Sign In  |  Register  |  About San Anselmo  |  Contact Us

San Anselmo, CA
September 01, 2020 1:33pm
7-Day Forecast | Traffic
  • Search Hotels in San Anselmo

  • CHECK-IN:
  • CHECK-OUT:
  • ROOMS:

HF Sinclair Corporation Reports 2023 Fourth Quarter and Full Year Results

Fourth Quarter

  • Reported net loss attributable to HF Sinclair stockholders of $(62.2) million, or $(0.34) per diluted share, and adjusted net income of $164.6 million, or $0.87 per diluted share
  • Reported EBITDA of $128.4 million and adjusted EBITDA of $427.7 million
  • Returned $247.5 million to stockholders through dividends and share repurchases
  • Announced $0.05 increase in regular quarterly dividend to $0.50 per share

Full Year 2023

  • Reported net income attributable to HF Sinclair stockholders of $1,589.7 million, or $8.29 per diluted share, and adjusted net income of $1,822.9 million, or $9.51 per diluted share
  • Reported EBITDA of $2,899.2 million and adjusted EBITDA of $3,207.1 million
  • Returned $1,340.0 million to stockholders through dividends and share repurchases

HF Sinclair Corporation (NYSE:DINO) (“HF Sinclair” or the “Company”) today reported fourth quarter net loss attributable to HF Sinclair stockholders of $(62.2) million, or $(0.34) per diluted share, for the quarter ended December 31, 2023, compared to net income attributable to HF Sinclair stockholders of $587.0 million, or $2.92 per diluted share, for the quarter ended December 31, 2022. Excluding the adjustments shown in the accompanying earnings release table, adjusted net income attributable to HF Sinclair stockholders for the fourth quarter of 2023 was $164.6 million, or $0.87 per diluted share, compared to $597.8 million, or $2.97 per diluted share, for the fourth quarter of 2022.

HF Sinclair’s Chief Executive Officer, Tim Go, commented, “HF Sinclair’s strong fourth quarter and full year results reflect our continued commitment to executing our corporate strategy. In 2023, we completed maintenance turnarounds at all of our refineries during the year on schedule and on budget as we took another step towards improving reliability across our portfolio. In addition, in the fourth quarter we closed the transaction to buy-in our HEP business and furthered our efforts to integrate and optimize our asset base. During the year, we also returned over $1.3 billion in cash to shareholders through share repurchases and dividends, delivering on our cash return commitment to shareholders. Going forward, we remain focused on further executing our corporate strategy to maximize shareholder value. We believe the strength and diversification of our asset base, coupled with our disciplined approach to capital allocation, will position us for success.”

Refining segment loss before interest and income taxes was $(74.6) million for the fourth quarter of 2023 compared to income before interest and income taxes of $758.8 million in the fourth quarter of 2022. The segment reported EBITDA of $57.5 million for the fourth quarter of 2023 compared to $863.8 million for the fourth quarter of 2022. Excluding the lower of cost or market inventory valuation adjustment, the segment reported Adjusted EBITDA of $278.0 million for the fourth quarter of 2023. This decrease was primarily driven by lower refinery gross margins in both the West and Mid-Continent regions which resulted in lower Refining segment earnings in the quarter. Consolidated refinery gross margin was $13.88 per produced barrel, a 41% decrease compared to $23.47 for the fourth quarter of 2022. Crude oil charge averaged 614,160 barrels per day (“BPD”) for the fourth quarter of 2023 compared to 628,160 BPD for the fourth quarter of 2022.

Renewables segment loss before interest and income taxes was $(75.9) million for the fourth quarter of 2023 compared to $(34.7) million for the fourth quarter of 2022. The segment reported EBITDA of $(56.7) million for the fourth quarter of 2023 compared to $(16.4) million for the fourth quarter of 2022. Excluding the lower of cost or market inventory valuation adjustment, the segment reported Adjusted EBITDA of $(2.7) million for the fourth quarter of 2023 compared to $(6.9) million for the fourth quarter of 2022. Total sales volumes were 63 million gallons for the fourth quarter of 2023 as compared to 54 million gallons for the fourth quarter of 2022.

Marketing segment income before interest and income taxes was $2.5 million for the fourth quarter of 2023 compared to $16.9 million for the fourth quarter of 2022. The segment reported EBITDA of $9.3 million for the fourth quarter of 2023 compared to $23.4 million for the fourth quarter of 2022. Total branded fuel sales volumes were 350 million gallons for the fourth quarter 2023 as compared to 336 million gallons for the fourth quarter of 2022.

Lubricants & Specialties segment income before interest and income taxes was $34.6 million for the fourth quarter of 2023 compared to $44.6 million in the fourth quarter of 2022. The segment reported EBITDA of $57.7 million for the fourth quarter of 2023 compared to $66.6 million in the fourth quarter of 2022. This decrease was largely driven by a $29.9 million FIFO charge from consumption of higher priced feedstock inventory in the fourth quarter of 2023 compared to a $7.3 million FIFO charge for the fourth quarter of 2022.

Midstream segment income before interest and income taxes was $81.6 million for the fourth quarter of 2023 compared to $68.8 million for the fourth quarter of 2022. The segment reported EBITDA of $104.6 million for the fourth quarter of 2023 compared to $89.6 million in the fourth quarter of 2022 and Adjusted EBITDA of $109.5 million for the fourth quarter of 2023 compared to $87.3 million for the fourth quarter of 2022.

For the fourth quarter of 2023, net cash provided by operations totaled $230.7 million. At December 31, 2023, the Company's cash and cash equivalents totaled $1,353.7 million, an $861.0 million decrease compared to cash and cash equivalents of $2,214.8 million at September 30, 2023. During the fourth quarter of 2023, the Company announced and paid a regular dividend of $0.45 per share to stockholders totaling $81.9 million and spent $165.7 million on share repurchases. Additionally, the Company's consolidated debt was $2,739.1 million.

HF Sinclair announced on February 14, 2024 that its Board of Directors declared a regular quarterly dividend in the amount of $0.50 per share, an increase of $0.05 over its previous dividend of $0.45 per share. The dividend is payable on March 5, 2024 to holders of record of common stock on February 26, 2024.

The Company has scheduled a webcast conference call for today, February 21, 2024, at 8:30 AM Eastern Time to discuss fourth quarter financial results. This webcast may be accessed at: https://events.q4inc.com/attendee/326631081. An audio archive of this webcast will be available using the above noted link through March 6, 2024.

HF Sinclair Corporation, headquartered in Dallas, Texas, is an independent energy company that produces and markets high-value light products such as gasoline, diesel fuel, jet fuel, renewable diesel and other specialty products. HF Sinclair owns and operates refineries located in Kansas, Oklahoma, New Mexico, Wyoming, Washington and Utah. HF Sinclair provides petroleum product and crude oil transportation, terminalling, storage and throughput services to its refineries and the petroleum industry. HF Sinclair markets its refined products principally in the Southwest U.S., the Rocky Mountains extending into the Pacific Northwest and in other neighboring Plains states and supplies high-quality fuels to more than 1,500 branded stations and licenses the use of the Sinclair brand at more than 300 additional locations throughout the country. HF Sinclair produces renewable diesel at two of its facilities in Wyoming and also at its facility in Artesia, New Mexico. In addition, subsidiaries of HF Sinclair produce and market base oils and other specialized lubricants in the U.S., Canada and the Netherlands, and export products to more than 80 countries.

The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995: The statements in this press release relating to matters that are not historical facts are “forward-looking statements” based on management’s beliefs and assumptions using currently available information and expectations as of the date hereof, are not guarantees of future performance and involve certain risks and uncertainties, including those contained in the Company's filings with the Securities and Exchange Commission (the “SEC”). Forward-looking statements use words such as “anticipate,” “project,” “will,” “expect,” “plan,” “goal,” “forecast,” “strategy,” “intend,” “should,” “would,” “could,” “believe,” “may,” and similar expressions and statements regarding the Company's plans and objectives for future operations. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, the Company cannot assure you that the Company's expectations will prove to be correct. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements. Any differences could be caused by a number of factors, including, but not limited to, the demand for and supply of feedstocks, crude oil and refined products, including uncertainty regarding the increasing societal expectations that companies address climate change and greenhouse gas emissions; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products or lubricant and specialty products in the Company’s markets; the spread between market prices for refined products and market prices for crude oil; the possibility of constraints on the transportation of refined products or lubricant and specialty products; the possibility of inefficiencies, curtailments or shutdowns in refinery operations or pipelines, whether due to reductions in demand, accidents, unexpected leaks or spills, unscheduled shutdowns, infection in the workforce, weather events, global health events, civil unrest, expropriation of assets, and other economic, diplomatic, legislative, or political events or developments, terrorism, cyberattacks, vandalism or other catastrophes or disruptions affecting the Company’s operations, production facilities, machinery, pipelines and other logistics assets, equipment, or information systems, or any of the foregoing of the Company’s suppliers, customers, or third-party providers, and any potential asset impairments resulting from, or the failure to have adequate insurance coverage for or receive insurance recoveries from, such actions; the effects of current and/or future governmental and environmental regulations and policies, including compliance with existing, new and changing environmental and health and safety laws and regulations, related reporting requirements and pipeline integrity programs; the availability and cost of financing to the Company; the effectiveness of the Company’s capital investments and marketing strategies; the Company’s efficiency in carrying out and consummating construction projects, including the Company’s ability to complete announced capital projects on time and within capital guidance; the Company’s ability to timely obtain or maintain permits, including those necessary for operations or capital projects; the ability of the Company to acquire complementary assets or businesses to the Company's existing assets and business on acceptable terms and to integrate any existing or future acquired operations and realize the expected synergies of any such transaction on the expected timeline; the possibility of vandalism or other disruptive activity, or terrorist or cyberattacks and the consequences of any such activities or attacks; uncertainty regarding the effects and duration of global hostilities, including shipping disruptions in the Red Sea, the Israel-Gaza conflict, the Russia-Ukraine war, and any associated military campaigns which may disrupt crude oil supplies and markets for the Company’s refined products and create instability in the financial markets that could restrict the Company’s ability to raise capital; general economic conditions, including economic slowdowns caused by a local or national recession or other adverse economic condition, such as periods of increased or prolonged inflation; limitations on the Company’s ability to make future dividend payments or effectuate share repurchases due to market conditions and corporate, tax, regulatory and other considerations, and other business, financial, operational and legal risks. Additional information on risks and uncertainties that could affect our business prospects and performance is provided in the reports filed by us with the SEC. All forward-looking statements included in this press release are expressly qualified in their entirety by the foregoing cautionary statements. The forward-looking statements speak only as of the date made and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

RESULTS OF OPERATIONS

Financial Data (all information in this release is unaudited)

 

Three Months Ended

December 31,

 

Change from 2022

 

 

2023

 

 

 

2022

 

 

Change

 

Percent

 

(In thousands, except per share data)

Sales and other revenues

$

7,660,136

 

 

$

8,984,927

 

 

$

(1,324,791

)

 

(15

)%

Operating costs and expenses:

 

 

 

 

 

 

 

Cost of products sold:

 

 

 

 

 

 

 

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

 

6,471,137

 

 

 

7,222,833

 

 

 

(751,696

)

 

(10

)

Lower of cost or market inventory valuation adjustment

 

274,533

 

 

 

9,573

 

 

 

264,960

 

 

2,768

 

 

 

6,745,670

 

 

 

7,232,406

 

 

 

(486,736

)

 

(7

)

Operating expenses

 

629,433

 

 

 

646,741

 

 

 

(17,308

)

 

(3

)

Selling, general and administrative expenses

 

150,726

 

 

 

102,511

 

 

 

48,215

 

 

47

 

Depreciation and amortization

 

211,668

 

 

 

176,169

 

 

 

35,499

 

 

20

 

Total operating costs and expenses

 

7,737,497

 

8,157,827

 

 

 

(420,330

)

 

(5

)

Income (loss) from operations

 

(77,361

)

 

827,100

 

 

 

(904,461

)

 

(109

)

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

Earnings of equity method investments

 

6,933

 

 

 

7,001

 

 

 

(68

)

 

(1

)

Interest income

 

31,365

 

 

 

17,517

 

 

 

13,848

 

 

79

 

Interest expense

 

(49,306

)

 

 

(56,978

)

 

 

7,672

 

 

(13

)

Gain on business interruption insurance settlement

 

 

 

 

15,202

 

 

 

(15,202

)

 

(100

)

Gain on early extinguishment of debt

 

 

 

 

604

 

 

 

(604

)

 

(100

)

Gain (loss) on foreign currency transactions

 

52

 

 

 

(2,415

)

 

 

2,467

 

 

(102

)

Gain on sale of assets and other

 

15,633

 

 

 

4,992

 

 

 

10,641

 

 

213

 

 

 

4,677

 

 

 

(14,077

)

 

 

18,754

 

 

(133

)

Income (loss) before income taxes

 

(72,684

)

 

 

813,023

 

 

 

(885,707

)

 

(109

)

Income tax expense (benefit)

 

(39,028

)

 

 

188,197

 

 

 

(227,225

)

 

(121

)

Net income (loss)

 

(33,656

)

 

 

624,826

 

 

 

(658,482

)

 

(105

)

Less net income attributable to noncontrolling interest

 

28,527

 

 

 

37,799

 

 

 

(9,272

)

 

(25

)

Net income (loss) attributable to HF Sinclair stockholders

$

(62,183

)

 

$

587,027

 

 

$

(649,210

)

 

(111

)%

 

 

 

 

 

 

 

 

Income (loss) per share:

 

 

 

 

 

 

 

Basic

$

(0.34

)

 

$

2.92

 

 

$

(3.26

)

 

(112

)%

Diluted

$

(0.34

)

 

$

2.92

 

 

$

(3.26

)

 

(112

)%

Cash dividends declared per common share

$

0.45

 

 

$

0.40

 

 

$

0.05

 

 

13

%

Average number of common shares outstanding:

 

 

 

 

 

 

 

Basic

 

187,035

 

 

 

199,459

 

 

 

(12,424

)

 

(6

)%

Diluted

 

187,035

 

 

 

199,459

 

 

 

(12,424

)

 

(6

)%

 

 

 

 

 

 

 

 

EBITDA

$

128,398

 

 

$

990,854

 

 

$

(862,456

)

 

(87

)%

Adjusted EBITDA

$

427,667

 

 

$

1,004,124

 

 

$

(576,457

)

 

(57

)%

 

Years Ended

December 31,

 

Change from 2022

 

 

2023

 

 

 

2022

 

 

Change

 

Percent

 

(In thousands, except per share data)

Sales and other revenues

$

31,964,395

 

 

$

38,204,839

 

 

$

(6,240,444

)

 

(16

)%

Operating costs and expenses:

 

 

 

 

 

 

 

Cost of products sold:

 

 

 

 

 

 

 

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

 

25,784,449

 

 

 

30,680,013

 

 

 

(4,895,564

)

 

(16

)

Lower of cost or market inventory valuation adjustment

 

270,419

 

 

 

52,412

 

 

 

218,007

 

 

416

 

 

 

26,054,868

 

 

 

30,732,425

 

 

 

(4,677,557

)

 

(15

)

Operating expenses

 

2,438,148

 

 

 

2,334,893

 

 

 

103,255

 

 

4

 

Selling, general and administrative expenses

 

498,240

 

 

 

426,485

 

 

 

71,755

 

 

17

 

Depreciation and amortization

 

770,573

 

 

 

656,787

 

 

 

113,786

 

 

17

 

Total operating costs and expenses

 

29,761,829

 

 

 

34,150,590

 

 

 

(4,388,761

)

 

(13

)

Income from operations

 

2,202,566

 

 

 

4,054,249

 

 

 

(1,851,683

)

 

(46

)

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

Earnings (loss) of equity method investments

 

17,369

 

 

 

(260

)

 

 

17,629

 

 

(6,780

)

Interest income

 

93,468

 

 

 

30,179

 

 

 

63,289

 

 

210

 

Interest expense

 

(190,796

)

 

 

(175,628

)

 

 

(15,168

)

 

9

 

Gain on business interruption insurance settlement

 

 

 

 

15,202

 

 

 

(15,202

)

 

(100

)

Gain on early extinguishment of debt

 

 

 

 

604

 

 

 

(604

)

 

(100

)

Gain (loss) on foreign currency transactions

 

2,530

 

 

 

(1,637

)

 

 

4,167

 

 

(255

)

Gain on sale of assets and other

 

27,370

 

 

 

13,337

 

 

 

14,033

 

 

105

 

 

 

(50,059

)

 

 

(118,203

)

 

 

68,144

 

 

(58

)

Income before income taxes

 

2,152,507

 

 

 

3,936,046

 

 

 

(1,783,539

)

 

(45

)

Income tax expense

 

441,612

 

 

 

894,872

 

 

 

(453,260

)

 

(51

)

Net income

 

1,710,895

 

 

 

3,041,174

 

 

 

(1,330,279

)

 

(44

)

Less net income attributable to noncontrolling interest

 

121,229

 

 

 

118,506

 

 

 

2,723

 

 

2

 

Net income attributable to HF Sinclair stockholders

$

1,589,666

 

 

$

2,922,668

 

 

$

(1,333,002

)

 

(46

)%

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

Basic

$

8.29

 

 

$

14.28

 

 

$

(5.99

)

 

(42

)%

Diluted

$

8.29

 

 

$

14.28

 

 

$

(5.99

)

 

(42

)%

Cash dividends declared per common share

$

1.80

 

 

$

1.20

 

 

$

0.60

 

 

50

%

Average number of common shares outstanding:

 

 

 

 

Basic

 

190,035

 

 

 

202,566

 

 

 

(12,531

)

 

(6

)%

Diluted

 

190,035

 

 

 

202,566

 

 

 

(12,531

)

 

(6

)%

 

 

 

 

 

 

 

 

EBITDA

$

2,899,179

 

 

$

4,619,776

 

 

$

(1,720,597

)

 

(37

)%

Adjusted EBITDA

$

3,207,074

 

 

$

4,734,160

 

 

$

(1,527,086

)

 

(32

)%

Balance Sheet Data

 

Years Ended December 31,

 

2023

 

2022

 

(In thousands)

Cash and cash equivalents

$

1,353,747

 

$

1,665,066

Working capital

$

3,371,905

$

3,502,790

Total assets

$

17,716,265

$

18,125,483

Total debt

$

2,739,083

 

$

3,255,472

Total equity

$

10,237,298

 

$

10,017,572

Segment Information

Our operations are organized into five reportable segments: Refining, Renewables, Marketing, Lubricants & Specialties and Midstream. Our operations that are not included in one of these five reportable segments are included in Corporate and Other. Intersegment transactions are eliminated in our consolidated financial statements and are included in Eliminations. Corporate and Other and Eliminations are aggregated and presented under the Corporate, Other and Eliminations column.

The Refining segment represents the operations of our El Dorado, Tulsa, Navajo, Woods Cross and Puget Sound refineries and HF Sinclair Asphalt Company LLC (“Asphalt”). Effective with the Sinclair Transactions that closed on March 14, 2022, the Refining segment includes our Parco and Casper refineries. Refining activities involve the purchase and refining of crude oil and wholesale marketing of refined products, such as gasoline, diesel fuel and jet fuel. These petroleum products are primarily marketed in the Mid-Continent, Southwest and Rocky Mountains extending into the Pacific Northwest geographic regions of the United States. Asphalt operates various asphalt terminals in Arizona, New Mexico and Oklahoma.

The Renewables segment represents the operations of our Cheyenne renewable diesel unit (“RDU”), which was mechanically complete in the fourth quarter of 2021 and operational in the first quarter of 2022, the pre-treatment unit at our Artesia, New Mexico facility, which was completed and operational in the first quarter of 2022 and the Artesia RDU, which was completed and operational in the second quarter of 2022. Also, effective with the Sinclair Transactions that closed on March 14, 2022, the Renewables segment includes the Sinclair RDU.

Effective with the Sinclair Transactions that closed on March 14, 2022, the Marketing segment represents branded fuel sales to Sinclair branded sites in the United States and licensing fees for the use of the Sinclair brand at additional locations throughout the country. The Marketing segment also includes branded fuel sales to non-Sinclair branded sites from legacy HollyFrontier agreements and revenues from other marketing activities. Our branded sites are located in several states across the United States with the highest concentration of the sites located in our West and Mid-Continent regions.

The Lubricants & Specialties segment represents Petro-Canada Lubricants Inc.’s production operations, located in Mississauga, Ontario, that includes lubricant products such as base oils, white oils, specialty products and finished lubricants, and the operations of our Petro-Canada Lubricants business that includes the marketing of products to both retail and wholesale outlets through a global sales network with locations in Canada, the United States and Europe. Additionally, the Lubricants & Specialties segment includes specialty lubricant products produced at our Tulsa refineries that are marketed throughout North America and are distributed in Central and South America and the operations of Red Giant Oil Company LLC, one of the largest suppliers of locomotive engine oil in North America. Also, the Lubricants & Specialties segment includes Sonneborn, a producer of specialty hydrocarbon chemicals such as white oils, petrolatums and waxes with manufacturing facilities in the United States and Europe.

The Midstream segment includes all of the operations of Holly Energy Partners, L.P. (“HEP”), which owns and operates logistics and refinery assets consisting of petroleum product and crude oil pipelines, terminals, tankage, loading rack facilities and, during the year ended December 31, 2023 refinery processing units, in the Mid-Continent, Southwest and Rocky Mountains geographic regions of the United States. The Midstream segment also includes 50% ownership interests in each of the Osage Pipeline (“Osage”), the Cheyenne Pipeline and Cushing Connect, a 25.12% ownership interest in the Saddle Butte Pipeline and a 49.995% ownership interest in the Pioneer Pipeline. Revenues from the Midstream segment are earned through transactions with unaffiliated parties for pipeline transportation, rental and terminalling operations as well as revenues relating to pipeline transportation services provided for our refining operations.

 

Refining

 

Renewables

 

Marketing

 

Lubricants

&

Specialties

 

Midstream

 

Corporate,

Other and

Eliminations

 

Consolidated

Total

 

 

(In thousands)

Three Months Ended December 31, 2023

Sales and other revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

5,871,425

 

 

$

190,689

 

 

$

908,769

 

$

656,826

 

$

32,427

 

$

 

 

$

7,660,136

 

Intersegment revenues

 

 

992,248

 

 

 

95,923

 

 

 

 

 

1,676

 

 

134,479

 

 

(1,224,326

)

 

 

 

 

 

$

6,863,673

 

 

$

286,612

 

 

$

908,769

 

$

658,502

 

$

166,906

 

$

(1,224,326

)

 

$

7,660,136

 

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

 

$

6,022,027

 

 

$

264,693

 

 

$

888,032

 

$

492,524

 

$

 

$

(1,196,139

)

 

$

6,471,137

 

Lower of cost or market inventory valuation adjustment

 

$

220,558

 

 

$

53,975

 

 

$

 

$

 

$

 

$

 

 

$

274,533

 

Operating expenses

 

$

506,288

 

 

$

23,114

 

 

$

 

$

65,986

 

$

58,925

 

$

(24,880

)

 

$

629,433

 

Selling, general and administrative expenses

 

$

57,086

 

 

$

1,530

 

 

$

11,592

 

$

40,082

 

$

8,359

 

$

32,077

 

 

$

150,726

 

Depreciation and amortization

 

$

132,092

 

 

$

19,254

 

 

$

6,710

 

$

23,168

 

$

25,026

 

$

5,418

 

 

$

211,668

 

Income (loss) from operations

 

$

(74,378

)

 

$

(75,954

)

 

$

2,435

 

$

36,742

 

$

74,596

 

$

(40,802

)

 

$

(77,361

)

Income (loss) before interest and income taxes

 

$

(74,626

)

 

$

(75,909

)

 

$

2,540

 

$

34,575

 

$

81,601

 

$

(22,924

)

 

$

(54,743

)

Net income attributable to noncontrolling interest

 

$

 

 

$

 

 

$

 

$

 

$

2,023

 

$

26,504

 

 

$

28,527

 

Earnings of equity method investments

 

$

 

 

$

 

 

$

 

$

 

$

6,523

 

$

410

 

 

$

6,933

 

Capital expenditures

 

$

65,440

 

 

$

6,961

 

 

$

11,952

 

$

12,979

 

$

9,984

 

$

16,660

 

 

$

123,976

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Sales and other revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

 

$

6,937,534

 

 

$

255,689

 

 

$

1,031,898

 

$

729,916

 

$

29,890

 

$

 

 

$

8,984,927

 

Intersegment revenues

 

 

1,044,841

 

 

 

162,205

 

 

 

 

 

295

 

 

112,620

 

 

(1,319,961

)

 

 

 

 

 

$

7,982,375

 

 

$

417,894

 

 

$

1,031,898

 

$

730,211

 

$

142,510

 

$

(1,319,961

)

 

$

8,984,927

 

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

 

$

6,561,147

 

 

$

391,646

 

 

$

1,008,042

 

$

555,287

 

$

 

$

(1,293,289

)

 

$

7,222,833

 

Lower of cost or market inventory valuation adjustment

 

$

 

 

$

9,573

 

 

$

 

$

 

$

 

$

 

 

$

9,573

 

Operating expenses

 

$

517,024

 

 

$

32,178

 

 

$

 

$

67,545

 

$

53,629

 

$

(23,635

)

 

$

646,741

 

Selling, general and administrative expenses

 

$

39,302

 

 

$

1,023

 

 

$

414

 

$

41,070

 

$

4,258

 

$

16,444

 

 

$

102,511

 

Depreciation and amortization

 

$

105,005

 

 

$

18,222

 

 

$

6,545

 

$

22,021

 

$

22,880

 

$

1,496

 

 

$

176,169

 

Income (loss) from operations

 

$

759,897

 

 

$

(34,748

)

 

$

16,897

 

$

44,288

 

$

61,743

 

$

(20,977

)

 

$

827,100

 

Income (loss) before interest and income taxes

 

$

758,844

 

 

$

(34,663

)

 

$

16,897

 

$

44,550

 

$

68,771

 

$

(1,915

)

 

$

852,484

 

Net income attributable to noncontrolling interest

 

$

 

 

$

 

 

$

 

$

 

$

2,010

 

$

35,789

 

 

$

37,799

 

Earnings of equity method investments

 

$

 

 

$

 

 

$

 

$

 

$

7,001

 

$

 

 

$

7,001

 

Capital expenditures

 

$

57,996

 

 

$

14,481

 

 

$

2,479

 

$

10,334

 

$

7,770

 

$

13,504

 

 

$

106,564

 

 

Refining

 

Renewables

 

Marketing

 

Lubricants

&

Specialties

 

Midstream

 

Corporate,

Other and

Eliminations

 

Consolidated

Total

 

(In thousands)

Year Ended December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

Sales and other revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

24,156,278

 

$

781,309

 

 

$

4,146,292

 

$

2,762,767

 

$

117,749

 

$

 

 

$

31,964,395

Intersegment revenues

 

4,516,326

 

 

407,681

 

 

 

 

 

12,566

 

 

490,566

 

 

(5,427,139

)

 

 

 

$

28,672,604

 

$

1,188,990

 

 

$

4,146,292

 

$

2,775,333

 

$

608,315

 

$

(5,427,139

)

 

$

31,964,395

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

$

23,969,557

 

$

1,080,919

 

 

$

4,050,759

 

$

2,005,853

 

$

 

$

(5,322,639

)

 

$

25,784,449

Lower of cost or market inventory valuation adjustment

$

220,558

 

$

49,861

 

 

$

 

$

 

$

 

$

 

 

$

270,419

Operating expenses

$

1,946,958

 

$

109,056

 

 

$

 

$

258,578

 

$

222,631

 

$

(99,075

)

 

$

2,438,148

Selling, general and administrative expenses

$

199,547

 

$

5,117

 

 

$

34,413

 

$

164,311

 

$

26,453

 

$

68,399

 

 

$

498,240

Depreciation and amortization

$

468,001

 

$

77,100

 

 

$

24,599

 

$

86,341

 

$

101,028

 

$

13,504

 

 

$

770,573

Income (loss) from operations

$

1,867,983

 

$

(133,063

)

 

$

36,521

 

$

260,250

 

$

258,203

 

$

(87,328

)

 

$

2,202,566

Income (loss) before interest and income taxes

$

1,872,074

 

$

(132,949

)

 

$

36,758

 

$

260,002

 

$

277,200

 

$

(63,250

)

 

$

2,249,835

Net income attributable to noncontrolling interest

$

 

$

 

 

$

 

$

 

$

7,200

 

$

114,029

 

 

$

121,229

Earnings (loss) of equity method investments

$

 

$

 

 

$

 

$

 

$

17,531

 

$

(162

)

 

$

17,369

Capital expenditures

$

223,225

 

$

18,154

 

 

$

27,630

 

$

37,431

 

$

31,962

 

$

47,011

 

 

$

385,413

Year Ended December 31, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Sales and other revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

30,379,696

 

$

654,893

 

 

 

3,911,922

 

$

3,149,128

 

$

109,200

 

 

$

 

 

$

38,204,839

 

Intersegment revenues

 

4,033,213

 

 

360,606

 

 

 

 

 

9,472

 

 

438,280

 

 

 

(4,841,571

)

 

 

 

 

$

34,412,909

 

$

1,015,499

 

 

$

3,911,922

 

$

3,158,600

 

$

547,480

 

 

$

(4,841,571

)

 

$

38,204,839

 

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

$

28,270,195

 

$

974,167

 

 

 

3,845,625

 

$

2,333,156

 

$

 

 

$

(4,743,130

)

 

$

30,680,013

 

Lower of cost or market inventory valuation adjustment

$

 

$

52,412

 

 

 

 

$

 

$

 

 

$

 

 

$

52,412

 

Operating expenses

$

1,815,931

 

$

111,974

 

 

 

 

$

277,522

 

$

210,623

 

 

$

(81,157

)

 

$

2,334,893

 

Selling, general and administrative expenses

$

146,660

 

$

3,769

 

 

 

2,954

 

$

168,207

 

$

17,003

 

 

$

87,892

 

 

$

426,485

 

Depreciation and amortization

$

405,065

 

$

52,621

 

 

 

17,819

 

$

83,447

 

$

96,683

 

 

$

1,152

 

 

$

656,787

 

Income (loss) from operations

$

3,775,058

 

$

(179,444

)

 

$

45,524

 

$

296,268

 

$

223,171

 

 

$

(106,328

)

 

$

4,054,249

 

Income (loss) before interest and income taxes

$

3,774,118

 

$

(179,252

)

 

$

45,524

 

$

299,389

 

$

223,579

 

 

$

(81,863

)

 

$

4,081,495

 

Net income attributable to noncontrolling interest

$

 

$

 

 

$

 

$

 

$

9,164

 

 

$

109,342

 

 

$

118,506

 

Loss of equity method investments

$

 

 

 

 

$

 

$

 

$

(260

)

 

$

 

 

$

(260

)

Capital expenditures

$

162,280

 

$

225,274

 

 

$

9,275

 

$

34,887

 

$

38,964

 

 

$

53,327

 

 

$

524,007

 

Refining Segment Operating Data

The following tables set forth information, including non-GAAP (generally accepted accounting principles) performance measures about our refinery operations. Refinery gross and net operating margins do not include the non-cash effects of lower of cost or market inventory valuation adjustments and depreciation and amortization. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

The disaggregation of our refining geographic operating data is presented in two regions, Mid-Continent and West, to best reflect the economic drivers of our refining operations. The Mid-Continent region is comprised of the El Dorado and Tulsa refineries. The West region is comprised of the Puget Sound, Navajo, Woods Cross, Parco and Casper refineries. The refinery operations of the Parco and Casper refineries are included for the period March 14, 2022 (the date of acquisition) through December 31, 2023.

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Mid-Continent Region

 

 

 

 

 

 

Crude charge (BPD) (1)

 

 

259,410

 

 

 

286,190

 

 

 

237,510

 

 

 

283,160

 

Refinery throughput (BPD) (2)

 

 

279,480

 

 

 

305,750

 

 

 

256,810

 

 

 

299,380

 

Sales of produced refined products (BPD) (3)

 

 

289,470

 

 

 

283,360

 

 

 

248,330

 

 

 

280,800

 

Refinery utilization (4)

 

 

99.8

%

 

 

110.1

%

 

 

91.4

%

 

 

108.9

%

 

 

 

 

 

 

 

 

 

Average per produced barrel (5)

 

 

 

 

 

 

 

 

Refinery gross margin

 

$

9.97

 

 

$

20.23

 

 

$

17.49

 

 

$

22.01

 

Refinery operating expenses (6)

 

 

6.00

 

 

 

6.41

 

 

 

7.02

 

 

 

6.19

 

Net operating margin

 

$

3.97

 

 

$

13.82

 

 

$

10.47

 

 

$

15.82

 

 

 

 

 

 

 

 

 

 

Refinery operating expenses per throughput barrel (7)

 

$

6.22

 

 

$

5.94

 

 

$

6.79

 

 

$

5.81

 

 

 

 

 

 

 

 

 

 

Feedstocks:

 

 

 

 

 

 

 

 

Sweet crude oil

 

 

48

%

 

 

58

%

 

 

56

%

 

 

58

%

Sour crude oil

 

 

26

%

 

 

20

%

 

 

20

%

 

 

20

%

Heavy sour crude oil

 

 

19

%

 

 

16

%

 

 

16

%

 

 

16

%

Other feedstocks and blends

 

 

7

%

 

 

6

%

 

 

8

%

 

 

6

%

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%

 

 

 

 

 

 

 

 

 

Sales of produced refined products:

 

 

 

 

 

 

 

 

Gasolines

 

 

54

%

 

 

52

%

 

 

51

%

 

 

51

%

Diesel fuels

 

 

30

%

 

 

31

%

 

 

30

%

 

 

33

%

Jet fuels

 

 

5

%

 

 

6

%

 

 

6

%

 

 

6

%

Fuel oil

 

 

1

%

 

 

1

%

 

 

1

%

 

 

1

%

Asphalt

 

 

4

%

 

 

3

%

 

 

4

%

 

 

3

%

Base oils

 

 

2

%

 

 

3

%

 

 

4

%

 

 

4

%

LPG and other

 

 

4

%

 

 

4

%

 

 

4

%

 

 

2

%

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022 (8)

West Region

 

 

 

 

 

 

 

 

Crude charge (BPD) (1)

 

 

354,750

 

 

 

341,970

 

 

 

330,030

 

 

 

323,820

 

Refinery throughput (BPD) (2)

 

 

384,910

 

 

 

367,360

 

 

 

360,200

 

 

 

347,590

 

Sales of produced refined products (BPD) (3)

 

 

369,430

 

 

 

374,900

 

 

 

353,950

 

 

 

347,540

 

Refinery utilization (4)

 

 

84.9

%

 

 

81.8

%

 

 

79.0

%

 

 

81.4

%

 

 

 

 

 

 

 

 

 

Average per produced barrel (5)

 

 

 

 

 

 

 

 

Refinery gross margin

 

$

16.95

 

 

$

25.92

 

 

$

24.13

 

 

$

30.64

 

Refinery operating expenses (6)

 

 

10.19

 

 

 

10.14

 

 

 

10.14

 

 

 

9.31

 

Net operating margin

 

$

6.76

 

 

$

15.78

 

 

$

13.99

 

 

$

21.33

 

 

 

 

 

 

 

 

 

 

Refinery operating expenses per throughput barrel (7)

 

$

9.78

 

 

$

10.35

 

 

$

9.97

 

 

$

9.31

 

 

 

 

 

 

 

 

 

 

Feedstocks:

 

 

 

 

 

 

 

 

Sweet crude oil

 

 

28

%

 

 

32

%

 

 

30

%

 

 

28

%

Sour crude oil

 

 

48

%

 

 

50

%

 

 

45

%

 

 

50

%

Heavy sour crude oil

 

 

10

%

 

 

6

%

 

 

11

%

 

 

10

%

Black wax crude oil

 

 

6

%

 

 

5

%

 

 

6

%

 

 

5

%

Other feedstocks and blends

 

 

8

%

 

 

7

%

 

 

8

%

 

 

7

%

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%

 

 

 

 

 

 

 

 

 

Sales of produced refined products:

 

 

 

 

 

 

 

 

Gasolines

 

 

55

%

 

 

55

%

 

 

54

%

 

 

53

%

Diesel fuels

 

 

32

%

 

 

30

%

 

 

31

%

 

 

32

%

Jet fuels

 

 

5

%

 

 

5

%

 

 

6

%

 

 

5

%

Fuel oil

 

 

2

%

 

 

3

%

 

 

2

%

 

 

3

%

Asphalt

 

 

2

%

 

 

3

%

 

 

2

%

 

 

3

%

LPG and other

 

 

4

%

 

 

4

%

 

 

5

%

 

 

4

%

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%

Consolidated

 

 

 

 

 

 

 

 

Crude charge (BPD) (1)

 

 

614,160

 

 

 

628,160

 

 

 

567,540

 

 

 

606,980

 

Refinery throughput (BPD) (2)

 

 

664,390

 

 

 

673,110

 

 

 

617,010

 

 

 

646,970

 

Sales of produced refined products (BPD) (3)

 

 

658,900

 

 

 

658,260

 

 

 

602,280

 

 

 

628,340

 

Refinery utilization (4)

 

 

90.6

%

 

 

92.7

%

 

 

83.7

%

 

 

92.3

%

 

 

 

 

 

 

 

 

 

Average per produced barrel (5)

 

 

 

 

 

 

 

 

Refinery gross margin

 

$

13.88

 

 

$

23.47

 

 

$

21.39

 

 

$

26.78

 

Refinery operating expenses (6)

 

 

8.35

 

 

 

8.54

 

 

 

8.86

 

 

 

7.92

 

Net operating margin

 

$

5.53

 

 

$

14.93

 

 

$

12.53

 

 

$

18.86

 

 

 

 

 

 

 

 

 

 

Refinery operating expenses per throughput barrel (7)

 

$

8.28

 

 

$

8.35

 

 

$

8.65

 

 

$

7.69

 

 

 

 

 

 

 

 

 

 

Feedstocks:

 

 

 

 

 

 

 

 

Sweet crude oil

 

 

36

%

 

 

43

%

 

 

42

%

 

 

42

%

Sour crude oil

 

 

39

%

 

 

36

%

 

 

34

%

 

 

36

%

Heavy sour crude oil

 

 

14

%

 

11

%

 

 

13

%

 

 

13

%

Black wax crude oil

 

 

3

%

 

 

3

%

 

 

3

%

 

 

3

%

Other feedstocks and blends

 

 

8

%

 

 

7

%

 

 

8

%

 

 

6

%

Total

 

 

100

%

 

 

100

%

 

 

100

%

 

 

100

%

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2023

 

2022

 

2023

 

2022

Consolidated

 

 

 

 

 

 

Sales of produced refined products:

 

 

 

 

 

 

 

Gasolines

 

55

%

 

54

%

 

53

%

 

52

%

Diesel fuels

 

31

%

 

30

%

 

30

%

 

32

%

Jet fuels

 

5

%

 

6

%

 

6

%

 

6

%

Fuel oil

 

1

%

 

2

%

 

1

%

 

2

%

Asphalt

 

3

%

 

3

%

 

3

%

 

3

%

Base oils

 

1

%

 

1

%

 

2

%

 

2

%

LPG and other

 

4

%

 

4

%

 

5

%

 

3

%

Total

 

100

%

 

100

%

 

100

%

 

100

%

(1)

 

Crude charge represents the barrels per day of crude oil processed at our refineries.

(2)

 

Refinery throughput represents the barrels per day of crude and other refinery feedstocks input to the crude units and other conversion units at our refineries.

(3)

 

Represents barrels sold of refined products produced at our refineries (including Asphalt and intersegment sales) and does not include volumes of refined products purchased for resale or volumes of excess crude oil sold.

(4)

 

Represents crude charge divided by total crude capacity (BPSD). Our consolidated crude capacity is 678,000 BPSD.

(5)

 

Represents average amount per produced barrel sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

(6)

 

Represents total Mid-Continent and West regions operating expenses, exclusive of depreciation and amortization, divided by sales volumes of refined products produced at our refineries.

(7)

 

Represents total Mid-Continent and West regions operating expenses, exclusive of depreciation and amortization, divided by refinery throughput.

(8)

 

We acquired the Parco and Casper refineries on March 14, 2022. Refining operating data for the year ended December 31, 2022 includes crude oil and feedstocks processed and refined products sold at our Parco and Casper refineries for the period March 14, 2022 through December 31, 2022 only, averaged over the 365 days in the year ended December 31, 2022.

Renewables Segment Operating Data

The following table sets forth information about our Renewables operations and includes our Sinclair businesses for the period March 14, 2022 (the date of acquisition) through December 31, 2023.

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

Renewables

 

 

 

 

 

 

 

 

Sales volumes (in thousand gallons)

 

 

62,614

 

 

 

53,733

 

 

 

215,510

 

 

 

136,204

 

Average per produced gallon (1)

 

 

 

 

 

 

 

 

Renewables gross margin

 

$

0.35

 

 

$

0.49

 

 

$

0.50

 

 

$

0.30

 

Renewables operating expense (2)

 

 

0.37

 

 

 

0.60

 

 

 

0.51

 

 

 

0.82

 

Net operating margin

 

$

(0.02

)

 

$

(0.11

)

 

$

(0.01

)

 

$

(0.52

)

(1)

 

Represents average amount per produced gallons sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

(2)

 

Represents total Renewables segment operating expenses, exclusive of depreciation and amortization, divided by sales volumes of renewable diesel produced at our renewable diesel units.

Marketing Segment Operating Data

The following table sets forth information about our Marketing operations and includes our Sinclair business for the period March 14, 2022 (the date of acquisition) through December 31, 2023. The marketing gross margin does not include the non-cash effects of depreciation and amortization. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

Marketing

 

 

 

 

 

 

 

 

Number of branded sites at period end (1)

 

 

1,540

 

 

1,513

 

 

1,540

 

 

1,513

Sales volumes (in thousand gallons)

 

 

350,391

 

 

335,926

 

 

1,441,607

 

 

1,118,444

Margin per gallon of sales (2)

 

$

0.06

 

$

0.07

 

$

0.07

 

$

0.06

(1)

 

Includes non-Sinclair branded sites from legacy HollyFrontier agreements.

(2)

 

Represents average amount per gallon sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

Lubricants & Specialties Segment Operating Data

The following table sets forth information about our Lubricants & Specialties operations.

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2023

 

2022

 

2023

 

2022

Lubricants & Specialties

 

 

 

 

 

 

 

 

Sales of produced products (BPD)

 

29,530

 

 

28,570

 

 

30,210

 

 

32,530

 

 

 

 

 

 

 

 

 

 

Sales of produced products:

 

 

 

 

 

 

 

 

Finished products

 

48

%

 

53

%

 

50

%

 

51

%

Base oils

 

25

%

 

28

%

 

27

%

 

28

%

Other

 

27

%

 

19

%

 

23

%

 

21

%

Total

 

100

%

 

100

%

 

100

%

 

100

%

Effective the first quarter of 2023, management views the Lubricants & Specialties segment as an integrated business of processing feedstocks into base oils and processing base oils into finished lubricant products along with the packaging, distribution and sales to customers.

Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles

Reconciliations of earnings before interest, taxes, depreciation and amortization (“EBITDA”) and EBITDA excluding special items (“Adjusted EBITDA”) to amounts reported under generally accepted accounting principles (“GAAP”) in financial statements.

Earnings before interest, taxes, depreciation and amortization, referred to as EBITDA, is calculated as net (loss) income attributable to HF Sinclair stockholders plus (i) interest expense, net of interest income, (ii) income tax provision and (iii) depreciation and amortization. Adjusted EBITDA is calculated as EBITDA plus or minus (i) lower of cost or market inventory valuation adjustments, (ii) decommissioning costs, (iii) HF Sinclair's pro-rata share of Osage environmental remediation costs, net of insurance recoveries and (iv) acquisition integration and regulatory costs.

EBITDA and Adjusted EBITDA are not calculations provided for under accounting principles generally accepted in the United States; however, the amounts included in these calculations are derived from amounts included in our consolidated financial statements. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income or operating income as an indication of our operating performance or as an alternative to operating cash flow as a measure of liquidity. EBITDA and Adjusted EBITDA are not necessarily comparable to similarly titled measures of other companies. These are presented here because they are widely used financial indicators used by investors and analysts to measure performance. EBITDA and Adjusted EBITDA are also used by our management for internal analysis and as a basis for financial covenants.

Set forth below is our calculation of EBITDA and Adjusted EBITDA.

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(In thousands)

Net income (loss) attributable to HF Sinclair stockholders

 

$

(62,183

)

 

$

587,027

 

 

$

1,589,666

 

 

$

2,922,668

 

Add interest expense

 

 

49,306

 

 

 

56,978

 

 

 

190,796

 

 

 

175,628

 

Subtract interest income

 

 

(31,365

)

 

 

(17,517

)

 

 

(93,468

)

 

 

(30,179

)

Add income tax expense (benefit)

 

 

(39,028

)

 

 

188,197

 

 

 

441,612

 

 

 

894,872

 

Add depreciation and amortization

 

 

211,668

 

 

 

176,169

 

 

 

770,573

 

 

 

656,787

 

EBITDA

 

$

128,398

 

 

$

990,854

 

 

$

2,899,179

 

 

$

4,619,776

 

Add lower of cost or market inventory valuation adjustment

 

 

274,533

 

 

 

9,573

 

 

 

270,419

 

 

 

52,412

 

Add decommissioning costs

 

 

 

 

 

220

 

 

 

 

 

 

1,689

 

Add (subtract) HF Sinclair's pro-rata share of Osage environmental remediation costs, net of insurance recoveries

 

 

313

 

 

 

(1,275

)

 

 

921

 

 

 

8,297

 

Add acquisition integration and regulatory costs

 

 

24,423

 

 

 

4,752

 

 

 

36,555

 

 

 

51,986

 

Adjusted EBITDA

 

$

427,667

 

 

$

1,004,124

 

 

$

3,207,074

 

 

$

4,734,160

 

EBITDA and Adjusted EBITDA attributable to our Refining segment is presented below:

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

Refining Segment

 

 

2023

 

 

 

2022

 

 

2023

 

 

 

2022

 

 

(In thousands)

Income (loss) before interest and income taxes (1)

 

$

(74,626

)

 

$

758,844

 

$

1,872,074

 

$

3,774,118

Add depreciation and amortization

 

 

132,092

 

 

 

105,005

 

 

468,001

 

 

405,065

EBITDA

 

$

57,466

 

 

$

863,849

 

$

2,340,075

 

$

4,179,183

Add lower of cost or market inventory valuation adjustment

 

 

220,558

 

 

 

 

 

220,558

 

 

Adjusted EBITDA

 

$

278,024

 

 

$

863,849

 

$

2,560,633

 

$

4,179,183

(1)

 

Income (loss) before interest and income taxes of our Refining segment represents income (loss) plus (i) interest expense, net of interest income and (ii) income tax provision.

EBITDA and Adjusted EBITDA attributable to our Renewables segment is set forth below:

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

Renewables Segment

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(In thousands)

Loss before interest and income taxes (1)

 

$

(75,909

)

 

$

(34,663

)

 

$

(132,949

)

 

$

(179,252

)

Add depreciation and amortization

 

 

19,254

 

 

 

18,222

 

 

 

77,100

 

 

 

52,621

 

EBITDA

 

 

(56,655

)

 

 

(16,441

)

 

 

(55,849

)

 

 

(126,631

)

Add lower of cost or market inventory valuation adjustment

 

 

53,975

 

 

 

9,573

 

 

 

49,861

 

 

 

52,412

 

Adjusted EBITDA

 

$

(2,680

)

 

$

(6,868

)

 

$

(5,988

)

 

$

(74,219

)

(1)

 

Loss before interest and income taxes of our Renewables segment represents loss plus (i) interest expense, net of interest income and (ii) income tax provision.

EBITDA attributable to our Marketing segment is set forth below:

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

Marketing Segment

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(In thousands)

Income before interest and income taxes (1)

 

$

2,540

 

 

16,897

 

$

36,758

 

 

45,524

Add depreciation and amortization

 

 

6,710

 

 

6,545

 

 

24,599

 

 

17,819

EBITDA

 

$

9,250

 

$

23,442

 

$

61,357

 

$

63,343

(1)

 

Income before interest and income taxes of our Marketing segment represents income plus (i) interest expense, net of interest income and (ii) income tax provision

EBITDA attributable to our Lubricants & Specialties segment is set forth below.

Lubricants & Specialties Segment

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

2023

 

 

2022

 

2023

 

 

 

2022

 

 

(In thousands)

Income before interest and income taxes (1)

 

34,575

44,550

 

260,002

 

299,389

Add depreciation and amortization

 

23,168

 

22,021

 

86,341

 

83,447

EBITDA

 

57,743

 

66,571

 

346,343

 

382,836

(1)

 

Income before interest and income taxes of our Lubricants & Specialties segment represents income plus (i) interest expense, net of interest income and (ii) income tax provision.

EBITDA and Adjusted EBITDA attributable to our Midstream segment is presented below:

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

Midstream Segment

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(In thousands)

Income before interest and income taxes (1)

 

 

81,601

 

 

 

68,771

 

 

 

277,200

 

 

 

223,579

 

Add depreciation and amortization

 

 

25,026

 

 

 

22,880

 

 

 

101,028

 

 

 

96,683

 

Subtract net income attributable to noncontrolling interest

 

 

(2,023

)

 

 

(2,010

)

 

 

(7,200

)

 

 

(9,164

)

EBITDA

 

$

104,604

 

 

$

89,641

 

 

$

371,028

 

 

$

311,098

 

Add (subtract) share of Osage environmental remediation costs, net of insurance recoveries

 

 

554

 

 

 

(2,703

)

 

 

1,843

 

 

 

17,594

 

Add acquisition integration and regulatory costs

 

 

4,322

 

 

 

336

 

 

 

10,079

 

 

 

2,431

 

Adjusted EBITDA

 

$

109,480

 

 

$

87,274

 

 

$

382,950

 

 

$

331,123

 

(1)

 

Income before interest and income taxes of our Midstream segment represents income plus (i) interest expense, net of interest income and (ii) income tax provision.

Reconciliations of refinery operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in financial statements.

Refinery gross margin and net operating margin are non-GAAP performance measures that are used by our management and others to compare our refining performance to that of other companies in our industry. We believe these margin measures are helpful to investors in evaluating our refining performance on a relative and absolute basis. Refinery gross margin per produced barrel sold is total Refining segment revenues less total Refining segment cost of products sold, exclusive of lower of cost or market inventory valuation adjustments, divided by sales volumes of produced refined products sold. Net operating margin per barrel sold is the difference between refinery gross margin and refinery operating expenses per produced barrel sold. These two margins do not include the non-cash effects of lower of cost or market inventory valuation adjustments or depreciation and amortization. Each of these component performance measures can be reconciled directly to our consolidated statements of operations. Other companies in our industry may not calculate these performance measures in the same manner.

Reconciliation of average refining net operating margin per produced barrel sold to refinery gross margin to refining sales and other revenues

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Dollars in thousands, except per barrel amounts)

 

 

 

 

 

 

 

 

 

Refining segment sales and other revenues

 

$

6,863,673

 

$

7,982,375

 

$

28,672,604

 

$

34,412,909

Refining segment cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

 

 

6,022,027

 

 

6,561,147

 

 

23,969,557

 

 

28,270,195

Lower of cost or market inventory valuation adjustment

 

 

220,558

 

 

 

 

220,558

 

 

 

 

 

621,088

 

 

1,421,228

 

 

4,482,489

 

 

6,142,714

Add lower of cost or market inventory valuation adjustment

 

 

220,558

 

 

 

 

220,558

 

 

Refining gross margin

 

$

841,646

 

$

1,421,228

 

$

4,703,047

 

$

6,142,714

 

 

 

 

 

 

 

 

 

Refining segment operating expenses

 

$

506,288

 

$

517,024

 

$

1,946,958

 

$

1,815,931

Produced barrels sold (BPD)

 

 

658,900

 

 

658,260

 

 

602,280

 

 

628,340

 

 

 

 

 

 

 

 

 

Refinery gross margin per produced barrel sold

 

$

13.88

 

$

23.47

 

$

21.39

 

$

26.78

Less average refinery operating expenses per produced barrel sold

 

 

8.35

 

 

8.54

 

 

8.86

 

 

7.92

Net operating margin per produced barrel sold

 

$

5.53

 

$

14.93

 

$

12.53

 

$

18.86

Reconciliation of renewables operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in financial statements.

Renewables gross margin and net operating margin are non-GAAP performance measures that are used by our management and others to compare our renewables performance to that of other companies in our industry. We believe these margin measures are helpful to investors in evaluating our renewables performance on a relative and absolute basis. Renewables gross margin per produced gallon sold is total Renewables segment revenues less total Renewables segment cost of products sold, exclusive of lower of cost or market inventory valuation adjustments, divided by sales volumes of produced renewables products sold. Net operating margin per produced gallon sold is the difference between renewables gross margin and renewables operating expenses per produced gallon sold. These two margins do not include the non-cash effects of lower of cost or market inventory valuation adjustments and depreciation and amortization. Each of these component performance measures can be reconciled directly to our consolidated statements of operations. Other companies in our industry may not calculate these performance measures in the same manner.

Reconciliation of renewables gross margin and operating expenses to gross margin per produced gallon sold and net operating margin per produced gallon sold

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(In thousands, except for per gallon amounts)

Renewables segment sales and other revenues

 

$

286,612

 

 

$

417,893

 

 

$

1,188,990

 

 

$

1,015,499

 

Renewables segment cost of products sold

 

 

264,693

 

 

 

391,647

 

 

 

1,080,919

 

 

 

974,167

 

Lower of cost or market inventory valuation adjustment

 

 

53,975

 

 

 

9,573

 

 

 

49,861

 

 

 

52,412

 

 

 

 

(32,056

)

 

 

16,673

 

 

 

58,210

 

 

 

(11,080

)

Add lower of cost or market inventory valuation adjustment

 

 

53,975

 

 

 

9,573

 

 

 

49,861

 

 

 

52,412

 

Renewables gross margin

 

$

21,919

 

 

$

26,246

 

 

$

108,071

 

 

$

41,332

 

 

 

 

 

 

 

 

 

 

Renewables segment operating expenses

 

$

23,114

 

 

$

32,176

 

 

$

109,056

 

 

$

111,974

 

Produced gallons sold (in thousand gallons)

 

 

62,614

 

 

 

53,733

 

 

 

215,510

 

 

 

136,204

 

 

 

 

 

 

 

 

 

 

Renewables gross margin per produced gallon sold

 

$

0.35

 

 

$

0.49

 

 

$

0.50

 

 

$

0.30

 

Less operating expense per produced gallon sold

 

 

0.37

 

 

 

0.60

 

 

 

0.51

 

 

 

0.82

 

Net operating margin per produced gallon sold

 

$

(0.02

)

 

$

(0.11

)

 

$

(0.01

)

 

$

(0.52

)

Reconciliation of marketing operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in financial statements.

Marketing gross margin is a non-GAAP performance measure that is used by our management and others to compare our marketing performance to that of other companies in our industry. We believe this margin measure is helpful to investors in evaluating our marketing performance on a relative and absolute basis. Marketing gross margin per gallon sold is total Marketing segment revenues less total Marketing segment cost of products sold divided by sales volumes of marketing products sold. This margin does not include the non-cash effects of depreciation and amortization. This component performance measure can be reconciled directly to our consolidated statements of operations. Other companies in our industry may not calculate these performance measures in the same manner.

Reconciliation of marketing gross margin to gross margin per gallon sold

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

(In thousands, except for per gallon amounts)

 

 

Marketing segment sales and other revenues

 

$

908,769

 

$

1,031,898

 

$

4,146,292

 

$

3,911,922

Marketing segment cost of products sold

 

 

888,032

 

 

1,008,042

 

 

4,050,759

 

 

3,845,625

Marketing gross margin

 

$

20,737

 

$

23,856

 

$

95,533

 

$

66,297

 

 

 

 

 

 

 

 

 

Sales volumes (in thousand gallons)

 

 

350,391

 

 

335,926

 

 

1,441,607

 

 

1,118,444

 

 

 

 

 

 

 

 

 

Marketing gross margin per gallon sold

 

$

0.06

 

$

0.07

 

$

0.07

 

$

0.06

Reconciliation of net income attributable to HF Sinclair stockholders to adjusted net income attributable to HF Sinclair stockholders

Adjusted net income attributable to HF Sinclair stockholders is a non-GAAP financial measure that excludes non-cash lower of cost or market inventory valuation adjustments, decommissioning costs, HEP's share of Osage environmental remediation costs, net of insurance recoveries and acquisition integration and regulatory costs. We believe this measure is helpful to investors and others in evaluating our financial performance and to compare our results to that of other companies in our industry. Similarly titled performance measures of other companies may not be calculated in the same manner.

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Dollars in thousands, except per share amounts)

Consolidated

 

 

 

 

 

 

 

 

GAAP:

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

$

(72,684

)

 

$

813,023

 

 

$

2,152,507

 

$

3,936,046

Income tax expense (benefit)

 

 

(39,028

)

 

 

188,197

 

 

 

441,612

 

 

894,872

Net income (loss)

 

 

(33,656

)

 

 

624,826

 

 

 

1,710,895

 

 

3,041,174

Less net income attributable to noncontrolling interest

 

 

28,527

 

 

 

37,799

 

 

 

121,229

 

 

118,506

Net income (loss) attributable to HF Sinclair stockholders

 

 

(62,183

)

 

 

587,027

 

 

 

1,589,666

 

 

2,922,668

 

 

 

 

 

 

 

 

 

Non-GAAP adjustments to arrive at adjusted results:

 

 

 

 

 

 

 

 

Lower of cost or market inventory valuation adjustment

 

 

274,533

 

 

 

9,573

 

 

 

270,419

 

 

52,412

Decommissioning costs

 

 

 

 

 

220

 

 

 

 

 

1,689

HEP's share of Osage environmental remediation costs, net of insurance recoveries

 

 

554

 

 

 

(2,703

)

 

 

1,843

 

 

17,594

Acquisition integration and regulatory costs

 

 

25,307

 

 

 

4,752

 

 

 

39,367

 

 

52,896

Total adjustments to income (loss) before income taxes

 

 

300,394

 

 

 

11,842

 

 

 

311,629

 

 

124,591

Adjustment to income tax expense (benefit) (1)

 

 

72,474

 

 

 

2,487

 

 

 

74,634

 

 

22,142

Adjustment to net income attributable to noncontrolling interest

 

 

1,124

 

 

 

(1,428

)

 

 

3,733

 

 

10,206

Total adjustments, net of tax

 

 

226,796

 

 

 

10,783

 

 

 

233,262

 

 

92,243

 

 

 

 

 

 

 

 

 

Adjusted results - Non-GAAP:

 

 

 

 

 

 

 

 

Adjusted income before income taxes

 

 

227,710

 

 

 

824,865

 

 

 

2,464,136

 

 

4,060,637

Adjusted income tax expense (2)

 

 

33,446

 

 

 

190,684

 

 

 

516,246

 

 

917,014

Adjusted net income

 

 

194,264

 

 

 

634,181

 

 

 

1,947,890

 

 

3,143,623

Less net income attributable to noncontrolling interest

 

 

29,651

 

 

 

36,371

 

 

 

124,962

 

 

128,712

Adjusted net income attributable to HF Sinclair stockholders

 

$

164,613

 

 

$

597,810

 

 

$

1,822,928

 

$

3,014,911

Adjusted earnings per share - diluted (3)

 

$

0.87

 

 

$

2.97

 

 

$

9.51

 

$

14.73

(1)

 

Represents adjustment to GAAP income tax expense to arrive at adjusted income tax expense, which is computed as follows:

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

Non-GAAP income tax expense (2)

 

$

33,446

 

 

$

190,684

 

$

516,246

 

$

917,014

Subtract GAAP income tax expense (benefit)

 

 

(39,028

)

 

 

188,197

 

 

441,612

 

 

894,872

Non-GAAP adjustment to income tax expense

 

$

72,474

 

 

$

2,487

 

$

74,634

 

$

22,142

(2)

 

Non-GAAP income tax expense is computed by (a) adjusting HF Sinclair’s consolidated estimated Annual Effective Tax Rate (“AETR”) for GAAP purposes for the effects of the above Non-GAAP adjustments, (b) applying the resulting Adjusted Non-GAAP AETR to Non-GAAP adjusted income before income taxes and (c) adjusting for discrete tax items applicable to the period.

 

 

 

(3)

 

Adjusted earnings per share - diluted is calculated as adjusted net income attributable to HF Sinclair stockholders divided by the average number of shares of common stock outstanding assuming dilution, which is based on weighted-average diluted shares outstanding as that used in the GAAP diluted earnings per share calculation. Income allocated to participating securities, if applicable, in the adjusted earnings per share calculation is calculated the same way as that used in GAAP diluted earnings per share calculation.

Reconciliation of effective tax rate to adjusted effective tax rate

 

 

Three Months Ended

December 31,

 

Years Ended

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2023

 

 

 

2022

 

 

 

(Dollars in thousands)

GAAP:

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

$

(72,684

)

 

$

813,023

 

 

$

2,152,507

 

 

$

3,936,046

 

Income tax expense (benefit)

 

$

(39,028

)

 

$

188,197

 

 

$

441,612

 

 

$

894,872

 

Effective tax rate for GAAP financial statements

 

 

53.7

%

 

 

23.1

%

 

 

20.5

%

 

 

22.7

%

Adjusted - Non-GAAP:

 

 

 

 

 

 

 

 

Effect of Non-GAAP adjustments

 

 

(39.0

)%

 

 

%

 

 

0.4

%

 

 

(0.1

)%

Effective tax rate for adjusted results

 

 

14.7

%

 

 

23.1

%

 

 

20.9

%

 

 

22.6

%

 

Contacts

Atanas H. Atanasov, Executive Vice President and Chief Financial Officer

Craig Biery, Vice President,

Investor Relations

HF Sinclair Corporation

214-954-6510

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
 
 
Copyright © 2010-2020 SanAnselmo.com & California Media Partners, LLC. All rights reserved.