SUGAR LAND, Texas, Oct. 30, 2014 /PRNewswire/ -- CVR Energy, Inc.
(NYSE: CVI) today announced third quarter 2014 net income of
$7.9 million, or 9 cents per diluted share, on net sales of
$2,279.9 million, compared to net
income of $44.0 million, or
51 cents per diluted share, on net
sales of $1,977.1 million for the
2013 third quarter. Third quarter 2014 adjusted EBITDA, a non-GAAP
financial measure, was $90.5 million,
compared to third quarter 2013 adjusted EBITDA of $42.4 million.
For the first nine months of 2014, net income was $218.3 million, or $2.51 per diluted share, on net sales of
$7,267.7 million, compared to net
income of $392.4 million, or
$4.52 per diluted share, on net sales
of $6,549.8 million for the same
period a year earlier. Adjusted EBITDA for the first nine months of
2014 was $391.9 million, compared to
adjusted EBITDA of $549.7 million for
the first nine months of 2013.
"Our third quarter results were primarily impacted by the
downtime associated with a fire that occurred in late July at CVR
Refining's Coffeyville refinery,
which resumed operations in late August," said Jack Lipinski, CVR Energy's chief executive
officer. "Even with the downtime, the Coffeyville and Wynnewood refineries posted combined total
crude throughput of 176,367 barrels per day (bpd) for the quarter.
At CVR Partners, realized fertilizer prices for the third quarter
were in line with the company's expectations, while UAN production
was somewhat lower than anticipated."
The company also announced a third quarter 2014 cash dividend of
75 cents per share. The dividend, as
declared by CVR Energy's Board of Directors, will be paid on
Nov. 17, 2014, to stockholders of
record on Nov. 10, 2014.
CVR Energy's third quarter cash dividend brings the cumulative
cash dividends paid or declared for the first nine months of 2014
to $4.25 per share. On July 17, 2014, CVR Energy announced a special
dividend of $2.00 per share, which
was paid on Aug. 4, 2014, to
stockholders of record on July 28,
2014.
Today, CVR Refining announced a 2014 third quarter cash
distribution of 54 cents per common
unit, and CVR Partners announced a 2014 third quarter cash
distribution of 27 cents per common
unit.
Petroleum Business
The petroleum business, which is operated by CVR Refining and
includes the Coffeyville and
Wynnewood refineries, reported
third quarter 2014 operating income of $3.9
million on net sales of $2,215.2
million, compared to operating income of $23.4 million on net sales of $1,910.5 million in the third quarter of
2013.
Refining margin adjusted for FIFO impact per crude oil
throughput barrel, a non-GAAP financial measure, was $13.16 in the 2014 third quarter, compared to
$8.21 for the same period in 2013.
Direct operating expenses, including major scheduled turnaround
expenses, per barrel sold, exclusive of depreciation and
amortization, for the 2014 third quarter was $6.52, compared to $6.92 in the third quarter of 2013.
Third quarter 2014 throughputs of crude oil and all other
feedstocks and blendstocks for the Coffeyville and Wynnewood refineries totaled 183,814 bpd.
Throughputs of crude oil and all other feedstocks and blendstocks
for both refineries totaled 167,563 bpd for the same period in
2013.
Nitrogen Fertilizers Business
The fertilizer business, which is operated by CVR Partners,
reported third quarter 2014 operating income of $14.4 million on net sales of $66.7 million, compared to operating income of
$21.3 million on net sales of
$69.2 million for the third quarter
of 2013.
For the third quarter of 2014, average realized gate prices for
UAN and ammonia were $254 per ton and
$503 per ton, respectively, compared
to $259 per ton and $505 per ton, respectively, for the same period
in 2013.
CVR Partners produced 99,800 tons of ammonia and purchased
approximately 4,000 additional tons of ammonia during the third
quarter of 2014, of which 11,800 net tons were available for sale
while the rest was upgraded to 223,500 tons of UAN. In the 2013
third quarter, the plant produced 100,400 tons of ammonia and
purchased approximately 1,000 additional tons of ammonia, of which
3,400 net tons were available for sale while the remainder was
upgraded to 239,300 tons of UAN.
Cash and Debt
Consolidated cash and cash equivalents, which included
$359.2 million for CVR Refining and
$68.0 million for CVR Partners, was
$793.1 million at Sept. 30, 2014. Consolidated total debt was
$675.3 million at Sept. 30, 2014. The company had no debt exclusive
of CVR Refining's and CVR Partners' debt.
CVR Energy 2014 Third Quarter Earnings Conference
Call
CVR Energy previously announced that it will host its third
quarter 2014 Earnings Conference Call for analysts and investors on
Oct. 30 at 2:30 p.m. Eastern.
The Earnings Conference Call will be broadcast live over the
Internet at http://www.videonewswire.com/event.asp?id=100680. 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
http://www.videonewswire.com/event.asp?id=100680. A repeat of the
conference call can be accessed by dialing (877) 660-6853,
conference ID 13593124.
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 a majority of the
common units representing limited partner interests of CVR Refining
and CVR Partners.
For further information, please contact:
Investor Relations:
Jay Finks
CVR Energy, Inc.
913-982-0481
InvestorRelations@CVREnergy.com
Media Relations:
Angie Dasbach
CVR Energy, Inc. 281-207-3550
MediaRelations@CVREnergy.com
CVR Energy, Inc.
Financial and Operations Data (all information in this
release is unaudited unless noted otherwise).
|
|
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|
|
|
|
|
|
|
|
|
|
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Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in millions,
except per share data)
|
Consolidated
Statement of Operations Data:
|
|
|
|
|
|
|
|
Net sales
|
$
|
2,279.9
|
|
|
$
|
1,977.1
|
|
|
$
|
7,267.7
|
|
|
$
|
6,549.8
|
|
Cost of product
sold
|
2,066.7
|
|
|
1,744.4
|
|
|
6,332.6
|
|
|
5,343.5
|
|
Direct operating
expenses
|
136.8
|
|
|
128.4
|
|
|
380.3
|
|
|
345.2
|
|
Selling, general and
administrative expenses
|
31.8
|
|
|
27.7
|
|
|
86.2
|
|
|
85.0
|
|
Depreciation and
amortization
|
37.8
|
|
|
36.2
|
|
|
113.7
|
|
|
105.4
|
|
Operating
income
|
6.8
|
|
|
40.4
|
|
|
354.9
|
|
|
670.7
|
|
Interest expense and
other financing costs
|
(9.4)
|
|
|
(11.7)
|
|
|
(28.8)
|
|
|
(39.6)
|
|
Interest
income
|
0.3
|
|
|
0.3
|
|
|
0.7
|
|
|
0.9
|
|
Gain on derivatives,
net
|
25.7
|
|
|
72.5
|
|
|
171.1
|
|
|
173.0
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(26.1)
|
|
Other income
(expense), net
|
2.1
|
|
|
6.2
|
|
|
(0.1)
|
|
|
6.5
|
|
Income before income
tax expense
|
25.5
|
|
|
107.7
|
|
|
497.8
|
|
|
785.4
|
|
Income tax
expense
|
4.2
|
|
|
29.5
|
|
|
118.8
|
|
|
222.8
|
|
Net income
|
21.3
|
|
|
78.2
|
|
|
379.0
|
|
|
562.6
|
|
Less: Net income
attributable to noncontrolling interest
|
13.4
|
|
|
34.2
|
|
|
160.7
|
|
|
170.2
|
|
Net income
attributable to CVR Energy stockholders
|
$
|
7.9
|
|
|
$
|
44.0
|
|
|
$
|
218.3
|
|
|
$
|
392.4
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
$
|
0.09
|
|
|
$
|
0.51
|
|
|
$
|
2.51
|
|
|
$
|
4.52
|
|
Diluted earnings per
share
|
$
|
0.09
|
|
|
$
|
0.51
|
|
|
$
|
2.51
|
|
|
$
|
4.52
|
|
Dividends declared
per share
|
$
|
2.75
|
|
|
$
|
0.75
|
|
|
$
|
4.25
|
|
|
$
|
13.50
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA*
|
$
|
90.5
|
|
|
$
|
42.4
|
|
|
$
|
391.9
|
|
|
$
|
549.7
|
|
Adjusted net
income*
|
$
|
37.0
|
|
|
$
|
5.2
|
|
|
$
|
194.0
|
|
|
$
|
286.3
|
|
Adjusted net income,
per diluted share*
|
$
|
0.43
|
|
|
$
|
0.06
|
|
|
$
|
2.23
|
|
|
$
|
3.30
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
Diluted
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
|
86.8
|
|
|
|
|
|
|
|
|
|
|
|
As of September
30, 2014
|
|
As of December 31,
2013
|
|
|
|
(audited)
|
|
(in
millions)
|
Balance Sheet
Data:
|
|
|
|
Cash and cash
equivalents
|
$
|
793.1
|
|
|
$
|
842.1
|
|
Working
capital
|
1,191.5
|
|
|
1,230.2
|
|
Total
assets
|
3,752.4
|
|
|
3,665.8
|
|
Total debt, including
current portion
|
675.3
|
|
|
676.2
|
|
Total CVR
stockholders' equity
|
1,105.7
|
|
|
1,188.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Cash Flow
Data:
|
|
|
|
|
|
|
|
Net cash flow
provided by (used in):
|
|
|
|
|
|
|
|
Operating
activities
|
$
|
125.3
|
|
|
$
|
(59.7)
|
|
|
$
|
530.8
|
|
|
$
|
321.3
|
|
Investing
activities
|
(56.6)
|
|
|
(44.3)
|
|
|
(249.6)
|
|
|
(177.4)
|
|
Financing
activities
|
(274.3)
|
|
|
(143.4)
|
|
|
(330.2)
|
|
|
(152.8)
|
|
Net cash
flow
|
$
|
(205.6)
|
|
|
$
|
(247.4)
|
|
|
$
|
(49.0)
|
|
|
$
|
(8.9)
|
|
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 includes the
operations of the Coffeyville,
Kansas and Wynnewood,
Oklahoma refineries along with the crude oil gathering and
pipeline systems. Effective with its initial public offering on
January 23, 2013, our Petroleum
segment is operated by CVR Refining, LP ("CVR Refining"), in which
we own a majority interest as well as the general partner. Detailed
operating results for the Petroleum segment for the quarter ended
September 30, 2014 are included in CVR Refining's press
release dated October 30, 2014. The Nitrogen Fertilizer
segment is operated by CVR Partners, LP, ("CVR Partners") in which
we own a majority interest as well as the general partner. It
consists of a nitrogen fertilizer manufacturing facility that
utilizes a pet coke gasification process in producing nitrogen
fertilizer. Detailed operating results for the Nitrogen Fertilizer
segment for the quarter ended September 30, 2014 are included
in CVR Partners' press release dated October 30, 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum (CVR
Refining)
|
|
Nitrogen
Fertilizer (CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
|
|
|
|
|
|
(in
millions)
|
Three Months Ended
September 30, 2014
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
2,215.2
|
|
|
$
|
66.7
|
|
|
$
|
(2.0)
|
|
|
$
|
2,279.9
|
|
Cost of product
sold
|
|
2,053.7
|
|
|
15.4
|
|
|
(2.4)
|
|
|
2,066.7
|
|
Direct operating
expenses (1)
|
|
105.1
|
|
|
26.1
|
|
|
0.1
|
|
|
131.3
|
|
Major scheduled
turnaround expenses
|
|
5.5
|
|
|
—
|
|
|
—
|
|
|
5.5
|
|
Selling, general and
administrative
|
|
17.3
|
|
|
4.0
|
|
|
10.5
|
|
|
31.8
|
|
Depreciation and
amortization
|
|
29.7
|
|
|
6.8
|
|
|
1.3
|
|
|
37.8
|
|
Operating income
(loss)
|
|
$
|
3.9
|
|
|
$
|
14.4
|
|
|
$
|
(11.5)
|
|
|
$
|
6.8
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
|
48.9
|
|
|
$
|
6.0
|
|
|
$
|
1.6
|
|
|
$
|
56.5
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30, 2014
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
7,056.9
|
|
|
$
|
224.3
|
|
|
$
|
(13.5)
|
|
|
$
|
7,267.7
|
|
Cost of product
sold
|
|
6,289.6
|
|
|
56.6
|
|
|
(13.6)
|
|
|
6,332.6
|
|
Direct operating
expenses (1)
|
|
297.5
|
|
|
77.2
|
|
|
0.1
|
|
|
374.8
|
|
Major scheduled
turnaround expenses
|
|
5.5
|
|
|
—
|
|
|
—
|
|
|
5.5
|
|
Selling, general and
administrative
|
|
54.0
|
|
|
13.9
|
|
|
18.3
|
|
|
86.2
|
|
Depreciation and
amortization
|
|
89.9
|
|
|
20.3
|
|
|
3.5
|
|
|
113.7
|
|
Operating income
(loss)
|
|
$
|
320.4
|
|
|
$
|
56.3
|
|
|
$
|
(21.8)
|
|
|
$
|
354.9
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
|
154.2
|
|
|
$
|
13.5
|
|
|
$
|
3.7
|
|
|
$
|
171.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum (CVR
Refining)
|
|
Nitrogen
Fertilizer (CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
|
|
|
|
|
|
(in
millions)
|
Three Months Ended
September 30, 2013
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
1,910.5
|
|
|
$
|
69.2
|
|
|
$
|
(2.6)
|
|
|
$
|
1,977.1
|
|
Cost of product
sold
|
|
1,734.7
|
|
|
13.0
|
|
|
(3.3)
|
|
|
1,744.4
|
|
Direct operating
expenses (1)
|
|
104.7
|
|
|
23.7
|
|
|
—
|
|
|
128.4
|
|
Major scheduled
turnaround expenses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Selling, general and
administrative
|
|
18.9
|
|
|
4.6
|
|
|
4.2
|
|
|
27.7
|
|
Depreciation and
amortization
|
|
28.8
|
|
|
6.6
|
|
|
0.8
|
|
|
36.2
|
|
Operating income
(loss)
|
|
$
|
23.4
|
|
|
$
|
21.3
|
|
|
$
|
(4.3)
|
|
|
$
|
40.4
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
|
60.7
|
|
|
$
|
4.0
|
|
|
$
|
4.3
|
|
|
$
|
69.0
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30, 2013
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
6,322.6
|
|
|
$
|
239.4
|
|
|
$
|
(12.2)
|
|
|
$
|
6,549.8
|
|
Cost of product
sold
|
|
5,317.0
|
|
|
39.2
|
|
|
(12.7)
|
|
|
5,343.5
|
|
Direct operating
expenses (1)
|
|
274.5
|
|
|
70.7
|
|
|
—
|
|
|
345.2
|
|
Major scheduled
turnaround expenses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Selling, general and
administrative
|
|
57.8
|
|
|
15.8
|
|
|
11.4
|
|
|
85.0
|
|
Depreciation and
amortization
|
|
85.2
|
|
|
18.5
|
|
|
1.7
|
|
|
105.4
|
|
Operating income
(loss)
|
|
$
|
588.1
|
|
|
$
|
95.2
|
|
|
$
|
(12.6)
|
|
|
$
|
670.7
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
$
|
140.8
|
|
|
$
|
35.8
|
|
|
$
|
7.0
|
|
|
$
|
183.6
|
|
|
(1) Excluding
turnaround expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Petroleum (CVR
Refining)
|
|
Nitrogen
Fertilizer (CVR Partners)
|
|
Corporate and
Other
|
|
Consolidated
|
|
|
|
|
|
|
|
(in
millions)
|
September 30,
2014
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
359.2
|
|
|
$
|
68.0
|
|
|
$
|
365.9
|
|
|
$
|
793.1
|
|
Total
assets
|
|
2,691.7
|
|
|
562.1
|
|
|
498.6
|
|
|
3,752.4
|
|
Total debt, including
current portion
|
|
581.8
|
|
|
125.0
|
|
|
(31.5)
|
|
|
675.3
|
|
|
|
|
|
|
|
|
|
|
December 31,
2013
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
279.8
|
|
|
$
|
85.1
|
|
|
$
|
477.2
|
|
|
$
|
842.1
|
|
Total
assets
|
|
2,533.3
|
|
|
593.5
|
|
|
539.0
|
|
|
3,665.8
|
|
Total debt, including
current portion
|
|
582.7
|
|
|
125.0
|
|
|
(31.5)
|
|
|
676.2
|
|
Petroleum Segment Operating Data
The following tables set forth information about our
consolidated Petroleum segment operated by CVR Refining, LP, of
which we own a majority interest and serve as 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 quarter ended
September 30, 2014 are included in CVR Refining's press
release dated October 30, 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Petroleum Segment
Summary Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
2,215.2
|
|
|
$
|
1,910.5
|
|
|
$
|
7,056.9
|
|
|
$
|
6,322.6
|
|
Cost of product
sold
|
2,053.7
|
|
|
1,734.7
|
|
|
6,289.6
|
|
|
5,317.0
|
|
Direct operating
expenses
|
105.1
|
|
|
104.7
|
|
|
297.5
|
|
|
274.5
|
|
Major scheduled
turnaround expenses
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
Selling, general and
administrative expenses
|
17.3
|
|
|
18.9
|
|
|
54.0
|
|
|
57.8
|
|
Depreciation and
amortization
|
29.7
|
|
|
28.8
|
|
|
89.9
|
|
|
85.2
|
|
Operating
income
|
3.9
|
|
|
23.4
|
|
|
320.4
|
|
|
588.1
|
|
Interest expense and
other financing costs
|
(7.9)
|
|
|
(10.0)
|
|
|
(24.5)
|
|
|
(34.8)
|
|
Interest
income
|
0.1
|
|
|
0.1
|
|
|
0.3
|
|
|
0.3
|
|
Gain on derivatives,
net
|
25.7
|
|
|
72.5
|
|
|
171.1
|
|
|
173.0
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(26.1)
|
|
Other income
(expense), net
|
—
|
|
|
—
|
|
|
(0.1)
|
|
|
0.1
|
|
Income before income
tax expense
|
21.8
|
|
|
86.0
|
|
|
467.2
|
|
|
700.6
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income
|
$
|
21.8
|
|
|
$
|
86.0
|
|
|
$
|
467.2
|
|
|
$
|
700.6
|
|
|
|
|
|
|
|
|
|
Refining
margin*
|
$
|
161.5
|
|
|
$
|
175.8
|
|
|
$
|
767.3
|
|
|
$
|
1,005.6
|
|
Gross
profit*
|
$
|
21.2
|
|
|
$
|
42.3
|
|
|
$
|
374.4
|
|
|
$
|
645.9
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
213.5
|
|
|
$
|
121.5
|
|
|
$
|
773.5
|
|
|
$
|
922.3
|
|
Adjusted Petroleum
EBITDA*
|
$
|
129.9
|
|
|
$
|
33.9
|
|
|
$
|
517.0
|
|
|
$
|
594.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(dollars per
barrel)
|
Petroleum Segment
Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Refining
margin*
|
$
|
9.96
|
|
|
$
|
11.89
|
|
|
$
|
14.29
|
|
|
$
|
20.15
|
|
FIFO impact
(favorable) unfavorable
|
3.20
|
|
|
(3.68)
|
|
|
0.11
|
|
|
(1.67)
|
|
Refining margin
adjusted for FIFO impact*
|
13.16
|
|
|
8.21
|
|
|
14.40
|
|
|
18.48
|
|
Gross
profit*
|
1.31
|
|
|
2.86
|
|
|
6.97
|
|
|
12.94
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
6.82
|
|
|
7.08
|
|
|
5.64
|
|
|
5.50
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
$
|
6.52
|
|
|
$
|
6.92
|
|
|
$
|
5.32
|
|
|
$
|
5.29
|
|
Barrels sold (barrels
per day)
|
184,262
|
|
|
164,431
|
|
|
208,461
|
|
|
190,055
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Petroleum Segment
Summary Refining Throughput and Production Data
(bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
164,067
|
|
|
89.3
|
%
|
|
130,876
|
|
|
78.1
|
%
|
|
178,390
|
|
|
86.5
|
%
|
|
147,074
|
|
|
76.9
|
%
|
Medium
|
1,610
|
|
|
0.9
|
%
|
|
20,752
|
|
|
12.4
|
%
|
|
1,558
|
|
|
0.7
|
%
|
|
17,901
|
|
|
9.4
|
%
|
Heavy sour
|
10,690
|
|
|
5.8
|
%
|
|
9,072
|
|
|
5.4
|
%
|
|
16,732
|
|
|
8.1
|
%
|
|
17,805
|
|
|
9.3
|
%
|
Total crude oil
throughput
|
176,367
|
|
|
96.0
|
%
|
|
160,700
|
|
|
95.9
|
%
|
|
196,680
|
|
|
95.3
|
%
|
|
182,780
|
|
|
95.6
|
%
|
All other feedstocks
and blendstocks
|
7,447
|
|
|
4.0
|
%
|
|
6,863
|
|
|
4.1
|
%
|
|
9,655
|
|
|
4.7
|
%
|
|
8,444
|
|
|
4.4
|
%
|
Total
throughput
|
183,814
|
|
|
100.0
|
%
|
|
167,563
|
|
|
100.0
|
%
|
|
206,335
|
|
|
100.0
|
%
|
|
191,224
|
|
|
100.0
|
%
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
88,633
|
|
|
48.1
|
%
|
|
74,990
|
|
|
45.2
|
%
|
|
100,630
|
|
|
48.5
|
%
|
|
89,390
|
|
|
46.8
|
%
|
Distillate
|
78,711
|
|
|
42.8
|
%
|
|
69,390
|
|
|
41.8
|
%
|
|
87,477
|
|
|
42.2
|
%
|
|
79,230
|
|
|
41.4
|
%
|
Other (excluding
internally produced fuel)
|
16,791
|
|
|
9.1
|
%
|
|
21,666
|
|
|
13.0
|
%
|
|
19,361
|
|
|
9.3
|
%
|
|
22,579
|
|
|
11.8
|
%
|
Total refining
production (excluding internally produced fuel)
|
184,135
|
|
|
100.0
|
%
|
|
166,046
|
|
|
100.0
|
%
|
|
207,468
|
|
|
100.0
|
%
|
|
191,199
|
|
|
100.0
|
%
|
Production price
(dollars per gallon):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
$
|
2.69
|
|
|
|
|
$
|
2.89
|
|
|
|
|
$
|
2.74
|
|
|
|
|
$
|
2.86
|
|
|
|
Distillate
|
2.85
|
|
|
|
|
3.07
|
|
|
|
|
2.94
|
|
|
|
|
3.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Market Indicators
(dollars per barrel):
|
|
|
|
|
|
|
|
West Texas
Intermediate (WTI) NYMEX
|
$
|
97.25
|
|
|
$
|
105.81
|
|
|
$
|
99.62
|
|
|
$
|
98.20
|
|
Crude Oil
Differentials:
|
|
|
|
|
|
|
|
WTI less WTS
(light/medium sour)
|
8.78
|
|
|
0.30
|
|
|
7.19
|
|
|
2.14
|
|
WTI less WCS (heavy
sour)
|
18.34
|
|
|
22.92
|
|
|
19.47
|
|
|
22.27
|
|
NYMEX Crack
Spreads:
|
|
|
|
|
|
|
|
Gasoline
|
18.13
|
|
|
16.27
|
|
|
19.83
|
|
|
23.92
|
|
Heating
Oil
|
21.56
|
|
|
22.13
|
|
|
23.41
|
|
|
27.46
|
|
NYMEX 2-1-1 Crack
Spread
|
19.85
|
|
|
19.20
|
|
|
21.62
|
|
|
25.69
|
|
PADD II Group 3
Basis:
|
|
|
|
|
|
|
|
Gasoline
|
(3.82)
|
|
|
(1.57)
|
|
|
(5.24)
|
|
|
(2.43)
|
|
Ultra Low Sulfur
Diesel
|
0.56
|
|
|
0.80
|
|
|
(0.36)
|
|
|
1.66
|
|
PADD II Group 3
Product Crack:
|
|
|
|
|
|
|
|
Gasoline
|
14.32
|
|
|
14.70
|
|
|
14.58
|
|
|
21.49
|
|
Ultra Low Sulfur
Diesel
|
22.11
|
|
|
22.93
|
|
|
23.05
|
|
|
29.12
|
|
PADD II Group 3
2-1-1
|
18.21
|
|
|
18.81
|
|
|
18.81
|
|
|
25.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in millions,
except operating statistics)
|
Coffeyville
Refinery Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
1,383.5
|
|
|
$
|
992.2
|
|
|
$
|
4,541.3
|
|
|
$
|
3,833.9
|
|
Cost of product
sold
|
1,311.4
|
|
|
893.8
|
|
|
4,068.6
|
|
|
3,206.4
|
|
Refining
margin*
|
72.1
|
|
|
98.4
|
|
|
472.7
|
|
|
627.5
|
|
Direct operating
expenses
|
62.2
|
|
|
68.4
|
|
|
169.2
|
|
|
170.7
|
|
Major scheduled
turnaround expenses
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
Depreciation and
amortization
|
17.6
|
|
|
17.7
|
|
|
54.4
|
|
|
52.9
|
|
Gross profit
(loss)*
|
$
|
(13.2)
|
|
|
$
|
12.3
|
|
|
$
|
243.6
|
|
|
$
|
403.9
|
|
|
|
|
|
|
|
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
111.4
|
|
|
$
|
60.0
|
|
|
$
|
476.1
|
|
|
$
|
567.2
|
|
|
|
|
|
|
|
|
|
Coffeyville
Refinery Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Refining
margin*
|
$
|
8.11
|
|
|
$
|
13.48
|
|
|
$
|
14.76
|
|
|
$
|
21.56
|
|
FIFO impact
(favorable) unfavorable
|
4.43
|
|
|
(5.26)
|
|
|
0.11
|
|
|
(2.07)
|
|
Refining margin
adjusted for FIFO impact*
|
12.54
|
|
|
8.22
|
|
|
14.87
|
|
|
19.49
|
|
Gross profit
(loss)*
|
(1.48)
|
|
|
1.69
|
|
|
7.61
|
|
|
13.88
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
7.62
|
|
|
9.37
|
|
|
5.46
|
|
|
5.86
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
$
|
7.01
|
|
|
$
|
9.12
|
|
|
$
|
4.96
|
|
|
$
|
5.51
|
|
Barrels sold (barrels
per day)
|
104,836
|
|
|
81,532
|
|
|
128,963
|
|
|
113,518
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Coffeyville
Refinery Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
85,835
|
|
|
83.8
|
%
|
|
69,785
|
|
|
84.0
|
%
|
|
100,063
|
|
|
79.9
|
%
|
|
88,337
|
|
|
78.4
|
%
|
Medium
|
—
|
|
|
—
|
%
|
|
514
|
|
|
0.6
|
%
|
|
493
|
|
|
0.4
|
%
|
|
454
|
|
|
0.4
|
%
|
Heavy sour
|
10,690
|
|
|
10.4
|
%
|
|
9,072
|
|
|
10.9
|
%
|
|
16,732
|
|
|
13.4
|
%
|
|
17,805
|
|
|
15.8
|
%
|
Total crude oil
throughput
|
96,525
|
|
|
94.2
|
%
|
|
79,371
|
|
|
95.5
|
%
|
|
117,288
|
|
|
93.7
|
%
|
|
106,596
|
|
|
94.6
|
%
|
All other feedstocks
and blendstocks
|
5,882
|
|
|
5.8
|
%
|
|
3,711
|
|
|
4.5
|
%
|
|
7,880
|
|
|
6.3
|
%
|
|
6,067
|
|
|
5.4
|
%
|
Total
throughput
|
102,407
|
|
|
100.0
|
%
|
|
83,082
|
|
|
100.0
|
%
|
|
125,168
|
|
|
100.0
|
%
|
|
112,663
|
|
|
100.0
|
%
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
50,397
|
|
|
48.2
|
%
|
|
35,493
|
|
|
42.4
|
%
|
|
61,629
|
|
|
48.1
|
%
|
|
52,507
|
|
|
45.8
|
%
|
Distillate
|
45,935
|
|
|
43.9
|
%
|
|
35,206
|
|
|
42.0
|
%
|
|
55,011
|
|
|
43.0
|
%
|
|
48,018
|
|
|
41.9
|
%
|
Other (excluding
internally produced fuel)
|
8,304
|
|
|
7.9
|
%
|
|
13,050
|
|
|
15.6
|
%
|
|
11,352
|
|
|
8.9
|
%
|
|
14,003
|
|
|
12.3
|
%
|
Total refining
production (excluding internally produced fuel)
|
104,636
|
|
|
100.0
|
%
|
|
83,749
|
|
|
100.0
|
%
|
|
127,992
|
|
|
100.0
|
%
|
|
114,528
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in millions,
except operating statistics)
|
Wynnewood Refinery
Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
830.7
|
|
|
$
|
917.2
|
|
|
$
|
2,512.3
|
|
|
$
|
2,485.4
|
|
Cost of product
sold
|
742.3
|
|
|
841.1
|
|
|
2,221.0
|
|
|
2,110.2
|
|
Refining
margin*
|
88.4
|
|
|
76.1
|
|
|
291.3
|
|
|
375.2
|
|
Direct operating
expenses
|
43.0
|
|
|
36.2
|
|
|
128.4
|
|
|
103.8
|
|
Major scheduled
turnaround expenses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
10.2
|
|
|
9.9
|
|
|
30.3
|
|
|
28.7
|
|
Gross
profit*
|
$
|
35.2
|
|
|
$
|
30.0
|
|
|
$
|
132.6
|
|
|
$
|
242.7
|
|
|
|
|
|
|
|
|
|
Refining margin
adjusted for FIFO impact*
|
$
|
101.1
|
|
|
$
|
60.2
|
|
|
$
|
294.0
|
|
|
$
|
352.2
|
|
|
|
|
|
|
|
|
|
Wynnewood Refinery
Key Operating Statistics:
|
|
|
|
|
|
|
|
Per crude oil
throughput barrel:
|
|
|
|
|
|
|
|
Refining
margin*
|
$
|
12.03
|
|
|
$
|
10.17
|
|
|
$
|
13.44
|
|
|
$
|
18.04
|
|
FIFO impact
(favorable) unfavorable
|
1.73
|
|
|
(2.13)
|
|
|
0.13
|
|
|
(1.11)
|
|
Refining margin
adjusted for FIFO impact*
|
13.76
|
|
|
8.04
|
|
|
13.57
|
|
|
16.93
|
|
Gross
profit*
|
4.79
|
|
|
4.00
|
|
|
6.12
|
|
|
11.66
|
|
Direct operating
expenses and major scheduled turnaround expenses
|
5.86
|
|
|
4.85
|
|
|
5.92
|
|
|
4.99
|
|
Direct operating
expenses and major scheduled turnaround expenses per barrel
sold
|
$
|
5.89
|
|
|
$
|
4.75
|
|
|
$
|
5.92
|
|
|
$
|
4.97
|
|
Barrels sold (barrels
per day)
|
79,426
|
|
|
82,899
|
|
|
79,498
|
|
|
76,537
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Wynnewood Refinery
Throughput and Production Data (bpd):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Throughput:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweet
|
78,232
|
|
|
96.1
|
%
|
|
61,091
|
|
|
72.3
|
%
|
|
78,327
|
|
|
96.5
|
%
|
|
58,737
|
|
|
74.8
|
%
|
Medium
|
1,610
|
|
|
2.0
|
%
|
|
20,238
|
|
|
24.0
|
%
|
|
1,065
|
|
|
1.3
|
%
|
|
17,447
|
|
|
22.2
|
%
|
Heavy sour
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
Total crude oil
throughput
|
79,842
|
|
|
98.1
|
%
|
|
81,329
|
|
|
96.3
|
%
|
|
79,392
|
|
|
97.8
|
%
|
|
76,184
|
|
|
97.0
|
%
|
All other feedstocks
and blendstocks
|
1,565
|
|
|
1.9
|
%
|
|
3,152
|
|
|
3.7
|
%
|
|
1,775
|
|
|
2.2
|
%
|
|
2,377
|
|
|
3.0
|
%
|
Total
throughput
|
81,407
|
|
|
100.0
|
%
|
|
84,481
|
|
|
100.0
|
%
|
|
81,167
|
|
|
100.0
|
%
|
|
78,561
|
|
|
100.0
|
%
|
Production:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gasoline
|
38,236
|
|
|
48.1
|
%
|
|
39,497
|
|
|
48.0
|
%
|
|
39,001
|
|
|
49.1
|
%
|
|
36,883
|
|
|
48.1
|
%
|
Distillate
|
32,776
|
|
|
41.2
|
%
|
|
34,184
|
|
|
41.5
|
%
|
|
32,466
|
|
|
40.8
|
%
|
|
31,212
|
|
|
40.7
|
%
|
Other (excluding
internally produced fuel)
|
8,487
|
|
|
10.7
|
%
|
|
8,616
|
|
|
10.5
|
%
|
|
8,009
|
|
|
10.1
|
%
|
|
8,576
|
|
|
11.2
|
%
|
Total refining
production (excluding internally produced fuel)
|
79,499
|
|
|
100.0
|
%
|
|
82,297
|
|
|
100.0
|
%
|
|
79,476
|
|
|
100.0
|
%
|
|
76,671
|
|
|
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 a
majority interest and serve as general partner. Reconciliations of
certain non-GAAP financial measures are provided under "Use of
Non-GAAP Financial Measures" below. Additional discussion of
operating results for the Nitrogen Fertilizer segment for the
quarter ended September 30, 2014 are included in CVR Partners'
press release dated October 30, 2014.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Nitrogen
Fertilizer Segment Business Financial Results:
|
|
|
|
|
|
|
|
Net sales
|
$
|
66.7
|
|
|
$
|
69.2
|
|
|
$
|
224.3
|
|
|
$
|
239.4
|
|
Cost of product
sold
|
15.4
|
|
|
13.0
|
|
|
56.6
|
|
|
39.2
|
|
Direct operating
expenses
|
26.1
|
|
|
23.7
|
|
|
77.2
|
|
|
70.7
|
|
Selling, general and
administrative expenses
|
4.0
|
|
|
4.6
|
|
|
13.9
|
|
|
15.8
|
|
Depreciation and
amortization
|
6.8
|
|
|
6.6
|
|
|
20.3
|
|
|
18.5
|
|
Operating
income
|
14.4
|
|
|
21.3
|
|
|
56.3
|
|
|
95.2
|
|
Interest expense and
other financing costs
|
(1.7)
|
|
|
(1.6)
|
|
|
(5.0)
|
|
|
(4.6)
|
|
Other income,
net
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
Income before income
tax expense
|
12.7
|
|
|
19.7
|
|
|
51.3
|
|
|
90.7
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income
|
$
|
12.7
|
|
|
$
|
19.7
|
|
|
$
|
51.3
|
|
|
$
|
90.7
|
|
|
|
|
|
|
|
|
|
Adjusted Nitrogen
Fertilizer EBITDA*
|
$
|
21.1
|
|
|
$
|
28.2
|
|
|
$
|
76.8
|
|
|
$
|
116.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Nitrogen
Fertilizer Segment Key Operating Statistics:
|
|
|
|
|
|
|
|
Production (thousand
tons):
|
|
|
|
|
|
|
|
Ammonia (gross
produced)(1)
|
99.8
|
|
|
100.4
|
|
|
283.0
|
|
|
303.0
|
|
Ammonia (net
available for sale)(1)(2)
|
11.8
|
|
|
3.4
|
|
|
23.9
|
|
|
36.3
|
|
UAN
|
223.5
|
|
|
239.3
|
|
|
704.1
|
|
|
660.6
|
|
|
|
|
|
|
|
|
|
Pet coke consumed
(thousand tons)
|
117.6
|
|
|
116.0
|
|
|
359.7
|
|
|
360.2
|
|
Pet coke (cost per
ton)
|
$
|
29
|
|
|
$
|
30
|
|
|
$
|
28
|
|
|
$
|
30
|
|
|
|
|
|
|
|
|
|
Sales (thousand
tons):
|
|
|
|
|
|
|
|
Ammonia
|
6.2
|
|
|
3.3
|
|
|
14.5
|
|
|
37.9
|
|
UAN
|
220.3
|
|
|
226.7
|
|
|
714.2
|
|
|
638.1
|
|
|
|
|
|
|
|
|
|
Product pricing at
gate (dollars per ton)(3):
|
|
|
|
|
|
|
|
Ammonia
|
$
|
503
|
|
|
$
|
505
|
|
|
$
|
497
|
|
|
$
|
654
|
|
UAN
|
$
|
254
|
|
|
$
|
259
|
|
|
$
|
263
|
|
|
$
|
295
|
|
|
|
|
|
|
|
|
|
On-stream
factors(4):
|
|
|
|
|
|
|
|
Gasification
|
94.6
|
%
|
|
91.2
|
%
|
|
95.8
|
%
|
|
94.1
|
%
|
Ammonia
|
92.0
|
%
|
|
90.1
|
%
|
|
90.7
|
%
|
|
92.6
|
%
|
UAN
|
89.2
|
%
|
|
89.5
|
%
|
|
90.7
|
%
|
|
89.6
|
%
|
|
|
|
|
|
|
|
|
Market
Indicators
|
|
|
|
|
|
|
|
Ammonia — Southern
Plains (dollars per ton)
|
$
|
570
|
|
|
$
|
498
|
|
|
$
|
524
|
|
|
$
|
611
|
|
UAN — Corn belt
(dollars per ton)
|
$
|
297
|
|
|
$
|
302
|
|
|
$
|
321
|
|
|
$
|
352
|
|
Cost of product sold, direct operating expenses and selling,
general and administrative expenses are all reflected exclusive of
depreciation and amortization.
* See Use of Non-GAAP Financial Measures below.
|
|
(1)
|
Gross tons produced
for ammonia represent the total ammonia produced, including ammonia
produced that was upgraded into UAN. As a result of the completion
of the UAN expansion project in February 2013, the Nitrogen
Fertilizer segment expects to upgrade substantially all of the
ammonia they produce into UAN. The net tons available for sale
represent the ammonia available for sale that was not upgraded into
UAN.
|
|
|
(2)
|
In addition to the
produced ammonia, the Nitrogen Fertilizer segment acquired
approximately 4,000 and 1,000 tons of ammonia during the three
months ended September 30, 2014 and 2013, respectively. The
Nitrogen Fertilizer segment acquired approximately 30,000 and 5,000
tons of ammonia during the nine months ended September 30,
2014 and 2013, respectively.
|
|
|
(3)
|
Product pricing at
gate per ton represents net sales less freight revenue divided by
product sales volume in tons and is shown in order to provide a
pricing measure that is comparable across the fertilizer
industry.
|
|
|
(4)
|
On-stream factor is
the total number of hours operated divided by the total number of
hours in the reporting period and is a measure of operating
efficiency.
|
|
|
|
Excluding the impact
of planned downtime associated with the replacement of damaged
catalyst, the on-stream factors for the three months ended
September 30, 2013 would have been 98.7% for gasifier, 98.2% for
ammonia and 97.8% for UAN.
|
|
|
|
Excluding the impact
of the shutdown for installation of the waste heat boiler, pressure
swing adsorption unit upgrade and the Linde air separation unit
maintenance, the on-stream factors for the nine months ended
September 30, 2014 would have been 97.8% for gasifier, 93.0% for
ammonia and 93.0% for UAN. Excluding the impact of the UAN
expansion coming on-line, the planned downtime associated with the
replacement of damaged catalyst, the unplanned Linde air separation
unit outages and the unplanned downtime associated with weather
issues, the on-stream factors for the nine months ended September
30, 2013 would have been 99.3% for gasifier, 98.7% for ammonia and
97.7% for UAN.
|
Use of Non-GAAP Financial Measures
To supplement the Company's actual results in accordance with
GAAP for the applicable periods, the Company also uses non-GAAP
measures as noted above which are reconciled to our GAAP-based
results below. These non-GAAP financial measures should not be
considered an alternative for GAAP results. The adjustments are
provided to enhance an overall understanding of the Company's
financial performance for the applicable periods and are indicators
management believes are relevant and useful for planning and
forecasting future periods.
Adjusted net income is not a recognized term under GAAP and
should not be substituted for net income as a measure of our
performance but rather should be utilized as a supplemental measure
of financial performance in evaluating our business. Management
believes that adjusted net income provides relevant and useful
information that enables external users of our financial
statements, such as industry analysts, investors, lenders and
rating agencies, to better understand and evaluate our ongoing
operating results and allow for greater transparency in the review
of our overall financial, operational and economic performance.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in millions,
except per share data)
|
Reconciliation of
Net Income to Adjusted Net Income:
|
|
|
|
|
|
|
|
Income before income
tax expense
|
$
|
25.5
|
|
|
$
|
107.7
|
|
|
$
|
497.8
|
|
|
$
|
785.4
|
|
Adjustments:
|
|
|
|
|
|
|
|
FIFO impact
(favorable) unfavorable
|
52.0
|
|
|
(54.3)
|
|
|
6.2
|
|
|
(83.3)
|
|
Share-based
compensation
|
2.0
|
|
|
3.4
|
|
|
10.8
|
|
|
13.7
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
26.1
|
|
Major scheduled
turnaround expenses
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
Gain on derivatives,
net
|
(25.7)
|
|
|
(72.5)
|
|
|
(171.1)
|
|
|
(173.0)
|
|
Current period
settlement on derivative contracts (1)
|
38.2
|
|
|
33.9
|
|
|
93.2
|
|
|
(3.9)
|
|
Adjusted net income
before income tax expense and noncontrolling interest
|
97.5
|
|
|
18.2
|
|
|
442.4
|
|
|
565.0
|
|
Adjusted net income
attributed to noncontrolling interest
|
(37.3)
|
|
|
(8.3)
|
|
|
(145.6)
|
|
|
(124.4)
|
|
Income tax expense,
as adjusted
|
(23.2)
|
|
|
(4.7)
|
|
|
(102.8)
|
|
|
(154.3)
|
|
Adjusted net income
attributable to CVR Energy stockholders
|
$
|
37.0
|
|
|
$
|
5.2
|
|
|
$
|
194.0
|
|
|
$
|
286.3
|
|
|
|
|
|
|
|
|
|
Adjusted net income
per diluted share
|
$
|
0.43
|
|
|
$
|
0.06
|
|
|
$
|
2.23
|
|
|
$
|
3.30
|
|
Refining margin per crude oil throughput barrel is a measurement
calculated as the difference between the Petroleum segment's net
sales and cost of product sold (exclusive of depreciation and
amortization). Refining margin is a non-GAAP measure that we
believe is important to investors in evaluating the refineries'
performance as a general indication of the amount above their cost
of product sold at which they are able to sell refined products.
Our calculation of refining margin may differ from similar
calculations of other companies in the industry, thereby limiting
its usefulness as a comparative measure. In order to derive the
refining margin per crude oil throughput barrel, we utilize the
total dollar figures for refining margin as derived above and
divide by the applicable number of crude oil throughput barrels for
the period. We believe that refining margin is important to enable
investors to better understand and evaluate the Petroleum segment's
ongoing operating results and allow for greater transparency in the
review of our overall financial, operational and economic
performance.
Refining margin per crude oil throughput barrel adjusted for
FIFO impact is a measurement calculated as the difference between
the Petroleum segment's net sales and cost of product sold
(exclusive of depreciation and amortization) adjusted for FIFO
impacts. Refining margin adjusted for FIFO impact is a non-GAAP
measure that we believe is important to investors in evaluating the
refineries' performance as a general indication of the amount above
their cost of product sold (taking into account the impact of the
utilization of FIFO) at which they are able to sell refined
products. Our calculation of refining margin adjusted for FIFO
impact may differ from calculations of other companies in the
industry, thereby limiting its usefulness as a comparative measure.
Under the FIFO accounting method, changes in crude oil prices can
cause fluctuations in the inventory valuation of crude oil, work in
process and finished goods, thereby resulting in favorable FIFO
impacts when crude oil prices increase and unfavorable FIFO impacts
when crude oil prices decrease.
Gross profit (loss) is calculated as the difference between the
Petroleum segment's net sales, cost of product sold (exclusive of
depreciation and amortization), direct operating expenses
(exclusive of depreciation and amortization), major scheduled
turnaround expenses and depreciation and amortization. Gross
profit (loss) per crude throughput barrel is calculated as gross
profit (loss) as derived above divided by the refineries' crude oil
throughput volumes for the respective periods presented. Gross
profit (loss) is a non-GAAP measure that should not be substituted
for operating income. Management believes it is important to
investors in evaluating the refineries' performance and the
Petroleum segment's ongoing operating results. Our calculation of
gross profit (loss) may differ from similar calculations of other
companies in the industry, thereby limiting its usefulness as a
comparative measure.
EBITDA and Adjusted EBITDA. EBITDA represents net income before
(i) interest expense and other financing costs, net of interest
income, (ii) income tax expense and (iii) depreciation and
amortization. Adjusted EBITDA represents EBITDA adjusted for FIFO
impacts (favorable) unfavorable, share-based compensation, major
scheduled turnaround expenses, loss on disposition of fixed assets,
(gain) loss on derivatives, net, current period settlements on
derivative contracts and loss on extinguishment of debt. EBITDA and
Adjusted EBITDA are not recognized terms under GAAP and should not
be substituted for net income 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. Below is a reconciliation of net income to EBITDA and
EBITDA to Adjusted EBITDA for the three and nine months ended
September 30, 2014 and 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Net income
attributable to CVR Energy stockholders
|
$
|
7.9
|
|
|
$
|
44.0
|
|
|
$
|
218.3
|
|
|
$
|
392.4
|
|
Add:
|
|
|
|
|
|
|
|
Interest expense and
other financing costs, net of interest income
|
9.1
|
|
|
11.4
|
|
|
28.1
|
|
|
38.7
|
|
Income tax
expense
|
4.2
|
|
|
29.5
|
|
|
118.8
|
|
|
222.8
|
|
Depreciation and
amortization
|
37.8
|
|
|
36.2
|
|
|
113.7
|
|
|
105.4
|
|
EBITDA adjustments
included in noncontrolling interest
|
(16.7)
|
|
|
(15.1)
|
|
|
(46.8)
|
|
|
(34.9)
|
|
EBITDA
|
42.3
|
|
|
106.0
|
|
|
432.1
|
|
|
724.4
|
|
Add:
|
|
|
|
|
|
|
|
FIFO impacts,
(favorable) unfavorable
|
52.0
|
|
|
(54.3)
|
|
|
6.2
|
|
|
(83.3)
|
|
Share-based
compensation
|
2.0
|
|
|
3.4
|
|
|
10.8
|
|
|
13.7
|
|
Major scheduled
turnaround expenses
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
Gain on derivatives,
net
|
(25.7)
|
|
|
(72.5)
|
|
|
(171.1)
|
|
|
(173.0)
|
|
Current period
settlement on derivative contracts (1)
|
38.2
|
|
|
33.9
|
|
|
93.2
|
|
|
(3.9)
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
26.1
|
|
Adjustments included
in noncontrolling interest
|
(23.8)
|
|
|
25.9
|
|
|
15.2
|
|
|
45.7
|
|
Adjusted
EBITDA
|
$
|
90.5
|
|
|
$
|
42.4
|
|
|
$
|
391.9
|
|
|
$
|
549.7
|
|
Petroleum and Nitrogen Fertilizer EBITDA and Adjusted EBITDA.
EBITDA by operating segment represents net income 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 FIFO impacts (favorable) unfavorable;
share-based compensation, non-cash; major scheduled turnaround
expenses; loss on extinguishment of debt; loss on disposition of
fixed assets; (gain) loss on derivatives, net; and current period
settlements on derivative contracts. 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. Adjusted EBITDA by operating segment is not a
recognized term under GAAP and should not be substituted for
operating income as a measure of performance. Management believes
that Adjusted EBITDA by operating segment enables investors to
better understand CVR Refining's and CVR Partners' ability to make
distributions to their common unitholders, helps investors evaluate
our ongoing operating results and allows for greater transparency
in reviewing our overall financial, operational and economic
performance. Adjusted EBITDA presented by other companies may not
be comparable to our presentation, since each company may define
these terms differently. Below is a reconciliation of net income to
EBITDA and EBITDA to Adjusted EBITDA for the Petroleum and Nitrogen
Fertilizer segments for the three and nine months ended
September 30, 2014 and 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Petroleum:
|
|
|
|
|
|
|
|
Petroleum net
income
|
$
|
21.8
|
|
|
$
|
86.0
|
|
|
$
|
467.2
|
|
|
$
|
700.6
|
|
Add:
|
|
|
|
|
|
|
|
Interest expense and
other financing costs, net of interest income
|
7.8
|
|
|
9.9
|
|
|
24.2
|
|
|
34.5
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
29.7
|
|
|
28.8
|
|
|
89.9
|
|
|
85.2
|
|
Petroleum
EBITDA
|
59.3
|
|
|
124.7
|
|
|
581.3
|
|
|
820.3
|
|
Add:
|
|
|
|
|
|
|
|
FIFO impacts
(favorable), unfavorable
|
52.0
|
|
|
(54.3)
|
|
|
6.2
|
|
|
(83.3)
|
|
Share-based
compensation, non-cash
|
0.6
|
|
|
2.1
|
|
|
1.9
|
|
|
8.3
|
|
Major scheduled
turnaround expenses
|
5.5
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
Gain on derivatives,
net
|
(25.7)
|
|
|
(72.5)
|
|
|
(171.1)
|
|
|
(173.0)
|
|
Current period
settlements on derivative contracts (1)
|
38.2
|
|
|
33.9
|
|
|
93.2
|
|
|
(3.9)
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
26.1
|
|
Adjusted Petroleum
EBITDA
|
$
|
129.9
|
|
|
$
|
33.9
|
|
|
$
|
517.0
|
|
|
$
|
594.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
(in
millions)
|
Nitrogen
Fertilizer:
|
|
|
|
|
|
|
|
Nitrogen Fertilizer
net income
|
$
|
12.7
|
|
|
$
|
19.7
|
|
|
$
|
51.3
|
|
|
$
|
90.7
|
|
Add:
|
|
|
|
|
|
|
|
Interest expense,
net
|
1.7
|
|
|
1.6
|
|
|
5.0
|
|
|
4.6
|
|
Income tax
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Depreciation and
amortization
|
6.8
|
|
|
6.6
|
|
|
20.3
|
|
|
18.5
|
|
Nitrogen
Fertilizer EBITDA
|
21.2
|
|
|
27.9
|
|
|
76.6
|
|
|
113.8
|
|
Add:
|
|
|
|
|
|
|
|
Share-based
compensation, non-cash
|
(0.1)
|
|
|
0.3
|
|
|
0.2
|
|
|
2.3
|
|
Adjusted Nitrogen
Fertilizer EBITDA
|
$
|
21.1
|
|
|
$
|
28.2
|
|
|
$
|
76.8
|
|
|
$
|
116.1
|
|
|
|
(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.
|
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, 2014. 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, 2014, the open commodity swap positions below
were comprised of approximately 89.3% for distillate crack swaps
and 10.7% for gasoline crack swaps.
|
|
|
|
|
|
|
|
|
Commodity
Swaps
|
|
Barrels
|
|
Fixed
Price(1)
|
Fourth Quarter
2014
|
|
5,100,000
|
|
|
$
|
27.25
|
|
|
|
|
|
|
First Quarter
2015
|
|
525,000
|
|
|
32.09
|
|
Second Quarter
2015
|
|
975,000
|
|
|
30.20
|
|
Third Quarter
2015
|
|
300,000
|
|
|
29.95
|
|
Fourth Quarter
2015
|
|
450,000
|
|
|
30.05
|
|
|
|
|
|
|
First Quarter
2016
|
|
615,000
|
|
|
29.01
|
|
Second Quarter
2016
|
|
615,000
|
|
|
29.01
|
|
Third Quarter
2016
|
|
615,000
|
|
|
29.01
|
|
Fourth Quarter
2016
|
|
615,000
|
|
|
29.01
|
|
|
|
|
|
|
Total
|
|
9,810,000
|
|
|
$
|
28.45
|
|
|
(1) Weighted-average
price of all positions for period indicated.
|
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SOURCE CVR Energy, Inc.