income	$	1,198	417	293			1,056	498

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Corporate & Other
Pre-Tax Loss	$	(655)	(239)	(219)			(593)	(178)
Pre-Tax Adjustments:
Pension settlement expense		4	1	3			-	-
Impairments		25	25	-	-	-
Certain tax impacts		(8)	-	(8)			-	-
Adjusted Pre-Tax Loss	$	(634)	(213)	(224)			(593)	(178)

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Midstream - Transportation
Pre-Tax Income (Loss)	$	411	(3)	214			696	248
Pre-Tax Adjustments:
Impairments		204	204	-	-	-
Hurricane-related costs		1	1	-	-	-
Asset dispositions		(84)	-	(84)			-	-
Adjusted Pre-Tax Income	$	532	202	130			696	248
Midstream - NGL & Other
Pre-Tax Income	$	356	99	78			402	169
Pre-Tax Adjustments:
Pension settlement expense		8	3	5			-	-
Adjusted Pre-Tax Income	$	364	102	83			402	169
Midstream - DCP Midstream
Pre-Tax Income (Loss)	$	(999)	50	32			(819)	(877)
Pre-Tax Adjustments:
Impairments by equity affiliates		-	-	-	47	47
Impairments		1,161	-	-	853	853
Lower-of-cost-or-market inventory adjustments		1	-	-	-	-
Adjusted Pre-Tax Income	$	163	50	32			81	23

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Chemicals - Olefins & Polyolefins
Pre-Tax Income	$	488	241	70			688	209
Pre-Tax Adjustments:
Lower-of-cost-or-market inventory adjustments		(58)	(95)	21			42	42
Hurricane-related costs		2	2	-	-	-
Impairments by equity affiliates		15	-	15			-	-
Adjusted Pre-Tax Income	$	447	148	106			730	251
Chemicals - Specialties, Aromatics & Styrenics
Pre-Tax Income	$	15	11	-	96	36
Pre-Tax Adjustments:
Lower-of-cost-or-market inventory adjustments		13	(6)	11			-	-
Adjusted Pre-Tax Income	$	28	5	11			96	36
Chemicals - Other
Pre-Tax Loss	$	(61)	(21)	(28)			(55)	(18)
Pre-Tax Adjustments:
None		-	-	-	-	-
Adjusted Pre-Tax Loss	$	(61)	(21)	(28)			(55)	(18)

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Refining - Atlantic Basin / Europe
Pre-Tax Income (Loss)	$	(1,063)	(199)	(227)			547	296
Pre-Tax Adjustments:
Impairments		441	-	-	-	-
Asset dispositions		-	-	-	(17)	(17)
Pension settlement expense		9	2	7			-	-
Adjusted Pre-Tax Income (Loss)	$	(613)	(197)	(220)			530	279
Refining - Gulf Coast
Pre-Tax Income (Loss)	$	(1,613)	(405)	(365)			288	184
Pre-Tax Adjustments:
Hurricane-related costs		11	11	-	-	-
Pension settlement expense		14	5	9			-	-
Impairments		670	-	-	-	-
Adjusted Pre-Tax Income (Loss)	$	(918)	(389)	(356)			288	184

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Non-GAAP Reconciliations

			Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Refining - Central Corridor
Pre-Tax Income (Loss)	$	(463)	(132)	(104)			1,005	408
Pre-Tax Adjustments:
Pending claims and settlements		-	-	-	(21)	-
Lower-of-cost-or-market inventory adjustments		-	-	(15)			-	-
Impairments		435	-	-	-	-
Pension settlement expense		9	3	6			-	-
Adjusted Pre-Tax Income (Loss)	$	(19)	(129)	(113)			984	408
Refining - West Coast
Pre-Tax Loss	$	(1,903)	(1,167)	(182)			(199)	(32)
Pre-Tax Adjustments:
Impairments		1,209	910	-	-	-
Pension settlement expense		6	2	4			-	-
Adjusted Pre-Tax Loss	$	(688)	(255)	(178)			(199)	(32)

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Non-GAAP Reconciliations

				Millions of Dollars
			Except as Indicated
			2020				2019
		Sep YTD	3Q	2Q	Sep YTD	3Q
Marketing & Specialties - Marketing & Other
Pre-Tax Income	$	1,091	365	255			872	440
Pre-Tax Adjustments:
Pension settlement expense		5	1	4			-	-
Pending claims and settlements		(37)	-	-	-	-
Adjusted Pre-Tax Income	$	1,059	366	259			872	440
Marketing & Specialties - Specialties
Pre-Tax Income	$	123	50	31			184	58
Pre-Tax Adjustments:
Lower-of-cost-or-market inventory adjustments		15	-	3			-	-
Hurricane-related costs		1	1	-	-	-
Adjusted Pre-Tax Income	$	139	51	34			184	58

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Non-GAAP Reconciliations

			Millions of Dollars (Except as Indicated)
				3Q 2020
	Atlantic Basin/	Gulf Coast	Central	West Coast	Worldwide
		Europe	Corridor
Realized Refining Margins
Loss before income taxes	$	(199)	(405)	(132)	(1,167)	(1,903)
Plus:
Taxes other than income taxes		14	30	11	16	71
Depreciation, amortization and impairments		50	75	33	974	1,132
Selling, general and administrative expenses		6	11	7	9	33
Operating expenses		180	258	111	235	784
Equity in losses of affiliates		2	1	118	-	121
Other segment (income) expense, net		-	(1)	(1)	1	(1)
Proportional share of refining gross margins contributed by equity affiliates		18	-	45	-	63
Special items:
None		-	-	-	-	-
Realized refining margins	$	71	(31)	192	68	300
Total processed inputs (thousands of barrels)		43,176	51,543	24,682	30,615	150,016
Adjusted total processed inputs (thousands of barrels)1		43,176	51,543	42,979	30,615	168,313
Loss before income taxes (dollars per barrel)2	$	(4.61)	(7.86)	(5.35)	(38.12)	(12.69)
Realized refining margins (dollars per barrel)3	$	1.65	(0.61)	4.46	2.23	1.78

1. Adjusted total processed inputs include our proportional share of processed inputs of an equity affiliate.
2. Loss before income taxes divided by total processed inputs.
3. Realized refining margins per barrel, as presented, are calculated using the underlying realized refining margin amounts, in dollars, divided by adjusted total processed inputs, in barrels. As such, recalculated per barrel amounts using the rounded margins and barrels presented may differ from the presented per barrel amounts.

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Non-GAAP Reconciliations

		2020 Sept. YTD
Numerator ($MM)
Net Loss	$	(3,220)
After-tax interest expense		285
GAAP ROCE loss		(2,935)
After-tax special items		3,537
Adjusted ROCE earnings	$	602
Denominator ($MM)
GAAP average capital employed1	$	37,881
2020 Annualized GAAP ROCE		(10)%
2020 Annualized Adjusted ROCE		2 %

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1) Capital employed is total equity plus total debt

Non-GAAP Reconciliations

		Millions of Dollars (Except as Indicated)
			Sept. 30, 2020
		Phillips 66	Phillips 66	Phillips 66 Excluding
		Consolidated	Partners1	Phillips 66 Partners
Total Debt	$	14,526	3,783	10,743
Total Equity		22,305	2,549	19,756
Debt-to-Capital Ratio		39 %		35 %
Total Cash	$	1,462	2	1,460
Net Debt-to-Capital Ratio		37 %		32 %

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1) Phillips 66 Partners' third-party debt and Phillips 66's noncontrolling interest attributable to Phillips 66 Partners

Non-GAAP Reconciliations

		Millions of Dollars
			3Q 2020
		Growth	Sustaining	Total
Capital Expenditures and Investments
Midstream	$	266	49	315
Refining		69	99	168
Marketing & Specialties		11	17	28
Corporate & Other		1	37	38
Adjusted Capital Spending		347	202	549
Capital Spending Funded by Certain Joint Venture Partners (Midstream)		3	-	3
Total	$	350	202	552

Millions of Dollars

2020 Sept. YTD

	Growth	Sustaining	Total
$	1,338	154	1,492
	234	343	577
	100	39	139
	3	139	142
	1,675	675	2,350
	64	-	64
$	1,739	675	2,414

Third Quarter 2020 Conference Call

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Non-GAAP Reconciliations

		Millions of Dollars
		Except as Indicated
		3Q 2020
Effective Tax Rates
Loss before income taxes	$	(1,350)
Special items		1,070
Adjusted loss before income taxes	$	(280)
Income tax benefit	$	(624)
Special items		272
Adjusted income tax benefit	$	(352)
GAAP effective tax rate		46.2 %
Adjusted effective tax rate		125.7 %

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