SUGAR LAND, Texas, April 28, 2016 /PRNewswire/ -- CVR Energy,
Inc. (NYSE: CVI) today announced a net loss of $16.2 million, or 19
cents per diluted share, on net sales of $905.5 million for the first quarter of 2016,
compared to net income of $54.9
million, or 63 cents per
diluted share, on net sales of $1,388.9
million for the 2015 first quarter. Net income for the 2016
first quarter was negatively impacted by the downtime associated
with the final phase of a major scheduled turnaround at CVR
Refining's Coffeyville
refinery.
First quarter 2016 adjusted EBITDA, a non-GAAP financial
measure, was $36.2 million, compared
to first quarter 2015 adjusted EBITDA of $163.7 million.
"CVR Energy's 2016 first quarter results were primarily impacted
by weak crack spreads and the scheduled downtime related to the
successful completion of the Coffeyville refinery turnaround," said
Jack Lipinski, CVR Energy's chief
executive officer. "CVR Partners posted strong operational results
for the quarter and completed its acquisition of Rentech Nitrogen
Partners, L.P. at the beginning of April."
CVR Energy also announced a first quarter 2016 cash dividend of
50 cents per share. The dividend, as
declared by CVR Energy's Board of Directors, will be paid on
May 16, 2016, to stockholders of
record on May 9, 2016.
Today, CVR Partners announced a 2016 first quarter cash
distribution of 27 cents per common
unit. CVR Refining announced that it will not pay a cash
distribution for the 2016 first quarter.
Petroleum Business
The petroleum business, which is operated by CVR Refining and
includes the Coffeyville and
Wynnewood refineries, reported a
first quarter 2016 operating loss of $56.0
million on net sales of $834.0
million, compared to operating income of $109.2 million on net sales of $1,304.4 million in the first quarter of
2015.
Refining margin adjusted for FIFO impact per crude oil
throughput barrel, a non-GAAP financial measure, was $7.19 in the 2016 first quarter, compared to
$15.03 during the same period in
2015. Direct operating expenses, including major scheduled
turnaround expenses, per barrel sold, exclusive of depreciation and
amortization, for the 2016 first quarter were $6.40, compared to $4.44 in the first quarter of 2015.
First quarter 2016 throughputs of crude oil and all other
feedstocks and blendstocks totaled 195,859 barrels per day (bpd),
compared to first quarter 2015 throughputs of crude oil and all
other feedstocks and blendstocks of 215,023 bpd.
Nitrogen Fertilizers Business
The fertilizer business, operated by CVR Partners, reported
first quarter 2016 operating income of $19.7
million on net sales of $73.1
million, compared to operating income of $31.5 million on net sales of $93.1 million for the first quarter of 2015.
For the first quarter of 2016, average realized gate prices for
UAN and ammonia were $209 per ton and
$367 per ton, respectively, compared
to $263 per ton and $553 per ton, respectively, for the same period
in 2015.
CVR Partners produced 113,700 tons of ammonia and purchased an
additional 3,000 tons of ammonia during the first quarter of 2016,
of which 15,100 net tons were available for sale while the rest was
upgraded to 248,200 tons of UAN. In the 2015 first quarter, the
plant produced 96,000 tons of ammonia and purchased an additional
21,200 tons of ammonia, of which 14,600 net tons were available for
sale while the remainder was upgraded to 252,100 tons of UAN.
Cash and Debt
Consolidated cash and cash equivalents, which included
$145.9 million for CVR Refining and
$52.0 million for CVR Partners, was
$681.8 million at March 31, 2016. Consolidated total debt was
$673.1 million, or $667.1 million net of $6.0
million unamortized debt issue costs, at March 31, 2016. The company had no debt exclusive
of CVR Refining's and CVR Partners' debt.
First Quarter 2016 Earnings Conference Call
CVR Energy previously announced that it will host its first
quarter 2016 Earnings Conference Call for analysts and investors on
Thursday, April 28, at 3 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 Earnings Conference Call will be broadcast live over the
Internet at
https://www.webcaster4.com/Webcast/Page/1003/14528. For investors
or analysts who want to participate during the call, the dial-in
number is (877) 407-8291.
For those unable to listen live, the Webcast will be archived
and available for 14 days at
https://www.webcaster4.com/Webcast/Page/1003/14528. A repeat of the
conference call can be accessed by dialing (877) 660-6853,
conference ID 13634754.
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. You can generally identify forward-looking
statements by our use of forward-looking terminology such as
"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. For a 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 SEC filings. These 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
press 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 petroleum refining and nitrogen fertilizer
manufacturing industries through its holdings in two limited
partnerships, CVR Refining, LP and CVR Partners, LP. CVR Energy
subsidiaries serve as the general partner and own 66 percent of the
common units of CVR Refining and 34 percent of the common units of
CVR Partners.
For further information, please contact:
Investor Contact:
Jay
Finks
CVR Energy, Inc.
(281) 207-3588
InvestorRelations@CVREnergy.com
Media Relations:
Angie
Dasbach
CVR Energy, Inc.
281-207-3550
MediaRelations@CVREnergy.com
CVR Energy,
Inc.
|
|
Financial and
Operations Data (all information in this release is unaudited
unless noted otherwise).
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in millions,
except per share data)
|
Consolidated
Statement of Operations Data:
|
|
|
|
Net sales
|
$
|
905.5
|
|
|
$
|
1,388.9
|
|
Cost of product
sold
|
736.8
|
|
|
1,073.6
|
|
Direct operating
expenses
|
141.4
|
|
|
111.4
|
|
Selling, general and
administrative expenses
|
27.2
|
|
|
25.3
|
|
Depreciation and
amortization
|
40.0
|
|
|
42.0
|
|
Operating income
(loss)
|
(39.9)
|
|
|
136.6
|
|
Interest expense and
other financing costs
|
(12.1)
|
|
|
(12.7)
|
|
Interest
income
|
0.2
|
|
|
0.2
|
|
Loss on derivatives,
net
|
(1.2)
|
|
|
(51.4)
|
|
Other income,
net
|
0.3
|
|
|
36.0
|
|
Income (loss) before
income tax expense
|
(52.7)
|
|
|
108.7
|
|
Income tax expense
(benefit)
|
(21.8)
|
|
|
24.0
|
|
Net income
(loss)
|
(30.9)
|
|
|
84.7
|
|
Less: Net income
(loss) attributable to noncontrolling interest
|
(14.7)
|
|
|
29.8
|
|
Net income (loss)
attributable to CVR Energy stockholders
|
$
|
(16.2)
|
|
|
$
|
54.9
|
|
|
|
|
|
Basic earnings (loss)
per share
|
$
|
(0.19)
|
|
|
$
|
0.63
|
|
Diluted earnings
(loss) per share
|
$
|
(0.19)
|
|
|
$
|
0.63
|
|
Dividends declared
per share
|
$
|
0.50
|
|
|
$
|
0.50
|
|
|
|
|
|
Adjusted
EBITDA*
|
$
|
36.2
|
|
|
$
|
163.7
|
|
Adjusted net
income*
|
$
|
8.4
|
|
|
$
|
84.9
|
|
Adjusted net income,
per diluted share*
|
$
|
0.10
|
|
|
$
|
0.98
|
|
|
|
|
|
Weighted-average
common shares outstanding:
|
|
|
|
Basic
|
86.8
|
|
|
86.8
|
|
Diluted
|
86.8
|
|
|
86.8
|
|
|
|
|
|
|
|
|
|
|
|
As of March
31,
2016
|
|
As of December
31,
2015
|
|
|
|
(audited)
|
|
(in
millions)
|
Balance Sheet
Data:
|
|
|
|
Cash and cash
equivalents
|
$
|
681.8
|
|
|
$
|
765.1
|
|
Working capital
(1)
|
679.5
|
|
|
789.0
|
|
Total assets
(1)
|
3,183.5
|
|
|
3,299.4
|
|
Total debt, including
current portion (1)
|
667.1
|
|
|
667.1
|
|
Total CVR
stockholders' equity
|
924.5
|
|
|
984.1
|
|
|
_____________________________
|
(1) Prior period
amounts have been retrospectively adjusted for Accounting Standard
Update No. 2015-03, which requires that costs incurred to issue
debt be presented in the balance sheet as a direct reduction from
the carrying value of the debt.
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Cash Flow
Data:
|
|
|
|
Net cash flow
provided by (used in):
|
|
|
|
Operating
activities
|
$
|
21.6
|
|
|
$
|
178.2
|
|
Investing
activities
|
(51.7)
|
|
|
(3.4)
|
|
Financing
activities
|
(53.2)
|
|
|
(76.3)
|
|
Net cash
flow
|
$
|
(83.3)
|
|
|
$
|
98.5
|
|
Segment Information
Our operations are organized into two reportable segments,
Petroleum and Nitrogen Fertilizer. Our operations that are not
included in the Petroleum and Nitrogen Fertilizer segments are
included in the Corporate and Other segment (along with elimination
of intersegment transactions). The Petroleum segment is operated by
CVR Refining, LP ("CVR Refining"), in which we own a majority
interest as well as the general partner. The Petroleum segment
includes the operations of the Coffeyville, Kansas and Wynnewood, Oklahoma refineries along with the
crude oil gathering and pipeline systems. Detailed operating
results for the Petroleum segment for the three months ended
March 31, 2016 are included in CVR Refining's press release
dated April 28, 2016. The Nitrogen Fertilizer segment is
operated by CVR Partners, LP, ("CVR Partners") in which we owned a
majority interest as of March 31,
2016 and serve as the general partner. On April 1, 2016, CVR Partners completed the
previously announced merger transactions contemplated by the
Agreement and Plan of Merger, dated as of August 9, 2015, with East Dubuque Nitrogen
Partners, L.P. (formerly known as Rentech Nitrogen Partners, L.P.)
and East Dubuque Nitrogen GP, LLC (formerly known as Rentech
Nitrogen GP, LLC) (together "East
Dubuque") with East Dubuque
continuing as surviving entities and wholly-owned subsidiaries of
CVR Partners. The Nitrogen Fertilizer segment consists of a
nitrogen fertilizer manufacturing facility located in Coffeyville, Kansas that utilizes a pet coke
gasification process in producing nitrogen fertilizer, and as of
April 1, 2016, a nitrogen fertilizer
manufacturing facility located in East
Dubuque, Illinois that utilizes natural gas in producing
nitrogen fertilizer. Detailed operating results for the Nitrogen
Fertilizer segment for the three months ended March 31, 2016
are included in CVR Partners' press release dated April 28,
2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
(in
millions)
|
Three Months Ended
March 31, 2016
|
|
|
|
|
|
|
|
Net sales
|
$
|
834.0
|
|
|
$
|
73.1
|
|
|
$
|
(1.6)
|
|
|
$
|
905.5
|
|
Cost of product
sold
|
722.3
|
|
|
16.3
|
|
|
(1.8)
|
|
|
736.8
|
|
Direct operating
expenses(1)
|
88.3
|
|
|
23.7
|
|
|
—
|
|
|
112.0
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
|
—
|
|
|
29.4
|
|
Selling, general and
administrative
|
18.5
|
|
|
6.4
|
|
|
2.3
|
|
|
27.2
|
|
Depreciation and
amortization
|
31.5
|
|
|
7.0
|
|
|
1.5
|
|
|
40.0
|
|
Operating income (loss)
|
$
|
(56.0)
|
|
|
$
|
19.7
|
|
|
$
|
(3.6)
|
|
|
$
|
(39.9)
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
44.0
|
|
|
$
|
1.7
|
|
|
$
|
1.8
|
|
|
$
|
47.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
(in
millions)
|
Three Months Ended
March 31, 2015
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,304.4
|
|
|
$
|
93.1
|
|
|
$
|
(8.6)
|
|
|
$
|
1,388.9
|
|
Cost of product
sold
|
1,056.1
|
|
|
25.8
|
|
|
(8.3)
|
|
|
1,073.6
|
|
Direct operating
expenses(1)
|
87.0
|
|
|
24.4
|
|
|
—
|
|
|
111.4
|
|
Selling, general and
administrative
|
18.1
|
|
|
4.6
|
|
|
2.6
|
|
|
25.3
|
|
Depreciation and
amortization
|
34.0
|
|
|
6.8
|
|
|
1.2
|
|
|
42.0
|
|
Operating income (loss)
|
$
|
109.2
|
|
|
$
|
31.5
|
|
|
$
|
(4.1)
|
|
|
$
|
136.6
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
41.7
|
|
|
$
|
2.7
|
|
|
$
|
1.1
|
|
|
$
|
45.5
|
|
|
|
|
|
|
|
|
|
(1) Excluding
turnaround expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
(in
millions)
|
March 31,
2016
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
145.9
|
|
|
$
|
52.0
|
|
|
$
|
483.9
|
|
|
$
|
681.8
|
|
Total
assets
|
2,116.9
|
|
|
529.2
|
|
|
537.4
|
|
|
3,183.5
|
|
Total debt, net of
current portion and unamortized debt issuance cost
|
573.6
|
|
|
125.0
|
|
|
(31.5)
|
|
|
667.1
|
|
|
|
|
|
|
|
|
|
December 31,
2015
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
187.3
|
|
|
$
|
50.0
|
|
|
$
|
527.8
|
|
|
$
|
765.1
|
|
Total assets
(1)
|
2,189.0
|
|
|
536.3
|
|
|
574.1
|
|
|
3,299.4
|
|
Total debt, net of
current portion and unamortized debt issuance cost (1)
|
573.8
|
|
|
124.8
|
|
|
(31.5)
|
|
|
667.1
|
|
|
_____________________________
|
(1) Prior period
amounts have been retrospectively adjusted for Accounting Standard
Update No. 2015-03, which requires that costs incurred to issue
debt be presented in the balance sheet as a direct reduction from
the carrying value of the debt.
|
Petroleum Segment Operating Data
The following tables set forth information about our
consolidated Petroleum segment operated by CVR Refining, of which
we own a majority interest and serve as the general partner, and
the Coffeyville and Wynnewood refineries. Reconciliations of
certain non-GAAP financial measures are provided under "Use of
Non-GAAP Financial Measures" below. Additional discussion of
operating results for the Petroleum segment for the three months
ended March 31, 2016 are included in CVR Refining's press
release dated April 28, 2016.
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Petroleum Segment
Summary Financial Results:
|
|
|
|
Net sales
|
$
|
834.0
|
|
|
$
|
1,304.4
|
|
Cost of product
sold
|
722.3
|
|
|
1,056.1
|
|
Direct operating
expenses
|
88.3
|
|
|
87.0
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
Selling, general and
administrative expenses
|
18.5
|
|
|
18.1
|
|
Depreciation and
amortization
|
31.5
|
|
|
34.0
|
|
Operating income
(loss)
|
(56.0)
|
|
|
109.2
|
|
Interest expense and
other financing costs
|
(10.8)
|
|
|
(11.3)
|
|
Interest
income
|
—
|
|
|
0.1
|
|
Loss on derivatives,
net
|
(1.2)
|
|
|
(51.4)
|
|
Other income,
net
|
—
|
|
|
0.1
|
|
Income (loss) before
income tax expense
|
(68.0)
|
|
|
46.7
|
|
Income tax
expense
|
—
|
|
|
—
|
|
Net income
(loss)
|
$
|
(68.0)
|
|
|
$
|
46.7
|
|
|
|
|
|
Refining
margin*
|
$
|
111.7
|
|
|
$
|
248.3
|
|
Gross profit
(loss)*
|
$
|
(37.5)
|
|
|
$
|
127.3
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
120.5
|
|
|
$
|
272.8
|
|
Adjusted Petroleum
EBITDA*
|
$
|
35.1
|
|
|
$
|
161.7
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(dollars per
barrel)
|
Petroleum Segment
Key Operating Statistics:
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
Refining
margin*
|
$
|
6.67
|
|
|
$
|
13.68
|
|
FIFO impact,
unfavorable
|
0.52
|
|
|
1.35
|
|
Refining margin
adjusted for FIFO impact*
|
7.19
|
|
|
15.03
|
|
Gross profit
(loss)*
|
(2.24)
|
|
|
7.02
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
7.02
|
|
|
4.79
|
|
Direct operating
expenses excluding major scheduled turnaround expenses
|
5.27
|
|
|
4.79
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
6.40
|
|
|
4.44
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
4.80
|
|
|
$
|
4.44
|
|
Barrels sold (barrels
per day)
|
201,970
|
|
|
217,686
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
Petroleum Segment
Summary Refining Throughput and Production Data
(bpd):
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
Sweet
|
170,728
|
|
87.2%
|
|
175,376
|
|
81.6%
|
Medium
|
1,513
|
|
0.8%
|
|
6,630
|
|
3.1%
|
Heavy sour
|
11,914
|
|
6.0%
|
|
19,658
|
|
9.1%
|
Total crude oil
throughput
|
184,155
|
|
94.0%
|
|
201,664
|
|
93.8%
|
All other feedstocks
and blendstocks
|
11,704
|
|
6.0%
|
|
13,359
|
|
6.2%
|
Total
throughput
|
195,859
|
|
100.0%
|
|
215,023
|
|
100.0%
|
Production:
|
|
|
|
|
|
|
|
Gasoline
|
105,878
|
|
54.2%
|
|
109,096
|
|
50.2%
|
Distillate
|
77,996
|
|
39.9%
|
|
89,436
|
|
41.1%
|
Other (excluding
internally produced fuel)
|
11,519
|
|
5.9%
|
|
18,857
|
|
8.7%
|
Total refining
production (excluding internally produced fuel)
|
195,393
|
|
100.0%
|
|
217,389
|
|
100.0%
|
Product price
(dollars per gallon):
|
|
|
|
|
|
|
|
Gasoline
|
$
|
1.04
|
|
|
|
$
|
1.48
|
|
|
Distillate
|
1.05
|
|
|
|
1.69
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
Market Indicators
(dollars per barrel):
|
|
|
|
West Texas
Intermediate (WTI) NYMEX
|
$
|
33.63
|
|
|
$
|
48.57
|
|
Crude Oil
Differentials:
|
|
|
|
WTI less WTS
(light/medium sour)
|
0.13
|
|
|
0.99
|
|
WTI less WCS (heavy
sour)
|
13.62
|
|
|
13.62
|
|
NYMEX Crack
Spreads:
|
|
|
|
Gasoline
|
15.84
|
|
|
18.54
|
|
Heating Oil
|
11.91
|
|
|
27.06
|
|
NYMEX 2-1-1 Crack
Spread
|
13.88
|
|
|
22.80
|
|
PADD II Group 3
Basis:
|
|
|
|
Gasoline
|
(5.88)
|
|
|
(3.50)
|
|
Ultra Low Sulfur
Diesel
|
(1.01)
|
|
|
(4.52)
|
|
PADD II Group 3
Product Crack Spread:
|
|
|
|
Gasoline
|
9.97
|
|
|
15.04
|
|
Ultra Low Sulfur
Diesel
|
10.90
|
|
|
22.54
|
|
PADD II Group 3
2-1-1
|
10.43
|
|
|
18.79
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in millions,
except operating statistics)
|
Coffeyville
Refinery Financial Results:
|
|
|
|
Net sales
|
$
|
528.0
|
|
|
$
|
851.7
|
|
Cost of product
sold
|
462.7
|
|
|
700.9
|
|
Refining
margin*
|
65.3
|
|
|
150.8
|
|
Direct operating
expenses
|
47.6
|
|
|
50.4
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
Depreciation and
amortization
|
16.9
|
|
|
19.4
|
|
Gross profit
(loss)*
|
$
|
(28.6)
|
|
|
$
|
81.0
|
|
|
|
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
69.2
|
|
|
$
|
169.2
|
|
|
|
|
|
Coffeyville
Refinery Key Operating Statistics:
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
Refining
margin*
|
$
|
6.75
|
|
|
$
|
13.21
|
|
FIFO impact,
unfavorable
|
0.40
|
|
|
1.61
|
|
Refining margin
adjusted for FIFO impact*
|
7.15
|
|
|
14.82
|
|
Gross profit
(loss)*
|
(2.96)
|
|
|
7.10
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
7.96
|
|
|
4.42
|
|
Direct operating
expenses excluding major scheduled turnaround expenses
|
4.92
|
|
|
4.42
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
6.89
|
|
|
3.97
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
4.26
|
|
|
$
|
3.97
|
|
Barrels sold (barrels
per day)
|
122,838
|
|
|
140,974
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
|
2016
|
|
2015
|
|
Coffeyville
Refinery Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
Sweet
|
92,938
|
|
80.3%
|
|
100,532
|
|
73.4%
|
|
Medium
|
1,513
|
|
1.3%
|
|
6,630
|
|
4.8%
|
|
Heavy sour
|
11,914
|
|
10.3%
|
|
19,658
|
|
14.3%
|
|
Total crude oil
throughput
|
106,365
|
|
91.9%
|
|
126,820
|
|
92.5%
|
|
All other feedstocks
and blendstocks
|
9,344
|
|
8.1%
|
|
10,227
|
|
7.5%
|
|
Total
throughput
|
115,709
|
|
100.0%
|
|
137,047
|
|
100.0%
|
|
Production:
|
|
|
|
|
|
|
|
|
Gasoline
|
64,033
|
|
54.8%
|
|
67,853
|
|
48.3%
|
|
Distillate
|
47,147
|
|
40.3%
|
|
59,415
|
|
42.3%
|
|
Other (excluding
internally produced fuel)
|
5,768
|
|
4.9%
|
|
13,228
|
|
9.4%
|
|
Total refining
production (excluding internally produced fuel)
|
116,948
|
|
100.0%
|
|
140,496
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in millions,
except operating statistics)
|
Wynnewood Refinery
Financial Results:
|
|
|
|
Net sales
|
$
|
304.8
|
|
|
$
|
451.7
|
|
Cost of product
sold
|
259.4
|
|
|
355.6
|
|
Refining
margin*
|
45.4
|
|
|
96.1
|
|
Direct operating
expenses
|
40.6
|
|
|
36.6
|
|
Major scheduled
turnaround expenses
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
12.7
|
|
|
12.5
|
|
Gross profit
(loss)*
|
$
|
(7.9)
|
|
|
$
|
47.0
|
|
|
|
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
50.2
|
|
|
$
|
102.2
|
|
|
|
|
|
Wynnewood Refinery
Key Operating Statistics:
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
Refining
margin*
|
$
|
6.41
|
|
|
$
|
14.27
|
|
FIFO impact,
unfavorable
|
0.68
|
|
|
0.91
|
|
Refining margin
adjusted for FIFO impact*
|
7.09
|
|
|
15.18
|
|
Gross profit
(loss)*
|
(1.11)
|
|
|
6.98
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
5.74
|
|
|
5.43
|
|
Direct operating
expenses excluding major scheduled turnaround expenses
|
5.74
|
|
|
5.43
|
|
Direct operating
expenses and major scheduled turnaround expenses
per barrel
sold
|
$
|
5.64
|
|
|
$
|
5.30
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
5.64
|
|
|
$
|
5.30
|
|
Barrels sold (barrels
per day)
|
79,132
|
|
|
76,712
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
Wynnewood Refinery
Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
Sweet
|
77,790
|
|
97.1%
|
|
74,844
|
|
96.0%
|
Medium
|
—
|
|
—%
|
|
—
|
|
—%
|
Heavy sour
|
—
|
|
—%
|
|
—
|
|
—%
|
Total crude oil
throughput
|
77,790
|
|
97.1%
|
|
74,844
|
|
96.0%
|
All other feedstocks
and blendstocks
|
2,360
|
|
2.9%
|
|
3,132
|
|
4.0%
|
Total
throughput
|
80,150
|
|
100.0%
|
|
77,976
|
|
100.0%
|
Production:
|
|
|
|
|
|
|
|
Gasoline
|
41,845
|
|
53.4%
|
|
41,243
|
|
53.7%
|
Distillate
|
30,849
|
|
39.3%
|
|
30,021
|
|
39.0%
|
Other (excluding
internally produced fuel)
|
5,751
|
|
7.3%
|
|
5,629
|
|
7.3%
|
Total refining
production (excluding internally produced fuel)
|
78,445
|
|
100.0%
|
|
76,893
|
|
100.0%
|
Nitrogen Fertilizer Segment Operating Data
The following tables set forth information about the Nitrogen
Fertilizer segment operated by CVR Partners, of which we owned a
majority interest as of March 31, 2016 and serve as the
general partner. Reconciliations of certain non-GAAP financial
measures are provided under "Use of Non-GAAP Financial Measures"
below. Additional discussion of operating results for the Nitrogen
Fertilizer segment for the three months ended March 31, 2016
are included in CVR Partners' press release dated April 28,
2016.
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Nitrogen
Fertilizer Segment Business Financial Results:
|
|
|
|
Net sales
|
$
|
73.1
|
|
|
$
|
93.1
|
|
Cost of product
sold
|
16.3
|
|
|
25.8
|
|
Direct operating
expenses
|
23.7
|
|
|
24.4
|
|
Selling, general and
administrative expenses
|
6.4
|
|
|
4.6
|
|
Depreciation and
amortization
|
7.0
|
|
|
6.8
|
|
Operating
income
|
19.7
|
|
|
31.5
|
|
Interest expense and
other financing costs
|
(1.7)
|
|
|
(1.7)
|
|
Income before income
tax expense
|
18.0
|
|
|
29.8
|
|
Income tax
expense
|
—
|
|
|
—
|
|
Net income
|
$
|
18.0
|
|
|
$
|
29.8
|
|
|
|
|
|
Adjusted Nitrogen
Fertilizer EBITDA*
|
$
|
27.9
|
|
|
$
|
38.4
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
Nitrogen
Fertilizer Segment Key Operating Statistics:
|
|
|
|
Production volume
(thousand tons):
|
|
|
|
Ammonia (gross
produced)(1)
|
113.7
|
|
96.0
|
Ammonia (net available
for sale)(1)(2)
|
15.1
|
|
14.6
|
UAN
|
248.2
|
|
252.1
|
|
|
|
|
Pet coke consumed
(thousand tons)
|
126.9
|
|
124.9
|
Pet coke consumed
(cost per ton)
|
$
|
17
|
|
$
|
29
|
|
|
|
|
Sales (thousand
tons):
|
|
|
|
Ammonia
|
24.4
|
|
12.8
|
UAN
|
267.0
|
|
274.5
|
|
|
|
|
Product pricing at
gate (dollars per ton)(3):
|
|
|
|
Ammonia
|
$
|
367
|
|
$
|
553
|
UAN
|
$
|
209
|
|
$
|
263
|
|
|
|
|
On-stream
factors(4):
|
|
|
|
Gasification
|
97.7%
|
|
99.4%
|
Ammonia
|
97.2%
|
|
94.4%
|
UAN
|
91.4%
|
|
97.8%
|
|
|
|
|
Market
Indicators:
|
|
|
|
Ammonia — Southern
Plains (dollars per ton)
|
$
|
375
|
|
$
|
553
|
UAN — Corn belt
(dollars per ton)
|
$
|
229
|
|
$
|
313
|
|
|
Cost of product sold,
direct operating expenses and selling, general and administrative
expenses are all reflected exclusive of depreciation and
amortization.
|
|
* See Use of
Non-GAAP Financial Measures below.
|
|
(1) Gross tons
produced for ammonia represent total ammonia produced, including
ammonia produced that was upgraded into UAN. Net tons available for
sale represent the ammonia available for sale that was not upgraded
into UAN.
|
|
(2) In addition to
the produced ammonia, the Nitrogen Fertilizer segment acquired
approximately 3.0 thousand tons and 21.2 thousand tons of ammonia
during the three months ended March 31, 2016 and 2015,
respectively.
|
|
(3) Product pricing
at gate per ton represents net 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.
|
|
(4) On-stream factor
is the total number of hours operated divided by the total number
of hours in the reporting period and is a measure of operating
efficiency.
|
Use of Non-GAAP Financial Measures
To supplement the Company's actual results in accordance with
GAAP for the applicable periods, the Company also uses the non-GAAP
financial measures noted above, which are reconciled to our
GAAP-based results below. These non-GAAP financial measures should
not be considered an alternative for GAAP results. The adjustments
are provided to enhance an overall understanding of the Company's
financial performance for the applicable periods and are indicators
management believes are relevant and useful for planning and
forecasting future periods.
Adjusted net income is not a recognized term under GAAP and
should not be substituted for net income as a measure of our
performance but rather should be utilized as a supplemental measure
of financial performance in evaluating our business. Management
believes that adjusted net income provides relevant and useful
information that enables external users of our financial
statements, such as industry analysts, investors, lenders and
rating agencies, to better understand and evaluate our ongoing
operating results and allow for greater transparency in the review
of our overall financial, operational and economic performance.
Adjusted net income per diluted share represents adjusted net
income divided by weighted-average diluted shares outstanding.
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in millions,
except per share data)
|
Reconciliation of
Net Income (Loss) to Adjusted Net Income:
|
|
|
|
Income (loss) before
income tax expense
|
$
|
(52.7)
|
|
|
$
|
108.7
|
|
Adjustments:
|
|
|
|
FIFO impact,
unfavorable
|
8.8
|
|
|
24.5
|
|
Share-based
compensation (1)
|
—
|
|
|
4.0
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
Loss on derivatives,
net
|
1.2
|
|
|
51.4
|
|
Current period
settlement on derivative contracts (2)
|
21.4
|
|
|
(6.3)
|
|
Expenses associated
with the East Dubuque mergers (3)
|
1.2
|
|
|
—
|
|
Adjusted net income
before income tax expense and noncontrolling interest
|
9.3
|
|
|
182.3
|
|
Adjusted net income
attributed to noncontrolling interest
|
(6.6)
|
|
|
(53.7)
|
|
Income tax expense,
as adjusted
|
5.7
|
|
|
(43.7)
|
|
Adjusted net income
attributable to CVR Energy stockholders
|
$
|
8.4
|
|
|
$
|
84.9
|
|
|
|
|
|
Adjusted net income
per diluted share
|
$
|
0.10
|
|
|
$
|
0.98
|
|
Refining margin per crude oil throughput barrel is a measurement
calculated as the difference between the Petroleum segment's net
sales and cost of product sold (exclusive of depreciation and
amortization). Refining margin is a non-GAAP measure that we
believe is important to investors in evaluating the refineries'
performance as a general indication of the amount above their cost
of product sold at which they are able to sell refined products.
Each of the components used in this calculation (net sales and cost
of product sold exclusive of depreciation and amortization) can be
taken directly from our Petroleum segment's Statements of
Operations. Our calculation of refining margin may differ from
similar calculations of other companies in the industry, thereby
limiting its usefulness as a comparative measure. In order to
derive the refining margin per crude oil throughput barrel, we
utilize the total dollar figures for refining margin as derived
above and divide by the applicable number of crude oil throughput
barrels for the period. We believe that refining margin is
important to enable investors to better understand and evaluate the
Petroleum segment's ongoing operating results and allow for greater
transparency in the review of our overall financial, operational
and economic performance.
Refining margin per crude oil throughput barrel adjusted for
FIFO impact is a measurement calculated as the difference between
the Petroleum segment's net sales and cost of product sold
(exclusive of depreciation and amortization) adjusted for FIFO
impact. Refining margin adjusted for FIFO impact is a non-GAAP
measure that we believe is important to investors in evaluating the
refineries' performance as a general indication of the amount above
their cost of product sold (taking into account the impact of the
utilization of FIFO) at which they are able to sell refined
products. Our calculation of refining margin adjusted for FIFO
impact may differ from calculations of other companies in the
industry, thereby limiting its usefulness as a comparative measure.
Under the FIFO accounting method, 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 FIFO
impact when crude oil prices increase and an unfavorable FIFO
impact when crude oil prices decrease.
Gross profit (loss) is calculated as the difference between the
Petroleum segment's net sales, cost of product sold (exclusive of
depreciation and amortization), direct operating expenses
(exclusive of depreciation and amortization), major scheduled
turnaround expenses, and depreciation and amortization. Gross
profit (loss) per crude throughput barrel is calculated as gross
profit (loss) as derived above divided by the refineries' crude oil
throughput volumes for the respective periods presented. Gross
profit (loss) is a non-GAAP measure that should not be substituted
for operating income. Management believes it is important to
investors in evaluating the refineries' performance and the
Petroleum segment's ongoing operating results. Our calculation of
gross profit (loss) may differ from similar calculations of other
companies in the industry, thereby limiting its usefulness as a
comparative measure.
EBITDA and Adjusted EBITDA. EBITDA represents net income (loss)
before (i) interest expense and other financing costs, net of
interest income, (ii) income tax expense and (iii) depreciation and
amortization. Adjusted EBITDA represents EBITDA adjusted for (i)
FIFO impact (favorable) unfavorable; (ii) loss on extinguishment of
debt; (iii) major scheduled turnaround expenses; (iv) (gain) loss
on derivatives, net; (v) current period settlements on derivative
contracts; and (vi) expenses associated with the East Dubuque mergers. EBITDA and Adjusted
EBITDA are not recognized terms under GAAP and should not be
substituted for net income (loss) or cash flow from operations.
Management believes that EBITDA and Adjusted EBITDA enable
investors to better understand and evaluate our ongoing operating
results and allow for greater transparency in reviewing our overall
financial, operational and economic performance. EBITDA and
Adjusted EBITDA presented by other companies may not be comparable
to our presentation, since each company may define these terms
differently.
EBITDA for the three months ended March
31, 2015 was also adjusted for share-based compensation
expense in calculating Adjusted EBITDA. Beginning in 2016,
share-based compensation expense is no longer utilized as an
adjustment to derive Adjusted EBITDA as no equity-settled awards
remain outstanding for CVR Energy or any of its subsidiaries, and
CVR Partners and CVR Refining are responsible for reimbursing CVR
Energy for their allocated portion of all outstanding awards.
Management believes, based on the nature, classification and cash
settlement feature of the currently outstanding awards, that it is
no longer necessary to adjust EBITDA for share-based compensation
expense to derive Adjusted EBITDA. For comparison purposes we have
also provided Adjusted EBITDA for the three months ended
March 31, 2015 without adjusting for
share-based compensation expense in order to provide a comparison
to Adjusted EBITDA for the three months ended March 31, 2016.
A reconciliation of net income to EBITDA and EBITDA to Adjusted
EBITDA for the three months ended March 31, 2016 and 2015 is
as follows:
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Net income (loss)
attributable to CVR Energy stockholders
|
$
|
(16.2)
|
|
|
$
|
54.9
|
|
Add:
|
|
|
|
Interest expense and
other financing costs, net of interest income
|
11.9
|
|
|
12.5
|
|
Income tax expense
(benefit)
|
(21.8)
|
|
|
24.0
|
|
Depreciation and
amortization
|
40.0
|
|
|
42.0
|
|
EBITDA adjustments
included in noncontrolling interest
|
(18.4)
|
|
|
(19.4)
|
|
EBITDA
|
(4.5)
|
|
|
114.0
|
|
Add:
|
|
|
|
FIFO impact,
unfavorable
|
8.8
|
|
|
24.5
|
|
Share-based
compensation (1)
|
—
|
|
|
4.0
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
Loss on derivatives,
net
|
1.2
|
|
|
51.4
|
|
Current period
settlement on derivative contracts (2)
|
21.4
|
|
|
(6.3)
|
|
Expenses associated
with the East Dubuque mergers (3)
|
1.2
|
|
|
—
|
|
Adjustments included
in noncontrolling interest
|
(21.3)
|
|
|
(23.9)
|
|
Adjusted
EBITDA
|
$
|
36.2
|
|
|
$
|
163.7
|
|
Petroleum and Nitrogen Fertilizer EBITDA and Adjusted EBITDA.
EBITDA by operating segment represents net income (loss) before (i)
interest expense and other financing costs, net of interest income,
(ii) income tax expense and (iii) depreciation and amortization.
Adjusted EBITDA by operating segment represents EBITDA by operating
segment adjusted for (i) FIFO impact (favorable) unfavorable; (ii)
share-based compensation, non-cash; (iii) loss on extinguishment of
debt; (iv) major scheduled turnaround expenses; (v) (gain) loss on
derivatives, net; (vi) current period settlements on derivative
contracts; and (vii) expenses associated with the East Dubuque mergers. We present Adjusted
EBITDA by operating segment because it is the starting point for
CVR Refining's and CVR Partners' calculation of available cash for
distribution. EBITDA and Adjusted EBITDA by operating segment are
not recognized terms under GAAP and should not be substituted for
net income (loss) as a measure of performance. Management believes
that EBITDA and Adjusted EBITDA by operating segment enable
investors to better understand CVR Refining's and CVR Partners'
ability to make distributions to their common unitholders, help
investors evaluate our ongoing operating results and allow for
greater transparency in reviewing our overall financial,
operational and economic performance. EBITDA and Adjusted EBITDA
presented by other companies may not be comparable to our
presentation, since each company may define these terms
differently.
A reconciliation of net income (loss) to EBITDA and EBITDA to
Adjusted EBITDA for the Petroleum and Nitrogen Fertilizer segments
for the three months ended March 31, 2016 and 2015 is as
follows:
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Petroleum:
|
|
|
|
Petroleum net income
(loss)
|
$
|
(68.0)
|
|
|
$
|
46.7
|
|
Add:
|
|
|
|
Interest expense and
other financing costs, net of interest income
|
10.8
|
|
|
11.2
|
|
Income tax
expense
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
31.5
|
|
|
34.0
|
|
Petroleum
EBITDA
|
(25.7)
|
|
|
91.9
|
|
Add:
|
|
|
|
FIFO impact,
unfavorable
|
8.8
|
|
|
24.5
|
|
Share-based
compensation, non-cash
|
—
|
|
|
0.2
|
|
Major scheduled
turnaround expenses
|
29.4
|
|
|
—
|
|
Loss on derivatives,
net
|
1.2
|
|
|
51.4
|
|
Current period
settlements on derivative contracts(2)
|
21.4
|
|
|
(6.3)
|
|
Adjusted Petroleum
EBITDA
|
$
|
35.1
|
|
|
$
|
161.7
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
(in
millions)
|
Nitrogen
Fertilizer:
|
|
|
|
Nitrogen Fertilizer
net income
|
$
|
18.0
|
|
|
$
|
29.8
|
|
Add:
|
|
|
|
Interest expense and
other financing costs, net
|
1.7
|
|
|
1.7
|
|
Income tax
expense
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
7.0
|
|
|
6.8
|
|
Nitrogen
Fertilizer EBITDA
|
26.7
|
|
|
38.3
|
|
Add:
|
|
|
|
Share-based
compensation, non-cash
|
—
|
|
|
0.1
|
|
Expenses associated
with the East Dubuque mergers(3)
|
1.2
|
|
|
—
|
|
Adjusted Nitrogen
Fertilizer EBITDA
|
$
|
27.9
|
|
|
$
|
38.4
|
|
|
|
|
|
|
|
|
|
(1)
|
Beginning in 2016,
share-based compensation expense is no longer utilized as an
adjustment to derive Adjusted net income and Adjusted EBITDA as no
equity-settled awards remain outstanding for CVR Energy or any of
its subsidiaries, and CVR Partners and CVR Refining are responsible
for reimbursing CVR Energy for their allocated portion of all
outstanding awards. Management believes, based on the nature,
classification and cash settlement feature of the currently
outstanding awards, that it is no longer necessary to adjust net
income (loss) and EBITDA for share-based compensation expense to
derive Adjusted net income and Adjusted EBITDA. Adjusted net income
attributable to CVR Energy stockholders and Adjusted EBITDA for the
three months ended March 31, 2015 would have been $82.5 million and
$159.7 million, respectively, without adjusting for share-based
compensation expense of $4.0 million.
|
|
|
(2)
|
Represents the
portion of gain (loss) on derivatives, net related to contracts
that matured during the respective periods and settled with
counterparties. There are no premiums paid or received at inception
of the derivative contracts and upon settlement, there is no cost
recovery associated with these contracts.
|
|
|
(3)
|
On April 1, 2016, CVR
Partners completed the previously announced merger transactions
with East Dubuque. The Nitrogen Fertilizer Partnership incurred
legal and other professional fees and other merger related expenses
for the three months ended March 31, 2016 that are referred to
herein as expenses associated with the East Dubuque mergers, which
are included in selling, general and administrative
expenses.
|
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SOURCE CVR Energy, Inc.