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News Release

CVR Energy Reports 2017 Third Quarter Results And Announces Cash Dividend of 50 Cents

SUGAR LAND, Texas, Nov. 1, 2017 /PRNewswire/ -- CVR Energy, Inc. (NYSE: CVI) today announced third quarter 2017 net income of $22.2 million, or 26 cents per diluted share, on net sales of $1,453.8 million, compared to net income of $5.4 million, or 6 cents per diluted share, on net sales of $1,240.3 million for the 2016 third quarter. Third quarter 2017 adjusted EBITDA, a non-GAAP financial measure, was $90.9 million, compared to third quarter 2016 adjusted EBITDA of $58.2 million.

CVR Energy Logo. (PRNewsFoto/CVR Energy) (PRNewsFoto/)

For the first nine months of 2017, net income was $33.9 million, or 39 cents per diluted share, on net sales of $4,395.3 million, compared to net income of $17.6 million, or 20 cents per diluted share, on net sales of $3,429.0 million for the same period a year earlier. Adjusted EBITDA for the first nine months of 2017 was $209.0 million, compared to adjusted EBITDA of $158.8 million for the first nine months of 2016.

"CVR Refining had a solid third quarter led by strong crack spreads and improved market conditions," said Jack Lipinski, CVR Energy's chief executive officer. "CVR Refining announced a 2017 third quarter cash distribution of 94 cents due to the exceptional performance of its Coffeyville, Kansas, refinery. CVR Refining's Wynnewood, Oklahoma, refinery began planned fall maintenance at the end of September and is on schedule to complete its turnaround in early November. The large scale and cost of the Wynnewood turnaround will negatively impact its results for the year.

"CVR Partners successfully completed the scheduled turnaround at its East Dubuque, Illinois, fertilizer facility on time and within budget during the 2017 third quarter," Lipinski said. "However, CVR Partners' results were negatively impacted by continued low U.S. nitrogen fertilizer pricing and unplanned downtime at both the East Dubuque and Coffeyville fertilizer facilities related to maintenance issues. As a result, CVR Partners announced that it will not pay a cash distribution for the quarter."

Petroleum Business

The petroleum business, which is operated by CVR Refining and includes the Coffeyville and Wynnewood refineries, reported third quarter 2017 operating income of $98.7 million on net sales of $1,385.8 million, compared to operating income of $28.4 million on net sales of $1,163.5 million in the third quarter of 2016.

Refining margin adjusted for FIFO impact per crude oil throughput barrel, a non-GAAP financial measure, was $13.72 in the 2017 third quarter, compared to $10.09 during the same period in 2016. Direct operating expenses (exclusive of depreciation and amortization), including major scheduled turnaround expenses, per crude oil throughput barrel, for the 2017 third quarter were $6.47, compared to $5.33 in the third quarter of 2016.

Third quarter 2017 throughputs of crude oil and all other feedstocks and blendstocks totaled 213,606 barrels per day (bpd), compared to third quarter 2016 throughputs of crude oil and all other feedstocks and blendstocks of 206,733 bpd.

Nitrogen Fertilizers Business

The fertilizer business, which is operated by CVR Partners and includes the Coffeyville and East Dubuque fertilizer facilities, reported a third quarter 2017 operating loss of $15.9 million on net sales of $69.4 million, compared to operating income of $2.4 million on net sales of $78.5 million for the third quarter of 2016. 

For the third quarter of 2017, consolidated average realized gate prices for UAN and ammonia were $138 per ton and $214 per ton, respectively. Consolidated average realized gate prices for UAN and ammonia were $154 per ton and $345 per ton, respectively, for the same period in 2016.

CVR Partners' fertilizer facilities produced a combined 180,700 tons of ammonia during the third quarter of 2017, of which 46,200 net tons were available for sale while the rest was upgraded to other fertilizer products, including 306,600 tons of UAN. In the 2016 third quarter, the fertilizer facilities produced 200,800 tons of ammonia, of which 60,300 net tons were available for sale while the remainder was upgraded to other fertilizer products, including 317,200 tons of UAN.

Cash, Debt and Dividend

Consolidated cash and cash equivalents was $849.1 million at Sept. 30, 2017. Consolidated total debt was $1,166.1 million at Sept. 30, 2017. The company had no debt exclusive of CVR Refining's and CVR Partners' debt.

CVR Energy also announced a third quarter 2017 cash dividend of 50 cents per share. The dividend, as declared by CVR Energy's Board of Directors, will be paid on Nov. 17, 2017, to stockholders of record on Nov. 10, 2017. CVR Energy's third quarter cash dividend brings the cumulative cash dividends paid or declared for the first nine months of 2017 to $1.50 per share.

Today, CVR Refining announced a 2017 third quarter cash distribution of 94 cents per common unit. CVR Partners announced that it will not pay a cash distribution for the 2017 third quarter.

Third Quarter 2017 Earnings Conference Call

CVR Energy previously announced that it will host its third quarter 2017 Earnings Conference Call for analysts and investors on Wednesday, Nov. 1, at 3 p.m. Eastern. The Earnings Conference Call may also include discussion of company developments, forward-looking information and other material information about business and financial matters.

The Earnings Conference Call will be broadcast live over the Internet at https://www.webcaster4.com/Webcast/Page/1003/23020. For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8291.

For those unable to listen live, the webcast will be archived and available for 14 days at https://www.webcaster4.com/Webcast/Page/1003/23020. A repeat of the conference call can be accessed by dialing (877) 660-6853, conference ID 13672109.

Forward-Looking Statements
This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can generally identify forward-looking statements by our use of forward-looking terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "explore," "evaluate," "intend," "may," "might," "plan," "potential," "predict," "seek," "should," or "will," or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. For a discussion of risk factors which may affect our results, please see the risk factors and other disclosures included in our most recent Annual Report on Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q and our other SEC filings. These risks may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof. CVR Energy disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

About CVR Energy, Inc.
Headquartered in Sugar Land, Texas, CVR Energy is a diversified holding company primarily engaged in the petroleum refining and nitrogen fertilizer manufacturing industries through its holdings in two limited partnerships, CVR Refining, LP and CVR Partners, LP. CVR Energy subsidiaries serve as the general partner and own 66 percent of the common units of CVR Refining and 34 percent of the common units of CVR Partners.

For further information, please contact:

Investor Contact:
Jay Finks
CVR Energy, Inc.
(281) 207-3588
InvestorRelations@CVREnergy.com

Media Relations:
Brandee Stephens
CVR Energy, Inc.
(281) 207-3516
MediaRelations@CVREnergy.com

CVR Energy, Inc.

Financial and Operational Data (all information in this release is unaudited other than the balance sheet data as of December 31, 2016).


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions, except per share data)

Consolidated Statement of Operations Data:








Net sales

$

1,453.8



$

1,240.3



$

4,395.3



$

3,429.0


Operating costs and expenses:








Cost of materials and other

1,132.4



1,005.7



3,582.2



2,719.3


Direct operating expenses(1)

161.1



129.5



423.4



409.2


Depreciation and amortization

51.3



48.1



151.7



134.5


Cost of sales

1,344.8



1,183.3



4,157.3



3,263.0


Selling, general and administrative expenses(1)

27.3



27.8



82.7



81.7


Depreciation and amortization

2.8



2.0



7.5



6.3


Operating income

78.9



27.2



147.8



78.0


Interest expense and other financing costs

(27.6)



(26.2)



(82.3)



(56.8)


Interest income

0.2



0.2



0.8



0.5


Loss on derivatives, net

(17.0)



(1.7)



(4.8)



(4.8)


Loss on extinguishment of debt







(5.1)


Other income, net



5.0



0.1



5.5


Income before income tax expense

34.5



4.5



61.6



17.3


Income tax expense

9.2



2.5



17.4



2.3


Net income

25.3



2.0



44.2



15.0


Less: Net income (loss) attributable to noncontrolling interest

3.1



(3.4)



10.3



(2.6)


Net income attributable to CVR Energy stockholders

$

22.2



$

5.4



$

33.9



$

17.6










Basic and diluted earnings per share

$

0.26



$

0.06



$

0.39



$

0.20


Dividends declared per share

$

0.50



$

0.50



$

1.50



$

1.50










Adjusted EBITDA*

$

90.9



$

58.2



$

209.0



$

158.8


Adjusted net income*

$

32.0



$

11.5



$

51.8



$

37.0


Adjusted net income per diluted share*

$

0.37



$

0.13



$

0.60



$

0.43










Weighted-average common shares outstanding - basic and diluted

86.8



86.8



86.8



86.8



______________________________


* See "Use of Non-GAAP Financial Measures" below.


(1)

Direct operating expenses and selling, general and administrative expenses for the three and nine months ended September 30, 2017 and 2016 are shown exclusive of depreciation and amortization, which amounts are presented separately below direct operating expenses and selling, general and administrative expenses.

 


As of September 30,

2017


As of December 31,
2016




(audited)


(in millions)

Balance Sheet Data:




Cash and cash equivalents

$

849.1



$

735.8


Working capital

765.0



749.6


Total assets

4,032.8



4,050.2


Total debt, including current portion

1,166.1



1,164.6


Total CVR stockholders' equity

761.8



858.1


 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions)

Cash Flow Data:








Net cash flow provided by (used in):








Operating activities

$

84.7



$

149.0



$

326.8



$

218.9


Investing activities

(21.6)



(16.9)



(80.4)



(172.0)


Financing activities

(43.9)



(60.1)



(133.1)



(49.4)


Net cash flow

$

19.2



$

72.0



$

113.3



$

(2.5)


 

Segment Information

Our operations are organized into two reportable segments, Petroleum and Nitrogen Fertilizer. Our operations that are not included in the Petroleum and Nitrogen Fertilizer segments are included in the Corporate and Other segment (along with elimination of intersegment transactions). The Petroleum segment is operated by CVR Refining, LP ("CVR Refining"), in which we own a majority interest as well as serve as the general partner. The Petroleum segment includes the operations of the Coffeyville, Kansas and Wynnewood, Oklahoma refineries along with the crude oil gathering and pipeline systems. Detailed operating results for the Petroleum segment for the three and nine months ended September 30, 2017 are included in CVR Refining's press release dated November 1, 2017. The Nitrogen Fertilizer segment is operated by CVR Partners, LP ("CVR Partners"), in which we own approximately 34% of the common units as of September 30, 2017 and serve as the general partner. On April 1, 2016, CVR Partners completed the merger (the "East Dubuque Merger") whereby CVR Partners acquired a nitrogen fertilizer manufacturing facility located in East Dubuque, Illinois (the "East Dubuque Facility"). The Nitrogen Fertilizer segment consists of a nitrogen fertilizer manufacturing facility located in Coffeyville, Kansas, and the East Dubuque Facility beginning on April 1, 2016, the date of the closing of the acquisition. Detailed operating results for the Nitrogen Fertilizer segment for the three and nine months ended September 30, 2017 are included in CVR Partners' press release dated November 1, 2017.

 


Petroleum
(CVR Refining)


Nitrogen
Fertilizer 

 (CVR Partners)


Corporate 
and Other


Consolidated


(in millions)

Three Months Ended September 30, 2017








Net sales

$

1,385.8



$

69.4



$

(1.4)



$

1,453.8


Cost of materials and other

1,114.4



19.4



(1.4)



1,132.4


Direct operating expenses (1)

99.2



37.8



(0.1)



136.9


Major scheduled turnaround expenses

21.7



2.5





24.2


Selling, general and administrative

18.8



6.1



2.4



27.3


Depreciation and amortization

33.0



19.5



1.6



54.1


Operating income (loss)

$

98.7



$

(15.9)



$

(3.9)



$

78.9










Capital expenditures

$

18.7



$

2.8



$

1.0



$

22.5


 


Petroleum
(CVR Refining)


Nitrogen
Fertilizer 
(CVR Partners)


Corporate
and Other


Consolidated


(in millions)

Nine Months Ended September 30, 2017








Net sales

$

4,147.5



$

252.6



$

(4.8)



$

4,395.3


Cost of materials and other

3,523.7



63.3



(4.8)



3,582.2


Direct operating expenses (1)

271.9



111.4



0.1



383.4


Major scheduled turnaround expenses

37.4



2.6





40.0


Selling, general and administrative

57.7



18.8



6.2



82.7


Depreciation and amortization

99.5



54.9



4.8



159.2


Operating income (loss)

$

157.3



$

1.6



$

(11.1)



$

147.8










Capital expenditures

$

66.1



$

11.4



$

2.4



$

79.9


 


Petroleum
(CVR Refining)


Nitrogen
Fertilizer 
(CVR Partners)


Corporate 
and Other


Consolidated


(in millions)

Three Months Ended September 30, 2016








Net sales

$

1,163.5



$

78.5



$

(1.7)



$

1,240.3


Cost of materials and other

987.5



19.9



(1.7)



1,005.7


Direct operating expenses (1)

97.0



32.5





129.5


Major scheduled turnaround expenses








Selling, general and administrative

18.1



7.3



2.4



27.8


Depreciation and amortization

32.5



16.4



1.2



50.1


Operating income (loss)

$

28.4



$

2.4



$

(3.6)



$

27.2










Capital expenditures

$

15.4



$

6.4



$

1.0



$

22.8


 


Petroleum
(CVR Refining)


Nitrogen

Fertilizer
 (CVR Partners)


Corporate
and Other


Consolidated


(in millions)

Nine Months Ended September 30, 2016








Net sales

$

3,161.9



$

271.4



$

(4.3)



$

3,429.0


Cost of materials and other

2,651.7



72.2



(4.6)



2,719.3


Direct operating expenses (1)

267.2



103.8



0.1



371.1


Major scheduled turnaround expenses

31.5



6.6





38.1


Selling, general and administrative

53.4



22.0



6.3



81.7


Depreciation and amortization

95.6



41.0



4.2



140.8


Operating income (loss)

$

62.5



$

25.8



$

(10.3)



$

78.0










Capital expenditures

$

83.4



$

18.3



$

3.9



$

105.6





(1)

Excluding turnaround expenses.

 


Petroleum
(CVR Refining)


Nitrogen
Fertilizer 
(CVR Partners)


Corporate 
and Other


Consolidated


(in millions)

September 30, 2017








Cash and cash equivalents

$

560.4



$

70.0



$

218.7



$

849.1


Total assets

2,500.7



1,275.8



256.3



4,032.8


Total debt, including current portion

540.9



625.2





1,166.1










December 31, 2016








Cash and cash equivalents

$

314.1



$

55.6



$

366.1



$

735.8


Total assets

2,331.9



1,312.2



406.1



4,050.2


Total debt, including current portion

541.5



623.1





1,164.6


 

Petroleum Segment Operating Data

The following tables set forth information about our consolidated Petroleum segment operated by CVR Refining, of which we own a majority interest and serve as the general partner, and the Coffeyville and Wynnewood refineries. Reconciliations of certain non-GAAP financial measures are provided under "Use of Non-GAAP Financial Measures" below. Additional discussion of operating results for the Petroleum segment for the three and nine months ended September 30, 2017 are included in CVR Refining's press release dated November 1, 2017.


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions)

Petroleum Segment Summary Financial Results:








Net sales

$

1,385.8



$

1,163.5



$

4,147.5



$

3,161.9


Operating costs and expenses:








Cost of materials and other

1,114.4



987.5



3,523.7



2,651.7


Direct operating expenses(1)

99.2



97.0



271.9



267.2


Major scheduled turnaround expenses

21.7





37.4



31.5


Depreciation and amortization

31.8



31.9



96.8



93.7


Cost of sales

1,267.1



1,116.4



3,929.8



3,044.1


Selling, general and administrative expenses(1)

18.8



18.1



57.7



53.4


Depreciation and amortization

1.2



0.6



2.7



1.9


Operating income

98.7



28.4



157.3



62.5


Interest expense and other financing costs

(12.0)



(10.8)



(35.2)



(31.7)


Interest income

0.2





0.4




Loss on derivatives, net

(17.0)



(1.7)



(4.8)



(4.8)


Other income, net

0.1





0.1




Income before income tax expense

70.0



15.9



117.8



26.0


Income tax expense








Net income

$

70.0



$

15.9



$

117.8



$

26.0










Gross profit

$

118.7



$

47.1



$

217.7



$

117.8


Refining margin*

$

271.4



$

176.0



$

623.8



$

510.2


Refining margin adjusted for FIFO impact*

$

256.5



$

183.7



$

624.6



$

480.5


Adjusted Petroleum EBITDA*

$

138.6



$

75.3



$

296.2



$

195.1



______________________________


* See "Use of Non-GAAP Financial Measures" below.


(1)

Direct operating expense and selling, general and administrative expenses for the three and nine months ended September 30, 2017 and 2016 are shown exclusive of depreciation and amortization and major scheduled turnaround expenses, which amounts are presented separately below direct operating expenses and selling, general and administrative expenses.

 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(dollars per barrel)

Petroleum Segment Key Operating Statistics:








Per crude oil throughput barrel:








Gross profit

$

6.35



$

2.59



$

3.79



$

2.21


Refining margin*

14.52



9.66



10.86



9.55


FIFO impact, (favorable) unfavorable

(0.80)



0.43



0.01



(0.56)


Refining margin adjusted for FIFO impact*

13.72



10.09



10.87



8.99


Direct operating expenses and major scheduled turnaround expenses

6.47



5.33



5.38



5.59


Direct operating expenses excluding major scheduled turnaround expenses

5.31



5.33



4.73



5.00


Direct operating expenses and major scheduled turnaround expenses per barrel sold

6.26



5.04



5.08



5.24


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

5.13



$

5.04



$

4.47



$

4.68


Barrels sold (barrels per day)

210,002



209,228



222,889



208,192



______________________________


* See "Use of Non-GAAP Financial Measures" below.

 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016

Petroleum Segment Summary



%




%




%




%

 Refining Throughput and Production Data (bpd):
















Throughput:
















Sweet

196,342



91.9



176,404



85.3



198,750



89.8



174,594



85.4


Medium





1,983



1.0







2,321



1.1


Heavy sour

6,751



3.2



19,568



9.5



11,643



5.3



17,978



8.9


  Total crude oil throughput

203,093



95.1



197,955



95.8



210,393



95.1



194,893



95.4


All other feedstocks and blendstocks

10,513



4.9



8,778



4.2



10,943



4.9



9,476



4.6


  Total throughput

213,606



100.0



206,733



100.0



221,336



100.0



204,369



100.0


Production:
















Gasoline

105,712



49.5



106,120



51.2



112,268



50.6



106,774



52.2


Distillate

89,655



42.0



84,669



40.9



92,046



41.5



83,101



40.6


Other (excluding internally produced fuel)

18,107



8.5



16,390



7.9



17,385



7.9



14,738



7.2


  Total refining production (excluding internally produced fuel)

213,474



100.0



207,179



100.0



221,699



100.0



204,613



100.0


Product price (dollars per gallon):
















Gasoline

$

1.63





$

1.45





$

1.56





$

1.31




Distillate

1.67





1.45





1.58





1.30
































 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016

Market Indicators (dollars per barrel):








West Texas Intermediate (WTI) NYMEX

$

48.20



$

44.94



$

49.36



$

41.53


Crude Oil Differentials:








WTI less WTS (light/medium sour)

0.97



1.47



1.15



0.82


WTI less WCS (heavy sour)

10.48



14.23



11.42



13.59


NYMEX Crack Spreads:








  Gasoline

20.42



13.73



17.74



16.24


  Heating Oil

21.05



14.34



17.24



13.04


  NYMEX 2-1-1 Crack Spread

20.73



14.03



17.49



14.64


PADD II Group 3 Basis:








Gasoline

(1.18)



0.48



(2.37)



(3.59)


Ultra Low Sulfur Diesel

0.85



1.01



(0.44)



(0.38)


PADD II Group 3 Product Crack Spread:








Gasoline

19.23



14.21



15.37



12.65


Ultra Low Sulfur Diesel

21.90



15.35



16.80



12.65


PADD II Group 3 2-1-1

20.57



14.78



16.09



12.65


 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions, except operating statistics)

Coffeyville Refinery Financial Results:








Net sales

$

939.3



$

788.1



$

2,750.5



$

2,094.1


Cost of materials and other

767.7



669.9



2,349.7



1,763.3


Direct operating expenses(1)

56.7



50.7



154.9



144.5


Major scheduled turnaround expenses







31.5


Depreciation and amortization

17.4



17.7



53.8



51.2


Gross profit

97.5



49.8



192.1



103.6


Add:








Direct operating expenses(1)

56.7



50.7



154.9



144.5


Major scheduled turnaround expenses







31.5


Depreciation and amortization

17.4



17.7



53.8



51.2


Refining margin*

171.6



118.2



400.8



330.8


FIFO impact, (favorable) unfavorable

(10.1)



4.0



1.5



(22.4)


Refining margin adjusted for FIFO impact*

$

161.5



$

122.2



$

402.3



$

308.4










Coffeyville Refinery Key Operating Statistics:








Per crude oil throughput barrel:








  Gross profit

$

8.26



$

4.15



$

5.37



$

3.12


  Refining margin*

14.52



9.86



11.21



9.94


  FIFO impact, (favorable)  unfavorable

(0.86)



0.33



0.04



(0.67)


  Refining margin adjusted for FIFO impact*

13.66



10.19



11.25



9.27


  Direct operating expenses and major scheduled turnaround expenses

4.80



4.23



4.33



5.29


  Direct operating expenses excluding major scheduled turnaround expenses

4.80



4.23



4.33



4.34


Direct operating expenses and major scheduled turnaround expenses per barrel sold

4.50



3.93



3.99



4.80


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

4.50



$

3.93



$

3.99



$

3.94


Barrels sold (barrels per day)

136,776



140,256



142,238



133,729



_____________________________


* See "Use of Non-GAAP Financial Measures" below.


(1)

Direct operating expenses for the three and nine months ended September 30, 2017 and 2016 are shown exclusive of depreciation and amortization and major scheduled turnaround expenses, which amounts are presented separately below direct operating expenses.

 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016




%




%




%




%

Coffeyville Refinery Throughput and Production Data (bpd):
















Throughput:
















Sweet

121,710



89.6



110,825



81.0



119,361



85.8



101,803



79.2


Medium













1,641



1.3


Heavy sour

6,751



5.0



19,568



14.3



11,643



8.4



17,978



13.9


  Total crude oil throughput

128,461



94.6



130,393



95.3



131,004



94.2



121,422



94.4


All other feedstocks and blendstocks

7,415



5.4



6,399



4.7



8,124



5.8



7,193



5.6


  Total throughput

135,876



100.0



136,792



100.0



139,128



100.0



128,615



100.0


Production:
















Gasoline

67,598



49.1



70,013



50.3



70,697



50.1



67,298



51.5


Distillate

57,654



41.9



57,839



41.6



58,927



41.7



54,192



41.5


Other (excluding internally produced fuel)

12,355



9.0



11,286



8.1



11,619



8.2



9,191



7.0


  Total refining production (excluding internally produced fuel)

137,607



100.0



139,138



100.0



141,243



100.0



130,681



100.0


 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions, except operating statistics)

Wynnewood Refinery Financial Results:








Net sales

$

445.3



$

374.3



$

1,393.7



$

1,064.4


Cost of materials and other

346.9



317.7



1,174.6



888.5


Direct operating expenses(1)

42.5



46.3



117.0



122.7


Major scheduled turnaround expenses

21.7





37.4




Depreciation and amortization

12.9



12.7



38.5



37.9


Gross profit (loss)

21.3



(2.4)



26.2



15.3


Add:








Direct operating expenses(1)

42.5



46.3



117.0



122.7


Major scheduled turnaround expenses

21.7





37.4




Depreciation and amortization

12.9



12.7



38.5



37.9


Refining margin*

98.4



56.6



219.1



175.9


FIFO impact, (favorable) unfavorable

(4.8)



3.8



(0.7)



(7.3)


Refining margin adjusted for FIFO impact*

$

93.6



$

60.4



$

218.4



$

168.6










Wynnewood Refinery Key Operating Statistics:








Per crude oil throughput barrel:








Gross profit (loss)

$

3.10



$

(0.39)



$

1.21



$

0.76


Refining margin*

14.33



9.10



10.11



8.74


FIFO impact, (favorable) unfavorable

(0.70)



0.61



(0.03)



(0.36)


Refining margin adjusted for FIFO impact*

13.63



9.71



10.08



8.38


Direct operating expenses and major scheduled turnaround expenses

9.35



7.45



7.13



6.10


Direct operating expenses excluding major scheduled turnaround expenses

6.18



7.45



5.40



6.10


Direct operating expenses and major scheduled turnaround expenses

per barrel sold

9.53



7.29



7.01



6.01


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

6.30



$

7.29



$

5.32



$

6.01


Barrels sold (barrels per day)

73,226



68,971



80,651



74,463



______________________________


* See "Use of Non-GAAP Financial Measures" below.


(1)

Direct operating expenses for the three and nine months ended September 30, 2017 and 2016 are shown exclusive of depreciation and amortization and major scheduled turnaround expenses, which amounts are presented separately below direct operating expenses.

 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016




%




%




%




%

Wynnewood Refinery Throughput and Production Data (bpd):
















Throughput:
















Sweet

74,632



96.0



65,579



93.8



79,389



96.6



72,791



96.1


Medium





1,983



2.8







680



0.9


Heavy sour
















  Total crude oil throughput

74,632



96.0



67,562



96.6



79,389



96.6



73,471



97.0


All other feedstocks and blendstocks

3,098



4.0



2,379



3.4



2,819



3.4



2,283



3.0


  Total throughput

77,730



100.0



69,941



100.0



82,208



100.0



75,754



100.0


Production:
















Gasoline

38,114



50.2



36,107



53.1



41,571



51.6



39,476



53.4


Distillate

32,001



42.2



26,830



39.4



33,119



41.2



28,909



39.1


Other (excluding internally produced fuel)

5,752



7.6



5,104



7.5



5,766



7.2



5,547



7.5


  Total refining production (excluding internally produced fuel)

75,867



100.0



68,041



100.0



80,456



100.0



73,932



100.0


 

Nitrogen Fertilizer Segment Operating Data

The following tables set forth information about the Nitrogen Fertilizer segment operated by CVR Partners, of which we own approximately 34% of the common units as of September 30, 2017 and serve as the general partner. The financial and operational data include the results of the East Dubuque Facility beginning on April 1, 2016, the date of the closing of the acquisition. Reconciliations of certain non-GAAP financial measures are provided under "Use of Non-GAAP Financial Measures" below. Additional discussion of operating results for the Nitrogen Fertilizer segment for the three and nine months ended September 30, 2017 are included in CVR Partners' press release dated November 1, 2017.


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016


(in millions)

Nitrogen Fertilizer Segment Business Financial Results:








Net sales

$

69.4



$

78.5



$

252.6



$

271.4


Cost of materials and other

19.4



19.9



63.3



72.2


Direct operating expenses(1)

37.8



32.5



111.4



103.8


Major scheduled turnaround expenses

2.5





2.6



6.6


Depreciation and amortization

19.5



16.4



54.9



41.0


Cost of sales

79.2



68.8



232.2



223.6


Selling, general and administrative expenses

6.1



7.3



18.8



22.0


Operating income (loss)

(15.9)



2.4



1.6



25.8


Interest expense and other financing costs

(15.7)



(15.6)



(47.1)



(32.8)


Loss on extinguishment of debt







(5.1)


Other income, net





0.1




  Loss before income tax expense

(31.6)



(13.2)



(45.4)



(12.1)


Income tax expense



0.2





0.3


  Net loss

$

(31.6)



$

(13.4)



$

(45.4)



$

(12.4)










Adjusted Nitrogen Fertilizer EBITDA*

$

5.0



$

17.4



$

58.1



$

74.4



_______________________________


 * See "Use of Non-GAAP Financial Measures" below.


(1)

Direct operating expenses for the three and nine months ended September 30, 2017 and 2016 are shown exclusive of depreciation and amortization and major scheduled turnaround expenses, which amounts are presented separately below direct operating expenses.

 


Three Months Ended
 September 30,


Nine Months Ended
 September 30,


2017


2016


2017


2016

Nitrogen Fertilizer Segment Key Operating Statistics:
















Consolidated sales (thousand tons):








Ammonia

65.3



47.7



201.8



145.7


UAN

299.1



296.0



951.6



902.4










Consolidated product pricing at gate (dollars per ton) (1):








Ammonia

$

214



$

345



$

287



$

385


UAN

$

138



$

154



$

158



$

187










Consolidated production volume (thousand tons):








Ammonia (gross produced) (2)

180.7



200.8



615.2



485.9


Ammonia (net available for sale) (2)

46.2



60.3



203.7



121.0


UAN

306.6



317.2



962.3



861.9










Feedstock:








Petroleum coke used in production (thousand tons)

114.3



126.8



371.0



384.4


Petroleum coke used in production (dollars per ton)

$

18



$

13



$

18



$

14


Natural gas used in production (thousands of MMBtus)

1,555.4



2,075.5



5,780.7



3,471.6


Natural gas used in production (dollars per MMBtu)(3)

$

3.12



$

2.97



$

3.25



$

2.75


Natural gas in cost of materials and other (thousands of MMBtus)

1,934.9



1,679.5



5,898.3



2,742.5


Natural gas in cost of materials and other (dollars per MMBtu)(3)

$

3.15



$

2.92



$

3.30



$

2.68










Coffeyville Facility on-stream factor (4):








Gasification

96.3

%


95.9

%


98.0

%


97.2

%

Ammonia

93.5

%


94.7

%


96.7

%


96.2

%

UAN

93.9

%


94.1

%


92.6

%


93.1

%









East Dubuque Facility on-stream factors (4):








Ammonia

76.3

%


94.4

%


91.9

%


81.7

%

UAN

77.1

%


92.9

%


91.5

%


81.1

%









Market Indicators:








Ammonia — Southern Plains (dollars per ton)

$

238



$

315



$

314



$

368


Ammonia — Corn belt (dollars per ton)

$

303



$

372



$

364



$