SAN ANTONIO, Jan. 28, 2016 /PRNewswire/ -- Valero Energy
Corporation (NYSE: VLO, "Valero") today reported adjusted net
income from continuing operations attributable to Valero
stockholders of $862 million, or
$1.79 per share, for the fourth
quarter of 2015 compared to $952
million, or $1.83 per share,
for the fourth quarter of 2014. Actual net income from
continuing operations attributable to Valero stockholders was
$298 million, or $0.62 per share, for the fourth quarter of 2015
compared to $1.2 billion, or
$2.22 per share, for the fourth
quarter of 2014.
For the year ended December 31,
2015, adjusted net income from continuing operations
attributable to Valero stockholders was $4.6
billion, or $9.24 per share,
compared to $3.5 billion, or
$6.68 per share, for 2014.
Actual net income from continuing operations attributable to Valero
stockholders was $4.0 billion, or
$7.99 per share, in 2015 compared to
$3.7 billion, or $6.97 per share, for 2014.
Reconciliations of actual to adjusted amounts are shown in the
accompanying financial tables.
"In 2015, we had solid operations, completed multiple strategic
refinery projects, and expanded our logistics system," said
Joe Gorder, Valero Chairman,
President and Chief Executive Officer. "We invested over
$2.4 billion into our business and
returned 80 percent of our adjusted net income to
stockholders."
Refining
The refining segment reported adjusted
operating income for the fourth quarter of 2015 of $1.5 billion, which was in line with $1.5 billion in the fourth quarter of
2014.
Fourth quarter 2015 refining throughput volumes averaged 2.9
million barrels per day, an increase of 34,000 barrels per day from
the fourth quarter of 2014. Valero's refineries operated at
97 percent throughput capacity utilization in the fourth quarter of
2015.
Ethanol
The ethanol segment reported adjusted
operating income for the fourth quarter of 2015 of $37 million
compared to $154 million in the
fourth quarter of 2014. The $117 million decrease was
mainly due to lower gross margin per gallon driven by a decline in
ethanol prices versus relatively stable corn prices. Ethanol
production volumes were 3.9 million gallons per day in the fourth
quarter of 2015, an increase of 131,000 gallons per day versus the
fourth quarter of 2014. The increase in production compared
to the fourth quarter of 2014 was due to ongoing optimization and
plant improvements.
Corporate and Other
General and administrative
expenses were $206 million in the
fourth quarter of 2015 compared to $214
million in the fourth quarter of 2014. The effective
tax rate was 28 percent in the fourth quarter of 2015.
Capital Investments
In the fourth quarter of 2015,
capital investment was $732 million,
of which $164 million was for
turnarounds and catalyst and $136
million was for joint venture investments. In 2015,
capital investment was $2.4 billion
for turnarounds, catalyst, strategic, and joint venture investments
consisting of $1.4 billion for
stay-in-business capital and $1.0
billion to advance Valero's growth
strategies. Approximately 40 percent of the 2015 growth
capital spending was allocated to investments in logistics assets
that support Valero's operations and potential drop-down
transactions to Valero Energy Partners LP ("VLP").
Stockholder Distributions
Valero paid $240 million in dividends and purchased 11.1
million shares of its common stock for $767
million, resulting in total cash returned to stockholders of
$1 billion in the fourth quarter of
2015. In 2015, Valero returned $3.7
billion to stockholders, or 80 percent of adjusted net
income from continuing operations attributable to Valero
stockholders, consisting of $848
million in dividends and $2.8
billion in stock buybacks. The company is targeting a
payout ratio of 75 percent of net income in 2016. Valero
defines total payout ratio as the sum of dividends plus stock
buybacks divided by adjusted net income from continuing operations
attributable to Valero stockholders.
On January 21, Valero announced a
20 percent increase in its quarterly common stock dividend from
$0.50 per share to $0.60 per share, payable on March 3, 2016, to holders of record on
February 9, 2016.
"This latest increase in our dividend further demonstrates our
confidence in Valero's earnings power, which is anchored by our
high quality portfolio concentrated in the U.S. Gulf Coast," said
Gorder. "Having a dividend among the top of our peer group is an
important part of our team's core objectives to deliver
significant, sustainable value to our stockholders while
maintaining safe and reliable operations and disciplined capital
allocation."
Liquidity and Financial Position
Valero ended the
fourth quarter of 2015 with $7.4
billion in total debt and $4.1
billion of cash and temporary cash investments, of which
$81 million was held by VLP.
The company's debt to capital ratio, net of $2 billion in cash, was 20 percent.
Strategic Update
In the fourth quarter of 2015, the
company commissioned its new crude unit at the Corpus Christi refinery, completed the
hydrocracker expansion at the Port
Arthur refinery, and completed the crude unit expansion at
the McKee refinery. Valero also acquired a 50 percent
interest in the Diamond Pipeline that will connect Cushing, OK to Memphis, TN and began receiving crude oil at
the Quebec City refinery from Enbridge's Line 9B pipeline.
The company expects the new crude unit under construction at the
Houston refinery to be completed
in the second quarter of 2016.
In January 2016, Valero's Board of
Directors approved the construction of a 13,000 barrel per day
alkylation unit at the Houston
refinery. The unit will upgrade low-cost natural gas liquids
into premium priced alkylate. Management expects the project
to be completed in the first half of 2019 for an estimated cost of
$300 million.
Valero expects 2016 capital investments, including turnarounds,
catalyst, and joint venture investments, to be $2.6 billion, which includes $1.6 billion for stay-in-business capital and
$1.0 billion for growth investments.
Approximately 55 percent of planned growth investment in 2016
is allocated for logistics projects and 45 percent for refining
asset optimization. The company believes that most of the
logistics investments will be eligible for future drop-down
transactions to VLP.
Conference Call
Valero's senior management will hold a
conference call at 11 a.m. ET today
to discuss this earnings release and to provide an update on
company operations and strategy.
About Valero
Valero Energy Corporation, through its
subsidiaries, is an international manufacturer and marketer of
transportation fuels, other petrochemical products and power.
Valero subsidiaries employ approximately 10,000 people, and its
assets include 15 petroleum refineries with a combined throughput
capacity of approximately 3.0 million barrels per day, 11 ethanol
plants with a combined production capacity of 1.3 billion gallons
per year, a 50-megawatt wind farm, and renewable diesel production
from a joint venture. Through subsidiaries, Valero owns the general
partner of Valero Energy Partners LP (NYSE: VLP), a midstream
master limited partnership. Approximately 7,500 outlets carry
the Valero, Diamond Shamrock, Shamrock, and Beacon brands in
the United States and the
Caribbean; Ultramar in
Canada; and Texaco in the
United Kingdom and Ireland.
Valero is a Fortune 500 company based in San Antonio. Please visit www.valero.com for
more information.
Valero Contacts
Investors:
John Locke, Vice President –
Investor Relations, 210-345-3077
Karen Ngo, Manager – Investor
Relations, 210-345-4574
Media:
Steve Lee, Manager – Corporate
Communications, 210-345-4137
To download our investor relations mobile app, which offers
access to SEC filings, press releases, quotes, and upcoming events,
please visit Apple's iTunes App
Store for your iPhone and iPad or Google's Play Store for
your Android mobile device.
Safe-Harbor Statement
Statements contained in this
release that state the company's or management's expectations or
predictions of the future are forward-looking statements intended
to be covered by the safe harbor provisions of the Securities Act
of 1933 and the Securities Exchange Act of 1934. The words
"believe," "expect," "should," "estimates," "intend," and other
similar expressions identify forward-looking statements. It
is important to note that actual results could differ materially
from those projected in such forward-looking statements. For
more information concerning factors that could cause actual results
to differ from those expressed or forecasted, see Valero's annual
reports on Form 10-K and quarterly reports on Form 10-Q filed with
the SEC and on Valero's website at www.valero.com, and VLP's annual
reports on Form 10-K and quarterly reports on Form 10-Q filed with
the SEC and on VLP's website at www.valeroenergypartners.com.
Use of Non-GAAP Financial Information
This earnings
release includes references to financial measures that are not
defined under U.S. generally accepted accounting principles
("GAAP"). These non-GAAP measures include adjusted net income,
adjusted net income per share, adjusted refining segment operating
income, and adjusted ethanol segment operating income.
However, these non-GAAP financial measures have been included
in this earnings release to help facilitate the comparison of
operating results between periods. See the accompanying
tables in this earnings release for a reconciliation of these
non-GAAP measures to the most directly comparable GAAP
measures.
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
EARNINGS
RELEASE
|
(Millions of
Dollars, Except per Share, per Barrel, and per Gallon
Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Statement of
Income Data:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
|
$
|
18,777
|
|
|
$
|
27,859
|
|
|
$
|
87,804
|
|
|
$
|
130,844
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Cost of sales
(excluding the lower of cost or market inventory valuation
adjustment) (a) (b)
|
|
15,627
|
|
|
24,321
|
|
|
73,861
|
|
|
118,141
|
|
Lower of cost
or market inventory valuation adjustment (c)
|
|
790
|
|
|
—
|
|
|
790
|
|
|
—
|
|
Operating
expenses
|
|
1,014
|
|
|
1,103
|
|
|
4,243
|
|
|
4,387
|
|
General and
administrative expenses
|
|
206
|
|
|
214
|
|
|
710
|
|
|
724
|
|
Depreciation
and amortization expense
|
|
494
|
|
|
425
|
|
|
1,842
|
|
|
1,690
|
|
Total costs and
expenses
|
|
18,131
|
|
|
26,063
|
|
|
81,446
|
|
|
124,942
|
|
Operating
income
|
|
646
|
|
|
1,796
|
|
|
6,358
|
|
|
5,902
|
|
Other income,
net
|
|
11
|
|
|
9
|
|
|
46
|
|
|
47
|
|
Interest and debt
expense, net of capitalized interest
|
|
(107)
|
|
|
(101)
|
|
|
(433)
|
|
|
(397)
|
|
Income from
continuing operations before income tax expense
|
|
550
|
|
|
1,704
|
|
|
5,971
|
|
|
5,552
|
|
Income tax expense
(d)
|
|
155
|
|
|
484
|
|
|
1,870
|
|
|
1,777
|
|
Income from
continuing operations
|
|
395
|
|
|
1,220
|
|
|
4,101
|
|
|
3,775
|
|
Loss from
discontinued operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(64)
|
|
Net income
|
|
395
|
|
|
1,220
|
|
|
4,101
|
|
|
3,711
|
|
Less: Net
income attributable to noncontrolling interests (e)
|
|
97
|
|
|
65
|
|
|
111
|
|
|
81
|
|
Net income
attributable to Valero Energy Corporation stockholders
|
|
$
|
298
|
|
|
$
|
1,155
|
|
|
$
|
3,990
|
|
|
$
|
3,630
|
|
Net income
attributable to Valero Energy Corporation
stockholders:
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
298
|
|
|
$
|
1,155
|
|
|
$
|
3,990
|
|
|
$
|
3,694
|
|
Discontinued
operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(64)
|
|
Total
|
|
$
|
298
|
|
|
$
|
1,155
|
|
|
$
|
3,990
|
|
|
$
|
3,630
|
|
Earnings per
common share:
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
0.62
|
|
|
$
|
2.22
|
|
|
$
|
8.00
|
|
|
$
|
7.00
|
|
Discontinued
operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.12)
|
|
Total
|
|
$
|
0.62
|
|
|
$
|
2.22
|
|
|
$
|
8.00
|
|
|
$
|
6.88
|
|
Weighted-average common shares outstanding (in millions)
|
|
479
|
|
|
517
|
|
|
497
|
|
|
526
|
|
Earnings per
common share – assuming dilution:
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
0.62
|
|
|
$
|
2.22
|
|
|
$
|
7.99
|
|
|
$
|
6.97
|
|
Discontinued
operations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.12)
|
|
Total
|
|
$
|
0.62
|
|
|
$
|
2.22
|
|
|
$
|
7.99
|
|
|
$
|
6.85
|
|
Weighted-average common shares outstanding - assuming dilution (in millions)
|
|
481
|
|
|
521
|
|
|
500
|
|
|
530
|
|
|
|
|
|
|
|
|
|
|
Dividends per
common share
|
|
$
|
0.500
|
|
|
$
|
0.275
|
|
|
$
|
1.700
|
|
|
$
|
1.050
|
|
|
See Notes to Earnings
Release.
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
EARNINGS
RELEASE
|
(Millions of
Dollars, Except per Share, per Barrel, and per Gallon
Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Operating income
by business segment:
|
|
|
|
|
|
|
|
|
Refining
|
|
$
|
876
|
|
|
$
|
1,861
|
|
|
$
|
6,973
|
|
|
$
|
5,884
|
|
Ethanol
|
|
(13)
|
|
|
158
|
|
|
142
|
|
|
786
|
|
Corporate
|
|
(217)
|
|
|
(223)
|
|
|
(757)
|
|
|
(768)
|
|
Total
|
|
$
|
646
|
|
|
$
|
1,796
|
|
|
$
|
6,358
|
|
|
$
|
5,902
|
|
Operating expenses
by business segment:
|
|
|
|
|
|
|
|
|
Refining
|
|
$
|
910
|
|
|
$
|
974
|
|
|
$
|
3,795
|
|
|
$
|
3,900
|
|
Ethanol
|
|
104
|
|
|
129
|
|
|
448
|
|
|
487
|
|
Total
|
|
$
|
1,014
|
|
|
$
|
1,103
|
|
|
$
|
4,243
|
|
|
$
|
4,387
|
|
Depreciation and
amortization expense by business segment:
|
|
|
|
|
|
|
|
|
Refining
|
|
$
|
465
|
|
|
$
|
403
|
|
|
$
|
1,745
|
|
|
$
|
1,597
|
|
Ethanol
|
|
18
|
|
|
13
|
|
|
50
|
|
|
49
|
|
Corporate
|
|
11
|
|
|
9
|
|
|
47
|
|
|
44
|
|
Total
|
|
$
|
494
|
|
|
$
|
425
|
|
|
$
|
1,842
|
|
|
$
|
1,690
|
|
Operating
highlights:
|
|
|
|
|
|
|
|
|
Refining:
|
|
|
|
|
|
|
|
|
Throughput
margin per barrel (a) (b) (c)
|
|
$
|
10.87
|
|
|
$
|
11.17
|
|
|
$
|
12.97
|
|
|
$
|
11.05
|
|
Operating
costs per barrel:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
3.47
|
|
|
3.76
|
|
|
3.71
|
|
|
3.87
|
|
Depreciation
and amortization expense
|
|
1.76
|
|
|
1.55
|
|
|
1.71
|
|
|
1.58
|
|
Total
operating costs per barrel
|
|
5.23
|
|
|
5.31
|
|
|
5.42
|
|
|
5.45
|
|
Operating
income per barrel
|
|
$
|
5.64
|
|
|
$
|
5.86
|
|
|
$
|
7.55
|
|
|
$
|
5.60
|
|
Throughput
volumes (thousand barrels per day):
|
|
|
|
|
|
|
|
|
Feedstocks:
|
|
|
|
|
|
|
|
|
Heavy
sour crude oil
|
|
475
|
|
|
447
|
|
|
438
|
|
|
457
|
|
Medium/light sour crude
oil
|
|
466
|
|
|
420
|
|
|
428
|
|
|
466
|
|
Sweet
crude oil
|
|
1,184
|
|
|
1,239
|
|
|
1,208
|
|
|
1,149
|
|
Residuals
|
|
277
|
|
|
243
|
|
|
274
|
|
|
230
|
|
Other
feedstocks
|
|
136
|
|
|
133
|
|
|
140
|
|
|
134
|
|
Total
feedstocks
|
|
2,538
|
|
|
2,482
|
|
|
2,488
|
|
|
2,436
|
|
Blendstocks and
other
|
|
316
|
|
|
338
|
|
|
311
|
|
|
329
|
|
Total
throughput volumes
|
|
2,854
|
|
|
2,820
|
|
|
2,799
|
|
|
2,765
|
|
Yields
(thousand barrels per day):
|
|
|
|
|
|
|
|
|
Gasolines and
blendstocks
|
|
1,384
|
|
|
1,365
|
|
|
1,364
|
|
|
1,329
|
|
Distillates
|
|
1,085
|
|
|
1,041
|
|
|
1,066
|
|
|
1,047
|
|
Other products
(f)
|
|
427
|
|
|
450
|
|
|
408
|
|
|
423
|
|
Total
yields
|
|
2,896
|
|
|
2,856
|
|
|
2,838
|
|
|
2,799
|
|
|
See Notes to Earnings
Release.
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
EARNINGS
RELEASE
|
(Millions of
Dollars, Except per Share, per Barrel, and per Gallon
Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Refining operating
highlights by region (a) (b) (c) (g):
|
|
|
|
|
|
|
|
|
U.S. Gulf
Coast:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
851
|
|
|
$
|
795
|
|
|
$
|
3,978
|
|
|
$
|
3,368
|
|
Throughput
volumes (thousand barrels per day)
|
|
1,657
|
|
|
1,633
|
|
|
1,592
|
|
|
1,600
|
|
Throughput
margin per barrel
|
|
$
|
10.70
|
|
|
$
|
10.43
|
|
|
$
|
12.27
|
|
|
$
|
11.03
|
|
Operating
costs per barrel:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
3.29
|
|
|
3.56
|
|
|
3.64
|
|
|
3.66
|
|
Depreciation
and amortization expense
|
|
1.83
|
|
|
1.57
|
|
|
1.78
|
|
|
1.60
|
|
Total
operating costs per barrel
|
|
5.12
|
|
|
5.13
|
|
|
5.42
|
|
|
5.26
|
|
Operating
income per barrel
|
|
$
|
5.58
|
|
|
$
|
5.30
|
|
|
$
|
6.85
|
|
|
$
|
5.77
|
|
U.S.
Mid-Continent:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
216
|
|
|
$
|
368
|
|
|
$
|
1,434
|
|
|
$
|
1,323
|
|
Throughput
volumes (thousand barrels per day)
|
|
449
|
|
|
490
|
|
|
447
|
|
|
446
|
|
Throughput
margin per barrel
|
|
$
|
10.34
|
|
|
$
|
13.19
|
|
|
$
|
14.09
|
|
|
$
|
13.63
|
|
Operating
costs per barrel:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
3.34
|
|
|
3.56
|
|
|
3.59
|
|
|
3.90
|
|
Depreciation
and amortization expense
|
|
1.78
|
|
|
1.50
|
|
|
1.71
|
|
|
1.61
|
|
Total
operating costs per barrel
|
|
5.12
|
|
|
5.06
|
|
|
5.30
|
|
|
5.51
|
|
Operating
income per barrel
|
|
$
|
5.22
|
|
|
$
|
8.13
|
|
|
$
|
8.79
|
|
|
$
|
8.12
|
|
North
Atlantic:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
279
|
|
|
$
|
329
|
|
|
$
|
1,446
|
|
|
$
|
911
|
|
Throughput
volumes (thousand barrels per day)
|
|
503
|
|
|
430
|
|
|
494
|
|
|
457
|
|
Throughput
margin per barrel
|
|
$
|
10.09
|
|
|
$
|
12.98
|
|
|
$
|
12.06
|
|
|
$
|
10.02
|
|
Operating
costs per barrel:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
2.89
|
|
|
3.39
|
|
|
2.88
|
|
|
3.40
|
|
Depreciation
and amortization expense
|
|
1.16
|
|
|
1.24
|
|
|
1.17
|
|
|
1.16
|
|
Total
operating costs per barrel
|
|
4.05
|
|
|
4.63
|
|
|
4.05
|
|
|
4.56
|
|
Operating
income per barrel
|
|
$
|
6.04
|
|
|
$
|
8.35
|
|
|
$
|
8.01
|
|
|
$
|
5.46
|
|
U.S. West
Coast:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
134
|
|
|
$
|
29
|
|
|
$
|
855
|
|
|
$
|
53
|
|
Throughput
volumes (thousand barrels per day)
|
|
245
|
|
|
267
|
|
|
266
|
|
|
262
|
|
Throughput
margin per barrel
|
|
$
|
14.62
|
|
|
$
|
9.12
|
|
|
$
|
17.00
|
|
|
$
|
8.60
|
|
Operating
costs per barrel:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
6.07
|
|
|
5.89
|
|
|
5.92
|
|
|
5.91
|
|
Depreciation and
amortization expense
|
|
2.58
|
|
|
2.06
|
|
|
2.26
|
|
|
2.14
|
|
Total
operating costs per barrel
|
|
8.65
|
|
|
7.95
|
|
|
8.18
|
|
|
8.05
|
|
Operating
income per barrel
|
|
$
|
5.97
|
|
|
$
|
1.17
|
|
|
$
|
8.82
|
|
|
$
|
0.55
|
|
|
|
|
|
|
|
|
|
|
Operating income for
regions above
|
|
$
|
1,480
|
|
|
$
|
1,521
|
|
|
$
|
7,713
|
|
|
5,655
|
|
Lower of cost or
market inventory valuation adjustment (c)
|
|
(740)
|
|
|
—
|
|
|
(740)
|
|
|
—
|
|
LIFO gain
(b)
|
|
—
|
|
|
229
|
|
|
—
|
|
|
229
|
|
Blender's tax credit
(a)
|
|
136
|
|
|
111
|
|
|
—
|
|
|
—
|
|
Total refining
operating income
|
|
$
|
876
|
|
|
$
|
1,861
|
|
|
$
|
6,973
|
|
|
$
|
5,884
|
|
|
See Notes to Earnings
Release.
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
EARNINGS
RELEASE
|
(Millions of
Dollars, Except per Share, per Barrel, and per Gallon
Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Average market
reference prices and differentials:
|
|
|
|
|
|
|
|
|
Feedstocks
(dollars per barrel):
|
|
|
|
|
|
|
|
|
Brent crude
oil
|
|
$
|
44.73
|
|
|
$
|
77.35
|
|
|
$
|
53.62
|
|
|
$
|
99.57
|
|
Brent less
West Texas Intermediate (WTI) crude oil
|
|
2.67
|
|
|
3.95
|
|
|
4.91
|
|
|
6.40
|
|
Brent less
Alaska North Slope (ANS) crude oil
|
|
0.94
|
|
|
2.59
|
|
|
0.67
|
|
|
1.73
|
|
Brent less
Louisiana Light Sweet (LLS) crude oil
|
|
2.21
|
|
|
1.77
|
|
|
2.37
|
|
|
2.79
|
|
Brent less
Mars crude oil
|
|
6.95
|
|
|
5.62
|
|
|
6.54
|
|
|
6.75
|
|
Brent less
Maya crude oil
|
|
10.42
|
|
|
10.09
|
|
|
9.54
|
|
|
13.73
|
|
LLS crude
oil
|
|
42.52
|
|
|
75.58
|
|
|
51.25
|
|
|
96.78
|
|
LLS less Mars
crude oil
|
|
4.74
|
|
|
3.85
|
|
|
4.17
|
|
|
3.96
|
|
LLS less Maya
crude oil
|
|
8.21
|
|
|
8.32
|
|
|
7.17
|
|
|
10.94
|
|
WTI crude
oil
|
|
42.06
|
|
|
73.40
|
|
|
48.71
|
|
|
93.17
|
|
|
|
|
|
|
|
|
|
|
Natural gas
(dollars per million British Thermal Units)
|
|
2.12
|
|
|
3.69
|
|
|
2.58
|
|
|
4.36
|
|
|
|
|
|
|
|
|
|
|
Products (dollars
per barrel, unless otherwise noted):
|
|
|
|
|
|
|
|
|
U.S. Gulf
Coast:
|
|
|
|
|
|
|
|
|
CBOB gasoline
less Brent
|
|
6.45
|
|
|
(1.00)
|
|
|
9.83
|
|
|
3.54
|
|
Ultra-low-sulfur diesel less Brent
|
|
9.29
|
|
|
15.21
|
|
|
12.64
|
|
|
14.28
|
|
Propylene less
Brent
|
|
(11.90)
|
|
|
21.27
|
|
|
(5.94)
|
|
|
5.57
|
|
CBOB gasoline
less LLS
|
|
8.66
|
|
|
0.77
|
|
|
12.20
|
|
|
6.33
|
|
Ultra-low-sulfur diesel less LLS
|
|
11.50
|
|
|
16.98
|
|
|
15.01
|
|
|
17.07
|
|
Propylene less
LLS
|
|
(9.69)
|
|
|
23.04
|
|
|
(3.57)
|
|
|
8.36
|
|
U.S.
Mid-Continent:
|
|
|
|
|
|
|
|
|
CBOB gasoline
less WTI
|
|
13.06
|
|
|
6.05
|
|
|
17.59
|
|
|
12.28
|
|
Ultra-low-sulfur diesel less WTI
|
|
15.02
|
|
|
27.60
|
|
|
19.02
|
|
|
24.05
|
|
North
Atlantic:
|
|
|
|
|
|
|
|
|
CBOB gasoline
less Brent
|
|
10.95
|
|
|
7.63
|
|
|
12.85
|
|
|
9.07
|
|
Ultra-low-sulfur diesel less Brent
|
|
11.44
|
|
|
20.98
|
|
|
16.05
|
|
|
18.25
|
|
U.S. West
Coast:
|
|
|
|
|
|
|
|
|
CARBOB 87
gasoline less ANS
|
|
20.60
|
|
|
6.20
|
|
|
25.56
|
|
|
13.40
|
|
CARB diesel
less ANS
|
|
15.45
|
|
|
21.75
|
|
|
16.90
|
|
|
19.14
|
|
CARBOB 87
gasoline less WTI
|
|
22.33
|
|
|
7.56
|
|
|
29.80
|
|
|
18.07
|
|
CARB diesel
less WTI
|
|
17.18
|
|
|
23.11
|
|
|
21.14
|
|
|
23.81
|
|
New York
Harbor corn crush (dollars per gallon)
|
|
0.23
|
|
|
0.71
|
|
|
0.22
|
|
|
0.85
|
|
|
See Notes to Earnings
Release.
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
EARNINGS
RELEASE
|
(Millions of
Dollars, Except per Share, per Barrel, and per Gallon
Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Ethanol (b)
(c):
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
37
|
|
|
$
|
154
|
|
|
$
|
192
|
|
|
$
|
782
|
|
Production (thousand
gallons per day)
|
|
3,883
|
|
|
3,752
|
|
|
3,827
|
|
|
3,422
|
|
Gross margin per
gallon of production
|
|
$
|
0.45
|
|
|
$
|
0.86
|
|
|
$
|
0.49
|
|
|
$
|
1.06
|
|
Operating costs per
gallon of production:
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
0.29
|
|
|
0.37
|
|
|
0.32
|
|
|
0.39
|
|
Depreciation
and amortization expense
|
|
0.05
|
|
|
0.04
|
|
|
0.03
|
|
|
0.04
|
|
Total operating
costs per gallon of production
|
|
0.34
|
|
|
0.41
|
|
|
0.35
|
|
|
0.43
|
|
Operating income per
gallon of production
|
|
$
|
0.11
|
|
|
$
|
0.45
|
|
|
$
|
0.14
|
|
|
$
|
0.63
|
|
|
|
|
|
|
|
|
|
|
Operating income from
above
|
|
$
|
37
|
|
|
$
|
154
|
|
|
$
|
192
|
|
|
$
|
782
|
|
Lower of cost or
market inventory valuation adjustment (c)
|
|
(50)
|
|
|
—
|
|
|
(50)
|
|
|
—
|
|
LIFO gain
(b)
|
|
—
|
|
|
4
|
|
|
—
|
|
|
4
|
|
Total ethanol
operating income (loss)
|
|
$
|
(13)
|
|
|
$
|
158
|
|
|
$
|
142
|
|
|
$
|
786
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
|
|
|
2015
|
|
2014
|
Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
Current
assets
|
|
$
|
14,805
|
|
|
$
|
16,614
|
|
Cash and temporary
cash investments, including $81 and $237, respectively, held by
Valero Energy Partners LP, included in current assets
|
|
4,114
|
|
|
3,689
|
|
Inventories included
in current assets
|
|
5,898
|
|
|
6,623
|
|
Current
liabilities
|
|
7,193
|
|
|
9,980
|
|
Current portion of
debt and capital lease obligations included in current
liabilities
|
|
127
|
|
|
606
|
|
Debt and capital
lease obligations, less current portion
|
|
7,250
|
|
|
5,780
|
|
Total debt and
capital lease obligations
|
|
7,377
|
|
|
6,386
|
|
Valero Energy
Corporation stockholders' equity
|
|
20,527
|
|
|
20,677
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Valero Energy
Partners LP:
|
|
|
|
|
|
|
|
|
Weighted-average
limited partner units outstanding:
|
|
|
|
|
|
|
|
Common units -
public (basic and diluted)
|
|
19
|
|
|
17
|
|
|
18
|
|
|
17
|
|
Common units -
Valero (basic and diluted)
|
|
15
|
|
|
12
|
|
|
14
|
|
|
12
|
|
Subordinated
units - Valero (basic and diluted)
|
|
29
|
|
|
29
|
|
|
29
|
|
|
29
|
|
Distributions
declared:
|
|
|
|
|
|
|
|
Limited
partner units - public
|
|
$
|
7
|
|
|
$
|
4
|
|
|
$
|
22
|
|
|
$
|
16
|
|
Limited
partner units - Valero
|
|
14
|
|
|
11
|
|
|
52
|
|
|
38
|
|
General
partner units - Valero
|
|
2
|
|
|
—
|
|
|
5
|
|
|
1
|
|
Total
distribution declared
|
|
$
|
23
|
|
|
$
|
15
|
|
|
$
|
79
|
|
|
$
|
55
|
|
|
See Notes to Earnings
Release.
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
RECONCILIATION OF
AMOUNTS REPORTED UNDER U.S. GAAP
|
(Millions of
Dollars, Except per Share Amounts)
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
operating income by business segment to adjusted operating income
by business segment:
|
|
|
|
|
|
|
|
|
Refining:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
$
|
876
|
|
|
$
|
1,861
|
|
|
$
|
6,973
|
|
|
$
|
5,884
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Lower of cost or
market inventory valuation adjustment (c)
|
|
740
|
|
|
—
|
|
|
740
|
|
|
—
|
|
LIFO gain
(b)
|
|
—
|
|
|
(229)
|
|
|
—
|
|
|
(229)
|
|
Blender's tax credit
(a)
|
|
(136)
|
|
|
(111)
|
|
|
—
|
|
|
—
|
|
Adjusted refining
operating income
|
|
1,480
|
|
|
1,521
|
|
|
7,713
|
|
|
5,655
|
|
Ethanol:
|
|
|
|
|
|
|
|
|
Operating
income
|
|
(13)
|
|
|
158
|
|
|
142
|
|
|
786
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Lower of cost or
market inventory valuation adjustment (c)
|
|
50
|
|
|
—
|
|
|
50
|
|
|
—
|
|
LIFO gain
(b)
|
|
—
|
|
|
(4)
|
|
|
—
|
|
|
(4)
|
|
Adjusted ethanol
operating income
|
|
37
|
|
|
154
|
|
|
192
|
|
|
782
|
|
Corporate
|
|
(217)
|
|
|
(223)
|
|
|
(757)
|
|
|
(768)
|
|
Total adjusted
operating income
|
|
$
|
1,300
|
|
|
$
|
1,452
|
|
|
$
|
7,148
|
|
|
$
|
5,669
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
net income from continuing operations to adjusted net income from
continuing operations:
|
|
|
|
|
|
|
|
|
Net income from
continuing operations attributable to Valero Energy Corporation
stockholders
|
|
$
|
298
|
|
|
$
|
1,155
|
|
|
$
|
3,990
|
|
|
$
|
3,694
|
|
Adjustments (after
taxes and excluding the portion of the blender's tax credit
attributable to the holder of the noncontrolling interest in
Diamond Green Diesel Holdings LLC):
|
|
|
|
|
|
|
|
|
Lower of cost or
market inventory valuation adjustment (c)
|
|
624
|
|
|
—
|
|
|
624
|
|
|
—
|
|
LIFO gain
(b)
|
|
—
|
|
|
(151)
|
|
|
—
|
|
|
(151)
|
|
Blender's tax credit
(a)
|
|
(60)
|
|
|
(52)
|
|
|
—
|
|
|
—
|
|
Adjusted net income
from continuing operations attributable to Valero Energy
Corporation stockholders
|
|
$
|
862
|
|
|
$
|
952
|
|
|
$
|
4,614
|
|
|
$
|
3,543
|
|
Earnings per
common share – assuming dilution from continuing
operations:
|
|
|
|
|
|
|
|
|
Actual
|
|
$
|
0.62
|
|
|
$
|
2.22
|
|
|
$
|
7.99
|
|
|
$
|
6.97
|
|
Adjusted
|
|
1.79
|
|
|
1.83
|
|
|
9.24
|
|
|
6.68
|
|
|
|
See Notes to Earnings
Release.
|
|
VALERO ENERGY
CORPORATION AND SUBSIDIARIES
|
NOTES TO EARNINGS
RELEASE
|
|
|
(a)
|
Cost of sales for the
three months and year ended December 31, 2015 and 2014 reflects a
benefit of $174 million and $155 million, respectively, for
biodiesel blender's tax credits attributable to volumes blended
throughout both years. The annual benefit was recorded during the
three months ended December 31, 2015 and 2014 (as opposed to
throughout the year as volumes were blended) because the
legislation authorizing the credit was not passed and signed into
law until December of each year. Of these annual amounts, $136
million and $111 million, respectively, relate to volumes blended
during the first nine months of each year. Therefore, we have
excluded these nine-month amounts from the segment and regional
throughput margins per barrel and the regional operating income
amounts for the refining segment for the three months ended
December 31, 2015 and 2014. We have also excluded these nine-month
amounts for purposes of computing refining segment adjusted
operating income, adjusted net income from continuing operations
attributable to Valero stockholders, and adjusted earnings per
common share – assuming dilution from continuing operations for the
three months ended December 31, 2015 and 2014, as reflected in the
reconciliation of amounts reported under United States (U.S.)
generally accepted accounting principles (GAAP).
|
|
|
(b)
|
Cost of sales for the
three months and year ended December 31, 2014 reflects a last-in,
first-out (LIFO) gain of $233 million ($151 million after
taxes), of which $229 million is attributable to our refining
segment and $4 million is attributable to our ethanol segment.
These amounts have been excluded from (1) the segment and regional
throughput margins per barrel and the regional operating income
amounts for the refining segment, and (2) the operating income and
gross margin per gallon of production amounts for the ethanol
segment, respectively. We have also excluded the segment and total
amounts for purposes of computing refining segment and ethanol
segment adjusted operating income, adjusted net income from
continuing operations attributable to Valero stockholders, and
adjusted earnings per common share – assuming dilution from
continuing operations for the three months and year ended December
31, 2014, as reflected in the reconciliation of amounts reported
under U.S. GAAP.
|
|
|
(c)
|
In December 2015, we
recorded a lower of cost or market (LCM) inventory valuation
adjustment of $790 million ($624 million after taxes), of
which $740 million is attributable to our refining segment and $50
million is attributable to our ethanol segment. In accordance with
U.S. GAAP, we are required to state our inventories at the lower of
cost or market. Cost is primarily determined using the LIFO
inventory valuation methodology, whereby the most recently incurred
costs are charged to cost of sales in the statement of income and
inventories are valued at base layer acquisition costs in the
balance sheet. Market is determined based on an assessment of the
net realizable value of our inventory. In periods where the
market price of our inventory falls below cost, we record an
inventory valuation adjustment to write down the value to market in
accordance with U.S. GAAP. The LCM inventory valuation adjustment
for the three months and year ended December 31, 2015 has
been excluded from (1) the segment and regional throughout margins
per barrel and the regional operating income amounts for the
refining segment, and (2) the gross operating income and the gross
margin per gallon of production amounts for the ethanol segment,
respectively. We have also excluded the segment and total amounts
for purposes of computing refining segment and ethanol segment
adjusted operating income, adjusted net income from continuing
operations attributable to Valero stockholders, and adjusted
earnings per common share – assuming dilution from continuing
operations for the three months and year ended December 31, 2015,
as reflected in the reconciliation of amounts reported under U.S.
GAAP.
|
|
|
(d)
|
The variation in the
customary relationship between income tax expense and income from
continuing operations for the three months and year ended December
31, 2015 and 2014 is due primarily to earnings from our
international operations that are taxed at statutory tax rates that
are lower than in the U.S. In addition, for the three months
and year ended December 31, 2015, the variation is due to a change
in the tax law in the United Kingdom (U.K.) that reduced the U.K.
statutory rate and the favorable settlement of various U.S. income
tax audits.
|
|
|
(e)
|
Net income
attributable to noncontrolling interests for the three months and
year ended December 31, 2015 and 2014 includes $59 million and $42
million, respectively, associated with the noncontrolling interest
holder's interest in the biodiesel blender's tax credit as further
discussed in note (a).
|
|
|
(f)
|
Primarily includes
petrochemicals, gas oils, No. 6 fuel oil, petroleum coke, sulfur,
and asphalt.
|
|
|
(g)
|
The regions reflected
herein contain the following refineries: U.S. Gulf Coast-
Corpus Christi East, Corpus Christi West, Houston, Meraux, Port
Arthur, St. Charles, Texas City, and Three Rivers Refineries;
U.S. Mid-Continent- Ardmore, McKee, and Memphis
Refineries; North Atlantic- Pembroke and Quebec City
Refineries; and U.S. West Coast- Benicia and
Wilmington Refineries.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/valero-energy-reports-2015-fourth-quarter-and-full-year-results-300211333.html
SOURCE Valero Energy Corporation