Marathon Petroleum Tops Q4 Earnings on Higher Throughput

Independent oil refiner and marketer Marathon Petroleum Corporation MPC reported fourth-quarter adjusted earnings per share of 77 cents, which comfortably beat the Zacks Consensus Estimate of 6 cents. The outperformance primarily reflects the stronger-than-expected performance of its Refining & Marketing segment.

The adjusted EBITDA of the segment totaled $559 million, surpassing the consensus mark, calling for a profit of $188 million on the back of lower costs and higher throughput.

However, the company’s bottom line fell sharply from the year-ago adjusted profit of $3.98 due to a drop in refining margin.

Marathon Petroleum reported revenues of $33.5 billion, which beat the Zacks Consensus Estimate of $30.7 billion but fell 9.1% year over year.

Marathon Petroleum Corporation Price, Consensus and EPS Surprise

Marathon Petroleum Corporation price-consensus-eps-surprise-chart | Marathon Petroleum Corporation Quote

Refining & Marketing: The Refining & Marketing segment reported adjusted EBITDA of $559 million, which plunged more than 75% from the year-ago profit of $2.2 billion. The drop primarily reflects lower year-over-year margins, partly offset by stronger throughput and lower costs.

Specifically, the refining margin of $12.93 per barrel declined from $17.81 a year ago. Capacity utilization during the quarter was 94% compared to 91% in the corresponding period of 2023.

Meanwhile, total refined product sales volumes were 3,747 thousand barrels per day (mbpd), up from 3,583 mbpd in the year-ago quarter. Throughput rose from 2,922 mbpd in the year-ago quarter to 2,997 mbpd and outperformed the Zacks Consensus Estimate of 2,915 mbpd.

MPC’s operating costs per barrel decreased from $5.55 in the year-ago quarter to $5.26.

Midstream: This unit mainly reflects Marathon Petroleum’s general partner and majority limited partner interests in MPLX LP MPLX — a publicly traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets.

Segment adjusted EBITDA was $1.7 billion, up 8.7% from the fourth quarter of 2023. Earnings were buoyed up by higher rates and volumes processed, together with contributions from the acquired assets in the Utica and Permian basins.

Marathon Petroleum reported expenses of $32.3 billion in fourth-quarter 2024, down 6.1% from the year-ago quarter.

In the reported quarter, Marathon Petroleum spent $921 million on capital programs (53% on Refining & Marketing and 41% on the Midstream segment) compared to $780 million in the year-ago period.

As of Dec. 31, the Zacks Rank #3 (Hold) company had cash and cash equivalents of $3.2 billion and total debt, including that of MPLX, of $27.5 billion, with a debt-to-capitalization of 53.1%.

In the fourth quarter, MPC repurchased $1.3 billion of shares. It currently has a remaining authorization of $7.8 billion.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Story Continues

While we have discussed Marathon Petroleum’s fourth-quarter results in detail, let’s take a look at some other key downstream reports of this season.

Valero Energy VLO reported fourth-quarter 2024 adjusted earnings of 64 cents per share, which comprehensively beat the Zacks Consensus Estimate of 13 cents due to an increase in renewable diesel margins and lower total cost of sales. However, adjusted operating income in the Refining segment totaled $437 million, plunging from $1.6 billion in the year-ago quarter. The figure also missed our estimate of $1.3 billion.

Valero’s total cost of sales decreased to $30.1 billion from the year-ago figure of $33.5 billion. The figure is also below our estimate of $30.6 billion, primarily due to lower costs of materials and others. The fourth-quarter capital investment totaled $547 million, of which $452 million was allotted for sustaining the business.

Phillips 66 PSX reported fourth-quarter 2024 adjusted loss of 15 cents per share, narrower than the Zacks Consensus Estimate of a loss of 20 cents. However, the bottom line compared unfavorably with the year-ago quarter’s earnings of $3.09. The better-than-expected quarterly results can be primarily attributed to higher renewable fuel margins and a reduction in total costs and expenses. However, the positives were partially offset by lower contributions from the Refining segment due to a decline in realized margins.

Phillips 66 generated $1.2 billion of net cash from operations for the reported quarter, significantly lower than $2.2 billion a year ago. The company’s capital expenditure and investments totaled $506 million. It paid out dividends of $472 million in the fourth quarter. As of Dec. 31, 2024, cash and cash equivalents.

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Marathon Petroleum Tops Q4 Earnings on Higher Throughput

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