SUGAR LAND, Texas, Nov. 1, 2017 /PRNewswire/ -- CVR Energy, Inc.
(NYSE: CVI) today announced third quarter 2017 net income of
$22.2 million, or 26 cents per diluted share, on net sales of
$1,453.8 million, compared to net
income of $5.4 million, or
6 cents per diluted share, on net
sales of $1,240.3 million for the
2016 third quarter. Third quarter 2017 adjusted EBITDA, a non-GAAP
financial measure, was $90.9 million,
compared to third quarter 2016 adjusted EBITDA of $58.2 million.
For the first nine months of 2017, net income was $33.9 million, or 39
cents per diluted share, on net sales of $4,395.3 million, compared to net income of
$17.6 million, or 20 cents per diluted share, on net sales of
$3,429.0 million for the same period
a year earlier. Adjusted EBITDA for the first nine months of 2017
was $209.0 million, compared to
adjusted EBITDA of $158.8 million for
the first nine months of 2016.
"CVR Refining had a solid third quarter led by strong crack
spreads and improved market conditions," said Jack Lipinski, CVR Energy's chief executive
officer. "CVR Refining announced a 2017 third quarter cash
distribution of 94 cents due to the
exceptional performance of its Coffeyville, Kansas, refinery. CVR Refining's
Wynnewood, Oklahoma, refinery
began planned fall maintenance at the end of September and is on
schedule to complete its turnaround in early November. The large
scale and cost of the Wynnewood
turnaround will negatively impact its results for the year.
"CVR Partners successfully completed the scheduled turnaround at
its East Dubuque, Illinois,
fertilizer facility on time and within budget during the 2017 third
quarter," Lipinski said. "However, CVR Partners' results were
negatively impacted by continued low U.S. nitrogen fertilizer
pricing and unplanned downtime at both the East Dubuque and Coffeyville fertilizer facilities related to
maintenance issues. As a result, CVR Partners announced that it
will not pay a cash distribution for the quarter."
Petroleum Business
The petroleum business, which is operated by CVR Refining and
includes the Coffeyville and
Wynnewood refineries, reported
third quarter 2017 operating income of $98.7
million on net sales of $1,385.8
million, compared to operating income of $28.4 million on net sales of $1,163.5 million in the third quarter of
2016.
Refining margin adjusted for FIFO impact per crude oil
throughput barrel, a non-GAAP financial measure, was $13.72 in the 2017 third quarter, compared to
$10.09 during the same period in
2016. Direct operating expenses (exclusive of depreciation and
amortization), including major scheduled turnaround expenses, per
crude oil throughput barrel, for the 2017 third quarter were
$6.47, compared to $5.33 in the third quarter of 2016.
Third quarter 2017 throughputs of crude oil and all other
feedstocks and blendstocks totaled 213,606 barrels per day (bpd),
compared to third quarter 2016 throughputs of crude oil and all
other feedstocks and blendstocks of 206,733 bpd.
Nitrogen Fertilizers Business
The fertilizer business, which is operated by CVR Partners and
includes the Coffeyville and
East Dubuque fertilizer
facilities, reported a third quarter 2017 operating loss of
$15.9 million on net sales of
$69.4 million, compared to operating
income of $2.4 million on net sales
of $78.5 million for the third
quarter of 2016.
For the third quarter of 2017, consolidated average realized
gate prices for UAN and ammonia were $138 per ton and $214 per ton, respectively. Consolidated average
realized gate prices for UAN and ammonia were $154 per ton and $345 per ton, respectively, for the same period
in 2016.
CVR Partners' fertilizer facilities produced a combined 180,700
tons of ammonia during the third quarter of 2017, of which 46,200
net tons were available for sale while the rest was upgraded to
other fertilizer products, including 306,600 tons of UAN. In the
2016 third quarter, the fertilizer facilities produced 200,800 tons
of ammonia, of which 60,300 net tons were available for sale while
the remainder was upgraded to other fertilizer products, including
317,200 tons of UAN.
Cash, Debt and Dividend
Consolidated cash and cash equivalents was $849.1 million at Sept.
30, 2017. Consolidated total debt was $1,166.1 million at Sept.
30, 2017. The company had no debt exclusive of CVR
Refining's and CVR Partners' debt.
CVR Energy also announced a third quarter 2017 cash dividend of
50 cents per share. The dividend, as
declared by CVR Energy's Board of Directors, will be paid on
Nov. 17, 2017, to stockholders of
record on Nov. 10, 2017. CVR Energy's
third quarter cash dividend brings the cumulative cash dividends
paid or declared for the first nine months of 2017 to $1.50 per share.
Today, CVR Refining announced a 2017 third quarter cash
distribution of 94 cents per common
unit. CVR Partners announced that it will not pay a cash
distribution for the 2017 third quarter.
Third Quarter 2017 Earnings Conference Call
CVR Energy previously announced that it will host its third
quarter 2017 Earnings Conference Call for analysts and investors on
Wednesday, Nov. 1, 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/1003/23020. 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/1003/23020. A repeat of the
conference call can be accessed by dialing (877) 660-6853,
conference ID 13672109.
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:
Brandee
Stephens
CVR Energy, Inc.
(281) 207-3516
MediaRelations@CVREnergy.com
CVR Energy, Inc.
Financial and Operational Data (all
information in this release is unaudited other than the balance
sheet data as of December 31,
2016).
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except per share data)
|
Consolidated
Statement of Operations Data:
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,453.8
|
|
|
$
|
1,240.3
|
|
|
$
|
4,395.3
|
|
|
$
|
3,429.0
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
Cost of materials and
other
|
1,132.4
|
|
|
1,005.7
|
|
|
3,582.2
|
|
|
2,719.3
|
|
Direct operating
expenses(1)
|
161.1
|
|
|
129.5
|
|
|
423.4
|
|
|
409.2
|
|
Depreciation and
amortization
|
51.3
|
|
|
48.1
|
|
|
151.7
|
|
|
134.5
|
|
Cost of
sales
|
1,344.8
|
|
|
1,183.3
|
|
|
4,157.3
|
|
|
3,263.0
|
|
Selling, general and
administrative expenses(1)
|
27.3
|
|
|
27.8
|
|
|
82.7
|
|
|
81.7
|
|
Depreciation and
amortization
|
2.8
|
|
|
2.0
|
|
|
7.5
|
|
|
6.3
|
|
Operating
income
|
78.9
|
|
|
27.2
|
|
|
147.8
|
|
|
78.0
|
|
Interest expense and
other financing costs
|
(27.6)
|
|
|
(26.2)
|
|
|
(82.3)
|
|
|
(56.8)
|
|
Interest
income
|
0.2
|
|
|
0.2
|
|
|
0.8
|
|
|
0.5
|
|
Loss on derivatives,
net
|
(17.0)
|
|
|
(1.7)
|
|
|
(4.8)
|
|
|
(4.8)
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.1)
|
|
Other income,
net
|
—
|
|
|
5.0
|
|
|
0.1
|
|
|
5.5
|
|
Income before income
tax expense
|
34.5
|
|
|
4.5
|
|
|
61.6
|
|
|
17.3
|
|
Income tax
expense
|
9.2
|
|
|
2.5
|
|
|
17.4
|
|
|
2.3
|
|
Net income
|
25.3
|
|
|
2.0
|
|
|
44.2
|
|
|
15.0
|
|
Less: Net income
(loss) attributable to noncontrolling interest
|
3.1
|
|
|
(3.4)
|
|
|
10.3
|
|
|
(2.6)
|
|
Net income
attributable to CVR Energy stockholders
|
$
|
22.2
|
|
|
$
|
5.4
|
|
|
$
|
33.9
|
|
|
$
|
17.6
|
|
|
|
|
|
|
|
|
|
Basic and diluted
earnings per share
|
$
|
0.26
|
|
|
$
|
0.06
|
|
|
$
|
0.39
|
|
|
$
|
0.20
|
|
Dividends declared
per share
|
$
|
0.50
|
|
|
$
|
0.50
|
|
|
$
|
1.50
|
|
|
$
|
1.50
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA*
|
$
|
90.9
|
|
|
$
|
58.2
|
|
|
$
|
209.0
|
|
|
$
|
158.8
|
|
Adjusted net
income*
|
$
|
32.0
|
|
|
$
|
11.5
|
|
|
$
|
51.8
|
|
|
$
|
37.0
|
|
Adjusted net income
per diluted share*
|
$
|
0.37
|
|
|
$
|
0.13
|
|
|
$
|
0.60
|
|
|
$
|
0.43
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding - basic and diluted
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
|
______________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
(1)
|
Direct operating
expenses and selling, general and administrative expenses for the
three and nine months ended September 30, 2017 and 2016 are shown
exclusive of depreciation and amortization, which amounts are
presented separately below direct operating expenses and selling,
general and administrative expenses.
|
|
As of September
30,
2017
|
|
As of December
31,
2016
|
|
|
|
(audited)
|
|
(in
millions)
|
Balance Sheet
Data:
|
|
|
|
Cash and cash
equivalents
|
$
|
849.1
|
|
|
$
|
735.8
|
|
Working
capital
|
765.0
|
|
|
749.6
|
|
Total
assets
|
4,032.8
|
|
|
4,050.2
|
|
Total debt, including
current portion
|
1,166.1
|
|
|
1,164.6
|
|
Total CVR
stockholders' equity
|
761.8
|
|
|
858.1
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Cash Flow
Data:
|
|
|
|
|
|
|
|
Net cash flow provided
by (used in):
|
|
|
|
|
|
|
|
Operating
activities
|
$
|
84.7
|
|
|
$
|
149.0
|
|
|
$
|
326.8
|
|
|
$
|
218.9
|
|
Investing
activities
|
(21.6)
|
|
|
(16.9)
|
|
|
(80.4)
|
|
|
(172.0)
|
|
Financing
activities
|
(43.9)
|
|
|
(60.1)
|
|
|
(133.1)
|
|
|
(49.4)
|
|
Net cash
flow
|
$
|
19.2
|
|
|
$
|
72.0
|
|
|
$
|
113.3
|
|
|
$
|
(2.5)
|
|
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 serve 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 and nine months
ended September 30, 2017 are included in CVR Refining's press
release dated November 1, 2017. The Nitrogen Fertilizer
segment is operated by CVR Partners, LP ("CVR Partners"), in which
we own approximately 34% of the common units as of
September 30, 2017 and serve as the general partner. On
April 1, 2016, CVR Partners completed
the merger (the "East Dubuque Merger") whereby CVR Partners
acquired a nitrogen fertilizer manufacturing facility located in
East Dubuque, Illinois (the "East
Dubuque Facility"). The Nitrogen Fertilizer segment consists of a
nitrogen fertilizer manufacturing facility located in Coffeyville, Kansas, and the East Dubuque
Facility beginning on April 1, 2016,
the date of the closing of the acquisition. Detailed operating
results for the Nitrogen Fertilizer segment for the three and nine
months ended September 30, 2017 are included in CVR Partners'
press release dated November 1, 2017.
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR
Partners)
|
|
Corporate
and Other
|
|
Consolidated
|
|
(in
millions)
|
Three Months Ended
September 30, 2017
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,385.8
|
|
|
$
|
69.4
|
|
|
$
|
(1.4)
|
|
|
$
|
1,453.8
|
|
Cost of materials and
other
|
1,114.4
|
|
|
19.4
|
|
|
(1.4)
|
|
|
1,132.4
|
|
Direct operating
expenses (1)
|
99.2
|
|
|
37.8
|
|
|
(0.1)
|
|
|
136.9
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
2.5
|
|
|
—
|
|
|
24.2
|
|
Selling, general and
administrative
|
18.8
|
|
|
6.1
|
|
|
2.4
|
|
|
27.3
|
|
Depreciation and
amortization
|
33.0
|
|
|
19.5
|
|
|
1.6
|
|
|
54.1
|
|
Operating income
(loss)
|
$
|
98.7
|
|
|
$
|
(15.9)
|
|
|
$
|
(3.9)
|
|
|
$
|
78.9
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
18.7
|
|
|
$
|
2.8
|
|
|
$
|
1.0
|
|
|
$
|
22.5
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate
and Other
|
|
Consolidated
|
|
(in
millions)
|
Nine Months Ended
September 30, 2017
|
|
|
|
|
|
|
|
Net sales
|
$
|
4,147.5
|
|
|
$
|
252.6
|
|
|
$
|
(4.8)
|
|
|
$
|
4,395.3
|
|
Cost of materials and
other
|
3,523.7
|
|
|
63.3
|
|
|
(4.8)
|
|
|
3,582.2
|
|
Direct operating
expenses (1)
|
271.9
|
|
|
111.4
|
|
|
0.1
|
|
|
383.4
|
|
Major scheduled
turnaround expenses
|
37.4
|
|
|
2.6
|
|
|
—
|
|
|
40.0
|
|
Selling, general and
administrative
|
57.7
|
|
|
18.8
|
|
|
6.2
|
|
|
82.7
|
|
Depreciation and
amortization
|
99.5
|
|
|
54.9
|
|
|
4.8
|
|
|
159.2
|
|
Operating income
(loss)
|
$
|
157.3
|
|
|
$
|
1.6
|
|
|
$
|
(11.1)
|
|
|
$
|
147.8
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
66.1
|
|
|
$
|
11.4
|
|
|
$
|
2.4
|
|
|
$
|
79.9
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate
and Other
|
|
Consolidated
|
|
(in
millions)
|
Three Months Ended
September 30, 2016
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,163.5
|
|
|
$
|
78.5
|
|
|
$
|
(1.7)
|
|
|
$
|
1,240.3
|
|
Cost of materials and
other
|
987.5
|
|
|
19.9
|
|
|
(1.7)
|
|
|
1,005.7
|
|
Direct operating
expenses (1)
|
97.0
|
|
|
32.5
|
|
|
—
|
|
|
129.5
|
|
Major scheduled
turnaround expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Selling, general and
administrative
|
18.1
|
|
|
7.3
|
|
|
2.4
|
|
|
27.8
|
|
Depreciation and
amortization
|
32.5
|
|
|
16.4
|
|
|
1.2
|
|
|
50.1
|
|
Operating income
(loss)
|
$
|
28.4
|
|
|
$
|
2.4
|
|
|
$
|
(3.6)
|
|
|
$
|
27.2
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
15.4
|
|
|
$
|
6.4
|
|
|
$
|
1.0
|
|
|
$
|
22.8
|
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate
and Other
|
|
Consolidated
|
|
(in
millions)
|
Nine Months Ended
September 30, 2016
|
|
|
|
|
|
|
|
Net sales
|
$
|
3,161.9
|
|
|
$
|
271.4
|
|
|
$
|
(4.3)
|
|
|
$
|
3,429.0
|
|
Cost of materials and
other
|
2,651.7
|
|
|
72.2
|
|
|
(4.6)
|
|
|
2,719.3
|
|
Direct operating
expenses (1)
|
267.2
|
|
|
103.8
|
|
|
0.1
|
|
|
371.1
|
|
Major scheduled
turnaround expenses
|
31.5
|
|
|
6.6
|
|
|
—
|
|
|
38.1
|
|
Selling, general and
administrative
|
53.4
|
|
|
22.0
|
|
|
6.3
|
|
|
81.7
|
|
Depreciation and
amortization
|
95.6
|
|
|
41.0
|
|
|
4.2
|
|
|
140.8
|
|
Operating income
(loss)
|
$
|
62.5
|
|
|
$
|
25.8
|
|
|
$
|
(10.3)
|
|
|
$
|
78.0
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
$
|
83.4
|
|
|
$
|
18.3
|
|
|
$
|
3.9
|
|
|
$
|
105.6
|
|
|
|
|
(1)
|
Excluding turnaround
expenses.
|
|
Petroleum
(CVR Refining)
|
|
Nitrogen
Fertilizer
(CVR Partners)
|
|
Corporate
and Other
|
|
Consolidated
|
|
(in
millions)
|
September 30,
2017
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
560.4
|
|
|
$
|
70.0
|
|
|
$
|
218.7
|
|
|
$
|
849.1
|
|
Total
assets
|
2,500.7
|
|
|
1,275.8
|
|
|
256.3
|
|
|
4,032.8
|
|
Total debt, including
current portion
|
540.9
|
|
|
625.2
|
|
|
—
|
|
|
1,166.1
|
|
|
|
|
|
|
|
|
|
December 31,
2016
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
314.1
|
|
|
$
|
55.6
|
|
|
$
|
366.1
|
|
|
$
|
735.8
|
|
Total
assets
|
2,331.9
|
|
|
1,312.2
|
|
|
406.1
|
|
|
4,050.2
|
|
Total debt, including
current portion
|
541.5
|
|
|
623.1
|
|
|
—
|
|
|
1,164.6
|
|
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 and nine
months ended September 30, 2017 are included in CVR Refining's
press release dated November 1, 2017.
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Petroleum Segment
Summary Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,385.8
|
|
|
$
|
1,163.5
|
|
|
$
|
4,147.5
|
|
|
$
|
3,161.9
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
Cost of materials and
other
|
1,114.4
|
|
|
987.5
|
|
|
3,523.7
|
|
|
2,651.7
|
|
Direct operating
expenses(1)
|
99.2
|
|
|
97.0
|
|
|
271.9
|
|
|
267.2
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
31.5
|
|
Depreciation and
amortization
|
31.8
|
|
|
31.9
|
|
|
96.8
|
|
|
93.7
|
|
Cost of
sales
|
1,267.1
|
|
|
1,116.4
|
|
|
3,929.8
|
|
|
3,044.1
|
|
Selling, general and
administrative expenses(1)
|
18.8
|
|
|
18.1
|
|
|
57.7
|
|
|
53.4
|
|
Depreciation and
amortization
|
1.2
|
|
|
0.6
|
|
|
2.7
|
|
|
1.9
|
|
Operating
income
|
98.7
|
|
|
28.4
|
|
|
157.3
|
|
|
62.5
|
|
Interest expense and
other financing costs
|
(12.0)
|
|
|
(10.8)
|
|
|
(35.2)
|
|
|
(31.7)
|
|
Interest
income
|
0.2
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
Loss on derivatives,
net
|
(17.0)
|
|
|
(1.7)
|
|
|
(4.8)
|
|
|
(4.8)
|
|
Other income,
net
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
Income before income
tax expense
|
70.0
|
|
|
15.9
|
|
|
117.8
|
|
|
26.0
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income
|
$
|
70.0
|
|
|
$
|
15.9
|
|
|
$
|
117.8
|
|
|
$
|
26.0
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
$
|
118.7
|
|
|
$
|
47.1
|
|
|
$
|
217.7
|
|
|
$
|
117.8
|
|
Refining
margin*
|
$
|
271.4
|
|
|
$
|
176.0
|
|
|
$
|
623.8
|
|
|
$
|
510.2
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
256.5
|
|
|
$
|
183.7
|
|
|
$
|
624.6
|
|
|
$
|
480.5
|
|
Adjusted Petroleum
EBITDA*
|
$
|
138.6
|
|
|
$
|
75.3
|
|
|
$
|
296.2
|
|
|
$
|
195.1
|
|
|
______________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
(1)
|
Direct operating
expense and selling, general and administrative expenses for the
three and nine months ended September 30, 2017 and 2016 are
shown exclusive of depreciation and amortization and major
scheduled turnaround expenses, which amounts are presented
separately below direct operating expenses and selling, general and
administrative expenses.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(dollars per
barrel)
|
Petroleum Segment
Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Gross
profit
|
$
|
6.35
|
|
|
$
|
2.59
|
|
|
$
|
3.79
|
|
|
$
|
2.21
|
|
Refining
margin*
|
14.52
|
|
|
9.66
|
|
|
10.86
|
|
|
9.55
|
|
FIFO impact,
(favorable) unfavorable
|
(0.80)
|
|
|
0.43
|
|
|
0.01
|
|
|
(0.56)
|
|
Refining margin
adjusted for FIFO impact*
|
13.72
|
|
|
10.09
|
|
|
10.87
|
|
|
8.99
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
6.47
|
|
|
5.33
|
|
|
5.38
|
|
|
5.59
|
|
Direct operating
expenses excluding major scheduled turnaround expenses
|
5.31
|
|
|
5.33
|
|
|
4.73
|
|
|
5.00
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
6.26
|
|
|
5.04
|
|
|
5.08
|
|
|
5.24
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
5.13
|
|
|
$
|
5.04
|
|
|
$
|
4.47
|
|
|
$
|
4.68
|
|
Barrels sold (barrels
per day)
|
210,002
|
|
|
209,228
|
|
|
222,889
|
|
|
208,192
|
|
|
______________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Petroleum Segment
Summary
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
Refining
Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
196,342
|
|
|
91.9
|
|
|
176,404
|
|
|
85.3
|
|
|
198,750
|
|
|
89.8
|
|
|
174,594
|
|
|
85.4
|
|
Medium
|
—
|
|
|
—
|
|
|
1,983
|
|
|
1.0
|
|
|
—
|
|
|
—
|
|
|
2,321
|
|
|
1.1
|
|
Heavy sour
|
6,751
|
|
|
3.2
|
|
|
19,568
|
|
|
9.5
|
|
|
11,643
|
|
|
5.3
|
|
|
17,978
|
|
|
8.9
|
|
Total crude
oil throughput
|
203,093
|
|
|
95.1
|
|
|
197,955
|
|
|
95.8
|
|
|
210,393
|
|
|
95.1
|
|
|
194,893
|
|
|
95.4
|
|
All other feedstocks
and blendstocks
|
10,513
|
|
|
4.9
|
|
|
8,778
|
|
|
4.2
|
|
|
10,943
|
|
|
4.9
|
|
|
9,476
|
|
|
4.6
|
|
Total
throughput
|
213,606
|
|
|
100.0
|
|
|
206,733
|
|
|
100.0
|
|
|
221,336
|
|
|
100.0
|
|
|
204,369
|
|
|
100.0
|
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
105,712
|
|
|
49.5
|
|
|
106,120
|
|
|
51.2
|
|
|
112,268
|
|
|
50.6
|
|
|
106,774
|
|
|
52.2
|
|
Distillate
|
89,655
|
|
|
42.0
|
|
|
84,669
|
|
|
40.9
|
|
|
92,046
|
|
|
41.5
|
|
|
83,101
|
|
|
40.6
|
|
Other (excluding
internally produced fuel)
|
18,107
|
|
|
8.5
|
|
|
16,390
|
|
|
7.9
|
|
|
17,385
|
|
|
7.9
|
|
|
14,738
|
|
|
7.2
|
|
Total refining
production (excluding internally produced fuel)
|
213,474
|
|
|
100.0
|
|
|
207,179
|
|
|
100.0
|
|
|
221,699
|
|
|
100.0
|
|
|
204,613
|
|
|
100.0
|
|
Product price
(dollars per gallon):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
$
|
1.63
|
|
|
|
|
$
|
1.45
|
|
|
|
|
$
|
1.56
|
|
|
|
|
$
|
1.31
|
|
|
|
Distillate
|
1.67
|
|
|
|
|
1.45
|
|
|
|
|
1.58
|
|
|
|
|
1.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Market Indicators
(dollars per barrel):
|
|
|
|
|
|
|
|
West Texas
Intermediate (WTI) NYMEX
|
$
|
48.20
|
|
|
$
|
44.94
|
|
|
$
|
49.36
|
|
|
$
|
41.53
|
|
Crude Oil
Differentials:
|
|
|
|
|
|
|
|
WTI less WTS
(light/medium sour)
|
0.97
|
|
|
1.47
|
|
|
1.15
|
|
|
0.82
|
|
WTI less WCS (heavy
sour)
|
10.48
|
|
|
14.23
|
|
|
11.42
|
|
|
13.59
|
|
NYMEX Crack
Spreads:
|
|
|
|
|
|
|
|
Gasoline
|
20.42
|
|
|
13.73
|
|
|
17.74
|
|
|
16.24
|
|
Heating
Oil
|
21.05
|
|
|
14.34
|
|
|
17.24
|
|
|
13.04
|
|
NYMEX 2-1-1
Crack Spread
|
20.73
|
|
|
14.03
|
|
|
17.49
|
|
|
14.64
|
|
PADD II Group 3
Basis:
|
|
|
|
|
|
|
|
Gasoline
|
(1.18)
|
|
|
0.48
|
|
|
(2.37)
|
|
|
(3.59)
|
|
Ultra Low Sulfur
Diesel
|
0.85
|
|
|
1.01
|
|
|
(0.44)
|
|
|
(0.38)
|
|
PADD II Group 3
Product Crack Spread:
|
|
|
|
|
|
|
|
Gasoline
|
19.23
|
|
|
14.21
|
|
|
15.37
|
|
|
12.65
|
|
Ultra Low Sulfur
Diesel
|
21.90
|
|
|
15.35
|
|
|
16.80
|
|
|
12.65
|
|
PADD II Group 3
2-1-1
|
20.57
|
|
|
14.78
|
|
|
16.09
|
|
|
12.65
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except operating statistics)
|
Coffeyville
Refinery Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
939.3
|
|
|
$
|
788.1
|
|
|
$
|
2,750.5
|
|
|
$
|
2,094.1
|
|
Cost of materials and
other
|
767.7
|
|
|
669.9
|
|
|
2,349.7
|
|
|
1,763.3
|
|
Direct operating
expenses(1)
|
56.7
|
|
|
50.7
|
|
|
154.9
|
|
|
144.5
|
|
Major scheduled
turnaround expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
31.5
|
|
Depreciation and
amortization
|
17.4
|
|
|
17.7
|
|
|
53.8
|
|
|
51.2
|
|
Gross
profit
|
97.5
|
|
|
49.8
|
|
|
192.1
|
|
|
103.6
|
|
Add:
|
|
|
|
|
|
|
|
Direct operating
expenses(1)
|
56.7
|
|
|
50.7
|
|
|
154.9
|
|
|
144.5
|
|
Major scheduled
turnaround expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
31.5
|
|
Depreciation and
amortization
|
17.4
|
|
|
17.7
|
|
|
53.8
|
|
|
51.2
|
|
Refining
margin*
|
171.6
|
|
|
118.2
|
|
|
400.8
|
|
|
330.8
|
|
FIFO impact,
(favorable) unfavorable
|
(10.1)
|
|
|
4.0
|
|
|
1.5
|
|
|
(22.4)
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
161.5
|
|
|
$
|
122.2
|
|
|
$
|
402.3
|
|
|
$
|
308.4
|
|
|
|
|
|
|
|
|
|
Coffeyville
Refinery Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Gross
profit
|
$
|
8.26
|
|
|
$
|
4.15
|
|
|
$
|
5.37
|
|
|
$
|
3.12
|
|
Refining
margin*
|
14.52
|
|
|
9.86
|
|
|
11.21
|
|
|
9.94
|
|
FIFO impact,
(favorable) unfavorable
|
(0.86)
|
|
|
0.33
|
|
|
0.04
|
|
|
(0.67)
|
|
Refining
margin adjusted for FIFO impact*
|
13.66
|
|
|
10.19
|
|
|
11.25
|
|
|
9.27
|
|
Direct
operating expenses and major scheduled turnaround
expenses
|
4.80
|
|
|
4.23
|
|
|
4.33
|
|
|
5.29
|
|
Direct
operating expenses excluding major scheduled turnaround
expenses
|
4.80
|
|
|
4.23
|
|
|
4.33
|
|
|
4.34
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
4.50
|
|
|
3.93
|
|
|
3.99
|
|
|
4.80
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
4.50
|
|
|
$
|
3.93
|
|
|
$
|
3.99
|
|
|
$
|
3.94
|
|
Barrels sold (barrels
per day)
|
136,776
|
|
|
140,256
|
|
|
142,238
|
|
|
133,729
|
|
|
_____________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
(1)
|
Direct operating
expenses for the three and nine months ended September 30, 2017 and
2016 are shown exclusive of depreciation and amortization and major
scheduled turnaround expenses, which amounts are presented
separately below direct operating expenses.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
Coffeyville
Refinery Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
121,710
|
|
|
89.6
|
|
|
110,825
|
|
|
81.0
|
|
|
119,361
|
|
|
85.8
|
|
|
101,803
|
|
|
79.2
|
|
Medium
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,641
|
|
|
1.3
|
|
Heavy sour
|
6,751
|
|
|
5.0
|
|
|
19,568
|
|
|
14.3
|
|
|
11,643
|
|
|
8.4
|
|
|
17,978
|
|
|
13.9
|
|
Total crude
oil throughput
|
128,461
|
|
|
94.6
|
|
|
130,393
|
|
|
95.3
|
|
|
131,004
|
|
|
94.2
|
|
|
121,422
|
|
|
94.4
|
|
All other feedstocks
and blendstocks
|
7,415
|
|
|
5.4
|
|
|
6,399
|
|
|
4.7
|
|
|
8,124
|
|
|
5.8
|
|
|
7,193
|
|
|
5.6
|
|
Total
throughput
|
135,876
|
|
|
100.0
|
|
|
136,792
|
|
|
100.0
|
|
|
139,128
|
|
|
100.0
|
|
|
128,615
|
|
|
100.0
|
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
67,598
|
|
|
49.1
|
|
|
70,013
|
|
|
50.3
|
|
|
70,697
|
|
|
50.1
|
|
|
67,298
|
|
|
51.5
|
|
Distillate
|
57,654
|
|
|
41.9
|
|
|
57,839
|
|
|
41.6
|
|
|
58,927
|
|
|
41.7
|
|
|
54,192
|
|
|
41.5
|
|
Other (excluding
internally produced fuel)
|
12,355
|
|
|
9.0
|
|
|
11,286
|
|
|
8.1
|
|
|
11,619
|
|
|
8.2
|
|
|
9,191
|
|
|
7.0
|
|
Total refining
production (excluding internally produced fuel)
|
137,607
|
|
|
100.0
|
|
|
139,138
|
|
|
100.0
|
|
|
141,243
|
|
|
100.0
|
|
|
130,681
|
|
|
100.0
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except operating statistics)
|
Wynnewood Refinery
Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
445.3
|
|
|
$
|
374.3
|
|
|
$
|
1,393.7
|
|
|
$
|
1,064.4
|
|
Cost of materials and
other
|
346.9
|
|
|
317.7
|
|
|
1,174.6
|
|
|
888.5
|
|
Direct operating
expenses(1)
|
42.5
|
|
|
46.3
|
|
|
117.0
|
|
|
122.7
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
—
|
|
Depreciation and
amortization
|
12.9
|
|
|
12.7
|
|
|
38.5
|
|
|
37.9
|
|
Gross profit
(loss)
|
21.3
|
|
|
(2.4)
|
|
|
26.2
|
|
|
15.3
|
|
Add:
|
|
|
|
|
|
|
|
Direct operating
expenses(1)
|
42.5
|
|
|
46.3
|
|
|
117.0
|
|
|
122.7
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
—
|
|
Depreciation and
amortization
|
12.9
|
|
|
12.7
|
|
|
38.5
|
|
|
37.9
|
|
Refining
margin*
|
98.4
|
|
|
56.6
|
|
|
219.1
|
|
|
175.9
|
|
FIFO impact,
(favorable) unfavorable
|
(4.8)
|
|
|
3.8
|
|
|
(0.7)
|
|
|
(7.3)
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
93.6
|
|
|
$
|
60.4
|
|
|
$
|
218.4
|
|
|
$
|
168.6
|
|
|
|
|
|
|
|
|
|
Wynnewood Refinery
Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Gross profit
(loss)
|
$
|
3.10
|
|
|
$
|
(0.39)
|
|
|
$
|
1.21
|
|
|
$
|
0.76
|
|
Refining
margin*
|
14.33
|
|
|
9.10
|
|
|
10.11
|
|
|
8.74
|
|
FIFO impact,
(favorable) unfavorable
|
(0.70)
|
|
|
0.61
|
|
|
(0.03)
|
|
|
(0.36)
|
|
Refining margin
adjusted for FIFO impact*
|
13.63
|
|
|
9.71
|
|
|
10.08
|
|
|
8.38
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
9.35
|
|
|
7.45
|
|
|
7.13
|
|
|
6.10
|
|
Direct operating
expenses excluding major scheduled turnaround expenses
|
6.18
|
|
|
7.45
|
|
|
5.40
|
|
|
6.10
|
|
Direct operating
expenses and major scheduled turnaround expenses
per barrel
sold
|
9.53
|
|
|
7.29
|
|
|
7.01
|
|
|
6.01
|
|
Direct operating
expenses excluding major scheduled turnaround expenses per barrel
sold
|
$
|
6.30
|
|
|
$
|
7.29
|
|
|
$
|
5.32
|
|
|
$
|
6.01
|
|
Barrels sold (barrels
per day)
|
73,226
|
|
|
68,971
|
|
|
80,651
|
|
|
74,463
|
|
|
______________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
(1)
|
Direct operating
expenses for the three and nine months ended September 30,
2017 and 2016 are shown exclusive of depreciation and amortization
and major scheduled turnaround expenses, which amounts are
presented separately below direct operating expenses.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
Wynnewood Refinery
Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
74,632
|
|
|
96.0
|
|
|
65,579
|
|
|
93.8
|
|
|
79,389
|
|
|
96.6
|
|
|
72,791
|
|
|
96.1
|
|
Medium
|
—
|
|
|
—
|
|
|
1,983
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
680
|
|
|
0.9
|
|
Heavy sour
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total crude
oil throughput
|
74,632
|
|
|
96.0
|
|
|
67,562
|
|
|
96.6
|
|
|
79,389
|
|
|
96.6
|
|
|
73,471
|
|
|
97.0
|
|
All other feedstocks
and blendstocks
|
3,098
|
|
|
4.0
|
|
|
2,379
|
|
|
3.4
|
|
|
2,819
|
|
|
3.4
|
|
|
2,283
|
|
|
3.0
|
|
Total
throughput
|
77,730
|
|
|
100.0
|
|
|
69,941
|
|
|
100.0
|
|
|
82,208
|
|
|
100.0
|
|
|
75,754
|
|
|
100.0
|
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
38,114
|
|
|
50.2
|
|
|
36,107
|
|
|
53.1
|
|
|
41,571
|
|
|
51.6
|
|
|
39,476
|
|
|
53.4
|
|
Distillate
|
32,001
|
|
|
42.2
|
|
|
26,830
|
|
|
39.4
|
|
|
33,119
|
|
|
41.2
|
|
|
28,909
|
|
|
39.1
|
|
Other (excluding
internally produced fuel)
|
5,752
|
|
|
7.6
|
|
|
5,104
|
|
|
7.5
|
|
|
5,766
|
|
|
7.2
|
|
|
5,547
|
|
|
7.5
|
|
Total refining
production (excluding internally produced fuel)
|
75,867
|
|
|
100.0
|
|
|
68,041
|
|
|
100.0
|
|
|
80,456
|
|
|
100.0
|
|
|
73,932
|
|
|
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 own
approximately 34% of the common units as of September 30, 2017
and serve as the general partner. The financial and operational
data include the results of the East Dubuque Facility beginning on
April 1, 2016, the date of the
closing of the acquisition. 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 and nine months ended
September 30, 2017 are included in CVR Partners' press release
dated November 1, 2017.
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Nitrogen
Fertilizer Segment Business Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
69.4
|
|
|
$
|
78.5
|
|
|
$
|
252.6
|
|
|
$
|
271.4
|
|
Cost of materials and
other
|
19.4
|
|
|
19.9
|
|
|
63.3
|
|
|
72.2
|
|
Direct operating
expenses(1)
|
37.8
|
|
|
32.5
|
|
|
111.4
|
|
|
103.8
|
|
Major scheduled
turnaround expenses
|
2.5
|
|
|
—
|
|
|
2.6
|
|
|
6.6
|
|
Depreciation and
amortization
|
19.5
|
|
|
16.4
|
|
|
54.9
|
|
|
41.0
|
|
Cost of
sales
|
79.2
|
|
|
68.8
|
|
|
232.2
|
|
|
223.6
|
|
Selling, general and
administrative expenses
|
6.1
|
|
|
7.3
|
|
|
18.8
|
|
|
22.0
|
|
Operating income
(loss)
|
(15.9)
|
|
|
2.4
|
|
|
1.6
|
|
|
25.8
|
|
Interest expense and
other financing costs
|
(15.7)
|
|
|
(15.6)
|
|
|
(47.1)
|
|
|
(32.8)
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.1)
|
|
Other income,
net
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
Loss before
income tax expense
|
(31.6)
|
|
|
(13.2)
|
|
|
(45.4)
|
|
|
(12.1)
|
|
Income tax
expense
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.3
|
|
Net
loss
|
$
|
(31.6)
|
|
|
$
|
(13.4)
|
|
|
$
|
(45.4)
|
|
|
$
|
(12.4)
|
|
|
|
|
|
|
|
|
|
Adjusted Nitrogen
Fertilizer EBITDA*
|
$
|
5.0
|
|
|
$
|
17.4
|
|
|
$
|
58.1
|
|
|
$
|
74.4
|
|
|
_______________________________
|
|
* See "Use of
Non-GAAP Financial Measures" below.
|
|
(1)
|
Direct operating
expenses for the three and nine months ended September 30,
2017 and 2016 are shown exclusive of depreciation and amortization
and major scheduled turnaround expenses, which amounts are
presented separately below direct operating expenses.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Nitrogen
Fertilizer Segment Key Operating Statistics:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated sales
(thousand tons):
|
|
|
|
|
|
|
|
Ammonia
|
65.3
|
|
|
47.7
|
|
|
201.8
|
|
|
145.7
|
|
UAN
|
299.1
|
|
|
296.0
|
|
|
951.6
|
|
|
902.4
|
|
|
|
|
|
|
|
|
|
Consolidated product
pricing at gate (dollars per ton) (1):
|
|
|
|
|
|
|
|
Ammonia
|
$
|
214
|
|
|
$
|
345
|
|
|
$
|
287
|
|
|
$
|
385
|
|
UAN
|
$
|
138
|
|
|
$
|
154
|
|
|
$
|
158
|
|
|
$
|
187
|
|
|
|
|
|
|
|
|
|
Consolidated
production volume (thousand tons):
|
|
|
|
|
|
|
|
Ammonia (gross
produced) (2)
|
180.7
|
|
|
200.8
|
|
|
615.2
|
|
|
485.9
|
|
Ammonia (net available
for sale) (2)
|
46.2
|
|
|
60.3
|
|
|
203.7
|
|
|
121.0
|
|
UAN
|
306.6
|
|
|
317.2
|
|
|
962.3
|
|
|
861.9
|
|
|
|
|
|
|
|
|
|
Feedstock:
|
|
|
|
|
|
|
|
Petroleum coke used in
production (thousand tons)
|
114.3
|
|
|
126.8
|
|
|
371.0
|
|
|
384.4
|
|
Petroleum coke used in
production (dollars per ton)
|
$
|
18
|
|
|
$
|
13
|
|
|
$
|
18
|
|
|
$
|
14
|
|
Natural gas used in
production (thousands of MMBtus)
|
1,555.4
|
|
|
2,075.5
|
|
|
5,780.7
|
|
|
3,471.6
|
|
Natural gas used in
production (dollars per MMBtu)(3)
|
$
|
3.12
|
|
|
$
|
2.97
|
|
|
$
|
3.25
|
|
|
$
|
2.75
|
|
Natural gas in cost of
materials and other (thousands of MMBtus)
|
1,934.9
|
|
|
1,679.5
|
|
|
5,898.3
|
|
|
2,742.5
|
|
Natural gas in cost of
materials and other (dollars per MMBtu)(3)
|
$
|
3.15
|
|
|
$
|
2.92
|
|
|
$
|
3.30
|
|
|
$
|
2.68
|
|
|
|
|
|
|
|
|
|
Coffeyville Facility
on-stream factor (4):
|
|
|
|
|
|
|
|
Gasification
|
96.3
|
%
|
|
95.9
|
%
|
|
98.0
|
%
|
|
97.2
|
%
|
Ammonia
|
93.5
|
%
|
|
94.7
|
%
|
|
96.7
|
%
|
|
96.2
|
%
|
UAN
|
93.9
|
%
|
|
94.1
|
%
|
|
92.6
|
%
|
|
93.1
|
%
|
|
|
|
|
|
|
|
|
East Dubuque Facility
on-stream factors (4):
|
|
|
|
|
|
|
|
Ammonia
|
76.3
|
%
|
|
94.4
|
%
|
|
91.9
|
%
|
|
81.7
|
%
|
UAN
|
77.1
|
%
|
|
92.9
|
%
|
|
91.5
|
%
|
|
81.1
|
%
|
|
|
|
|
|
|
|
|
Market
Indicators:
|
|
|
|
|
|
|
|
Ammonia — Southern
Plains (dollars per ton)
|
$
|
238
|
|
|
$
|
315
|
|
|
$
|
314
|
|
|
$
|
368
|
|
Ammonia — Corn belt
(dollars per ton)
|
$
|
303
|
|
|
$
|
372
|
|
|
$
|
364
|
|
|
$
|
432
|
|
UAN — Corn belt
(dollars per ton)
|
$
|
165
|
|
|
$
|
188
|
|
|
$
|
192
|
|
|
$
|
218
|
|
Natural gas NYMEX
(dollars per MMBtu)
|
$
|
2.95
|
|
|
$
|
2.79
|
|
|
$
|
3.05
|
|
|
$
|
2.35
|
|
|
|
________________________________
|
|
|
(1)
|
Product pricing at
gate 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.
|
|
|
(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 the ammonia available for sale that
was not upgraded into other fertilizer products.
|
|
|
(3)
|
The cost per MMBtu
excludes derivative activity, when applicable. The impact of
natural gas derivative activity during the periods presented was
not material.
|
|
|
(4)
|
On-stream factor is
the total number of hours operated divided by the total number of
hours in the reporting period and is included as a measure of
operating efficiency.
|
|
|
|
Coffeyville
Facility The Linde air separation unit experienced a shut
down during the second quarter of 2017. Following the Linde outage,
the Coffeyville Facility UAN unit experienced a number of
operational challenges, resulting in approximately 11 days of UAN
downtime during the second quarter of 2017. Excluding the impact of
the Linde air separation unit outage at the Coffeyville Facility,
the UAN unit on-stream factors at the Coffeyville Facility would
have been 96.7% for the nine months ended September 30,
2017.
|
|
|
|
East Dubuque
Facility Excluding the impact of approximately 14 days of
downtime associated with the 2017 full facility turnaround at the
East Dubuque Facility, the on-stream factors at the East Dubuque
Facility would have been 91.3% for ammonia and 91.8% for UAN for
the three months ended September 30, 2017 and 96.9% for ammonia and
96.4% for UAN for the nine months ended September 30,
2017.
|
|
|
|
Excluding the impact
of approximately 28 days of downtime associated with the 2016 full
facility turnaround at the East Dubuque Facility, the on-stream
factors at the East Dubuque Facility would have been 97.2% for
ammonia and 96.2% for UAN for the six months ended September 30,
2016.
|
Use of Non-GAAP Financial Measures
To supplement our actual results in accordance with GAAP for the
applicable periods, we also use 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 our financial performance for
the applicable periods and are indicators management believes are
relevant and useful for planning and forecasting future
periods.
Adjusted net income (loss) is not a recognized term under GAAP
and should not be substituted for net income (loss) 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 (loss) 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 (loss) per diluted share represents adjusted
net income (loss) divided by weighted-average diluted shares
outstanding. Adjusted net income (loss) represents net income
(loss), as adjusted, that is attributable to CVR Energy
stockholders.
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except per share data)
|
Reconciliation of
Income before income tax expense to Adjusted Net
Income:
|
|
|
|
|
|
|
|
Income before income
tax expense
|
$
|
34.5
|
|
|
$
|
4.5
|
|
|
$
|
61.6
|
|
|
$
|
17.3
|
|
Adjustments:
|
|
|
|
|
|
|
|
FIFO impact,
(favorable) unfavorable
|
(14.9)
|
|
|
7.7
|
|
|
0.8
|
|
|
(29.7)
|
|
Major scheduled
turnaround expenses
|
24.2
|
|
|
—
|
|
|
40.0
|
|
|
38.1
|
|
Loss on derivatives,
net
|
17.0
|
|
|
1.7
|
|
|
4.8
|
|
|
4.8
|
|
Current period
settlement on derivative contracts (1)
|
—
|
|
|
6.7
|
|
|
1.1
|
|
|
35.2
|
|
Loss on extinguishment
of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
Expenses associated
with the East Dubuque Merger (2)
|
—
|
|
|
0.7
|
|
|
—
|
|
|
3.1
|
|
Insurance recovery -
business interruption (3)
|
(1.1)
|
|
|
(2.1)
|
|
|
(1.1)
|
|
|
(2.1)
|
|
Adjusted net income
before income tax expense and noncontrolling interest
|
59.7
|
|
|
19.2
|
|
|
107.2
|
|
|
71.8
|
|
Adjusted net income
attributed to noncontrolling interest
|
(12.1)
|
|
|
(1.1)
|
|
|
(26.3)
|
|
|
(19.7)
|
|
Income tax expense, as
adjusted
|
(15.6)
|
|
|
(6.6)
|
|
|
(29.1)
|
|
|
(15.1)
|
|
Adjusted net
income
|
$
|
32.0
|
|
|
$
|
11.5
|
|
|
$
|
51.8
|
|
|
$
|
37.0
|
|
|
|
|
|
|
|
|
|
Adjusted net income
per diluted share
|
$
|
0.37
|
|
|
$
|
0.13
|
|
|
$
|
0.60
|
|
|
$
|
0.43
|
|
Refining margin per crude oil throughput barrel is a measurement
calculated as the difference between the Petroleum segment's net
sales and cost of materials and other. 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 materials and other at which they
are able to sell refined products. Each of the components used in
this calculation (net sales and cost of materials and other) 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 materials and other
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 materials and other (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.
The calculation of refining margin and refining margin adjusted
for FIFO impact (each a non-GAAP financial measure), including a
reconciliation to the most directly comparable GAAP financial
measure for the three and nine months ended September 30, 2017
and 2016 is as follows:
Petroleum Segment
Operating Data
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Net sales
|
$
|
1,385.8
|
|
|
$
|
1,163.5
|
|
|
$
|
4,147.5
|
|
|
$
|
3,161.9
|
|
Operating costs and
expenses:
|
|
|
|
|
|
|
|
Cost of materials and
other
|
1,114.4
|
|
|
987.5
|
|
|
3,523.7
|
|
|
2,651.7
|
|
Direct operating
expenses (exclusive of depreciation and amortization and major
scheduled turnaround expenses as reflected below)
|
99.2
|
|
|
97.0
|
|
|
271.9
|
|
|
267.2
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
31.5
|
|
Depreciation and
amortization
|
31.8
|
|
|
31.9
|
|
|
96.8
|
|
|
93.7
|
|
Gross
profit
|
118.7
|
|
|
47.1
|
|
|
217.7
|
|
|
117.8
|
|
Add:
|
|
|
|
|
|
|
|
Direct operating
expenses (exclusive of depreciation and amortization and major
scheduled turnaround expenses as reflected below)
|
99.2
|
|
|
97.0
|
|
|
271.9
|
|
|
267.2
|
|
Major scheduled
turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
31.5
|
|
Depreciation and
amortization
|
31.8
|
|
|
31.9
|
|
|
96.8
|
|
|
93.7
|
|
Refining
margin
|
271.4
|
|
|
176.0
|
|
|
623.8
|
|
|
510.2
|
|
FIFO impact,
(favorable) unfavorable
|
(14.9)
|
|
|
7.7
|
|
|
0.8
|
|
|
(29.7)
|
|
Refining margin
adjusted for FIFO impact
|
$
|
256.5
|
|
|
$
|
183.7
|
|
|
$
|
624.6
|
|
|
$
|
480.5
|
|
The calculation of refining margin per crude oil throughput
barrel and refining margin adjusted for FIFO impact per crude oil
throughput barrel for the three and nine months ended
September 30, 2017 and 2016 is as follows:
Petroleum Segment
Operating Data
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Total crude oil
throughput barrels per day
|
203,093
|
|
|
197,955
|
|
|
210,393
|
|
|
194,893
|
|
Days in the
period
|
92
|
|
|
92
|
|
|
273
|
|
|
274
|
|
Total crude oil
throughput barrels
|
18,684,556
|
|
|
18,211,860
|
|
|
57,437,289
|
|
|
53,400,682
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining
margin
|
$
|
271.4
|
|
|
$
|
176.0
|
|
|
$
|
623.8
|
|
|
$
|
510.2
|
|
Divided by: crude oil
throughput barrels
|
18.7
|
|
|
18.2
|
|
|
57.4
|
|
|
53.4
|
|
Refining margin per
crude oil throughput barrel
|
$
|
14.52
|
|
|
$
|
9.66
|
|
|
$
|
10.86
|
|
|
$
|
9.55
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining margin
adjusted for FIFO impact
|
$
|
256.5
|
|
|
$
|
183.7
|
|
|
$
|
624.6
|
|
|
$
|
480.5
|
|
Divided by: crude oil
throughput barrels
|
18.7
|
|
|
18.2
|
|
|
57.4
|
|
|
53.4
|
|
Refining margin
adjusted for FIFO impact per crude oil throughput barrel
|
$
|
13.72
|
|
|
$
|
10.09
|
|
|
$
|
10.87
|
|
|
$
|
8.99
|
|
Coffeyville
Refinery
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Total crude oil
throughput barrels per day
|
128,461
|
|
|
130,393
|
|
|
131,004
|
|
|
121,422
|
|
Days in the
period
|
92
|
|
|
92
|
|
|
273
|
|
|
274
|
|
Total crude oil
throughput barrels
|
11,818,412
|
|
|
11,996,156
|
|
|
35,764,092
|
|
|
33,269,628
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining
margin
|
$
|
171.6
|
|
|
$
|
118.2
|
|
|
$
|
400.8
|
|
|
$
|
330.8
|
|
Divided by: crude oil
throughput barrels
|
11.8
|
|
|
12.0
|
|
|
35.8
|
|
|
33.3
|
|
Refining margin per
crude oil throughput barrel
|
$
|
14.52
|
|
|
$
|
9.86
|
|
|
$
|
11.21
|
|
|
$
|
9.94
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining margin
adjusted for FIFO impact
|
$
|
161.5
|
|
|
$
|
122.2
|
|
|
$
|
402.3
|
|
|
$
|
308.4
|
|
Divided by: crude oil
throughput barrels
|
11.8
|
|
|
12.0
|
|
|
35.8
|
|
|
33.3
|
|
Refining margin
adjusted for FIFO impact per crude oil throughput barrel
|
$
|
13.66
|
|
|
$
|
10.19
|
|
|
$
|
11.25
|
|
|
$
|
9.27
|
|
Wynnewood
Refinery
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Total crude oil
throughput barrels per day
|
74,632
|
|
|
67,562
|
|
|
79,389
|
|
|
73,471
|
|
Days in the
period
|
92
|
|
|
92
|
|
|
273
|
|
|
274
|
|
Total crude oil
throughput barrels
|
6,866,144
|
|
|
6,215,704
|
|
|
21,673,197
|
|
|
20,131,054
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining
margin
|
$
|
98.4
|
|
|
$
|
56.6
|
|
|
$
|
219.1
|
|
|
$
|
175.9
|
|
Divided by: crude oil
throughput barrels
|
6.9
|
|
|
6.2
|
|
|
21.7
|
|
|
20.1
|
|
Refining margin per
crude oil throughput barrel
|
$
|
14.33
|
|
|
$
|
9.10
|
|
|
$
|
10.11
|
|
|
$
|
8.74
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in millions,
except for $ per barrel data)
|
Refining margin
adjusted for FIFO impact
|
$
|
93.6
|
|
|
$
|
60.4
|
|
|
$
|
218.4
|
|
|
$
|
168.6
|
|
Divided by: crude oil
throughput barrels
|
6.9
|
|
|
6.2
|
|
|
21.7
|
|
|
20.1
|
|
Refining margin
adjusted for FIFO impact per crude oil throughput barrel
|
$
|
13.63
|
|
|
$
|
9.71
|
|
|
$
|
10.08
|
|
|
$
|
8.38
|
|
EBITDA and Adjusted EBITDA. EBITDA represents net income
(loss) attributable to CVR Energy stockholders before consolidated
(i) interest expense and other financing costs, net of interest
income, (ii) income tax expense (benefit), and (iii) depreciation
and amortization, less the portion of these adjustments
attributable to non-controlling interest. Adjusted EBITDA
represents EBITDA adjusted for, as applicable, consolidated (i)
FIFO impact (favorable) unfavorable; (ii) loss on extinguishment of
debt; (iii) major scheduled turnaround expenses (that many of our
competitors capitalize and thereby exclude from their measures of
EBITDA and adjusted EBITDA); (iv) (gain) loss on derivatives, net;
(v) current period settlements on derivative contracts; (vi)
business interruption insurance recovery and (vii) expenses
associated with the East Dubuque Merger, less the portion of these
adjustments attributable to non-controlling interest. 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 and Adjusted EBITDA represent EBITDA and
Adjusted EBITDA that is attributable to CVR Energy
stockholders.
A reconciliation of net income attributable to CVR Energy
stockholders to EBITDA and EBITDA to Adjusted EBITDA for the three
and nine months ended September 30, 2017 and 2016 is as
follows:
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Net income
attributable to CVR Energy stockholders
|
$
|
22.2
|
|
|
$
|
5.4
|
|
|
$
|
33.9
|
|
|
$
|
17.6
|
|
Add:
|
|
|
|
|
|
|
|
Interest expense and
other financing costs, net of interest income
|
27.4
|
|
|
26.0
|
|
|
81.5
|
|
|
56.3
|
|
Income tax
expense
|
9.2
|
|
|
2.5
|
|
|
17.4
|
|
|
2.3
|
|
Depreciation and
amortization
|
54.1
|
|
|
50.1
|
|
|
159.2
|
|
|
140.8
|
|
Adjustments
attributable to noncontrolling interest
|
(38.3)
|
|
|
(35.9)
|
|
|
(112.7)
|
|
|
(90.3)
|
|
EBITDA
|
74.6
|
|
|
48.1
|
|
|
179.3
|
|
|
126.7
|
|
Add:
|
|
|
|
|
|
|
|
FIFO impact,
(favorable) unfavorable
|
(14.9)
|
|
|
7.7
|
|
|
0.8
|
|
|
(29.7)
|
|
Major scheduled
turnaround expenses
|
24.2
|
|
|
—
|
|
|
40.0
|
|
|
38.1
|
|
Loss on derivatives,
net
|
17.0
|
|
|
1.7
|
|
|
4.8
|
|
|
4.8
|
|
Current period
settlement on derivative contracts (1)
|
—
|
|
|
6.7
|
|
|
1.1
|
|
|
35.2
|
|
Loss on extinguishment
of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
Expenses associated
with the East Dubuque Merger (2)
|
—
|
|
|
0.7
|
|
|
—
|
|
|
3.1
|
|
Insurance recovery -
business interruption (3)
|
(1.1)
|
|
|
(2.1)
|
|
|
(1.1)
|
|
|
(2.1)
|
|
Adjustments
attributable to noncontrolling interest
|
(8.9)
|
|
|
(4.6)
|
|
|
(15.9)
|
|
|
(22.4)
|
|
Adjusted
EBITDA
|
$
|
90.9
|
|
|
$
|
58.2
|
|
|
$
|
209.0
|
|
|
$
|
158.8
|
|
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, as applicable (i) FIFO impact (favorable)
unfavorable; (ii) loss on extinguishment of debt; (iii) major
scheduled turnaround expenses (that many of our competitors
capitalize and thereby exclude from their measures of EBITDA and
adjusted EBITDA); (iv) (gain) loss on derivatives, net; (v) current
period settlements on derivative contracts; (vi) expenses
associated with the East Dubuque Merger and (vii) business
interruption insurance recovery, less the portion of these
adjustments attributable to noncontrolling interest. 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 and nine months ended September 30, 2017 and
2016 is as follows:
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Petroleum:
|
|
|
|
|
|
|
|
Petroleum net
income
|
$
|
70.0
|
|
|
$
|
15.9
|
|
|
$
|
117.8
|
|
|
$
|
26.0
|
|
Add:
|
|
|
|
|
|
|
|
Interest
expense and other financing costs, net of interest
income
|
11.8
|
|
|
10.8
|
|
|
34.8
|
|
|
31.7
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Depreciation
and amortization
|
33.0
|
|
|
32.5
|
|
|
99.5
|
|
|
95.6
|
|
Petroleum
EBITDA
|
114.8
|
|
|
59.2
|
|
|
252.1
|
|
|
153.3
|
|
Add:
|
|
|
|
|
|
|
|
FIFO impact,
(favorable) unfavorable
|
(14.9)
|
|
|
7.7
|
|
|
0.8
|
|
|
(29.7)
|
|
Major
scheduled turnaround expenses
|
21.7
|
|
|
—
|
|
|
37.4
|
|
|
31.5
|
|
Loss on
derivatives, net
|
17.0
|
|
|
1.7
|
|
|
4.8
|
|
|
4.8
|
|
Current period
settlements on derivative contracts (1)
|
—
|
|
|
6.7
|
|
|
1.1
|
|
|
35.2
|
|
Adjusted Petroleum
EBITDA
|
$
|
138.6
|
|
|
$
|
75.3
|
|
|
$
|
296.2
|
|
|
$
|
195.1
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(in
millions)
|
Nitrogen
Fertilizer:
|
|
|
|
|
|
|
|
Nitrogen fertilizer
net loss
|
$
|
(31.6)
|
|
|
$
|
(13.4)
|
|
|
$
|
(45.4)
|
|
|
$
|
(12.4)
|
|
Add:
|
|
|
|
|
|
|
|
Interest
expense and other financing costs, net
|
15.7
|
|
|
15.6
|
|
|
47.1
|
|
|
32.8
|
|
Income tax
expense
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.3
|
|
Depreciation
and amortization
|
19.5
|
|
|
16.4
|
|
|
54.9
|
|
|
41.0
|
|
Nitrogen Fertilizer
EBITDA
|
3.6
|
|
|
18.8
|
|
|
56.6
|
|
|
61.7
|
|
Add:
|
|
|
|
|
|
|
|
Major
scheduled turnaround expenses
|
2.5
|
|
|
—
|
|
|
2.6
|
|
|
6.6
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
Expenses
associated with the East Dubuque Merger (2)
|
—
|
|
|
0.7
|
|
|
—
|
|
|
3.1
|
|
Insurance
recovery - business interruption (3)
|
(1.1)
|
|
|
(2.1)
|
|
|
(1.1)
|
|
|
(2.1)
|
|
Adjusted Nitrogen
Fertilizer EBITDA
|
$
|
5.0
|
|
|
$
|
17.4
|
|
|
$
|
58.1
|
|
|
$
|
74.4
|
|
|
_________________________________
|
|
|
(1)
|
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.
|
|
|
(2)
|
On April 1, 2016, CVR
Partners completed the East Dubuque Merger. CVR Partners incurred
legal and other professional fees and other merger related expenses
that are referred to herein as expenses associated with the East
Dubuque Merger, which are included in selling, general and
administrative expenses.
|
|
|
(3)
|
CVR Partners received
business interruption insurance recoveries of $1.1 million and $2.1
million in the third quarter of 2017 and 2016,
respectively.
|
Derivatives Summary. The Petroleum segment enters into
commodity swap contracts through crack spread swap agreements with
financial counterparties to fix the spread risk between the
refineries' crude oil purchases and the refined products the
refineries produce for sale. Through these swaps, the Petroleum
segment will sell a fixed differential for the value between the
selected refined product benchmark and the benchmark crude oil
price, thereby locking in a margin for a portion of the refineries'
production. The physical volumes are not exchanged and these
contracts are net settled with cash. From time to time, the
Petroleum segment holds various NYMEX positions through a
third-party clearing house.
The table below summarizes the Petroleum segment's open
commodity swap positions as of September 30, 2017. The
positions are primarily in the form of crack spread swap agreements
with financial counterparties, wherein the Petroleum segment has
locked in differentials at the fixed prices noted below. As of
September 30, 2017, the open commodity swap positions for 2017
and 2018 were comprised of approximately 39.8% for 2-1-1 crack
swaps, 30.1% for distillate crack swaps and 30.1% for gasoline
crack swaps.
Commodity
Swaps
|
|
Barrels
|
|
Fixed Price
(1)
|
Fourth Quarter
2017
|
|
7,050,000
|
|
|
$
|
17.80
|
|
|
|
|
|
|
First Quarter
2018
|
|
7,050,000
|
|
|
18.66
|
|
Second Quarter
2018
|
|
1,950,000
|
|
|
21.09
|
|
Third Quarter
2018
|
|
150,000
|
|
|
19.22
|
|
|
|
|
|
|
Total
|
|
16,200,000
|
|
|
$
|
18.59
|
|
|
|
|
|
|
|
______________________________
|
|
|
(1)
|
Weighted-average
price of all positions for period indicated.
|
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SOURCE CVR Energy, Inc.