Phillips 66 | 2013 | FY | 3

Segment Disclosures and Related Information

Effective January 1, 2013, we changed the organizational structure of the internal financial information reviewed by our chief executive officer, and determined this resulted in a change in the composition of our operating segments. The primary effects of this reporting reorganization were:

•
We disaggregated the former R&M segment into two separate operating segments titled "Refining" and "Marketing and Specialties."

•
We moved our Transportation and power businesses from the former R&M segment to the Midstream and M&S segments, respectively.

This realignment resulted in the following operating segments:

1)
Midstream—Gathers, processes, transports and markets natural gas; and transports, fractionates and markets NGL in the United States. In addition, this segment transports crude oil and other feedstocks to our refineries and other locations, and delivers refined and specialty products to market. The Midstream segment includes, among other businesses, our 50 percent equity investment in DCP Midstream.

2)
Chemicals—Manufactures and markets petrochemicals and plastics on a worldwide basis. The Chemicals segment consists of our 50 percent equity investment in CPChem.

3)
Refining—Buys, sells and refines crude oil and other feedstocks at 15 refineries, mainly in the United States, Europe and Asia.

4)
Marketing and Specialties—Purchases for resale and markets refined products, mainly in the United States and Europe. In addition, this segment includes the manufacturing and marketing of specialty products (such as lubricants), as well as power generation operations.

Corporate and Other includes general corporate overhead, interest expense, our investments in new technologies and various other corporate activities. Corporate assets include all cash and cash equivalents.

We evaluate performance and allocate resources based on net income attributable to Phillips 66. Intersegment sales are at prices that approximate market, except for certain 2012 and 2011 transportation services provided by the Midstream segment to the Refining and M&S segments.


Analysis of Results by Operating Segment
 
 
Millions of Dollars
 
2013

 
2012

 
2011

Sales and Other Operating Revenues
 
 
 
 
 
Midstream
 
 
 
 
 
Total sales
$
6,477

 
7,138

 
9,475

Intersegment eliminations
(933
)
 
(901
)
 
(1,105
)
Total Midstream
5,544

 
6,237

 
8,370

Chemicals
9

 
11

 
11

Refining
 
 
 
 
 
Total sales
124,579

 
131,154

 
143,457

Intersegment eliminations
(72,503
)
 
(73,393
)
 
(76,365
)
Total Refining
52,076

 
57,761

 
67,092

Marketing and Specialties
 
 
 
 
 
Total sales
115,358

 
116,623

 
121,829

Intersegment eliminations
(1,421
)
 
(1,355
)
 
(1,374
)
Total Marketing and Specialties
113,937

 
115,268

 
120,455

Corporate and Other
30

 
13

 
3

Consolidated sales and other operating revenues
$
171,596

 
179,290

 
195,931

 
 
 
 
 
 
Depreciation, Amortization and Impairments
 
 
 
 
 
Midstream
$
89

 
607

 
89

Chemicals
—

 
—

 
—

Refining
688

 
1,262

 
1,128

Marketing and Specialties
119

 
148

 
154

Corporate and Other
80

 
47

 
3

Consolidated depreciation, amortization and impairments
$
976

 
2,064

 
1,374


 
Millions of Dollars
 
2013

 
2012

 
2011

Equity in Earnings of Affiliates
 
 
 
 
 
Midstream
$
436

 
343

 
544

Chemicals
1,362

 
1,192

 
975

Refining
1,213

 
1,542

 
1,270

Marketing and Specialties
63

 
57

 
54

Corporate and Other
(1
)
 
—

 
—

Consolidated equity in earnings of affiliates
$
3,073

 
3,134

 
2,843

 
 
 
 
 
 
Income Taxes from Continuing Operations
 
 
 
 
 
Midstream
$
265

 
29

 
454

Chemicals
375

 
366

 
252

Refining
1,091

 
2,067

 
902

Marketing and Specialties
376

 
250

 
311

Corporate and Other
(263
)
 
(239
)
 
(97
)
Consolidated income taxes from continuing operations
$
1,844

 
2,473

 
1,822

 
 
 
 
 
 
Net Income Attributable to Phillips 66
 
 
 
 
 
Midstream
$
469

 
53

 
2,149

Chemicals
986

 
823

 
716

Refining
1,851

 
3,217

 
1,529

Marketing and Specialties
790

 
417

 
530

Corporate and Other
(431
)
 
(434
)
 
(192
)
Discontinued Operations
61

 
48

 
43

Consolidated net income attributable to Phillips 66
$
3,726

 
4,124

 
4,775

 
Millions of Dollars
 
2013

 
2012

 
2011

Investments In and Advances To Affiliates
 
 
 
 
 
Midstream
$
2,328

 
2,011

 
1,873

Chemicals
4,241

 
3,524

 
2,998

Refining
4,316

 
4,571

 
5,186

Marketing and Specialties
194

 
185

 
177

Corporate and Other
1

 
—

 
—

Consolidated investments in and advances to affiliates
$
11,080

 
10,291

 
10,234

 
 
 
 
 
 
Total Assets
 
 
 
 
 
Midstream
$
5,413

 
4,641

 
4,997

Chemicals
4,377

 
3,816

 
2,999

Refining
26,294

 
26,834

 
27,336

Marketing and Specialties
7,155

 
7,806

 
7,681

Corporate and Other
6,348

 
4,770

 
22

Discontinued Operations*
211

 
206

 
176

Consolidated total assets
$
49,798

 
48,073

 
43,211

*In December 2013, $117 million of goodwill was allocated to assets held for sale in association with the planned disposition of PSPI. Although this goodwill was included in the M&S segment at December 31, 2012 and 2011, for more useful comparisons, it is included in the discontinued operations line of this table for all periods presented.
 
 
 
 
 
 
Capital Expenditures and Investments
 
 
 
 
 
Midstream
$
528

 
704

 
122

Chemicals
—

 
—

 
—

Refining
889

 
738

 
771

Marketing and Specialties
226

 
119

 
106

Corporate and Other
136

 
140

 
17

Consolidated capital expenditures and investments
$
1,779

 
1,701

 
1,016

 
 
 
 
 
 
Interest Income and Expense
 
 
 
 
 
Interest income
 
 
 
 
 
Refining
$
—

 
—

 
1

Marketing and Specialties
—

 
—

 
32

Corporate and Other
20

 
18

 
—

 
$
20

 
18

 
33

Interest and debt expense
 
 
 
 
 
Corporate and Other
$
275

 
246

 
17



Sales and Other Operating Revenues by Product Line
 
 
 
 
 
Refined products
$
140,488

 
140,986

 
146,683

Crude oil resales
22,777

 
28,730

 
38,259

NGL
7,431

 
8,533

 
10,024

Other
900

 
1,041

 
965

Consolidated sales and other operating revenues by product line
$
171,596

 
179,290

 
195,931




Geographic Information
 
 
Millions of Dollars
 
Sales and Other Operating Revenues*
 
Long-Lived Assets**
 
2013

 
2012

 
2011

 
2013

 
2012

 
2011

 
 
 
 
 
 
 
 
 
 
 
 
United States
$
115,378

 
120,332

 
134,342

 
23,641

 
22,285

 
21,196

United Kingdom
21,868

 
22,129

 
26,976

 
1,485

 
2,018

 
1,927

Germany
9,799

 
9,908

 
10,647

 
587

 
567

 
547

Other foreign countries
24,551

 
26,921

 
23,966

 
765

 
828

 
1,335

Worldwide consolidated
$
171,596

 
179,290

 
195,931

 
26,478

 
25,698

 
25,005

*Sales and other operating revenues are attributable to countries based on the location of the operations generating the revenues and 2012 amounts are reclassified to correct the geographic alignment of certain revenues, primarily between the United Kingdom and other foreign countries.
**Defined as net properties, plants and equipment plus investments in and advances to affiliated companies.

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