INDIANAPOLIS, Aug. 26, 2025 /PRNewswire/ -- Calumet, Inc. (NASDAQ: CLMT) ("Calumet, ""we," "our" or "us") provided an update regarding the recent U.S. Environmental Protection Agency (EPA) decision on small refinery exemptions and the expected impact on our Renewable Identification Number ("RINs") balance sheet accrual.On Friday, August 22, the EPA notified Calumet that we were successful in receiving full or partial exemptions on every petition that was filed by the Company from 2019 through 2024.  With Fr ...

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $76.5 million for Q2 2025, with $8.3 million generated from Montana Renewables, indicating strong performance despite a full month turnaround at the Shreveport facility [5][10][28] - Operating costs were reduced by $42 million in the first half of 2025 compared to the same period in 2024, despite a $7 million increase in natural gas and electricity costs [8][24] - Specialty product margins increased to over $66 per barrel, reflecting improved operational efficiency [24][30] Business Line Data and Key Metrics Changes - The Specialty Products and Solutions segment generated $66.8 million of adjusted EBITDA, with sales volume exceeding 20,000 barrels per day for the third consecutive quarter [24][26] - The Performance Brands segment reported $13.5 million in adjusted EBITDA, driven by strong volume growth, particularly in the TruFuel brand [27] - Montana Renewables segment adjusted EBITDA with tax attributes was $16.3 million, up from $8.7 million in the prior year, showcasing resilience in a challenging market [28][29] Market Data and Key Metrics Changes - The renewable diesel industry is currently facing low quarterly index margins, but Montana Renewables managed to generate positive adjusted EBITDA due to its competitive advantages [10][14] - The proposed Renewable Volume Obligation (RVO) for 2026 is expected to increase demand for biomass-based diesel, potentially leading to improved margins [19][20][76] Company Strategy and Development Direction - The company is focused on deleveraging and managing its debt, with a target of reaching $800 million in restricted group debt [22][40] - The MAX SAF 150 project is on track to start in 2026, aiming to produce 120 million to 150 million annual gallons of sustainable aviation fuel (SAF) [12][31] - The company is actively pursuing monetization of production tax credits, with expectations of completing these transactions in the near future [66][91] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term outlook for the renewable diesel market, anticipating margin recovery as regulatory clarity improves [73][76] - The company is optimistic about the potential for increased production and improved margins in 2026, contingent on the finalization of the RVO [19][76] Other Important Information - The company has successfully reduced operational costs and improved efficiency, with a focus on water treatment and operational learning [46][48] - The company does not expect tariffs to significantly impact its specialties business due to its U.S.-based manufacturing and supply chain [27] Q&A Session Summary Question: What are the updated thoughts on mid-cycle earnings for renewable diesel? - Management indicated that mid-cycle earnings could return to historical levels of $1.50 to $2.00 per gallon index margin, with potential adjusted EBITDA of $140 million to $150 million at $1.50 margins [35][36] Question: Can you discuss the path to further debt pay down and potential future divestitures? - Management highlighted that they have made significant progress on debt reduction and are considering strategic asset sales as part of their deleveraging strategy [39][40] Question: What types of improvements have driven cost reductions in operations? - Management noted that significant improvements in water treatment and operational efficiency have contributed to reduced costs [46][48] Question: How does the company view the attractiveness of different regions for SAF? - Management emphasized the flexibility to serve various markets, including the Midwest and California, and highlighted the potential for partnerships in Canada [50][54] Question: What is the status of PTC monetization? - Management confirmed that they are in the process of finalizing term sheets for PTCs and expect to complete these transactions soon [66][91]

Financial Performance - Calumet's Q2'25 Adjusted EBITDA with Tax Attributes was $76.5 million[6], compared to $74.8 million in Q2'24[6] - Specialty Products and Solutions (SPS) segment achieved Adjusted EBITDA of $66.8 million in Q2'25[6], slightly lower than the $72.7 million in Q2'24[6] - Performance Brands (PB) segment reported Adjusted EBITDA of $13.5 million in Q2'25[6], compared to $14.1 million in Q2'24[6] - Montana/Renewables (MRL at 87%) segment saw an increase in Adjusted EBITDA with Tax Attributes to $16.3 million in Q2'25[6] from $8.7 million in Q2'24[6] - Montana Renewables generated $0.53 per gallon in Production Tax Credits (PTC), totaling $24.6 million in Q2'25[27] Strategic Initiatives and Regulatory Landscape - The company achieved $42 million year-over-year operating cost reduction in the first half of 2025[6, 7] - Operating costs at Montana Renewables were $0.43 per gallon[6, 7] ($0.51 per gallon including SG&A)[6, 7] - The company issued a partial redemption notice for $80 million of '26 Notes, following a $150 million partial redemption in April[7, 16] - EPA's Renewable Volume Obligation (RVO) proposal includes a proposed 5.6 billion gallon requirement for biomass-based diesel[10, 11], up from the current 4.5 billion gallons[10, 11] - Plans are on track to unlock 120 million to 150 million gallons of Sustainable Aviation Fuel (SAF) capacity by Q2 2026 ("MaxSAF150") at a capital cost of $20 million to $30 million[6, 15, 33]

Core Insights - Calumet, Inc. reported a net loss of $147.9 million for Q2 2025, compared to a loss of $39.1 million in Q2 2024, reflecting significant challenges in financial performance [3][26] - Adjusted EBITDA with Tax Attributes for Q2 2025 was $76.5 million, showing a slight increase from $74.8 million in the same quarter last year [3][29] - The company achieved approximately $42 million in year-over-year operating cost reductions through disciplined operational execution [3][4] Financial Performance - The total sales volume for Q2 2025 was 88,766 barrels per day, a decrease from 90,242 barrels per day in Q2 2024 [7] - The Specialty Products and Solutions segment reported Adjusted EBITDA of $66.8 million in Q2 2025, down from $72.7 million in Q2 2024, attributed to a planned turnaround [2][3] - The Performance Brands segment's Adjusted EBITDA was $13.5 million in Q2 2025, compared to $14.1 million in Q2 2024, reflecting strong margin performance despite the divestiture of the Royal Purple® Industrial business [2][3] Segment Analysis - The Montana/Renewables segment reported Adjusted EBITDA with Tax Attributes of $16.3 million in Q2 2025, up from $8.7 million in the prior year, benefiting from lower operating costs and record volumes [4][31] - The gross profit (loss) for the Specialty Products and Solutions segment was $(14.9) million in Q2 2025, compared to a profit of $39.1 million in Q2 2024 [3][26] - The Montana/Renewables segment's gross profit (loss) per barrel was $(20.78) in Q2 2025, compared to $(0.18) in Q2 2024, indicating significant challenges in profitability [3][21] Operational Highlights - The company completed a month-long turnaround at its Shreveport facility, which contributed to operational performance improvements [3] - Operating costs at Montana Renewables fell to $0.43 per gallon in Q2 2025, the lowest since the platform's launch, enhancing its competitive position [3][4] - The company is on track to achieve 120–150 million gallons of annualized SAF production by Q2 2026, supported by a favorable regulatory environment [3][4]

Company Overview - Calumet, Inc. manufactures, formulates, and markets a diversified slate of specialty branded products and renewable fuels to a wide range of consumer-facing and industrial markets [2] - The company is headquartered in Indianapolis, Indiana, and operates twelve facilities throughout North America [2] Upcoming Events - On September 3rd, 2025, Calumet will attend the Barclays 39th Annual CEO Energy-Power Conference and will hold one-on-one investor meetings [3] - On September 8th, 2025, Calumet will attend the H.C. Wainwright 27th Annual Global Investment Conference, where it will present and conduct one-on-one investor meetings throughout the day [3]

Core Viewpoint - Calumet, Inc. has extended its asset financing arrangement with Stonebriar, increasing the value of its Shreveport terminal assets to $120 million and providing $80 million in proceeds to reduce outstanding Senior Notes due 2026 [1][2]. Group 1: Financial Transaction Details - The new financing arrangement assigns a value of $120 million to the Shreveport terminal assets, up from the previous valuation of $70 million [1]. - The transaction will yield $80 million in proceeds, which will be used to partially redeem $80 million of the outstanding 11.00% Senior Notes due 2026 at par plus accrued interest [1]. - The cost of capital for this transaction is set at 10.75% [1]. Group 2: Company Operations and Management - Todd Borgmann, CEO of Calumet, emphasized the value increase as a result of the Shreveport team's efforts to enhance facility reliability and throughput [2]. - Calumet, Inc. manufactures and markets a range of specialty branded products and renewable fuels across various consumer and industrial markets, operating twelve facilities in North America [3].

Core Viewpoint - Calumet, Inc. plans to report its financial results for the Second Quarter of 2025 on August 8, 2025, with a conference call scheduled for the same day at 9:00 AM ET [1]. Company Information - Calumet, Inc. manufactures, formulates, and markets a diverse range of specialty branded products and renewable fuels for various consumer-facing and industrial markets [3]. - The company is headquartered in Indianapolis, Indiana, and operates twelve facilities across North America [3].

Group 1 - The article emphasizes ongoing support for Calumet, Inc. (NASDAQ: CLMT) and highlights the importance of patience in investment strategies [1] - The author reflects on decades of investment experience, including surviving major market crashes in 1987, 2000, and 2008, indicating a long-term perspective on market fluctuations [1] - The article mentions the use of trading systems developed with TradeStation, suggesting a blend of technical analysis and fundamental investment strategies [1] Group 2 - The author holds a beneficial long position in Calumet, Inc. shares, indicating confidence in the company's future performance [2] - The article is presented as an independent opinion, with no external compensation influencing the views expressed [2] - There is a clear distinction made regarding the lack of business relationships with any companies mentioned, reinforcing the independence of the analysis [2]

Company Overview - Calumet, Inc. manufactures, formulates, and markets a diversified slate of specialty branded products and renewable fuels to a wide range of consumer-facing and industrial markets [2] - The company is headquartered in Indianapolis, Indiana, and operates twelve facilities throughout North America [2] Upcoming Events - On June 5th, Calumet will attend the Bank of America Securities Energy and Power Credit Conference, where it will hold one-on-one investor meetings [3] - On June 11th, Calumet will participate in the Wells Fargo Industrials & Materials Conference, conducting one-on-one investor meetings throughout the day [3]

Financial Data and Key Metrics Changes - The company reported a strong first quarter with adjusted EBITDA of $56.3 million for the Specialty Products segment, reflecting robust volume growth and operational improvements [32] - Montana Renewables generated $3.3 million in adjusted EBITDA with tax attributes, a significant improvement from a negative $13.4 million in the prior year [36] - The company ended the first quarter with $347 million in liquidity, positioning itself for strong cash flow generation in the upcoming quarters [30] Business Line Data and Key Metrics Changes - The Specialty Products segment achieved one of the highest quarterly volumes on record at approximately 23,000 barrels per day, despite some operational challenges [33] - The Performance Brands segment posted adjusted EBITDA of $15.8 million, driven by strong volume growth and supply chain efficiencies [35] - Montana Renewables saw operational cost improvements, reducing costs to below $0.70 per gallon, with a focus on increasing SAF production [36] Market Data and Key Metrics Changes - The renewable diesel market is currently facing challenges with low index margins, but the company remains optimistic about future demand and regulatory clarity [17] - The biomass-based diesel production undershot the RVO by approximately 230 million gallons in Q1, indicating a temporary market dynamic [17] - The company expects to ramp up SAF sales in late Q2 2025, with a focus on capturing market demand as global mandates increase [37] Company Strategy and Development Direction - The company is executing a deleveraging strategy, including the sale of non-core assets and the completion of a DOE loan to strengthen its balance sheet [6][29] - The MaxSaf project is a key focus, with expectations to bring 150 million gallons of SAF capacity online by early 2026 at a significantly reduced capital cost [20] - The company aims to maintain operational flexibility and cost control to navigate through economic cycles, leveraging its integrated asset base [8][10] Management's Comments on Operating Environment and Future Outlook - Management noted that despite recession fears, the company is not experiencing significant downturns, with strong specialty sales volumes recorded [7] - The management expressed confidence in the company's ability to generate positive cash flow across economic cycles, citing operational improvements and cost reductions [14] - There is optimism regarding regulatory clarity and market recovery, which could enhance margins and operational performance [52] Other Important Information - The company has made significant changes to how it reports adjusted EBITDA to better reflect cash generation capabilities, including the addition of production tax credits [24][26] - The sale of the Royal Purple Industrial business generated approximately $100 million in cash proceeds, aiding liquidity and operational focus [29] Q&A Session Summary Question: Regulatory environment and adjustments to EBITDA reporting - Management explained the rationale behind the changes to EBITDA reporting, emphasizing the need for clarity in cash generation capabilities and the impact of tax credits [41][44] Question: Balance sheet and liquidity concerns - Management reassured that liquidity is strong, with $340 million available, and highlighted the impact of the DOE loan on reducing annual cash flow from debt service [48][50] Question: Higher SAF volumes and capital expenditures - Management clarified that existing assets would be utilized to achieve higher SAF output at a lower capital cost, with a focus on marketing efforts for increased sales [58][60] Question: PTC booking and future expectations - Management confirmed that the full value of the PTC was booked for the quarter and discussed expectations for future bookings based on feedstock optimization [66][68] Question: Strategic alternatives for debt reduction - Management indicated that any cash inflow would primarily be directed towards debt reduction, with ongoing interest in selling non-core assets [77][78]