CVR Energy, Inc. (“CVR Energy” or the “Company”) (NYSE: CVI) today
announced net income of $94 million, or 93 cents per diluted share,
on net sales of $2.4 billion for the first quarter of 2022,
compared to a net loss of $39 million, or 39 cents per diluted
share, on net sales of $1.5 billion for the first quarter of 2021.
First quarter 2022 EBITDA was $278 million, compared to first
quarter 2021 EBITDA of less than $1 million.
“CVR Energy reported solid results for the 2022
first quarter as the fundamentals for both the refining and
fertilizer sectors continued to improve,” said Dave Lamp, CVR
Energy’s Chief Executive Officer. “Our Petroleum Segment’s first
quarter results were driven by increased crude oil pricing and
widening Group 3 2-1-1 crack spreads offset by elevated Renewable
Identification Number (RIN) pricing. CVR Energy also announced a
first quarter 2022 cash dividend of 40 cents per share and
continued to advance its renewables restructuring plan.
“CVR Partners achieved strong first quarter results led by
robust global industry conditions and declared a first quarter 2022
cash distribution of $2.26 per common unit,” Lamp said. “The U.S.
spring crop planting season is progressing and we expect industry
conditions to remain firm for the remainder of 2022.”
Petroleum
The Petroleum Segment reported first quarter
2022 operating income of $130 million on net sales of $2.2 billion,
compared to an operating loss of $115 million on net sales of $1.4
billion in the first quarter of 2021.
Refining margin per total throughput barrel was
$16.75 in the first quarter of 2022, compared to $3.05 during the
same period in 2021. The increase in refining margin of $246
million was primarily due to an increase in product crack spreads
and an increase in crude oil prices. The Group 3 2-1-1 crack spread
increased by $5.87 per barrel relative to the first quarter of
2021, driven by increasing refined product demand, tight inventory
levels and supply concerns due to the ongoing Russia-Ukraine
conflict. Throughput volumes improved by 11,251 barrels per day
(“bpd”) due to plant outages in the prior period resulting from
weather events. Offsetting these impacts, the Petroleum Segment
recognized costs to comply with the Renewable Fuel Standard (“RFS”)
of $88 million, or $4.93 per throughput barrel, which excludes
the RINs revaluation impact of $19 million, or $1.08 per total
throughput barrel, for the first quarter of 2022. This is compared
to RFS compliance costs of $66 million, or $3.97 per
throughput barrel, which excludes the RINs revaluation impact of
$111 million, or $6.65 per total throughput barrel, for the first
quarter of 2021. The increase in RFS compliance costs in 2022 was
primarily related to higher RIN prices and a higher renewable
volume obligation for the first quarter of 2022 compared to the
2021 period. The RINs revaluation impact decreased in 2022 as a
result of decreased volatility in RIN prices for the current
period. The Petroleum Segment also recognized a first quarter 2022
derivative net gain of $8 million, or 47 cents per total
throughput barrel, compared to a derivative loss of $32 million, or
$1.90 per total throughput barrel, for the first quarter of 2021.
Included in this derivative net gain for the first quarter of 2022
was a $5 million unrealized gain, compared to a $43 million
unrealized loss for the first quarter of 2021. Further, crude oil
prices rose during the quarter, which led to a favorable inventory
valuation impact of $133 million, or $7.51 per total throughout
barrel, compared to a favorable inventory valuation impact of $66
million, or $3.93 per total throughput barrel, during the first
quarter of 2021.
First quarter 2022 combined total throughput was
approximately 197,000 bpd, compared to approximately 186,000 bpd of
combined total throughput for the first quarter of 2021. This
increase was primarily attributable to improved throughputs as a
result of Winter Storm Uri in the prior period.
Nitrogen Fertilizer
The Nitrogen Fertilizer Segment reported
operating income of $104 million on net sales of $223 million for
the first quarter of 2022, compared to an operating loss of $14
million on net sales of $61 million for the first quarter of
2021.
First quarter 2022 average realized gate prices
for urea ammonia nitrate (“UAN”) showed an improvement over the
prior year, up 212 percent to $496 per ton, and ammonia was up 252
percent over the prior year to $1,055 per ton. Average
realized gate prices for UAN and ammonia were $159 and $300 per
ton, respectively, for the first quarter of 2021.
CVR Partners, LP’s (“CVR Partners”) fertilizer
facilities produced a combined 187,000 tons of ammonia during the
first quarter of 2022, of which 52,000 net tons were available for
sale while the rest was upgraded to other fertilizer products,
including 317,000 tons of UAN. During the first quarter 2021, the
fertilizer facilities produced 188,000 tons of ammonia, of which
70,000 net tons were available for sale while the remainder was
upgraded to other fertilizer products, including 272,000 tons of
UAN.
Corporate
The Company reported an income tax expense of
$34 million, or 18.0 percent of income before income taxes, for the
three months ended March 31, 2022, as compared to an income tax
benefit of $42 million, or 43.3 percent of loss before income
taxes, for the three months ended March 31, 2021. The fluctuation
in income tax was due primarily to changes in pretax earnings and
earnings attributable to noncontrolling interest. The
year-over-year decrease in effective income tax rate was due
primarily to the relationship between pretax results, earnings
attributable to noncontrolling interest and state income taxes
generated.
Cash, Debt and Dividend
Consolidated cash and cash equivalents were $676
million at March 31, 2022, an increase of $166 million from
December 31, 2021. Consolidated total debt and finance lease
obligations were $1.6 billion at March 31, 2022, including $546
million held by the Nitrogen Fertilizer Segment.
On February 22, 2022, CVR Partners redeemed
all of the outstanding $65 million in aggregate principal
amount of its 9.25% Senior Secured Notes, due June 2023, at par and
settled accrued interest of approximately $1 million through
the date of redemption.
CVR Energy also announced a first quarter 2022
cash dividend of 40 cents per share. The dividend, as declared by
CVR Energy’s Board of Directors, will be paid on May 23, 2022,
to stockholders of record as of May 13, 2022.
Today, CVR Partners announced that the Board of
Directors of its general partner declared a first quarter 2022 cash
distribution of $2.26 per common unit, which will be paid on
May 23, 2022, to common unitholders of record as of
May 13, 2022.
Corporate Structure
On February 22, 2022, in connection with our
focus on decarbonization, we announced that our Board of Directors
had approved a plan to restructure our business to segregate our
renewables business. As part of this restructuring, in the first
quarter of 2022, we formed 16 new indirect, wholly owned
subsidiaries (“NewCos”) of CVR Energy. Over the coming year, the
Company intends to evaluate the transfer of certain assets to these
NewCos to, among other purposes, better align our organizational
structure with management, financial reporting and our goal to
maximize our renewables focus. At the present time, we expect the
restructuring to be completed during the first quarter of 2023.
First Quarter 2022 Earnings Conference
Call
CVR Energy previously announced that it will
host its first quarter 2022 Earnings Conference Call on Tuesday,
May 3, at 1 p.m. Eastern. The Earnings Conference Call may
also include discussion of Company developments, forward-looking
information and other material information about business and
financial matters.
The first quarter 2022 Earnings Conference Call
will be webcast live and can be accessed on the Investor Relations
section of CVR Energy’s website at www.CVREnergy.com. For investors
or analysts who want to participate during the call, the dial-in
number is (877) 407-8291. The webcast will be archived and
available for 14 days at
https://edge.media-server.com/mmc/p/t6hq57yj. A repeat of the call
also can be accessed for 14 days by dialing (877) 660-6853,
conference ID 13728976.
Forward-Looking StatementsThis
news release may contain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
Statements concerning current estimates, expectations and
projections about future results, performance, prospects,
opportunities, plans, actions and events and other statements,
concerns, or matters that are not historical facts are
“forward-looking statements,” as that term is defined under the
federal securities laws. These forward-looking statements include,
but are not limited to, statements regarding future: receipt of CVR
Partners’ cash distributions; improvement of refining and
fertilizer sector fundamentals; crude oil and RIN pricing; crack
spreads; global fertilizer industry conditions; progression of the
spring crop planting season; operating income; net sales; refining
margin; refined product demand; inventory levels, including the
tightness thereof; impacts of plant outages and weather events on
throughput volume; renewables initiatives; conversion of
hydrocrackers at Wynnewood and Coffeyville and/or feed
pre-treaters, including the completion, operation, capacities,
timing, costs, optionality and benefits thereof; segregation of our
renewables business and the timing and scope of asset transfers in
connection with the related restructuring; strategic optionality;
margins, spreads and economics relating to renewables; carbon
capture; decarbonization; ammonia utilization rates; crop and
industry conditions; UAN, ammonia and fertilizer demand, pricing
and sales volumes; ammonia upgrades; cost to comply with the
Renewable Fuel Standard, RIN prices and valuation of our net RVO;
derivative activities and gains or losses associated therewith; tax
rates and expense; dividends and distributions, including the
timing, payment and amount (if any) thereof; total throughput,
direct operating expenses, capital expenditures, depreciation and
amortization and turnaround expense; continued safe and reliable
operations; 45Q credits (if any) including the amount, timing and
receipt thereof; the expected timing and completion of turnaround
projects; natural gas and global energy costs; exports; and other
matters. You can generally identify forward-looking statements by
our use of forward-looking terminology such as “outlook,”
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“explore,” “evaluate,” “intend,” “may,” “might,” “plan,”
“potential,” “predict,” “seek,” “should,” or “will,” or the
negative thereof or other variations thereon or comparable
terminology. These forward-looking statements are only predictions
and involve known and unknown risks and uncertainties, many of
which are beyond our control. Investors are cautioned that various
factors may affect these forward-looking statements, including the
health and economic effects of the COVID-19 pandemic and any
variant thereof, the rate of any economic improvement, demand for
fossil fuels, price volatility of crude oil, other feedstocks and
refined products (among others); the ability of the Company to pay
cash dividends and CVR Partners to make cash distributions;
potential operating hazards; costs of compliance with existing, or
compliance with new, laws and regulations and potential liabilities
arising therefrom; impacts of planting season on CVR Partners;
general economic and business conditions; political disturbances,
geopolitical instability and tensions, and associated changes in
global trade policies and economic sanctions, including, but not
limited to, in connection with Russia’s invasion of Ukraine in
February 2022; and other risks. For additional discussion of risk
factors which may affect our results, please see the risk factors
and other disclosures included in our most recent Annual Report on
Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q
and our other Securities and Exchange Commission (“SEC”) filings.
These and other risks may cause our actual results, performance or
achievements to differ materially from any future results,
performance or achievements expressed or implied by these
forward-looking statements. Given these risks and uncertainties,
you are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements included
in this news release are made only as of the date hereof. CVR
Energy disclaims any intention or obligation to update publicly or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent
required by law.
About CVR Energy,
Inc.Headquartered in Sugar Land, Texas, CVR Energy is a
diversified holding company primarily engaged in the renewables,
petroleum refining and marketing business as well as in the
nitrogen fertilizer manufacturing business through its interest in
CVR Partners. CVR Energy subsidiaries serve as the general partner
and own 37 percent of the common units of CVR Partners.
Investors and others should note that CVR Energy
may announce material information using SEC filings, press
releases, public conference calls, webcasts and the Investor
Relations page of its website. CVR Energy may use these channels to
distribute material information about the Company and to
communicate important information about the Company, corporate
initiatives and other matters. Information that CVR Energy posts on
its website could be deemed material; therefore, CVR Energy
encourages investors, the media, its customers, business partners
and others interested in the Company to review the information
posted on its website.
For further information, please contact:
Investor Relations:Richard
RobertsCVR Energy, Inc.(281)
207-3205InvestorRelations@CVREnergy.com
Media Relations:Brandee
StephensCVR Energy, Inc. (281)
207-3516MediaRelations@CVREnergy.com
Non-GAAP Measures
Our management uses certain non-GAAP performance
measures, and reconciliations to those measures, to evaluate
current and past performance and prospects for the future to
supplement our financial information presented in accordance with
accounting principles generally accepted in the United States
(“GAAP”). These non-GAAP financial measures are important factors
in assessing our operating results and profitability and include
the performance and liquidity measures defined below.
The following are non-GAAP measures we present
for the period ended March 31, 2022:
EBITDA - Consolidated net income (loss) before
(i) interest expense, net, (ii) income tax expense (benefit) and
(iii) depreciation and amortization expense.
Petroleum EBITDA and Nitrogen Fertilizer EBITDA
- Segment net income (loss) before segment (i) interest expense,
net, (ii) income tax expense (benefit), and (iii) depreciation and
amortization.
Refining Margin - The difference between our
Petroleum Segment net sales and cost of materials and other.
Refining Margin, adjusted for Inventory
Valuation Impacts - Refining Margin adjusted to exclude the impact
of current period market price and volume fluctuations on crude oil
and refined product inventories purchased in prior periods and
lower of cost or net realizable value adjustments, if applicable.
We record our commodity inventories on the first-in-first-out
basis. As a result, significant current period fluctuations in
market prices and the volumes we hold in inventory can have
favorable or unfavorable impacts on our refining margins as
compared to similar metrics used by other publicly-traded companies
in the refining industry.
Refining Margin and Refining Margin adjusted for
Inventory Valuation Impacts, per Throughput Barrel - Refining
Margin and Refining Margin adjusted for Inventory Valuation Impacts
divided by the total throughput barrels during the period, which is
calculated as total throughput barrels per day times the number of
days in the period.
Direct Operating Expenses per Throughput Barrel
- Direct operating expenses for our Petroleum Segment divided by
total throughput barrels for the period, which is calculated as
total throughput barrels per day times the number of days in the
period.
Adjusted EBITDA, Adjusted Petroleum EBITDA and
Adjusted Nitrogen Fertilizer EBITDA - EBITDA, Petroleum EBITDA and
Nitrogen Fertilizer EBITDA adjusted for certain significant
non-cash items and items that management believes are not
attributable to or indicative of our on-going operations or that
may obscure our underlying results and trends.
Adjusted Earnings (Loss) per Share - Earnings
(loss) per share adjusted for certain significant non-cash items
and items that management believes are not attributable to or
indicative of our on-going operations or that may obscure our
underlying results and trends.
Free Cash Flow - Net cash provided by (used in)
operating activities less capital expenditures and capitalized
turnaround expenditures.
Net Debt and Finance Lease Obligations - Net
debt and finance lease obligations is total debt and finance lease
obligations reduced for cash and cash equivalents.
Total Debt and Net Debt and Finance Lease
Obligations to EBITDA Exclusive of Nitrogen Fertilizer - Total debt
and net debt and finance lease obligations is calculated as the
consolidated debt and net debt and finance lease obligations less
the Nitrogen Fertilizer Segment’s debt and net debt and finance
lease obligations as of the most recent period ended divided by
EBITDA exclusive of the Nitrogen Fertilizer Segment for the most
recent twelve-month period.
We present these measures because we believe
they may help investors, analysts, lenders and ratings agencies
analyze our results of operations and liquidity in conjunction with
our U.S. GAAP results, including but not limited to our operating
performance as compared to other publicly-traded companies in the
refining and fertilizer industries, without regard to historical
cost basis or financing methods and our ability to incur and
service debt and fund capital expenditures. Non-GAAP measures have
important limitations as analytical tools, because they exclude
some, but not all, items that affect net earnings and operating
income. These measures should not be considered substitutes for
their most directly comparable U.S. GAAP financial measures. See
“Non-GAAP Reconciliations” included herein for reconciliation of
these amounts. Due to rounding, numbers presented within this
section may not add or equal to numbers or totals presented
elsewhere within this document.
Factors Affecting Comparability of Our
Financial Results
Our historical results of operations for the
periods presented may not be comparable with prior periods or to
our results of operations in the future for the reasons discussed
below.
Petroleum Segment
Coffeyville Refinery - During the three months
ended March 31, 2022, we capitalized $1 million related to the
pre-planning phase of a major planned turnaround that is currently
expected to be commence in the spring of 2023.
Wynnewood Refinery - The Petroleum Segment’s
Wynnewood Refinery’s major planned turnaround began in late
February 2022 and was completed in early April 2022. The
pre-planning phase began during the first quarter of 2021. During
the three months ended March 31, 2022 and 2021, we capitalized $63
million and $1 million, respectively.
Nitrogen Fertilizer Segment
Major Scheduled Turnaround
Activities
Coffeyville Fertilizer Facility -The next
planned turnaround at the Coffeyville Fertilizer Facility is
currently expected to occur in the summer of 2022. For the three
months ended March 31, 2022, we incurred turnaround expense of less
than $1 million related to the planning for this
turnaround.
East Dubuque Fertilizer Facility - The next
planned turnaround at the East Dubuque Fertilizer Facility is
currently expected to occur in the summer of 2022. For the three
months ended March 31, 2022, we incurred turnaround expense of
approximately $1 million related to planning for this
turnaround.
CVR Energy, Inc. (all
information in this release is unaudited)
Consolidated Statement of Operations Data
|
Three Months EndedMarch 31, |
(in millions, except per share data) |
|
2022 |
|
|
|
2021 |
|
Net sales |
$ |
2,373 |
|
|
$ |
1,463 |
|
Operating costs and
expenses: |
|
|
|
Cost of materials and other |
|
1,887 |
|
|
|
1,369 |
|
Direct operating expenses (exclusive of depreciation and
amortization) |
|
160 |
|
|
|
136 |
|
Depreciation and amortization |
|
65 |
|
|
|
63 |
|
Cost of sales |
|
2,112 |
|
|
|
1,568 |
|
Selling, general and
administrative expenses (exclusive of depreciation and
amortization) |
|
39 |
|
|
|
27 |
|
Depreciation and
amortization |
|
2 |
|
|
|
3 |
|
Operating income (loss) |
|
220 |
|
|
|
(135 |
) |
Other (expense) income: |
|
|
|
Interest expense, net |
|
(24 |
) |
|
|
(31 |
) |
Investment income on marketable securities |
|
— |
|
|
|
62 |
|
Other (expense) income, net |
|
(9 |
) |
|
|
7 |
|
Income (loss) before income tax expense |
|
187 |
|
|
|
(97 |
) |
Income tax expense
(benefit) |
|
34 |
|
|
|
(42 |
) |
Net income (loss) |
|
153 |
|
|
|
(55 |
) |
Less: Net income (loss)
attributable to noncontrolling interest |
|
59 |
|
|
|
(16 |
) |
Net income (loss) attributable to CVR Energy
stockholders |
$ |
94 |
|
|
$ |
(39 |
) |
|
|
|
|
Basic and diluted earnings (loss) per share |
$ |
0.93 |
|
|
$ |
(0.39 |
) |
|
|
|
|
Adjusted earnings (loss) per
share |
$ |
0.02 |
|
|
$ |
(0.19 |
) |
EBITDA* |
$ |
278 |
|
|
$ |
— |
|
Adjusted EBITDA * |
$ |
155 |
|
|
$ |
26 |
|
|
|
|
|
Weighted-average common shares
outstanding - basic and diluted |
|
100.5 |
|
|
|
100.5 |
|
|
|
|
|
|
|
|
|
_______________* See “Non-GAAP Reconciliations” section
below.
Selected Balance Sheet Data
(in millions) |
March 31, 2022 |
|
December 31, 2021 |
Cash and cash equivalents |
$ |
676 |
|
|
$ |
510 |
|
Working capital |
|
214 |
|
|
|
213 |
|
Total assets |
|
4,345 |
|
|
|
3,906 |
|
Total debt and finance lease
obligations, including current portion |
|
1,595 |
|
|
|
1,660 |
|
Total liabilities |
|
3,469 |
|
|
|
3,136 |
|
Total CVR stockholders’
equity |
|
644 |
|
|
|
553 |
|
|
|
|
|
|
|
|
|
Selected Cash Flow Data
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Net cash provided by: |
|
|
|
Operating activities |
$ |
322 |
|
|
$ |
96 |
|
Investing activities |
|
(41 |
) |
|
|
(54 |
) |
Financing activities |
|
(115 |
) |
|
|
(2 |
) |
Net increase in cash and cash equivalents and restricted
cash |
$ |
166 |
|
|
$ |
40 |
|
|
|
|
|
Free cash flow* |
$ |
281 |
|
|
$ |
61 |
|
|
|
|
|
|
|
|
|
_______________* See “Non-GAAP Reconciliations” section
below.
Selected Segment Data
|
Three Months Ended March 31, 2022 |
(in millions) |
Petroleum |
|
Nitrogen Fertilizer |
|
Consolidated |
Net sales |
$ |
2,154 |
|
|
$ |
223 |
|
|
$ |
2,373 |
|
Operating income |
|
130 |
|
|
|
104 |
|
|
|
220 |
|
Net income |
|
126 |
|
|
|
94 |
|
|
|
153 |
|
EBITDA* |
|
167 |
|
|
|
123 |
|
|
|
278 |
|
|
|
|
|
|
|
Capital expenditures (1) |
|
|
|
|
|
Maintenance capital expenditures |
$ |
18 |
|
|
$ |
5 |
|
|
$ |
23 |
|
Growth capital expenditures |
|
1 |
|
|
|
— |
|
|
|
27 |
|
Total capital expenditures |
$ |
19 |
|
|
$ |
5 |
|
|
$ |
50 |
|
|
Three Months Ended March 31, 2021 |
(in millions) |
Petroleum |
|
Nitrogen Fertilizer |
|
Consolidated |
Net sales |
$ |
1,404 |
|
|
$ |
61 |
|
|
$ |
1,463 |
|
Operating loss |
|
(115 |
) |
|
|
(14 |
) |
|
|
(135 |
) |
Net loss |
|
(110 |
) |
|
|
(25 |
) |
|
|
(55 |
) |
EBITDA* |
|
(61 |
) |
|
|
5 |
|
|
|
— |
|
|
|
|
|
|
|
Capital expenditures (1) |
|
|
|
|
|
Maintenance capital expenditures |
$ |
10 |
|
|
$ |
2 |
|
|
$ |
12 |
|
Growth capital expenditures |
|
— |
|
|
|
1 |
|
|
|
56 |
|
Total capital expenditures |
$ |
10 |
|
|
$ |
3 |
|
|
$ |
68 |
|
|
|
|
|
|
|
|
|
|
|
|
|
_______________* See “Non-GAAP Reconciliations” section
below.(1) Capital expenditures are shown exclusive of capitalized
turnaround expenditures and business combinations.
Selected Balance Sheet Data
|
March 31, 2022 |
|
December 31, 2021 |
(in millions) |
Petroleum |
|
Nitrogen Fertilizer |
|
Consolidated |
|
Petroleum |
|
Nitrogen Fertilizer |
|
Consolidated |
Cash and cash equivalents (1) |
$ |
482 |
|
|
$ |
137 |
|
|
$ |
676 |
|
|
$ |
305 |
|
|
$ |
113 |
|
|
$ |
510 |
|
Total assets |
|
3,874 |
|
|
|
1,103 |
|
|
|
4,345 |
|
|
|
3,368 |
|
|
|
1,127 |
|
|
|
3,906 |
|
Total debt and finance lease
obligations, including current portion (2) |
|
53 |
|
|
|
546 |
|
|
|
1,595 |
|
|
|
54 |
|
|
|
611 |
|
|
|
1,660 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_______________(1) Corporate cash and cash equivalents consisted
of $57 million and $92 million at March 31, 2022 and December 31,
2021, respectively.(2) Corporate total debt and finance lease
obligations, including current portion consisted of $996 million
and $995 million at March 31, 2022 and December 31, 2021,
respectively.
Petroleum Segment
Key Operating Metrics per Total Throughput
Barrel
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Refining margin * |
$ |
16.75 |
|
|
$ |
3.05 |
|
Refining margin adjusted for
inventory valuation impacts * |
|
9.24 |
|
|
|
(0.88 |
) |
Direct operating expenses
* |
|
5.57 |
|
|
|
5.89 |
|
|
|
|
|
|
|
|
|
_______________* See “Non-GAAP Reconciliations” section
below.
Throughput Data by Refinery
|
Three Months EndedMarch 31, |
(in bpd) |
2022 |
|
2021 |
Coffeyville |
|
|
|
|
|
Regional crude |
39,766 |
|
|
29,232 |
|
WTI |
47,815 |
|
|
52,936 |
|
Midland WTI |
2,602 |
|
|
— |
|
Condensate |
11,352 |
|
|
7,051 |
|
Heavy Canadian |
6,761 |
|
|
— |
|
DJ Basin |
18,035 |
|
|
16,733 |
|
Other feedstocks and blendstocks |
11,344 |
|
|
8,725 |
|
Wynnewood |
|
|
|
|
|
Regional crude |
43,403 |
|
|
55,159 |
|
WTL |
344 |
|
|
3,535 |
|
Midland WTI |
1,634 |
|
|
— |
|
WTS |
578 |
|
|
— |
|
Condensate |
10,285 |
|
|
9,540 |
|
Other feedstocks and blendstocks |
3,425 |
|
|
3,182 |
|
Total throughput |
197,344 |
|
|
186,093 |
|
Production Data by Refinery
|
Three Months EndedMarch 31, |
(in bpd) |
2022 |
|
2021 |
Coffeyville |
|
|
|
Gasoline |
75,050 |
|
|
61,664 |
|
Distillate |
54,665 |
|
|
46,542 |
|
Other liquid products |
4,988 |
|
|
4,107 |
|
Solids |
4,359 |
|
|
3,397 |
|
Wynnewood |
|
|
|
Gasoline |
29,366 |
|
|
37,456 |
|
Distillate |
22,518 |
|
|
29,164 |
|
Other liquid products |
5,134 |
|
|
2,947 |
|
Solids |
20 |
|
|
22 |
|
Total production |
196,100 |
|
|
185,299 |
|
|
|
|
|
Light product yield (as % of
crude throughput) (1) |
99.5 |
% |
|
100.4 |
% |
Liquid volume yield (as % of
total throughput) (2) |
97.2 |
% |
|
97.7 |
% |
Distillate yield (as % of
crude throughput) (3) |
42.3 |
% |
|
43.5 |
% |
|
|
|
|
|
|
_______________(1) Total Gasoline and Distillate divided by
total Regional crude, WTI, WTL, Midland WTI, WTS, Condensate, Heavy
Canadian, and DJ Basin throughput.(2) Total Gasoline, Distillate,
and Other liquid products divided by total throughput.(3) Total
Distillate divided by total Regional crude, WTI, WTL, Midland WTI,
WTS, Condensate, Heavy Canadian, and DJ Basin throughput.
Key Market Indicators
|
Three Months EndedMarch 31, |
|
|
2022 |
|
|
|
2021 |
|
West Texas Intermediate (WTI)
NYMEX |
$ |
95.01 |
|
|
$ |
58.14 |
|
Crude Oil Differentials to
WTI: |
|
|
|
Brent |
|
2.89 |
|
|
|
3.18 |
|
WCS (heavy sour) |
|
(12.78 |
) |
|
|
(11.82 |
) |
Condensate |
|
0.10 |
|
|
|
(0.22 |
) |
Midland Cushing |
|
1.43 |
|
|
|
0.87 |
|
NYMEX Crack Spreads: |
|
|
|
Gasoline |
|
23.46 |
|
|
|
16.43 |
|
Heating Oil |
|
33.88 |
|
|
|
15.26 |
|
NYMEX 2-1-1 Crack Spread |
|
28.67 |
|
|
|
15.84 |
|
PADD II Group 3 Product
Basis: |
|
|
|
Gasoline |
|
(7.16 |
) |
|
|
(1.22 |
) |
Ultra-Low Sulfur Diesel |
|
(5.78 |
) |
|
|
2.20 |
|
PADD II Group 3 Product Crack
Spread: |
|
|
|
Gasoline |
|
16.30 |
|
|
|
15.20 |
|
Ultra-Low Sulfur Diesel |
|
28.10 |
|
|
|
17.46 |
|
PADD II Group 3 2-1-1 |
|
22.20 |
|
|
|
16.33 |
|
|
|
|
|
|
|
|
|
Nitrogen Fertilizer Segment:
Ammonia Utilization Rates
(1)
|
Three Months EndedMarch 31, |
(percent of capacity utilization) |
2022 |
|
|
2021 |
|
Consolidated |
88 |
% |
|
88 |
% |
|
|
|
|
|
|
_______________(1) Reflects our ammonia
utilization rates on a consolidated basis. Utilization is an
important measure used by management to assess operational output
at each of the Partnership’s facilities. Utilization is calculated
as actual tons produced divided by capacity. We present our
utilization for the three months ended March 31, 2022 and 2021 and
take into account the impact of our current turnaround cycles on
any specific period. Additionally, we present utilization solely on
ammonia production rather than each nitrogen product as it provides
a comparative baseline against industry peers and eliminates the
disparity of plant configurations for upgrade of ammonia into other
nitrogen products. With our efforts being primarily focused on
ammonia upgrade capabilities, this measure provides a meaningful
view of how well we operate.
Sales and Production Data
|
Three Months EndedMarch 31, |
|
|
2022 |
|
|
|
2021 |
|
Consolidated sales (thousand
tons): |
|
|
|
Ammonia |
|
40 |
|
|
|
32 |
|
UAN |
|
322 |
|
|
|
239 |
|
|
|
|
|
Consolidated product pricing
at gate (dollars per ton):(1) |
|
|
|
Ammonia |
$ |
1,055 |
|
|
$ |
300 |
|
UAN |
|
496 |
|
|
|
159 |
|
|
|
|
|
Consolidated production volume
(thousand tons): |
|
|
|
Ammonia (gross produced) (2) |
|
187 |
|
|
|
188 |
|
Ammonia (net available for sale) (2) |
|
52 |
|
|
|
70 |
|
UAN |
|
317 |
|
|
|
272 |
|
|
|
|
|
Feedstock: |
|
|
|
Petroleum coke used in production (thousand tons) |
|
108 |
|
|
|
128 |
|
Petroleum coke (dollars per ton) |
$ |
56.46 |
|
|
$ |
42.91 |
|
Natural gas used in production (thousands of MMBtu) (3) |
|
1,761 |
|
|
|
1,882 |
|
Natural gas used in production (dollars per MMBtu) (3) |
$ |
5.54 |
|
|
$ |
3.10 |
|
Natural gas in cost of materials and other (thousands of MMBtus)
(3) |
|
1,528 |
|
|
|
940 |
|
Natural gas in cost of materials and other (dollars per MMBtu)
(3) |
$ |
5.62 |
|
|
$ |
2.94 |
|
|
|
|
|
|
|
|
|
_______________(1) Product pricing at gate
represents sales less freight revenue divided by product sales
volume in tons and is shown in order to provide a pricing measure
that is comparable across the fertilizer industry.(2) Gross tons
produced for ammonia represent total ammonia produced, including
ammonia produced that was upgraded into other fertilizer products.
Net tons available for sale represent ammonia available for sale
that was not upgraded into other fertilizer products.(3) The
feedstock natural gas shown above does not include natural gas used
for fuel. The cost of fuel natural gas is included in direct
operating expense.
Key Market Indicators
|
Three Months EndedMarch 31, |
|
|
2022 |
|
|
|
2021 |
|
Ammonia — Southern Plains
(dollars per ton) |
$ |
1,277 |
|
|
$ |
437 |
|
Ammonia — Corn belt (dollars
per ton) |
|
1,376 |
|
|
|
497 |
|
UAN — Corn belt (dollars per
ton) |
|
615 |
|
|
|
256 |
|
|
|
|
|
Natural gas NYMEX (dollars per
MMBtu) |
$ |
4.59 |
|
|
$ |
2.72 |
|
|
|
|
|
|
|
|
|
Q2 2022 Outlook
The table below summarizes our outlook for
certain operational statistics and financial information for the
second quarter of 2022. See “Forward-Looking Statements” above.
|
Q2 2022 |
|
Low |
|
High |
Petroleum |
|
|
|
Total throughput (bpd) |
|
195,000 |
|
|
|
210,000 |
|
Direct operating expenses (in millions) (1) |
$ |
95 |
|
|
$ |
100 |
|
Turnaround (2) |
$ |
5 |
|
|
$ |
10 |
|
|
|
|
|
Renewables (3) |
|
|
|
Total throughput (bpd) |
|
3,500 |
|
|
|
4,500 |
|
Direct operating expenses (in millions) (1) |
$ |
2 |
|
|
$ |
4 |
|
|
|
|
|
Nitrogen Fertilizer |
|
|
|
Ammonia utilization rates (4) |
|
|
|
Consolidated |
|
92 |
% |
|
|
97 |
% |
Coffeyville Fertilizer Facility |
|
95 |
% |
|
|
100 |
% |
East Dubuque Fertilizer Facility |
|
88 |
% |
|
|
93 |
% |
Direct operating expenses (in millions) (1) |
$ |
55 |
|
|
$ |
60 |
|
|
|
|
|
Capital Expenditures (in
millions) (2) |
|
|
|
Petroleum |
$ |
30 |
|
|
$ |
40 |
|
Renewables (3) |
|
17 |
|
|
|
22 |
|
Nitrogen Fertilizer |
|
12 |
|
|
|
17 |
|
Other |
|
— |
|
|
|
3 |
|
Total capital expenditures |
$ |
59 |
|
|
$ |
82 |
|
|
|
|
|
|
|
|
|
_______________(1) Direct operating expenses are
shown exclusive of depreciation and amortization and, for the
Nitrogen Fertilizer segment, turnaround expenses and inventory
valuation impacts.(2) Turnaround and capital expenditures are
disclosed on an accrual basis.(3) Renewables reflects spending on
the Wynnewood renewable diesel unit project. Upon completion and
meeting of certain criteria under accounting rules, Renewables is
expected to be a new reportable segment. As of March 31, 2022,
Renewables does not the meet the definition of a reportable segment
as defined under Accounting Standards Codification 280.(4) Ammonia
utilization rates exclude the impact of turnarounds.
Non-GAAP Reconciliations:
Reconciliation of Net Income (Loss) to EBITDA and
Adjusted EBITDA
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Net income
(loss) |
$ |
153 |
|
|
$ |
(55 |
) |
Interest expense, net |
|
24 |
|
|
|
31 |
|
Income tax expense (benefit) |
|
34 |
|
|
|
(42 |
) |
Depreciation and amortization |
|
67 |
|
|
|
66 |
|
EBITDA |
$ |
278 |
|
|
$ |
— |
|
Adjustments: |
|
|
|
Revaluation of RFS liability |
|
19 |
|
|
|
111 |
|
Loss on marketable securities |
|
— |
|
|
|
(62 |
) |
Unrealized (gain) loss on derivatives |
|
(6 |
) |
|
|
43 |
|
Inventory valuation impacts, favorable |
|
(136 |
) |
|
|
(66 |
) |
Adjusted EBITDA |
$ |
155 |
|
|
$ |
26 |
|
|
|
|
|
|
|
|
|
Reconciliation of Basic and Diluted Earnings (Loss) per
Share to Adjusted Earnings (Loss) per Share
|
Three Months EndedMarch 31, |
|
|
2022 |
|
|
|
2021 |
|
Basic and diluted
earnings (loss) per share |
$ |
0.93 |
|
|
$ |
(0.39 |
) |
Adjustments: (1) |
|
|
|
Revaluation of RFS liability |
|
0.14 |
|
|
|
0.82 |
|
Loss on marketable securities |
|
— |
|
|
|
(0.46 |
) |
Unrealized (gain) loss on derivatives |
|
(0.05 |
) |
|
|
0.32 |
|
Inventory valuation impacts, favorable |
|
(1.00 |
) |
|
|
(0.48 |
) |
Adjusted earnings (loss) per share |
$ |
0.02 |
|
|
$ |
(0.19 |
) |
|
|
|
|
|
|
|
|
_______________(1) Amounts are shown after-tax, using the
Company’s marginal tax rate, and are presented on a per share basis
using the weighted average shares outstanding for each period.
Reconciliation of Net Cash Provided By
Operating Activities to Free Cash Flow
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Net cash provided by
operating activities |
$ |
322 |
|
|
$ |
96 |
|
Less: |
|
|
|
Capital expenditures |
|
(26 |
) |
|
|
(34 |
) |
Capitalized turnaround expenditures |
|
(15 |
) |
|
|
(1 |
) |
Free cash flow |
$ |
281 |
|
|
$ |
61 |
|
|
|
|
|
|
|
|
|
Reconciliation of Petroleum Segment Net
Income (Loss) to EBITDA and Adjusted EBITDA
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Petroleum net income
(loss) |
$ |
126 |
|
|
$ |
(110 |
) |
Interest income, net |
|
(5 |
) |
|
|
(2 |
) |
Depreciation and amortization |
|
46 |
|
|
|
51 |
|
Petroleum EBITDA |
|
167 |
|
|
|
(61 |
) |
Adjustments: |
|
|
|
Revaluation of RFS liability |
|
19 |
|
|
|
111 |
|
Unrealized (gain) loss on derivatives |
|
(5 |
) |
|
|
43 |
|
Inventory valuation impacts, favorable (1) |
|
(133 |
) |
|
|
(66 |
) |
Petroleum Adjusted EBITDA |
$ |
48 |
|
|
$ |
27 |
|
|
|
|
|
|
|
|
|
Reconciliation of Petroleum Segment
Gross Profit (Loss) to Refining Margin and Refining Margin Adjusted
for Inventory Valuation Impacts
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Net
sales |
$ |
2,154 |
|
|
$ |
1,404 |
|
Less: |
|
|
|
Cost of materials and other |
|
(1,857 |
) |
|
|
(1,353 |
) |
Direct operating expenses (exclusive of depreciation and
amortization) |
|
(99 |
) |
|
|
(99 |
) |
Depreciation and amortization |
|
(46 |
) |
|
|
(51 |
) |
Gross profit (loss) |
|
152 |
|
|
|
(99 |
) |
Add: |
|
|
|
Direct operating expenses (exclusive of depreciation and
amortization) |
|
99 |
|
|
|
99 |
|
Depreciation and amortization |
|
46 |
|
|
|
51 |
|
Refining margin |
|
297 |
|
|
|
51 |
|
Inventory valuation impacts,
favorable (1) |
|
(133 |
) |
|
|
(66 |
) |
Refining margin adjusted for inventory valuation
impacts |
$ |
164 |
|
|
$ |
(15 |
) |
|
|
|
|
|
|
|
|
_______________(1) The Petroleum Segment’s basis
for determining inventory value under GAAP is First-In, First-Out
(“FIFO”). Changes in crude oil prices can cause fluctuations in the
inventory valuation of crude oil, work in process and finished
goods, thereby resulting in a favorable inventory valuation impact
when crude oil prices increase and an unfavorable inventory
valuation impact when crude oil prices decrease. The inventory
valuation impact is calculated based upon inventory values at the
beginning of the accounting period and at the end of the accounting
period. In order to derive the inventory valuation impact per total
throughput barrel, we utilize the total dollar figures for the
inventory valuation impact and divide by the number of total
throughput barrels for the period.
Reconciliation of Petroleum Segment
Total Throughput Barrels
|
Three Months EndedMarch 31, |
|
2022 |
|
2021 |
Total throughput barrels per day |
197,344 |
|
|
186,093 |
|
Days in the period |
90 |
|
|
90 |
|
Total throughput barrels |
17,760,998 |
|
|
16,748,383 |
|
|
|
|
|
|
|
Reconciliation of Petroleum Segment Refining Margin per
Total Throughput Barrel
|
Three Months EndedMarch 31, |
(in millions, except for per throughput barrel data) |
|
2022 |
|
|
|
2021 |
|
Refining margin |
$ |
297 |
|
|
$ |
51 |
|
Divided by: total throughput
barrels |
|
18 |
|
|
|
17 |
|
Refining margin per total throughput barrel |
$ |
16.75 |
|
|
$ |
3.05 |
|
|
|
|
|
|
|
|
|
Reconciliation of Petroleum Segment
Refining Margin Adjusted for Inventory Valuation Impacts per Total
Throughput Barrel
|
Three Months EndedMarch 31, |
(in millions, except for throughput barrel data) |
|
2022 |
|
|
|
2021 |
|
Refining margin adjusted for
inventory valuation impacts |
$ |
164 |
|
|
$ |
(15 |
) |
Divided by: total throughput
barrels |
|
18 |
|
|
|
17 |
|
Refining margin adjusted for inventory valuation impacts
per total throughput barrel |
$ |
9.24 |
|
|
$ |
(0.88 |
) |
|
|
|
|
|
|
|
|
Reconciliation of Petroleum Segment Direct Operating
Expenses per Total Throughput Barrel
|
Three Months EndedMarch 31, |
(in millions, except for throughput barrel data) |
|
2022 |
|
|
|
2021 |
|
Direct operating expenses
(exclusive of depreciation and amortization) |
$ |
99 |
|
|
$ |
99 |
|
Divided by: total throughput
barrels |
|
18 |
|
|
|
17 |
|
Direct operating expenses per total throughput
barrel |
$ |
5.57 |
|
|
$ |
5.89 |
|
|
|
|
|
|
|
|
|
Reconciliation of Nitrogen Fertilizer Segment Net Income
(Loss) to EBITDA and Adjusted EBITDA
|
Three Months EndedMarch 31, |
(in millions) |
|
2022 |
|
|
|
2021 |
|
Nitrogen fertilizer
net income (loss) |
$ |
94 |
|
|
$ |
(25 |
) |
Interest expense, net |
|
10 |
|
|
|
16 |
|
Depreciation and amortization |
|
19 |
|
|
|
14 |
|
Nitrogen Fertilizer EBITDA and Adjusted
EBITDA |
$ |
123 |
|
|
$ |
5 |
|
|
|
|
|
|
|
|
|
Reconciliation of Total Debt and Net Debt and Finance
Lease Obligations to EBITDA Exclusive of Nitrogen
Fertilizer
(in millions) |
Twelve Months EndedMarch 31, 2022 |
Total debt and finance lease obligations (1) |
$ |
1,595 |
|
Less: |
|
Nitrogen Fertilizer debt and finance lease obligations (1) |
$ |
546 |
|
Total debt and finance lease obligations exclusive of Nitrogen
Fertilizer |
|
1,049 |
|
|
|
EBITDA exclusive of Nitrogen
Fertilizer |
$ |
408 |
|
|
|
Total debt and finance
lease obligations to EBITDA exclusive of Nitrogen
Fertilizer |
|
2.57 |
|
|
|
Consolidated cash and cash
equivalents |
$ |
676 |
|
Less: |
|
Nitrogen Fertilizer cash and cash equivalents |
|
137 |
|
Cash and cash equivalents exclusive of Nitrogen Fertilizer |
|
539 |
|
|
|
Net debt and finance lease
obligations exclusive of Nitrogen Fertilizer (2) |
$ |
510 |
|
|
|
Net debt and finance
lease obligations to EBITDA exclusive of Nitrogen
Fertilizer (2) |
|
1.25 |
|
|
|
|
|
_______________(1) Amounts are shown inclusive of the current
portion of long-term debt and finance lease obligations.(2) Net
debt represents total debt and finance lease obligations exclusive
of cash and cash equivalents.
|
|
|
Twelve Months Ended March 31, 2022 |
(in millions) |
|
June 30, 2021 |
|
September 30, 2021 |
|
December 31, 2021 |
|
March 31, 2022 |
|
Consolidated |
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
|
$ |
(2 |
) |
|
$ |
106 |
|
|
$ |
25 |
|
|
$ |
153 |
|
|
$ |
282 |
|
Interest expense, net |
|
|
38 |
|
|
|
23 |
|
|
|
24 |
|
|
|
24 |
|
|
|
109 |
|
Income tax (benefit) expense |
|
|
(6 |
) |
|
|
47 |
|
|
|
(7 |
) |
|
|
34 |
|
|
|
68 |
|
Depreciation and amortization |
|
|
72 |
|
|
|
67 |
|
|
|
74 |
|
|
|
67 |
|
|
|
280 |
|
EBITDA |
|
$ |
102 |
|
|
$ |
243 |
|
|
$ |
116 |
|
|
$ |
278 |
|
|
$ |
739 |
|
|
|
|
|
|
|
|
|
|
|
|
Nitrogen Fertilizer |
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
7 |
|
|
$ |
35 |
|
|
$ |
61 |
|
|
$ |
94 |
|
|
|
197 |
|
Interest expense, net |
|
|
23 |
|
|
|
11 |
|
|
|
11 |
|
|
|
10 |
|
|
|
55 |
|
Depreciation and amortization |
|
|
21 |
|
|
|
18 |
|
|
|
21 |
|
|
|
19 |
|
|
|
79 |
|
EBITDA |
|
$ |
51 |
|
|
$ |
64 |
|
|
$ |
93 |
|
|
$ |
123 |
|
|
$ |
331 |
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA exclusive of
Nitrogen Fertilizer |
|
$ |
51 |
|
|
$ |
179 |
|
|
$ |
23 |
|
|
$ |
155 |
|
|
$ |
408 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CVR Energy (NYSE:CVI)
Historical Stock Chart
From Mar 2024 to Apr 2024
CVR Energy (NYSE:CVI)
Historical Stock Chart
From Apr 2023 to Apr 2024