Phillips 66 (PSX)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 7.56% | 7.57% | 10.84% | 6.97% | 7.84% |
| Operating profit margin | 1.22% | 5.44% | 7.50% | 3.43% | -0.45% |
| Pretax margin | 1.87% | 6.42% | 8.61% | 1.56% | -7.74% |
| Net profit margin | 1.48% | 4.75% | 6.49% | 1.18% | -5.79% |
Phillips 66's gross profit margin has shown fluctuations over the past five years, ranging from a low of 6.97% in 2021 to a high of 10.84% in 2022. This indicates the company's ability to generate profit after accounting for the cost of goods sold.
The operating profit margin, a measure of efficiency in managing operating expenses, has also varied for Phillips 66. The company recovered from a negative margin in 2020 to reach 7.50% in 2022 before declining to 1.22% in 2024.
The pretax margin, which reflects the company's profitability before accounting for taxes, demonstrated an improvement trend from 2020 to 2022, with a peak of 8.61%. However, it declined to 1.87% in 2024.
Lastly, the net profit margin, representing the percentage of revenue that translates into profit, has shown a similar pattern to the pretax margin. Phillips 66's net profit margin has fluctuated between -5.79% in 2020 and 6.49% in 2022 before decreasing to 1.48% in 2024.
Overall, while Phillips 66 has experienced fluctuations in its profitability margins, it is essential to further investigate the reasons behind these trends to understand the company's performance comprehensively.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 2.41% | 10.62% | 16.67% | 6.88% | -0.52% |
| Return on assets (ROA) | 2.92% | 9.28% | 14.42% | 2.37% | -6.79% |
| Return on total capital | 13.22% | 33.99% | 51.73% | 12.11% | -23.52% |
| Return on equity (ROE) | 7.72% | 22.90% | 37.38% | 6.86% | -19.56% |
Profitability ratios for Phillips 66 show a fluctuating trend over the years. The Operating Return on Assets (Operating ROA) improved significantly from -0.52% in 2020 to 16.67% in 2022 before decreasing to 2.41% in 2024. This indicates that the company was able to generate higher operating profits relative to its asset base during this period.
The Return on Assets (ROA) also saw improvement, moving from -6.79% in 2020 to 14.42% in 2022, before stabilizing around 2-3% in subsequent years. This ratio reflects the company's ability to generate profits from its total assets.
Return on Total Capital increased notably from -23.52% in 2020 to 51.73% in 2022, showing a strong performance in utilizing both debt and equity to generate returns. However, this ratio declined to 13.22% by 2024, indicating a decrease in efficiency in generating profits from the overall capital employed.
Return on Equity (ROE) also displayed an upward trend, climbing from -19.56% in 2020 to 37.38% in 2022, before decreasing to 7.72% in 2024. This ratio signifies the ability of the company to generate returns for its shareholders from their equity investments.
Overall, the profitability ratios of Phillips 66 show variability over the years, reflecting changes in operational efficiency, asset utilization, and capital structure management.