CVR Energy(US:CVI)2024-10-28 21:13Third Quarter 2024 Financial Highlights CVR Energy reported a Q3 2024 net loss of $124 million, a significant decline from Q3 2023, driven by Petroleum Segment issues, leading to dividend suspension Overall Performance CVR Energy reported a Q3 2024 net loss of $124 million, a significant decline from Q3 2023, driven by Petroleum Segment issues, leading to dividend suspension Q3 2024 Consolidated Financial Results vs. Q3 2023 | Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Net (Loss) Income Attributable to CVR Energy | ($124 million) | $353 million | | (Loss) Earnings per Diluted Share | ($1.24) | $3.51 | | Adjusted (Loss) Earnings per Diluted Share | ($0.50) | $1.89 | | EBITDA | ($35 million) | $530 million | | Adjusted EBITDA | $63 million | $313 million | - The refining business performance was negatively impacted by reduced throughputs from unplanned downtime at both facilities, partially due to external power outages2 - The Board suspended the quarterly dividend, citing concerns about the persistence of the current margin environment and a large, planned turnaround at the Coffeyville refinery in Q1 20252 - CVR Partners announced a cash distribution of $1.19 per common unit for Q3 20241312 Segment Performance This section details the financial and operational performance of the Petroleum and Nitrogen Fertilizer segments, highlighting their contrasting results Petroleum Segment The Petroleum Segment reported a Q3 2024 net loss of $110 million, a sharp reversal from Q3 2023, driven by lower throughput and significantly reduced refining margins Petroleum Segment Financials (Q3 2024 vs. Q3 2023) | Metric | Q3 2024 (million) | Q3 2023 (million) | | :--- | :--- | :--- | | Net (Loss) Income | ($110 million) | $460 million | | EBITDA | ($75 million) | $484 million | | Adjusted EBITDA | $24 million | $281 million | Petroleum Segment Operational Metrics (Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Combined Total Throughput | 189,000 bpd | 212,000 bpd | | Refining Margin per Barrel | $2.53 | $31.05 | | Adjusted Refining Margin per Barrel | $8.23 | $20.73 | - Q3 2024 refining margin was negatively affected by a $59 million unfavorable mark-to-market impact on RFS obligations, a $9 million unfavorable derivative impact, and a $31 million unfavorable inventory valuation impact5 Nitrogen Fertilizer Segment The Nitrogen Fertilizer Segment showed strong Q3 2024 performance with net income rising to $4 million and increased EBITDA, supported by higher realized prices Nitrogen Fertilizer Segment Financials (Q3 2024 vs. Q3 2023) | Metric | Q3 2024 (million) | Q3 2023 (million) | | :--- | :--- | :--- | | Net Sales | $125 million | $131 million | | Net Income | $4 million | $1 million | | EBITDA | $36 million | $32 million | Nitrogen Fertilizer Production & Pricing (Q3 2024 vs. Q3 2023) | Metric | Q3 2024 | Q3 2023 | | :--- | :--- | :--- | | Ammonia Production | 212,000 tons | 217,000 tons | | UAN Production | 321,000 tons | 358,000 tons | | Avg. Realized UAN Price | $229/ton (+3% YoY) | $223/ton | | Avg. Realized Ammonia Price | $399/ton (+9% YoY) | $365/ton | Corporate and Other The company reported a Q3 2024 tax benefit of $6 million due to lower pretax earnings, while renewable diesel throughput decreased due to optimized catalyst life - Reported an income tax benefit of $6 million, or 4.6% of loss before income taxes, compared to an expense of $84 million in Q3 20239 - The renewable diesel unit's throughput decreased to 19.6 million gallons from 23.8 million gallons in Q3 2023, as the unit was run at lower utilization rates to optimize catalyst life10 Financial Position and Shareholder Returns This section outlines CVR Energy's cash and debt position, along with its decision to suspend dividends, contrasting with CVR Partners' distribution Cash, Debt, and Dividends As of September 30, 2024, CVR Energy held $534 million cash and $1.6 billion debt, suspending its Q3 2024 dividend, while CVR Partners declared a distribution Cash and Debt Position (as of Sept 30, 2024) | Metric | Amount | | :--- | :--- | | Consolidated Cash and Cash Equivalents | $534 million | | Consolidated Total Debt and Finance Lease Obligations | $1.6 billion | - CVR Energy will not pay a cash dividend for the third quarter of 202411 - CVR Partners declared a Q3 2024 cash distribution of $1.19 per common unit for Q3 2024, payable on November 18, 202412 Q4 2024 Outlook The Q4 2024 outlook forecasts petroleum throughput of 200,000-215,000 bpd, total capital expenditures of $59-70 million, and nitrogen fertilizer ammonia utilization of 92-97% Q4 2024 Outlook | Category | Metric | Low | High | | :--- | :--- | :--- | :--- | | Petroleum | Total throughput (bpd) | 200,000 | 215,000 | | | Direct operating expenses | $100M | $110M | | | Turnaround expenses | $8M | $12M | | Renewables | Total throughput (M gallons) | 17 | 22 | | | Direct operating expenses | $9M | $11M | | Nitrogen Fertilizer | Ammonia utilization rate | 92% | 97% | | | Direct operating expenses | $60M | $70M | | Capital Expenditures | Total | $59M | $70M | Financial Tables This section provides comprehensive unaudited consolidated financial statements and segment operating data for the reported periods Consolidated Financial Statements This section presents unaudited consolidated financial statements for Q3 and YTD September 2024, including Statement of Operations, Balance Sheet, and Cash Flow data Consolidated Statement of Operations Data (in millions, except per share data) | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Net sales | $1,833 | $2,522 | $5,663 | $7,045 | | Operating (loss) income | ($113) | $445 | $37 | $1,000 | | Net (loss) income attributable to CVR Energy stockholders | ($124) | $353 | ($22) | $678 | | Basic and diluted (loss) earnings per share | ($1.24) | $3.51 | ($0.22) | $6.74 | Selected Consolidated Balance Sheet Data (in millions) | | Sep 30, 2024 | Dec 31, 2023 | | :--- | :---: | :---: | | Cash and cash equivalents | $534 | $581 | | Total assets | $3,878 | $4,707 | | Total debt and finance lease obligations | $1,582 | $2,185 | | Total CVR stockholders' equity | $675 | $847 | Selected Consolidated Cash Flow Data (in millions) | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Net cash provided by operating activities | $48 | $370 | $306 | $984 | | Net cash used in investing activities | ($35) | ($51) | ($164) | ($181) | | Net cash used in financing activities | ($65) | ($181) | ($794) | ($424) | | Free cash flow* | $13 | $318 | $141 | $802 | Segment Operating Data This section details key operating metrics and market indicators for Petroleum and Nitrogen Fertilizer segments, including throughput, production, utilization, sales, and pricing data Petroleum Segment Key Operating Metrics per Total Throughput Barrel | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Refining margin | $2.53 | $31.05 | $9.96 | $24.33 | | Adjusted refining margin | $8.23 | $20.73 | $9.51 | $20.02 | | Direct operating expenses | $5.72 | $5.39 | $6.14 | $5.58 | Nitrogen Fertilizer Consolidated Sales and Pricing | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Sales Volumes (k tons) | | | | | | Ammonia | 62 | 62 | 175 | 183 | | UAN | 336 | 387 | 950 | 1,075 | | Product Pricing at Gate ($/ton) | | | | | | Ammonia | $399 | $365 | $481 | $633 | | UAN | $229 | $223 | $254 | $330 | Non-GAAP Reconciliations This section provides reconciliations of non-GAAP financial measures, including EBITDA, Adjusted EBITDA, Adjusted EPS, and Free Cash Flow, for consolidated and segment results Reconciliation of Net (Loss) Income to Adjusted EBITDA (in millions) | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Net (loss) income | ($122) | $354 | $5 | $781 | | EBITDA | ($35) | $530 | $271 | $1,231 | | Adjustments | $98 | ($217) | ($22) | ($237) | | Adjusted EBITDA | $63 | $313 | $249 | $994 | Reconciliation of Petroleum Net (Loss) Income to Adjusted EBITDA (in millions) | | Three Months Ended Sep 30 | Nine Months Ended Sep 30 | | :--- | :---: | :---: | :---: | :---: | | | 2024 | 2023 | 2024 | 2023 | | Petroleum net (loss) income | ($110) | $460 | $35 | $913 | | Petroleum EBITDA | ($75) | $484 | $152 | $989 | | Adjustments | $99 | ($203) | ($24) | ($239) | | Petroleum Adjusted EBITDA | $24 | $281 | $128 | $750 |