July 28, 2016 - 8:30 AM EDT
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CVR Refining Reports 2016 Second Quarter Results

SUGAR LAND, Texas, July 28, 2016 /PRNewswire/ -- CVR Refining, LP (NYSE: CVRR), a refiner and marketer of petroleum fuels, today announced second quarter 2016 net income of $78.1 million on net sales of $1,164.4 million, compared to net income of $227.8 million on net sales of $1,547.5 million for the second quarter of 2015. Adjusted EBITDA, a non-GAAP financial measure, for the 2016 second quarter was $84.7 million compared to adjusted EBITDA of $194.3 million for the 2015 second quarter.

CVR Refining, LP Logo.

For the first six months of 2016, net income was $10.1 million on net sales of $1,998.4 million, compared to net income of $274.5 million on net sales of $2,852.0 million for the comparable period a year earlier. Adjusted EBITDA for the first six months of 2016 was $119.8 million, compared to adjusted EBITDA of $356.0 million for the first six months of 2015.

"CVR Refining posted solid operational performance during the 2016 second quarter," said Jack Lipinski, chief executive officer. "The Coffeyville and Wynnewood refineries posted a combined crude throughput of 202,536 barrels per day (bpd), which fell within the range of our outlook despite lower crude rates at the Coffeyville refinery due to restrictions on the Magellan pipeline system.

"While we saw an improvement in refining margins quarter over quarter, we were disappointed in product realizations due to a large overhang of product inventories in the U.S.," Lipinski said. "In addition, the increasing cost of RINs significantly impacted our results. RINs, which we have to purchase to comply with the Renewable Fuel Standard (RFS), have become completely disconnected from the cost of blending and instead have become a source of windfall profits for blenders who the Environmental Protection Agency (EPA) chose to exempt from the program. The RFS program, as currently managed by the EPA, fails on many fronts. Not only are exempt blenders earning windfall profits from selling RINs to refiners who cannot blend, the RFS program allows exempt blenders to retain the profits and not increase biofuel usage in the U.S.

"RINs have become a black pool allowing exempt parties, and even speculators, to drive prices to confiscatory levels. We believe the market may be cornered, the effect of which will be to bring small merchant refiners to the brink of bankruptcy while unjustly enriching speculators and exempt blenders," Lipinski continued. "RINs were intended to be a compliance tool for refiners, not a device to extract windfall profits from obligated parties. The EPA needs to open its eyes and recognize that it must change the point of obligation to close the loophole that allows these exempt blenders, who control the vast majority of biofuels blending, to retain the profits from selling RINs without investing in increasing biofuel use. The windfall serves no regulatory purpose, but creates a system of winners and losers within the fuels industry based on their ability to blend.

"Market experts like Goldman Sachs and Credit Suisse are advising investors to avoid companies with high RIN exposure and to buy shares in large retail and distribution chains, like Casey's General Stores, who are benefitting from this structural flaw in the EPA's rule," he said. "For example, Goldman Sachs predicts that Casey's will see a 1 percent increase in EBITDA for every 10 cent increase in the price of RINs. Adding to concerns about the RIN market is the ability of third parties to buy and sell RINs. At the point that Goldman Sachs is advising investors to buy shares based on their RIN exposure, it seems reasonable to ask the question of whether third-party speculators are buying and selling RINs directly. There are a discrete number of obligated parties. It would be very easy for third parties to buy RINs and corner the market, driving up prices for obligated parties even higher. The EPA has so far refused to disclose the identity of the entities holding, buying and selling RINs, but this certainly should be investigated.

"There are pending lawsuits seeking to compel the EPA to fix the loophole and administrative requests for a rulemaking, both targeted at stopping the flow of profits to exempt parties at the expense of RIN-short refiners. We are hopeful that justice and reason will prevail and that RINs will once again become a compliance tool for refiners and not a windfall profit device for exempt parties," Lipinski concluded.

Consolidated Operations

Second quarter 2016 throughputs of crude oil and all other feedstocks and blendstocks totaled 210,488 bpd. Throughputs of crude oil and all other feedstocks and blendstocks for both refineries totaled 221,095 bpd for the same period in 2015.

Refining margin adjusted for FIFO impact per crude oil throughput barrel, a non-GAAP financial measure, was $9.56 in the 2016 second quarter, compared to $17.22 during the same period in 2015. Direct operating expenses, including major scheduled turnaround expenses, per barrel sold, exclusive of depreciation and amortization, for the 2016 second quarter were $4.33, compared to $4.43 in the second quarter of 2015.

Distributions

CVR Refining will not pay a cash distribution for the 2016 second quarter.

"As a result of forecasted weaker NYMEX crack spreads and escalating RINs costs, the Board of Directors has determined that it is prudent to retain cash to preserve the company's ability to support necessary future operating needs," Lipinski said. "This reserve may be released to unitholders in the future if margins improve or if RINs prices decline."

CVR Refining is a variable distribution master limited partnership. As a result, its quarterly distributions, if any, will vary from quarter to quarter due to several factors, including, but not limited to, its operating performance, fluctuations in the prices paid for crude oil and other feedstocks, as well as the prices received for finished products, and other cash reserves deemed necessary or appropriate by the board of directors of its general partner.

Second Quarter 2016 Earnings Conference Call

CVR Refining previously announced that it will host its second quarter 2016 Earnings Conference Call for analysts and investors on Thursday, July 28, at 1 p.m. Eastern. The Earnings Conference Call may also include discussion of the Partnership's 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/1005/15906. For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8289.

For those unable to listen live, the Webcast will be archived and available for 14 days at
https://www.webcaster4.com/Webcast/Page/1005/15906. A repeat of the conference call can be accessed by dialing (877) 660-6853, conference ID 13639901.

Forward-Looking Statements

This news release contains forward-looking statements. You can generally identify forward-looking statements by our use of forward-looking terminology such as "outlook," "anticipate," "believe," "continue," "could," "estimate," "expect," "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 Refining disclaims any intention or obligation to update publicly or revise its forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

About CVR Refining, LP

Headquartered in Sugar Land, Texas, CVR Refining, LP is an independent downstream energy limited partnership that owns refining and related logistics assets in the Midcontinent United States. CVR Refining's subsidiaries operate a complex full coking medium-sour crude oil refinery with a rated capacity of 115,000 barrels per calendar day (bpcd) in Coffeyville, Kansas, and a complex crude oil refinery with a rated capacity of 70,000 bpcd in Wynnewood, Oklahoma. CVR Refining's subsidiaries also operate supporting logistics assets including approximately 340 miles of active owned and leased pipelines, approximately 150 crude oil transports, a network of strategically located crude oil gathering tank farms, and approximately 6.4 million barrels of owned and leased crude oil storage capacity.

For further information, please contact: 

Investor Contact:
Jay Finks
CVR Refining, LP
(281) 207-3588
[email protected]

Media Relations:
Angie Dasbach
CVR Refining, LP
(281) 207-3550
[email protected]


CVR Refining, LP

Financial and Operational Data (all information in this release is unaudited except as otherwise noted).



















Three Months Ended 
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015


(in millions, except per unit data)

Statement of Operations Data:








Net sales

$

1,164.4



$

1,547.5



$

1,998.4



$

2,852.0


Cost of product sold

941.9



1,180.9



1,664.2



2,237.1


Direct operating expenses (1)

84.0



90.3



201.7



177.3


Flood insurance recovery



(27.3)





(27.3)


Selling, general and administrative expenses

16.8



18.6



35.3



36.7


Depreciation and amortization

31.6



34.2



63.1



68.2


Operating income

90.1



250.8



34.1



360.0


Interest expense and other financing costs

(10.1)



(10.4)



(20.9)



(21.7)


Interest income



0.1





0.2


Loss on derivatives, net

(1.9)



(12.6)



(3.1)



(64.0)


Other income (expense), net



(0.1)






Income before income tax expense

78.1



227.8



10.1



274.5


Income tax expense








Net income

$

78.1



$

227.8



$

10.1



$

274.5










Net income per common unit - basic and diluted

$

0.53



$

1.54



$

0.07



$

1.86










Adjusted EBITDA*

$

84.7



$

194.3



$

119.8



$

356.0


Available cash for distribution*

$



$

144.2



$



$

256.0










Weighted average, number of common units outstanding:








     Basic and diluted

147.6



147.6



147.6



147.6












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

(1) Direct operating expenses includes $2.1 million and $31.5 million of major scheduled turnaround expenses during the three and six months ended June 30, 2016, respectively.

 











As of June 30,
2016


As of December 31,
2015




(audited)


(in millions)

Balance Sheet Data:




Cash and cash equivalents

$

159.3



$

187.3


Working capital (1)

317.0



297.5


Total assets (1)

2,192.7



2,189.0


Total debt, including current portion (1)

573.4



573.8


Total partners' capital

1,291.5



1,281.4











(1) Prior period amounts have been retrospectively adjusted for Accounting Standard Update No. 2015-03, which requires that costs incurred to issue debt be presented in the balance sheet as a direct reduction from the carrying value of the debt.

 



















Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015


(in millions)

Cash Flow Data:








Net cash flow provided by (used in):








Operating activities

$

37.8



$

160.0



$

40.8



$

308.5


Investing activities

(24.0)



(36.4)



(68.0)



(78.1)


Financing activities

(0.4)



(112.5)



(0.8)



(167.4)


Net cash flow

$

13.4



$

11.1



$

(28.0)



$

63.0










Capital expenditures for property, plant and equipment:








Maintenance capital expenditures

$

14.3



$

20.4



$

39.6



$

40.7


Growth capital expenditures

9.7



16.0



28.4



37.4


Total capital expenditures

$

24.0



$

36.4



$

68.0



$

78.1


Operating Data

The following tables set forth information about our consolidated operations and our Coffeyville and Wynnewood refineries. Reconciliations of certain non-GAAP financial measures are provided under "Use of Non-GAAP Financial Measures" below.



















 Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015

Key Operating Statistics:








Per crude oil throughput barrel:








Refining margin*

$

12.07



$

19.12



$

9.50



$

16.47


FIFO impact, favorable

(2.51)



(1.90)



(1.06)



(0.32)


Refining margin adjusted for FIFO impact*

9.56



17.22



8.44



16.15


Gross profit*

5.80



14.05



1.97



10.63


Gross profit excluding flood insurance recovery*

5.80



12.63



1.97



9.90


Direct operating expenses and major scheduled turnaround expenses

4.56



4.71



5.73



4.75


Direct operating expenses excluding major scheduled turnaround expenses

4.45



4.62



4.84



4.71


Direct operating expenses and major scheduled turnaround expenses per barrel sold

4.33



4.43



5.34



4.43


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

4.22



$

4.35



$

4.50



$

4.39


Barrels sold (barrels per day)

213,368



224,031



207,669



220,876

















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

 































Three Months Ended 
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015

Refining Throughput and Production Data (bpd):
















Throughput:
















Sweet

176,674



83.9

%


192,691



87.1

%


173,700



85.5

%


184,082



84.4

%

Medium

3,429



1.6

%


1,082



0.5

%


2,471



1.2

%


3,841



1.8

%

Heavy sour

22,433



10.7

%


16,954



7.7

%


17,174



8.5

%


18,298



8.4

%

Total crude oil throughput

202,536



96.2

%


210,727



95.3

%


193,345



95.2

%


206,221



94.6

%

All other feedstocks and blendstocks

7,952



3.8

%


10,368



4.7

%


9,827



4.8

%


11,855



5.4

%

Total throughput

210,488



100.0

%


221,095



100.0

%


203,172



100.0

%


218,076



100.0

%

Production:
















Gasoline

108,330



51.3

%


107,439



48.3

%


107,105



52.7

%


108,263



49.3

%

Distillate

86,622



41.0

%


95,881



43.1

%


82,309



40.5

%


92,675



42.1

%

Other (excluding internally produced fuel)

16,280



7.7

%


19,160



8.6

%


13,900



6.8

%


19,011



8.6

%

Total refining production (excluding internally produced fuel)

211,232



100.0

%


222,480



100.0

%


203,314



100.0

%


219,949



100.0

%

Product price (dollars per gallon):
















Gasoline

$

1.44





$

1.87





$

1.24





$

1.67




Distillate

1.37





1.81





1.22





1.75






















Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015

Market Indicators (dollars per barrel):








West Texas Intermediate (WTI) NYMEX

$

45.64



$

57.95



$

39.78



$

53.34


Crude Oil Differentials:








WTI less WTS (light/medium sour)

0.83



(0.71)



0.49



0.12


WTI less WCS (heavy sour)

12.92



9.57



13.26



11.60


NYMEX Crack Spreads:








Gasoline

19.13



26.02



17.53



22.34


Heating Oil

12.82



21.69



12.37



24.33


NYMEX 2-1-1 Crack Spread

15.98



23.85



14.95



23.33


PADD II Group 3 Basis:








Gasoline

(5.49)



(6.19)



(5.68)



(4.87)


Ultra Low Sulfur Diesel

(1.18)



(3.69)



(1.10)



(4.10)


PADD II Group 3 Product Crack Spread:








Gasoline

13.64



19.83



11.85



17.47


Ultra Low Sulfur Diesel

11.63



18.00



11.27



20.23


PADD II Group 3 2-1-1

12.64



18.91



11.56



18.85




















Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015


(in millions, except operating statistics)

Coffeyville Refinery Financial Results:








Net sales

$

778.0



$

1,006.3



$

1,306.0



$

1,858.0


Cost of product sold

630.7



764.8



1,093.4



1,465.7


Refining margin*

147.3



241.5



212.6



392.3


Direct operating expenses

46.1



51.2



93.8



101.5


Major scheduled turnaround expenses

2.1



1.7



31.5



1.7


Flood insurance recovery



(27.3)





(27.3)


Depreciation and amortization

16.8



19.5



33.6



38.9


Gross profit*

$

82.3



$

196.4



$

53.7



$

277.5










Refining margin adjusted for FIFO impact*

$

117.1



$

212.4



$

186.2



$

381.7










Coffeyville Refinery Key Operating Statistics:








Per crude oil throughput barrel:








Refining margin*

$

12.71



$

20.27



$

9.99



$

16.82


FIFO impact, favorable

(2.62)



(2.44)



(1.24)



(0.46)


Refining margin adjusted for FIFO impact*

10.09



17.83



8.75



16.36


Gross profit*

7.10



16.49



2.53



11.89


Gross profit excluding flood insurance recovery*

7.10



14.20



2.53



10.72


Direct operating expenses and major scheduled turnaround expenses

4.16



4.43



5.89



4.43


Direct operating expenses excluding major scheduled turnaround expenses

3.98



4.29



4.41



4.35


Direct operating expenses and major scheduled turnaround expenses per barrel sold

3.84



4.03



5.28



4.00


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

3.67



$

3.90



$

3.95



$

3.94


Barrels sold (barrels per day)

138,021



144,183



130,429



142,587


















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

 



























Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015

Coffeyville Refinery Throughput and Production Data (bpd):
















Throughput:
















Sweet

101,548



76.2

%


112,867



81.2

%


97,242



78.1

%


106,734



77.3

%

Medium

3,429



2.6

%


1,082



0.8

%


2,471



2.0

%


3,841



2.8

%

Heavy sour

22,433



16.8

%


16,954



12.2

%


17,174



13.8

%


18,298



13.3

%

Total crude oil throughput

127,410



95.6

%


130,903



94.2

%


116,887



93.9

%


128,873



93.4

%

All other feedstocks and blendstocks

5,844



4.4

%


8,122



5.8

%


7,594



6.1

%


9,168



6.6

%

Total throughput

133,254



100.0

%


139,025



100.0

%


124,481



100.0

%


138,041



100.0

%

Production:
















Gasoline

67,819



49.9

%


66,374



46.6

%


65,927



52.2

%


67,110



47.5

%

Distillate

57,549



42.4

%


62,257



43.7

%


52,348



41.4

%


60,843



43.0

%

Other (excluding internally produced fuel)

10,491



7.7

%


13,722



9.7

%


8,130



6.4

%


13,477



9.5

%

Total refining production (excluding internally produced fuel)

135,859



100.0

%


142,353



100.0

%


126,405



100.0

%


141,430



100.0

%



















Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015


(in millions, except operating statistics)

Wynnewood Refinery Financial Results:








Net sales

$

385.3



$

540.1



$

690.1



$

991.8


Cost of product sold

311.3



415.9



570.7



771.4


Refining margin*

74.0



124.2



119.4



220.4


Direct operating expenses

35.8



37.5



76.4



74.1


Major scheduled turnaround expenses








Depreciation and amortization

12.6



12.5



25.3



25.1


Gross profit*

$

25.6



$

74.2



$

17.7



$

121.2










Refining margin adjusted for FIFO impact*

$

58.1



$

116.9



$

108.4



$

219.1










Wynnewood Refinery Key Operating Statistics:








Per crude oil throughput barrel:








Refining margin*

$

10.83



$

17.10



$

8.58



$

15.74


FIFO impact, favorable

(2.32)



(1.01)



(0.79)



(0.09)


Refining margin adjusted for FIFO impact*

8.51



16.09



7.79



15.65


Gross profit*

3.74



10.21



1.27



8.66


Direct operating expenses and major scheduled turnaround expenses

5.24



5.16



5.49



5.29


Direct operating expenses excluding major scheduled turnaround expenses

5.24



5.16



5.49



5.29


Direct operating expenses and major scheduled turnaround expenses per barrel sold

5.22



5.16



5.44



5.23


Direct operating expenses excluding major scheduled turnaround expenses per barrel sold

$

5.22



$

5.16



$

5.44



$

5.23


Barrels sold (barrels per day)

75,347



79,848



77,239



78,289































































Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015

Wynnewood Refinery Throughput and Production Data (bpd):
















Throughput:
















Sweet

75,126



97.3

%


79,824



97.3

%


76,458



97.2

%


77,348



96.6

%

Medium



%




%




%




%

Heavy sour



%




%




%




%

Total crude oil throughput

75,126



97.3

%


79,824



97.3

%


76,458



97.2

%


77,348



96.6

%

All other feedstocks and blendstocks

2,108



2.7

%


2,246



2.7

%


2,233



2.8

%


2,687



3.4

%

Total throughput

77,234



100.0

%


82,070



100.0

%


78,691



100.0

%


80,035



100.0

%

Production:
















Gasoline

40,511



53.7

%


41,065



51.2

%


41,178



53.5

%


41,153



52.4

%

Distillate

29,073



38.6

%


33,624



42.0

%


29,961



39.0

%


31,832



40.5

%

Other (excluding internally produced fuel)

5,789



7.7

%


5,438



6.8

%


5,770



7.5

%


5,534



7.1

%

Total refining production (excluding internally produced fuel)

75,373



100.0

%


80,127



100.0

%


76,909



100.0

%


78,519



100.0

%

























Cost of product sold, direct operating expenses and selling, general and administrative expenses are all reflected exclusive of depreciation and amortization.


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

Use of Non-GAAP Financial Measures

To supplement our actual results in accordance with GAAP for the applicable periods, the Partnership also uses the non-GAAP financial measures noted above, which are reconciled to our GAAP-based results below. These non-GAAP financial measures should not be considered an alternative for GAAP results. The adjustments are provided to enhance an overall understanding of the Partnership's financial performance for the applicable periods and are indicators management believes are relevant and useful for planning and forecasting future periods.

Refining margin per crude oil throughput barrel is a measurement calculated as the difference between net sales and cost of product sold (exclusive of depreciation and amortization). Refining margin is a non-GAAP measure that we believe is important to investors in evaluating our refineries' performance as a general indication of the amount above our cost of product sold at which we are able to sell refined products. Each of the components used in this calculation (net sales and cost of product sold exclusive of depreciation and amortization) can be taken directly from our Statements of Operations. Our calculation of refining margin may differ from similar calculations of other companies in our industry, thereby limiting its usefulness as a comparative measure. In order to derive the refining margin per crude oil throughput barrel, we utilize the total dollar figures for refining margin as derived above and divide by the applicable number of crude oil throughput barrels for the period. We believe that refining margin is important to enable investors to better understand and evaluate our ongoing operating results and allow for greater transparency in the review of our overall financial, operational and economic performance.

Refining margin per crude oil throughput barrel adjusted for FIFO impact is a measurement calculated as the difference between net sales and cost of product sold (exclusive of depreciation and amortization) adjusted for FIFO impact. Refining margin adjusted for FIFO impact is a non-GAAP measure that we believe is important to investors in evaluating our refineries' performance as a general indication of the amount above our cost of product sold (taking into account the impact of our utilization of FIFO) at which we are able to sell refined products. Our calculation of refining margin adjusted for FIFO impact may differ from calculations of other companies in our industry, thereby limiting its usefulness as a comparative measure. Under our FIFO accounting method, changes in crude oil prices can cause fluctuations in the inventory valuation of our crude oil, work in process and finished goods, thereby resulting in a favorable FIFO impact when crude oil prices increase and an unfavorable FIFO impact when crude oil prices decrease.

Gross profit is calculated as the difference between net sales, cost of product sold (exclusive of depreciation and amortization), direct operating expenses (exclusive of depreciation and amortization), major scheduled turnaround expenses, flood insurance recovery and depreciation and amortization. Gross profit per crude throughput barrel is calculated as gross profit as derived above divided by our refineries' crude oil throughput volumes for the respective periods presented. Gross profit is a non-GAAP measure that should not be substituted for operating income. Management believes it is important to investors in evaluating our refineries' performance and our ongoing operating results. Our calculation of gross profit may differ from similar calculations of other companies in our industry, thereby limiting its usefulness as a comparative measure.

EBITDA and Adjusted EBITDA. EBITDA represents net income before (i) interest expense and other financing costs, net of interest income, (ii) income tax expense and (iii) depreciation and amortization. Adjusted EBITDA represents EBITDA adjusted for (i) FIFO impact, favorable; (ii) share-based compensation, non-cash; (iii) loss on extinguishment of debt; (iv) major scheduled turnaround expenses; (v) loss on derivatives, net, (vi) current period settlements on derivative contracts and (vii) flood insurance recovery. We present Adjusted EBITDA because it is the starting point for our calculation of available cash for distribution. EBITDA and Adjusted EBITDA are not recognized terms under GAAP and should not be substituted for net income or cash flow from operations. Management believes that EBITDA and Adjusted EBITDA enable investors to better understand our ability to make distributions to our common unitholders, help investors evaluate our ongoing operating results and allow for greater transparency in reviewing our overall financial, operational and economic performance. EBITDA and Adjusted EBITDA presented by other companies may not be comparable to our presentation, since each company may define these terms differently.

A reconciliation of net income to EBITDA and EBITDA to Adjusted EBITDA for the three and six months ended June 30, 2016 and 2015 is as follows:


















Three Months Ended
June 30,


Six Months Ended
June 30,


2016


2015


2016


2015


(in millions)

Net income

$

78.1



$

227.8



$

10.1



$

274.5


Add:








Interest expense and other financing costs, net of interest income

10.1



10.3



20.9



21.5


Income tax expense








Depreciation and amortization

31.6



34.2



63.1



68.2


EBITDA

119.8



272.3



94.1



364.2


Add:








FIFO impact, favorable

(46.2)



(36.4)



(37.4)



(11.9)


Share-based compensation, non-cash



(0.1)





0.1


Major scheduled turnaround expenses

2.1



1.7



31.5



1.7


Loss on derivatives, net

1.9



12.6



3.1



64.0


Current period settlements on derivative contracts(1)

7.1



(28.5)



28.5



(34.8)


Flood insurance recovery(2)



(27.3)





(27.3)


Adjusted EBITDA

$

84.7



$

194.3



$

119.8



$

356.0




(1)

Represents the portion of loss on derivatives, net related to contracts that matured during the respective periods and settled with counterparties. There are no premiums paid or received at inception of the derivative contracts and upon settlement, there is no cost recovery associated with these contracts.



(2)

Represents an insurance recovery from Coffeyville Resources Refining and Marketing, LLC's environmental insurance carriers as a result of the flood and crude oil discharge at the Coffeyville refinery on June/July 2007.

Available cash for distribution is not a recognized term under GAAP. Available cash should not be considered in isolation or as an alternative to net income or operating income as a measure of operating performance. In addition, available cash for distribution is not presented as, and should not be considered, an alternative to cash flows from operations or as a measure of liquidity. Available cash as reported by the Partnership may not be comparable to similarly titled measures of other entities, thereby limiting its usefulness as a comparative measure.

Available cash begins with Adjusted EBITDA reduced for cash needed for (i) debt service; (ii) reserves for environmental and maintenance capital expenditures; (iii) reserves for major scheduled turnaround expenses and (iv) to the extent applicable, reserves for future operating or capital needs that the board of directors of our general partner deems necessary or appropriate, if any. Available cash for distribution may be increased by the release of previously established cash reserves, if any, and other excess cash, at the discretion of the board of directors of our general partner. Actual distributions are set by the board of directors of our general partner. The board of directors of our general partner may modify our cash distribution policy at any time, and our partnership agreement does not require us to make distributions at all.

A reconciliation of Adjusted EBITDA to Available cash for distribution is as follows:











Three Months
Ended
 

June 30, 2016


Six Months Ended

June 30, 2016


(in millions, except per unit data)

Adjusted EBITDA

$

84.7



$

119.8


Adjustments:




Less:




Cash needs for debt service

(10.0)



(20.0)


Reserves for environmental and maintenance capital expenditures

(40.0)



(56.4)


Reserves for major scheduled turnaround expenses

(15.0)



(23.7)


Reserves for future operating needs

(19.7)



(19.7)


Available cash for distribution

$



$






Available cash for distribution, per unit

$



$


Common units outstanding

147.6



147.6


Q3 2016 Outlook. The table below summarizes our outlook for certain refining statistics for the third quarter of 2016. See "forward looking statements."









Q3 2016


Low


High

Refinery Statistics:




Total crude oil throughput (bpd)

190,000



205,000


Total refining production (bpd)

200,000



215,000


 

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To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/cvr-refining-reports-2016-second-quarter-results-300305484.html

SOURCE CVR Refining, LP


Source: PR Newswire (July 28, 2016 - 8:30 AM EDT)

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