Phillips 66 (PSX)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 10.65% | 13.73% | 6.69% | 0.79% | 9.83% |
| Operating profit margin | 4.59% | 8.03% | -2.08% | -17.28% | 1.64% |
| Pretax margin | 6.31% | 8.00% | 1.28% | -7.98% | 3.52% |
| Net profit margin | 4.79% | 6.18% | 1.15% | -6.07% | 2.79% |
Phillips 66's profitability ratios have shown fluctuations over the past five years. The gross profit margin has seen some volatility, ranging from a low of 8.41% in 2021 to a high of 13.10% in 2023, indicating variability in the company's ability to generate revenue after accounting for the cost of goods sold.
The operating profit margin has also varied, with a notable increase in 2023 compared to 2021 and 2022, suggesting potential improvements in the company's operational efficiency and cost management.
The pretax margin has shown improvement over the years, with a significant positive shift from a negative -7.74% in 2020 to a positive 6.42% in 2023, indicating a better ability to generate profits before tax expenses.
Similarly, the net profit margin has displayed improvements over the years, with a positive trend from a negative -6.21% in 2020 to a positive 4.75% in 2023, reflecting enhancements in the company's overall profitability after accounting for all expenses.
Overall, the profitability ratios for Phillips 66 have shown positive trends in recent years, indicating potential improvements in the company's ability to generate profits and manage costs effectively. However, the fluctuations in these ratios suggest the need for continued monitoring and proactive management of profitability drivers.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 8.90% | 18.74% | -4.29% | -20.66% | 3.08% |
| Return on assets (ROA) | 9.29% | 14.42% | 2.37% | -7.26% | 5.24% |
| Return on total capital | 33.11% | 50.60% | 10.78% | -24.18% | 15.59% |
| Return on equity (ROE) | 22.94% | 37.38% | 6.87% | -20.94% | 12.35% |
Phillips 66's profitability ratios indicate fluctuations over the past five years. The operating return on assets (Operating ROA) has ranged from a low of -2.86% in 2020 to a high of 12.55% in 2022, with a modest decrease to 10.49% in 2023. This ratio reflects the company's ability to generate profit from its assets before considering interest and taxes.
The return on assets (ROA) also displayed variability, with a negative figure of -7.28% in 2020, rebounding to 14.41% in 2022 before settling at 9.28% in 2023. ROA measures the company's effectiveness in generating profits from its total assets without considering how these assets are financed.
Furthermore, the return on total capital highlights Phillips 66's performance in generating profits from both debt and equity sources. This ratio varied significantly over the period, peaking at 32.78% in 2022, dropping to -0.89% in 2020, and recovering to 20.62% in 2023.
Lastly, return on equity (ROE) demonstrates the return generated for shareholders' equity. The company experienced notable fluctuations in ROE, reaching a low of -20.98% in 2020, followed by a peak of 37.34% in 2022, and settling at 22.90% in 2023.
Overall, Phillips 66's profitability ratios have shown a mixed performance over the past five years, indicating some volatility in profitability levels. Additional analysis would be needed to identify the specific factors driving these fluctuations and to assess the company's long-term profitability prospects.