Financial Data and Key Metrics Changes - Delek reported adjusted EPS of $1.52 and adjusted EBITDA of approximately $319 million for Q3 2025, reflecting strong momentum and progress from the enterprise optimization plan [3][14] - Net income for the quarter was $178 million, or $2.93 per share, while adjusted net income was $434 million, or $7.13 per share, with adjusted EBITDA reaching approximately $760 million [14][15] - Cash flow from operations was $44 million, but adjusted for working capital, it improved to $150 million, a $202 million increase compared to Q3 last year [16] Business Line Data and Key Metrics Changes - The supply and marketing segment contributed approximately $130 million in the quarter, with wholesale marketing generating about $70 million [12][13] - The logistics segment delivered approximately $132 million in adjusted EBITDA, marking an $11 million increase over the previous record [15] - The enterprise optimization plan (EOP) contributed approximately $60 million to the P&L in Q3, leading to an increase in the annual run rate EOP improvement target from $150 million to at least $180 million [5][9] Market Data and Key Metrics Changes - The refining system achieved record throughput, with Krotz Springs setting a record high [11] - Total throughput in Tyler was 76,000 barrels per day, with a production margin of $11.32 per barrel [11] - El Dorado's throughput was approximately 83,000 barrels per day, with a production margin of $7.43 per barrel [12] Company Strategy and Development Direction - The company is focused on safe and reliable operations, with a strong operational quarter across its refining system [4] - Delek is committed to a disciplined capital allocation framework, having paid approximately $15 million in dividends and repurchased $15 million of its shares [9] - The company is optimistic about the future, expecting to finish 2025 strong and build on current momentum [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the monetization of granted RINs, expecting approximately $400 million in profits over the next six to nine months [6][24] - The company anticipates continued strength in distillate cracks and a positive outlook for Q4 [47] - Management emphasized the importance of the EOP as a core strength and a continuous improvement culture within the organization [5][40] Other Important Information - The company has increased its full-year EBITDA guidance for Delek Logistics to between $500 million and $520 million [4][9] - The EPA's approval of several SRE petitions is seen as a critical part of the current administration's energy policy, with implications for future profitability [6][24] Q&A Session Summary Question: Refining throughput guidance and RVO risk - Management clarified that they expect to qualify for 100% of SREs for 2025 and are confident in the legal backing for their petitions [20][25] Question: Clarification on total adjusted refining margin - The reported total adjusted refining margin of $688.6 million includes SRE benefits, while gross margins reported do not [29][30] Question: Impact of Permian Sour Gas opportunity - Management highlighted the strategic advantage of being early in the Permian Sour Gas market and the need for rapid solutions for sour gas [32][35] Question: Timing of SRE cash impact on balance sheet - Management expects to see cash from SRE monetization in the next six to nine months [37][38] Question: Drivers of recent EOP cash savings guidance increase - Management emphasized that EOP is a lifestyle across the organization, with ongoing initiatives leading to improved margins and cash flow [39][40] Question: Strength of wholesale and supply results - Management noted that structural improvements in the wholesale business are a significant part of the EOP progress [43][45] Question: Sensitivity of results to Group 3 pricing - Management stated that the enterprise optimization plan aims to reduce dependence on specific market conditions, leading to more structural improvements [58][59] Question: Monetization of $400 million in RINs - Management confirmed that $400 million is a solid number to model for future cash flow from RINs [60][61]

Financial Data and Key Metrics Changes - HF Sinclair reported a third quarter net income attributable to shareholders of $403 million, or $2.15 per diluted share, with adjusted net income of $459 million, or $2.44 per diluted share, compared to $96 million, or $0.51 per diluted share, for the same period in 2024 [13][14] - Adjusted EBITDA for the third quarter was $870 million, up from $316 million in the third quarter of 2024 [13] - The company returned $254 million in cash to shareholders, consisting of $160 million in share repurchases and $94 million in dividends [9][12] Business Line Data and Key Metrics Changes - In the refining segment, adjusted EBITDA was $661 million, significantly up from $110 million in the same quarter of 2024, driven by higher gross margins [14] - The marketing segment reported record EBITDA of $29 million, an increase from $22 million in the third quarter of 2024, attributed to high margins and improved store mix [16] - The lubricants and specialty segments reported EBITDA of $78 million, slightly up from $76 million in the same quarter of 2024, driven by improved mix and FIFO benefits [16] Market Data and Key Metrics Changes - Total sales volumes were 57 million gallons for the third quarter of 2025, down from 69 million gallons in the same quarter of 2024 [16] - Crude oil charge averaged 639,000 barrels per day for the third quarter, marking the second highest quarter on record [15] Company Strategy and Development Direction - HF Sinclair is focusing on expanding its midstream refined products footprint across PADD 4 and PADD 5 to address supply and demand imbalances in key Western U.S. markets [10][11] - The company is evaluating a multi-phased expansion projected to enable incremental supply of up to 150,000 barrels per day into various West Coast markets [11] - Strategic projects include the CARB project at the PSR refinery and a jet project to enhance flexibility in product output [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the refining market, citing a global shortfall of approximately 800,000 barrels per day and supportive demand for distillate fuels [26][29] - The company anticipates continued strong performance in refining margins due to ongoing supply constraints and increasing demand [27][29] - Management remains committed to returning excess cash to shareholders while maintaining an investment-grade balance sheet [9][12] Other Important Information - HF Sinclair issued $500 million of senior notes at 5.5% due 2032 to redeem higher interest notes, allowing for a reduction in the weighted average cost of debt [17] - The company has approximately $1.5 billion in cash and a debt-to-cap ratio of 23% as of September 30, 2025 [17] Q&A Session Summary Question: Can you elaborate on the multi-phased expansion targeting PADD 4 and PADD 5? - Management believes they are strategically positioned due to existing infrastructure and the ability to quickly deliver refined products to markets facing shortages [21][24] Question: What is the outlook for refining margins in the near term? - Management is bullish on refining margins, expecting continued support from demand for distillate fuels and low product inventories [25][27] Question: Can you clarify the impact of small refinery exemptions (SREs) on your financials? - The $115 million benefit from SREs is reflected in cost of sales, while the $56 million is from trading benefits associated with RINs [35][46] Question: How do you plan to finance the pipeline expansion projects? - Management indicated multiple financing options, including liquidity on the balance sheet and potential joint ventures [60][61] Question: What is the current state of the lubricants market and M&A opportunities? - The lubricants market is performing well, and the company continues to explore bolt-on acquisitions to enhance its portfolio [73][76]

Financial Data and Key Metrics Changes - The company reported a consolidated net loss of $90 million for the second quarter of 2025, with a loss per share of $1.14 and an EBITDA loss of $24 million [5][11] - Adjusted EBITDA for the quarter was $99 million, with an adjusted loss per share of $0.23 [11] - The negative mark to market impact on the RFS obligation was $89 million, and the unfavorable inventory valuation impact was $32 million [11] Business Line Data and Key Metrics Changes - In the Petroleum segment, total throughput was approximately 172,000 barrels per day, with a light product yield of 99% on crude oil processed [5] - Adjusted EBITDA for the Petroleum segment was $38 million, driven by increased Group 3 crack spreads, offset by higher RIN prices and lower throughput volumes [11] - The Fertilizer segment achieved an adjusted EBITDA of $67 million, supported by higher UAN and ammonia sales pricing and volumes [11] Market Data and Key Metrics Changes - Group 3 2-1-1 benchmark cracks averaged $24.02 per barrel for the second quarter, compared to $18.83 per barrel in the same period last year [6] - Average RIN prices for 2025 were approximately $1.11, an increase of over 70% from the prior year [6] - Nitrogen fertilizer prices for 2025 were higher for both UAN and ammonia compared to 2024 [10] Company Strategy and Development Direction - The company plans to focus on improving capture rates, reducing costs, and growing the business profitably [25] - The alkylation project at Wynnewood is expected to enhance the ability to produce premium gasoline, with completion anticipated in 2027 [19] - The company is cautiously optimistic about the refining sector's near and medium-term outlook, given low refined product inventories and steady demand [20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the refining market, citing low inventories and steady demand for refined products [17][20] - The company is awaiting final regulations from the IRS regarding PTC benefits, which could positively impact the Renewables segment [9][21] - Management indicated that the energy transition is evolving, with a belief that gas and diesel will remain essential fuels for the foreseeable future [48] Other Important Information - The company ended the quarter with a consolidated cash balance of $596 million and total liquidity of approximately $759 million [15] - Significant cash uses included $189 million for capital and turnaround spending and a $70 million prepayment on the term loan [13] Q&A Session Summary Question: Impact of excess inventory on financials - Management acknowledged that excess inventory during turnaround seasons negatively impacted financial performance, estimating a 7% to 9% decline in capture rates due to timing of product sales [31][35] Question: 2026 CapEx and turnaround outlook - Management indicated that there are no major turnarounds planned for 2026, and guidance on capital spending will be provided later in the year [36] Question: Strategic focus for new leadership - Management emphasized the need for diversification and the potential for future acquisitions to mitigate reliance on a single market [40] Question: Dividend reinstatement considerations - Management expressed a desire to return to dividend payments as soon as possible, with ongoing discussions at the board level [48][51] Question: Small refinery exemptions outlook - Management discussed the ongoing challenges with small refinery exemptions and the potential for legal action if necessary, emphasizing the importance of these exemptions for rural refineries [54][56]