• CVR Energy Reports Second Quarter 2023 Results, Announces a Cash Dividend of 50 cents and a Special Dividend of $1.00

    Источник: Nasdaq GlobeNewswire / 31 июл 2023 17:06:05   America/New_York

    SUGAR LAND, Texas, July 31, 2023 (GLOBE NEWSWIRE) -- CVR Energy, Inc. (“CVR Energy” or the “Company”) (NYSE: CVI) today announced net income of $130 million, or $1.29 per diluted share, on net sales of $2.2 billion for the second quarter of 2023, compared to net income of $165 million, or $1.64 per diluted share, on net sales of $3.1 billion for the second quarter of 2022. Adjusted earnings for the second quarter of 2023 was $1.64 per diluted share compared to adjusted earnings of $2.45 per diluted share in the second quarter of 2022, with the decline in the current period primarily driven by lower crack spreads. Second quarter 2023 EBITDA was $300 million, compared to second quarter 2022 EBITDA of $401 million. Adjusted EBITDA for the second quarter of 2023 was $347 million, down from $511 million in the second quarter of 2022.

    “CVR Energy posted solid results for the second quarter of 2023 driven by strong crack spreads,” said Dave Lamp, CVR Energy’s Chief Executive Officer. “In addition to our second quarter 2023 cash dividend of 50 cents, our Board of Directors was pleased to approve a special dividend of $1.00 per share, bringing our year to date declared dividends to $2.00 per share.

    “CVR Partners achieved solid results for the 2023 second quarter led by strong production, including a combined ammonia production rate of 100 percent offset by lower fertilizer pricing,” Lamp said. “CVR Partners announced a cash distribution of $4.14 per common unit for the 2023 second quarter.”

    Petroleum

    The Petroleum Segment reported second quarter 2023 operating income of $171 million on net sales of $2.0 billion, compared to operating income of $297 million on net sales of $2.9 billion in the second quarter of 2022.

    Refining margin per total throughput barrel was $18.21 in the second quarter of 2023, compared to $26.10 during the same period in 2022. The decrease in refining margin of $145 million was primarily due to a decrease in product crack spreads. The Group 3 2-1-1 crack spread decreased by $16.47 per barrel relative to the second quarter of 2022, driven by a tightening distillate crack spread due primarily to recession concerns and slowing demand trends.

    The Petroleum Segment recognized costs to comply with the Renewable Fuel Standard (“RFS”) of $88 million, or $4.85 per throughput barrel, which excludes the RINs’ revaluation expense impact of $2 million, or 10 cents per total throughput barrel, for the second quarter of 2023. This is compared to RFS compliance costs of $102 million, or $5.55 per throughput barrel, which excludes the RINs’ revaluation expense impact of $51 million, or $2.79 per total throughput barrel, for the second quarter of 2022. The decrease in RFS compliance costs in 2023 was primarily related to an increase in RINs generated by ethanol and biodiesel blending for the second quarter of 2023 compared to the 2022 period. The favorable RINs’ revaluation in 2023 was a result of a mark-to-market expense in the current period due to a decline in RIN prices and a lower outstanding obligation in the current period compared to the 2022 period.

    The Petroleum Segment also recognized a second quarter 2023 derivative net gain of $3 million, or 16 cents per total throughput barrel, compared to a derivative net loss of $61 million, or $3.35 per total throughput barrel, for the second quarter of 2022. Included in this derivative net gain for the second quarter of 2023 was a $15 million unrealized loss, primarily a result of crack spread swaps, inventory hedging activity, and Canadian crude forward purchases and sales, compared to a $22 million unrealized loss for the second quarter of 2022. Offsetting these impacts, crude oil prices decreased during the quarter, which led to an unfavorable inventory valuation impact of $21 million, or $1.17 per total throughput barrel, compared to a favorable inventory valuation impact of $37 million, or $2.02 per total throughput barrel, during the second quarter of 2022.

    Second quarter 2023 combined total throughput was approximately 201,000 bpd, compared to approximately 201,000 bpd of combined total throughput for the second quarter of 2022.

    On June 28, 2023, the Company, through one of its indirect wholly owned subsidiaries, entered into a crude oil supply agreement (the “Gunvor Crude Oil Supply Agreement”) with Gunvor USA LLC (“Gunvor”), pursuant to which Gunvor will supply certain crude oil and intermediation logistics in connection with deliveries beginning on or about January 1, 2024. The Gunvor Crude Oil Supply Agreement has a term of 24 months, subject to automatic one-year renewals thereafter in the absence of either party providing 180 days’ notice of termination and will replace the Vitol Crude Oil Supply Agreement.

    Nitrogen Fertilizer

    The Nitrogen Fertilizer Segment reported an operating income of $67 million on net sales of $183 million for the second quarter of 2023, compared to operating income of $126 million on net sales of $244 million for the second quarter of 2022.

    Second quarter 2023 average realized gate prices for urea ammonia nitrate (“UAN”) showed a reduction over the prior year, down 43 percent to $316 per ton, and ammonia was down 40 percent over the prior year to $707 per ton. Average realized gate prices for UAN and ammonia were $555 and $1,182 per ton, respectively, for the second quarter of 2022.

    CVR Partners, LP’s (“CVR Partners”) fertilizer facilities produced a combined 219,000 tons of ammonia during the second quarter of 2023, of which 70,000 net tons were available for sale while the rest was upgraded to other fertilizer products, including 339,000 tons of UAN. During the second quarter 2022, the fertilizer facilities produced 193,000 tons of ammonia, of which 50,000 net tons were available for sale while the remainder was upgraded to other fertilizer products, including 331,000 tons of UAN. These increases were due to operating reliability after completing the planned turnarounds during the third quarter of 2022.

    Corporate and Other

    The Company reported an income tax expense of $44 million, or 20.9 percent of income before income taxes, for the three months ended June 30, 2023, as compared to an income tax expense of $66 million, or 21.5 percent of income before income taxes, for the three months ended June 30, 2022. The decrease in income tax expense was due primarily to a decrease in pretax earnings.

    The renewable diesel unit at the Wynnewood refinery continued to increase production, with total vegetable oil throughputs for the second quarter of 2023 of approximately 17.8 million gallons, down from 22.4 million gallons in the first quarter of 2023 due to a planned catalyst change.

    Cash, Debt and Dividend

    Consolidated cash and cash equivalents were $751 million at June 30, 2023, an increase of $241 million from December 31, 2022. Consolidated total debt and finance lease obligations were $1.6 billion at June 30, 2023, including $547 million held by the Nitrogen Fertilizer Segment.

    CVR Energy announced a second quarter 2023 cash dividend of 50 cents per share. In addition, the Company announced a special dividend of $1.00 per share. The quarterly and special dividends, as declared by CVR Energy’s Board of Directors, will be paid on August 21, 2023, to stockholders of record as of August 14, 2023.

    Today, CVR Partners announced that the Board of Directors of its general partner declared a second quarter 2023 cash distribution of $4.14 per common unit, which will be paid on August 21, 2023, to common unitholders of record as of August 14, 2023.

    Second Quarter 2023 Earnings Conference Call

    CVR Energy previously announced that it will host its second quarter 2023 Earnings Conference Call on Tuesday, August 1, at 1 p.m. Eastern. The Earnings Conference Call may also include discussion of Company developments, forward-looking information and other material information about business and financial matters.

    The second quarter 2023 Earnings Conference Call will be webcast live and can be accessed on the Investor Relations section of CVR Energy’s website at www.CVREnergy.com. For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8291. The webcast will be archived and available for 14 days at https://edge.media-server.com/mmc/p/2k9ej4vv. A repeat of the call also can be accessed for 14 days by dialing (877) 660-6853, conference ID 13739750.

    Forward-Looking Statements
    This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements concerning current estimates, expectations and projections about future results, performance, prospects, opportunities, plans, actions and events and other statements, concerns, or matters that are not historical facts are “forward-looking statements,” as that term is defined under the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding future: drivers of results; crack spreads, including the continued strength thereof; production rates of CVR Partners, including the impact thereof on results; nitrogen fertilizer pricing; net income and sales; adjusted earnings including the drivers thereof; EBITDA and Adjusted EBITDA; operating income; net sales; refining margin; distillate crack spreads, including the tightening thereof; recession; demand trends; cost to comply with the Renewable Fuel Standard, RIN prices and level and valuation of our net RVO; CVR Energy’s blending activity, including its impact on RFS compliance costs; derivative activities and realized and unrealized gains or losses associated therewith; crude oil pricing; inventory levels and valuation, including the drivers thereof; throughput rates, including factors impacting same; crude oil supply and intermediation agreements; UAN, ammonia and nitrogen fertilizer production, demand, pricing and sales volumes, including the factors impacting same; rates at which ammonia will be upgraded to other fertilizer products; operational reliability, including the factors impacting same; tax rates and expense; quarterly and special dividends and distributions, including the timing, payment and amount (if any) thereof; production rates of our renewable diesel unit and related feedstock throughput, including factors impacting same; cash and cash equivalent levels; debt and finance lease obligations; continued safe and reliable operations; operating expenses, capital expenditures, depreciation and amortization and turnaround expense; the expected timing and completion of turnaround projects; impacts of plant outages and weather events on throughput volume; renewables initiatives; conversion of hydrocrackers at Coffeyville and/or feed pre-treaters, including the completion, operation, capacities, timing, costs, optionality and benefits thereof; carbon capture and decarbonization initiatives; Section 45Q credits and future payments arising under the 45Q Transaction (if any), including the amount, timing and receipt thereof; utilization rates; global fertilizer industry conditions; crop and planting conditions; natural gas and global energy costs; risks related to the conclusion of consideration of a spin-off of some or all of Company’s interests in its nitrogen fertilizer business or potential future reconsideration thereof; and other matters. You can generally identify forward-looking statements by our use of forward-looking terminology such as “outlook,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “explore,” “evaluate,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “seek,” “should,” or “will,” or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. Investors are cautioned that various factors may affect these forward-looking statements, including the rate of any economic improvement, demand for fossil fuels, price volatility of crude oil, other feedstocks and refined products (among others); the ability of the Company to pay cash dividends and CVR Partners to make cash distributions; potential operating hazards; costs of compliance with existing, or compliance with new, laws and regulations and potential liabilities arising therefrom; impacts of planting season on CVR Partners; the health and economic effects of the COVID-19 pandemic and any variant thereof; general economic and business conditions; political disturbances, geopolitical instability and tensions, and associated changes in global trade policies and economic sanctions, including, but not limited to, in connection with the Russia/Ukraine conflict; and other risks. For additional discussion of risk factors which may affect our results, please see the risk factors and other disclosures included in our most recent Annual Report on Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q and our other Securities and Exchange Commission (“SEC”) filings. These and other risks may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this news release are made only as of the date hereof. CVR Energy disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

    About CVR Energy, Inc.

    Headquartered in Sugar Land, Texas, CVR Energy is a diversified holding company primarily engaged in the renewables, petroleum refining and marketing business as well as in the nitrogen fertilizer manufacturing business through its interest in CVR Partners. CVR Energy subsidiaries serve as the general partner and own 37 percent of the common units of CVR Partners.

    Investors and others should note that CVR Energy may announce material information using SEC filings, press releases, public conference calls, webcasts and the Investor Relations page of its website. CVR Energy may use these channels to distribute material information about the Company and to communicate important information about the Company, corporate initiatives and other matters. Information that CVR Energy posts on its website could be deemed material; therefore, CVR Energy encourages investors, the media, its customers, business partners and others interested in the Company to review the information posted on its website.

    For further information, please contact:

    Investor Relations
    Richard Roberts
    CVR Energy, Inc.
    (281) 207-3205
    InvestorRelations@CVREnergy.com

    Media Relations
    Brandee Stephens
    CVR Energy, Inc.
    (281) 207-3516
    MediaRelations@CVREnergy.com

    Non-GAAP Measures

    Our management uses certain non-GAAP performance measures, and reconciliations to those measures, to evaluate current and past performance and prospects for the future to supplement our financial information presented in accordance with accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures are important factors in assessing our operating results and profitability and include the performance and liquidity measures defined below.

    The following are non-GAAP measures we present for the period ended June 30, 2023:

    EBITDA - Consolidated net income (loss) before (i) interest expense, net, (ii) income tax expense (benefit) and (iii) depreciation and amortization expense.

    Petroleum EBITDA and Nitrogen Fertilizer EBITDA - Segment net income (loss) before segment (i) interest expense, net, (ii) income tax expense (benefit), and (iii) depreciation and amortization.

    Refining Margin - The difference between our Petroleum Segment net sales and cost of materials and other.

    Refining Margin, adjusted for Inventory Valuation Impacts - Refining Margin adjusted to exclude the impact of current period market price and volume fluctuations on crude oil and refined product inventories purchased in prior periods and lower of cost or net realizable value adjustments, if applicable. We record our commodity inventories on the first-in-first-out basis. As a result, significant current period fluctuations in market prices and the volumes we hold in inventory can have favorable or unfavorable impacts on our refining margins as compared to similar metrics used by other publicly-traded companies in the refining industry.

    Refining Margin and Refining Margin adjusted for Inventory Valuation Impacts, per Throughput Barrel - Refining Margin and Refining Margin adjusted for Inventory Valuation Impacts divided by the total throughput barrels during the period, which is calculated as total throughput barrels per day times the number of days in the period.

    Direct Operating Expenses per Throughput Barrel - Direct operating expenses for our Petroleum Segment divided by total throughput barrels for the period, which is calculated as total throughput barrels per day times the number of days in the period.

    Adjusted EBITDA, Adjusted Petroleum EBITDA and Adjusted Nitrogen Fertilizer EBITDA - EBITDA, Petroleum EBITDA and Nitrogen Fertilizer EBITDA adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends.

    Adjusted Earnings (Loss) per Share - Earnings (loss) per share adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends.

    Free Cash Flow - Net cash provided by (used in) operating activities less capital expenditures and capitalized turnaround expenditures.

    Net Debt and Finance Lease Obligations - Net debt and finance lease obligations is total debt and finance lease obligations reduced for cash and cash equivalents.

    Total Debt and Net Debt and Finance Lease Obligations to EBITDA Exclusive of Nitrogen Fertilizer - Total debt and net debt and finance lease obligations is calculated as the consolidated debt and net debt and finance lease obligations less the Nitrogen Fertilizer Segment’s debt and net debt and finance lease obligations as of the most recent period ended divided by EBITDA exclusive of the Nitrogen Fertilizer Segment for the most recent twelve-month period.

    We present these measures because we believe they may help investors, analysts, lenders and ratings agencies analyze our results of operations and liquidity in conjunction with our U.S. GAAP results, including but not limited to our operating performance as compared to other publicly-traded companies in the refining and fertilizer industries, without regard to historical cost basis or financing methods and our ability to incur and service debt and fund capital expenditures. Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures. See “Non-GAAP Reconciliations” included herein for reconciliation of these amounts. Due to rounding, numbers presented within this section may not add or equal to numbers or totals presented elsewhere within this document.

    CVR Energy, Inc.
    (all information in this release is unaudited)

    Consolidated Statement of Operations Data

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions, except per share data)2023 2022 2023 2022
    Net sales$2,236  $3,144  $4,523  $5,517 
    Operating costs and expenses:       
    Cost of materials and other 1,743   2,465   3,423   4,352 
    Direct operating expenses (exclusive of depreciation and amortization) 165   167   334   327 
    Depreciation and amortization 71   71   137   136 
    Cost of sales 1,979   2,703   3,894   4,815 
    Selling, general and administrative expenses (exclusive of depreciation and amortization) 32   37   71   75 
    Depreciation and amortization 1   2   4   4 
    Operating income 224   402   554   623 
    Other (expense) income:       
    Interest expense, net (16)  (23)  (32)  (48)
    Other income (expense), net 4   (74)  6   (84)
    Income before income tax expense 212   305   528   491 
    Income tax expense 44   66   101   99 
    Net income 168   239   427   392 
    Less: Net income attributable to noncontrolling interest 38   74   102   134 
    Net income attributable to CVR Energy stockholders$130  $165  $325  $258 
            
    Basic and diluted earnings per share$1.29  $1.64  $3.23  $2.57 
    Dividends declared per share$0.50  $0.40  $1.00  $0.40 
            
    Adjusted earnings per share$1.64  $2.45  $3.08  $2.47 
    EBITDA*$300  $401  $701  $679 
    Adjusted EBITDA *$347  $511  $680  $666 
            
    Weighted-average common shares outstanding - basic and diluted 100.5   100.5   100.5   100.5 

    ______________________________

    * See “Non-GAAP Reconciliations” section below.

    Selected Balance Sheet Data

    (in millions)June 30, 2023 December 31, 2022
    Cash and cash equivalents$751 $510
    Working capital 361  154
    Total assets 4,217  4,119
    Total debt and finance lease obligations, including current portion 1,591  1,591
    Total liabilities 3,240  3,328
    Total CVR stockholders’ equity 755  531

    Selected Cash Flow Data

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Net cash provided by:       
    Operating activities$367  $390  $614  $712 
    Investing activities (96)  (115)  (130)  (156)
    Financing activities (121)  (58)  (243)  (173)
    Net increase in cash and cash equivalents and restricted cash$150  $217  $241  $383 
            
    Free cash flow*$271  $275  $484  $556 

    ___________________________

    * See “Non-GAAP Reconciliations” section below.

    Selected Segment Data

     Three Months Ended June 30, 2023 Six Months Ended June 30, 2023
    (in millions)Petroleum Nitrogen Fertilizer Consolidated Petroleum Nitrogen Fertilizer Consolidated
    Net sales$2,000 $183 $2,236 $3,993 $409 $4,523
    Operating income 171  67  224  408  176  554
    Net income 194  60  168  453  162  427
    EBITDA* 220  87  300  505  211  701
                
    Capital expenditures(1)           
    Maintenance capital expenditures$20 $5 $27 $50 $9 $62
    Growth capital expenditures 2  1  21  3  1  35
    Total capital expenditures$22 $6 $48 $53 $10 $97


     Three Months Ended June 30, 2022 Six Months Ended June 30, 2022
    (in millions)Petroleum Nitrogen Fertilizer Consolidated Petroleum Nitrogen Fertilizer Consolidated
    Net sales$2,868 $244 $3,144 $5,022 $467 $5,517
    Operating income 297  126  402  427  230  623
    Net income 306  118  239  432  211  392
    EBITDA* 347  147  401  514  271  679
                
    Capital expenditures(1)           
    Maintenance capital expenditures$19 $8 $28 $37 $13 $51
    Growth capital expenditures —  1  13  1  1  40
    Total capital expenditures$19 $9 $41 $38 $14 $91

    ___________________________

    * See “Non-GAAP Reconciliations” section below.
    (1)   Capital expenditures are shown exclusive of capitalized turnaround expenditures.


    Selected Balance Sheet Data

     June 30, 2023 December 31, 2022
    (in millions)Petroleum Nitrogen Fertilizer Consolidated Petroleum Nitrogen Fertilizer Consolidated
    Cash and cash equivalents(1)$514 $69 $751 $235 $86 $510
    Total assets 4,260  1,019  4,217  4,354  1,100  4,119
    Total debt and finance lease obligations, including current portion(2) 47  547  1,591  48  547  1,591

    ______________________________

    (1) Corporate cash and cash equivalents consisted of $168 million and $189 million at June 30, 2023 and December 31, 2022, respectively.
    (2) Corporate total debt and finance lease obligations, including current portion consisted of $997 million and $996 million at June 30, 2023 and December 31, 2022, respectively.

    Petroleum Segment

    Key Operating Metrics per Total Throughput Barrel

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Refining margin *$18.21 $26.10 $20.68 $21.50
    Refining margin adjusted for inventory valuation impacts * 19.38  24.08  21.61  16.77
    Direct operating expenses * 5.46  6.12  5.68  5.85

    ______________________________

    * See “Non-GAAP Reconciliations” section below.

    Throughput Data by Refinery

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in bpd)2023 2022 2023 2022
    Coffeyville       
    Regional crude73,547 66,266 59,527 53,089
    WTI25,091 34,513 31,343 41,127
    WTL— 1,317 — 662
    Midland WTI— — — 1,294
    Condensate6,598 10,596 7,879 10,972
    Heavy Canadian84 6,468 2,091 6,614
    DJ Basin16,630 10,763 15,229 14,379
    Other feedstocks and blendstocks12,124 9,270 12,678 10,301
    Wynnewood       
    Regional crude51,142 47,392 50,485 45,407
    WTL1,002 1,660 2,471 1,006
    Midland WTI— — — 813
    WTS— — — 288
    Condensate11,992 10,710 13,950 10,499
    Other feedstocks and blendstocks2,865 2,291 3,144 2,855
    Total throughput201,075 201,246 198,797 199,306

    Production Data by Refinery

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in bpd)2023 2022 2023 2022
    Coffeyville       
    Gasoline68,008  71,003  66,258  73,015 
    Distillate57,996  58,769  54,100  56,728 
    Other liquid products3,816  5,730  4,461  5,361 
    Solids3,916  4,342  3,632  4,351 
    Wynnewood       
    Gasoline36,017  33,255  37,991  31,322 
    Distillate23,604  22,316  24,424  22,416 
    Other liquid products6,714  4,897  6,499  5,015 
    Solids10  7  10  13 
    Total production200,081  200,319  197,375  198,221 
            
    Light product yield (as % of crude throughput)(1)99.8% 97.7% 99.9% 98.6%
    Liquid volume yield (as % of total throughput)(2)97.6% 97.4% 97.5% 97.3%
    Distillate yield (as % of crude throughput)(3)43.9% 42.7% 42.9% 42.5%

    _____________________________

    (1) Total Gasoline and Distillate divided by total Regional crude, WTI, WTL, Midland WTI, WTS, Condensate, Heavy Canadian, and DJ Basin throughput.
    (2) Total Gasoline, Distillate, and Other liquid products divided by total throughput.
    (3) Total Distillate divided by total Regional crude, WTI, WTL, Midland WTI, WTS, Condensate, Heavy Canadian, and DJ Basin throughput.

    Key Market Indicators

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
     2023 2022 2023 2022
    West Texas Intermediate (WTI) NYMEX$73.51  $108.51  $74.76  $101.86 
    Crude Oil Differentials to WTI:       
    Brent 4.22   3.38   5.18   3.08 
    WCS (heavy sour) (13.36)  (15.34)  (16.54)  (14.08)
    Condensate (0.43)  (0.62)  (0.15)  (0.26)
    Midland Cushing 0.93   1.14   1.22   1.28 
    NYMEX Crack Spreads:       
    Gasoline 35.64   46.09   32.72   34.96 
    Heating Oil 28.91   61.03   37.92   47.67 
    NYMEX 2-1-1 Crack Spread 32.27   53.56   35.32   41.31 
    PADD II Group 3 Product Basis:       
    Gasoline (4.24)  (9.56)  (4.01)  (8.38)
    Ultra-Low Sulfur Diesel 3.76   (0.55)  (0.44)  (3.12)
    PADD II Group 3 Product Crack Spread:       
    Gasoline 31.40   36.53   28.71   26.57 
    Ultra-Low Sulfur Diesel 32.66   60.48   37.48   44.55 
    PADD II Group 3 2-1-1 32.03   48.50   33.10   35.56 
                    

    Nitrogen Fertilizer Segment:

    Ammonia Utilization Rates (1)

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (percent of capacity utilization)2023 2022 2023 2022
    Consolidated100% 89% 103% 88%

    _____________________________

    (1) Reflects our ammonia utilization rates on a consolidated basis. Utilization is an important measure used by management to assess operational output at each of CVR Partners’ facilities. Utilization is calculated as actual tons produced divided by capacity. We present our utilization for the three and six months ended June 30, 2023 and 2022 and take into account the impact of our current turnaround cycles on any specific period. Additionally, we present utilization solely on ammonia production rather than each nitrogen product as it provides a comparative baseline against industry peers and eliminates the disparity of plant configurations for upgrade of ammonia into other nitrogen products. With our efforts being primarily focused on ammonia upgrade capabilities, this measure provides a meaningful view of how well we operate.


    Sales and Production Data

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
     2023 2022 2023 2022
    Consolidated sales (thousand tons):       
    Ammonia 79  52  121  91
    UAN 329  287  688  609
            
    Consolidated product pricing at gate (dollars per ton):(1)       
    Ammonia$707 $1,182 $770 $1,127
    UAN 316  555  390  524
            
    Consolidated production volume (thousand tons):       
    Ammonia(gross produced)(2) 219  193  442  380
    Ammonia(net available for sale)(2) 70  50  132  102
    UAN 339  331  705  648
            
    Feedstock:       
    Petroleum coke used in production(thousand tons) 124  116  255  224
    Petroleum coke used in production(dollars per ton)$73.91 $49.91 $75.62 $53.06
    Natural gas used in production(thousands of MMBtu)(3) 2,194  1,936  4,296  3,697
    Natural gas used in production(dollars per MMBtu)(3)$2.35 $7.34 $4.02 $6.48
    Natural gas in cost of materials and other(thousands of MMBtu)(3) 2,403  1,707  3,718  3,235
    Natural gas in cost of materials and other(dollars per MMBtu)(3)$4.11 $5.98 $5.41 $5.81

    ________________________________

    (1) Product pricing at gate represents sales less freight revenue divided by product sales volume in tons and is shown in order to provide a pricing measure that is comparable across the fertilizer industry.
    (2) Gross tons produced for ammonia represent total ammonia produced, including ammonia produced that was upgraded into other fertilizer products. Net tons available for sale represent ammonia available for sale that was not upgraded into other fertilizer products.
    (3) The feedstock natural gas shown above does not include natural gas used for fuel. The cost of fuel natural gas is included in direct operating expense.


    Key Market Indicators

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
     2023 2022 2023 2022
    Ammonia — Southern Plains(dollars per ton)$435 $1,241 $586 $1,259
    Ammonia — Corn belt(dollars per ton) 472  1,405  682  1,391
    UAN — Corn belt(dollars per ton) 298  632  335  624
            
    Natural gas NYMEX(dollars per MMBtu)$2.33 $7.49 $2.54 $6.06
                

    Q3 2023 Outlook

    The table below summarizes our outlook for certain operational statistics and financial information for the third quarter of 2023. See “Forward-Looking Statements” above.

     Q3 2023
     Low High
    Petroleum   
    Total throughput(bpd) 200,000   215,000 
    Direct operating expenses(in millions)(1)$95  $105 
        
    Renewables(2)   
    Total throughput(in millions of gallons) 17   22 
    Direct operating expenses(in millions)(1)$6  $8 
        
    Nitrogen Fertilizer   
    Ammonia utilization rates   
    Consolidated 95%  100%
    Coffeyville Fertilizer Facility 95%  100%
    East Dubuque Fertilizer Facility 95%  100%
    Direct operating expenses(in millions)(1)$50  $55 
        
    Capital Expenditures (in millions)(3)   
    Petroleum$45  $49 
    Renewables(2) 23   25 
    Nitrogen Fertilizer 14   16 
    Other 3   5 
    Total capital expenditures$85  $95 

    __________________________________

    (1) Direct operating expenses are shown exclusive of depreciation and amortization and, for the Nitrogen Fertilizer Segment, turnaround expenses and inventory valuation impacts.
    (2) Renewables reflects spending on the Wynnewood renewable diesel unit project. As of June 30, 2023, Renewables does not meet the definition of a reportable segment as defined under Accounting Standards Codification 280.
    (3) Capital expenditures is disclosed on an accrual basis.

    Non-GAAP Reconciliations:

    Reconciliation of Net Income to EBITDA and Adjusted EBITDA

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Net income$168 $239  $427  $392 
    Interest expense, net 16  23   32   48 
    Income tax expense 44  66   101   99 
    Depreciation and amortization 72  73   141   140 
    EBITDA 300  401   701   679 
    Adjustments:       
    Revaluation of RFS liability 2  51   (54)  70 
    Unrealized loss (gain) on derivatives, net 19  21   (13)  15 
    Inventory valuation impacts, unfavorable (favorable) 26  (41)  46   (177)
    Call Option Lawsuits settlement —  79   —   79 
    Adjusted EBITDA$347 $511  $680  $666 
                   

    Reconciliation of Basic and Diluted Earnings per Share to Adjusted Earnings per Share

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
     2023 2022 2023 2022
    Basic and diluted earnings per share$1.29 $1.64  $3.23  $2.57 
    Adjustments:(1)       
    Revaluation of RFS liability 0.01  0.38   (0.40)  0.52 
    Unrealized loss (gain) on derivatives, net 0.14  0.16   (0.10)  0.11 
    Inventory valuation impacts, unfavorable (favorable) 0.20  (0.31)  0.35   (1.31)
    Call Option Lawsuits settlement —  0.58   —   0.58 
    Adjusted earnings per share$1.64 $2.45  $3.08  $2.47 

    _____________________________

    (1) Amounts are shown after-tax, using the Company’s marginal tax rate, and are presented on a per share basis using the weighted average shares outstanding for each period.


    Reconciliation of Net Cash Provided By Operating Activities to Free Cash Flow

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Net cash provided by operating activities$367  $390  $614  $712 
    Less:       
    Capital expenditures (55)  (62)  (100)  (88)
    Capitalized turnaround expenditures (42)  (53)  (50)  (68)
    Return on equity method investment 1   —   20   — 
    Free cash flow$271  $275  $484  $556 
                    

    Reconciliation of Petroleum Segment Net Income to EBITDA and Adjusted EBITDA

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Petroleum net income$194  $306  $453  $432 
    Interest income, net (19)  (5)  (39)  (11)
    Depreciation and amortization 45   46   91   93 
    Petroleum EBITDA 220   347   505   514 
    Adjustments:       
    Revaluation of RFS liability 2   51   (54)  70 
    Unrealized loss (gain) on derivatives, net 15   22   (16)  17 
    Inventory valuation impacts, unfavorable (favorable)(1) 21   (37)  33   (170)
    Petroleum Adjusted EBITDA$258  $383  $468  $431 
                    

    Reconciliation of Petroleum Segment Gross Profit to Refining Margin and Refining Margin Adjusted for Inventory Valuation Impacts

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Net sales$2,000  $2,868  $3,993  $5,022 
    Less:       
    Cost of materials and other (1,667)  (2,390)  (3,249)  (4,247)
    Direct operating expenses (exclusive of depreciation and amortization) (100)  (112)  (204)  (211)
    Depreciation and amortization (45)  (46)  (91)  (93)
    Gross profit 188   320   449   471 
    Add:       
    Direct operating expenses (exclusive of depreciation and amortization) 100   112   204   211 
    Depreciation and amortization 45   46   91   93 
    Refining margin 333   478   744   775 
    Inventory valuation impacts, unfavorable (favorable)(1) 21   (37)  33   (170)
    Refining margin adjusted for inventory valuation impacts$354  $441  $777  $605 

    _____________________________

    (1) The Petroleum Segment’s basis for determining inventory value under GAAP is First-In, First-Out (“FIFO”). Changes in crude oil prices can cause fluctuations in the inventory valuation of crude oil, work in process and finished goods, thereby resulting in a favorable inventory valuation impact when crude oil prices increase and an unfavorable inventory valuation impact when crude oil prices decrease. The inventory valuation impact is calculated based upon inventory values at the beginning of the accounting period and at the end of the accounting period. In order to derive the inventory valuation impact per total throughput barrel, we utilize the total dollar figures for the inventory valuation impact and divide by the number of total throughput barrels for the period.


    Reconciliation of Petroleum Segment Total Throughput Barrels

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
     2023 2022 2023 2022
    Total throughput barrels per day201,075 201,246 198,797 199,306
    Days in the period91 91 181 181
    Total throughput barrels18,297,814 18,313,357 35,982,294 36,074,355
            

    Reconciliation of Petroleum Segment Refining Margin per Total Throughput Barrel

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions, except for per throughput barrel data)2023 2022 2023 2022
    Refining margin$333 $478 $744 $775
    Divided by: total throughput barrels 18  18  36  36
    Refining margin per total throughput barrel$18.21 $26.10 $20.68 $21.50
                

    Reconciliation of Petroleum Segment Refining Margin Adjusted for Inventory Valuation Impacts per Total Throughput Barrel

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions, except for throughput barrel data)2023 2022 2023 2022
    Refining margin adjusted for inventory valuation impacts$354 $441 $777 $605
    Divided by: total throughput barrels 18  18  36  36
    Refining margin adjusted for inventory valuation impacts per total throughput barrel$19.38 $24.08 $21.61 $16.77
                

    Reconciliation of Petroleum Segment Direct Operating Expenses per Total Throughput Barrel

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions, except for throughput barrel data)2023 2022 2023 2022
    Direct operating expenses (exclusive of depreciation and amortization)$100 $112 $204 $211
    Divided by: total throughput barrels 18  18  36  36
    Direct operating expenses per total throughput barrel$5.46 $6.12 $5.68 $5.85
                

    Reconciliation of Nitrogen Fertilizer Segment Net Income to EBITDA and Adjusted EBITDA

     Three Months Ended
    June 30,    		 Six Months Ended
    June 30,
    (in millions)2023 2022 2023 2022
    Nitrogen Fertilizer net income$60 $118 $162 $211
    Interest expense, net 7  8  14  18
    Depreciation and amortization 20  21  35  42
    Nitrogen Fertilizer EBITDA and Adjusted EBITDA$87 $147 $211 $271
                

    Reconciliation of Total Debt and Net Debt and Finance Lease Obligations to EBITDA Exclusive of Nitrogen Fertilizer

    (in millions)Twelve Months Ended
    June 30, 2023
    Total debt and finance lease obligations(1)$1,591
    Less: Nitrogen Fertilizer debt and finance lease obligations(1) 547
    Total debt and finance lease obligations exclusive of Nitrogen Fertilizer 1,044
      
    EBITDA exclusive of Nitrogen Fertilizer 852
      
    Total debt and finance lease obligations to EBITDA exclusive of Nitrogen Fertilizer 1.23
      
    Consolidated cash and cash equivalents 751
    Less: Nitrogen Fertilizer cash and cash equivalents 69
    Cash and cash equivalents exclusive of Nitrogen Fertilizer 682
      
    Net debt and finance lease obligations exclusive of Nitrogen Fertilizer(2) 362
      
    Net debt and finance lease obligations to EBITDA exclusive of Nitrogen Fertilizer(2)$0.42

    ____________________________

    (1) Amounts are shown inclusive of the current portion of long-term debt and finance lease obligations.
    (2) Net debt represents total debt and finance lease obligations exclusive of cash and cash equivalents.

     Three Months Ended Twelve Months
    Ended     June 30,
    2023    (1)
    (in millions)September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 
    Consolidated         
    Net income$80  $172 $259 $168 $679
    Interest expense, net 19   18  18  16  71
    Income tax expense 7   50  56  44  157
    Depreciation and amortization 75   73  68  72  288
    EBITDA 181   313  401  300  1,195
    Nitrogen Fertilizer         
    Net income (loss) (20)  95  102  60  237
    Interest expense, net 8   8  7  7  30
    Depreciation and amortization 22   19  15  20  76
    EBITDA 10   122  124  87  343
              
    EBITDA exclusive of Nitrogen Fertilizer$171  $191 $277 $213 $852

    _______________________________

    (1) Due to rounding, numbers within this table may not add or equal to totals presented.


    Primary Logo

Опубликовать