Phillips 66, Marathon Petroleum Hailed as Spinoff Successes

HOUSTON -- Sometimes, separation can be a good thing. After being spun off from their parent organizations, Phillips 66 and Marathon Petroleum Corp. have made Fortune magazine's list of the top six spinoffs.

Phillips 66 took the No. 1 spot on the successful spinoff list and Marathon Petroleum took the No. 3 spot.

Houston-based Phillips 66 became an independent company after ConocoPhillips spun off its downstream assets on May 1, 2012. The company, which holds the No. 4 spot on the Fortune 500, has posted healthy profits with earnings of $5.4 billion in 2012 compared to $3.6 billion in 2011, according to the magazine. As a result of the strong numbers, Phillips 66 returned $400 million of capital to shareholders in 2012 through dividends and share purchases.

In addition, earlier this year, Phillips 66 reiterated its intent to form a master limited partnership (MLP) of its midstream and chemicals segments. According to the company, a registration statement is expected to be filed with the Securities and Exchange Commission during the second quarter of this year and once approved, Phillips 66 anticipates an initial public offering of its MLP in the second half of 2013, as CSNews Online previously reported.

Findlay, Ohio-based Marathon Petroleum was spun off from Marathon Oil Corp. in June 2011. According to Fortune, the newly independent company quickly rewarded shareholders with a 25-percent increase in its first subsequent dividend. The company's 2012 revenues rose 6.5 percent, with analysts predicting healthy long-term earnings growth of 7 percent. With a strong balance sheet and plenty of free cash, Marathon Petroleum remains an attractive value proposition for investors, the report added. Marathon Petroleum occupies the No. 33 spot on the Fortune 500.

Marathon-brand gasoline is sold through more than 5,000 independently owned retail outlets across 18 states. In addition, Speedway LLC, a Marathon Petroleum subsidiary, owns and operates approximately 1,460 convenience stores in seven states.