Par Pacific Holdings Reports Third Quarter 2021 Results
Par Pacific Holdings Reports Third Quarter 2021 Results
Third Quarter 2021 Highlights
- Record Quarterly Net Income of
$81.8 million , or$1.37 per diluted share - Adjusted Net Income of
$45.1 million , or$0.76 per diluted share - Adjusted EBITDA of
$84.7 million - Financial results include a
$29.1 million RINs mark-to-market (MTM) benefit related to the 2019 and 2020 compliance years
“Strong operational execution during the ongoing global recovery enabled us to generate record net income for our investors in the third quarter,” said
Refining
The Refining segment reported an operating income of
Refining Adjusted EBITDA was
The 3-1-2 Singapore Crack Spread was
The
The
The
During the third quarter of 2021, the
The Wyoming refinery's Adjusted Gross Margin of
Retail
The Retail segment reported operating income of
Retail Adjusted EBITDA was
Logistics
The Logistics segment reported operating income of
Logistics Adjusted EBITDA was
Laramie Energy
Due to the discontinuation of the equity method of accounting as of
Laramie’s total net loss was
Liquidity
Net cash provided by operations totaled
At
Conference Call Information
A conference call is scheduled for
About
Forward-Looking Statements
This news release (and oral statements regarding the subject matter of this news release, including those made on the conference call and webcast announced herein) includes certain “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, which are intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements include, without limitation, statements about: expected market conditions; expected refinery throughput; anticipated cost savings; anticipated capital expenditures, including major maintenance costs, and their effect on our financial and operating results, including earnings per share and free cash flow; anticipated retail sales volumes and on-island sales; the anticipated financial and operational results of
Contact:
Ashimi Patel
Senior Manager, Investor Relations
(832) 916-3355
[email protected]
| Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except per share data) |
|||||||||||||||
| Three Months Ended |
Nine Months Ended |
||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Revenues | $ | 1,310,368 | $ | 689,981 | $ | 3,416,573 | $ | 2,409,365 | |||||||
| Operating expenses | |||||||||||||||
| Cost of revenues (excluding depreciation) | 1,098,422 | 585,289 | 3,184,583 | 2,236,778 | |||||||||||
| Operating expense (excluding depreciation) | 78,059 | 69,458 | 221,068 | 209,876 | |||||||||||
| Depreciation, depletion, and amortization | 23,618 | 22,821 | 70,046 | 66,232 | |||||||||||
| Impairment expense | — | — | — | 67,922 | |||||||||||
| Loss (gain) on sale of assets, net | 2 | — | (64,400 | ) | — | ||||||||||
| General and administrative expense (excluding depreciation) | 12,473 | 9,818 | 36,559 | 31,823 | |||||||||||
| Acquisition and integration costs | 1 | (155 | ) | 87 | 600 | ||||||||||
| Total operating expenses | 1,212,575 | 687,231 | 3,447,943 | 2,613,231 | |||||||||||
| Operating income (loss) | 97,793 | 2,750 | (31,370 | ) | (203,866 | ) | |||||||||
| Other income (expense) | |||||||||||||||
| Interest expense and financing costs, net | (15,374 | ) | (17,523 | ) | (50,711 | ) | (52,611 | ) | |||||||
| Debt extinguishment and commitment costs | (9 | ) | — | (8,144 | ) | — | |||||||||
| Gain on curtailment of pension obligation | — | — | 2,032 | — | |||||||||||
| Other income (expense), net | (22 | ) | 610 | 3 | 1,089 | ||||||||||
| Change in value of common stock warrants | — | — | — | 4,270 | |||||||||||
| Equity losses from |
— | — | — | (46,905 | ) | ||||||||||
| Total other income (expense), net | (15,405 | ) | (16,913 | ) | (56,820 | ) | (94,157 | ) | |||||||
| Income (loss) before income taxes | 82,388 | (14,163 | ) | (88,190 | ) | (298,023 | ) | ||||||||
| Income tax benefit (expense) | (586 | ) | (108 | ) | (1,193 | ) | 20,855 | ||||||||
| Net income (loss) | $ | 81,802 | $ | (14,271 | ) | $ | (89,383 | ) | $ | (277,168 | ) | ||||
| Weighted-average shares outstanding | |||||||||||||||
| Basic | 59,437 | 53,374 | 57,713 | 53,265 | |||||||||||
| Diluted | 59,761 | 53,374 | 57,713 | 53,265 | |||||||||||
| Income (loss) per share | |||||||||||||||
| Basic | $ | 1.38 | $ | (0.27 | ) | $ | (1.55 | ) | $ | (5.20 | ) | ||||
| Diluted | $ | 1.37 | $ | (0.27 | ) | $ | (1.55 | ) | $ | (5.20 | ) | ||||
| Balance Sheet Data (Unaudited) (in thousands) |
|||||||
| Balance Sheet Data | |||||||
| Cash and cash equivalents | $ | 201,305 | $ | 68,309 | |||
| Working capital (1) | (434,136 | ) | (250,587 | ) | |||
| Debt, including current portion | 566,784 | 708,593 | |||||
| Total stockholders’ equity | 253,502 | 246,274 | |||||
________________________________________
(1) Working capital is calculated as (i) total current assets excluding cash and cash equivalents less (ii) total current liabilities excluding current portion of long-term debt. Total current assets include inventories stated at the lower of cost or net realizable value.
Operating Statistics
The following table summarizes key operational data:
| Three Months Ended |
Nine Months Ended |
||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||
| Total Refining Segment | |||||||||||||||||
| Feedstocks throughput (Mbpd) | 137.3 | 105.0 | 135.1 | 124.0 | |||||||||||||
| Refined product sales volume (Mbpd) | 144.9 | 125.0 | 140.5 | 141.2 | |||||||||||||
| Hawaii Refineries | |||||||||||||||||
| Combined Feedstocks throughput (Mbpd) | 81.0 | 51.2 | 82.0 | 70.9 | |||||||||||||
| Par East throughput (Mbpd) | 81.0 | 51.2 | 82.0 | 62.5 | |||||||||||||
| Par West throughput (Mbpd) | — | — | — | 8.4 | |||||||||||||
| Yield (% of total throughput) | |||||||||||||||||
| Gasoline and gasoline blendstocks | 23.3 | % | 23.1 | % | 24.2 | % | 23.6 | % | |||||||||
| Distillates | 45.9 | % | 31.0 | % | 45.3 | % | 41.1 | % | |||||||||
| Fuel oils | 24.9 | % | 41.0 | % | 26.0 | % | 29.6 | % | |||||||||
| Other products | 3.4 | % | (0.7 | ) | % | 1.5 | % | 1.3 | % | ||||||||
| Total yield | 97.5 | % | 94.4 | % | 97.0 | % | 95.6 | % | |||||||||
| Refined product sales volume (Mbpd) | |||||||||||||||||
| On-island sales volume | 86.7 | 67.6 | 83.9 | 85.3 | |||||||||||||
| Export sales volume | — | 2.5 | — | 0.8 | |||||||||||||
| Total refined product sales volume | 86.7 | 70.1 | 83.9 | 86.1 | |||||||||||||
| Adjusted Gross Margin per bbl ($/throughput bbl) (1) | $ | 7.66 | $ | (0.47 | ) | $ | 2.52 | $ | (2.17 | ) | |||||||
| Production costs per bbl ($/throughput bbl) (2) | 4.28 | 5.80 | 3.89 | 4.30 | |||||||||||||
| DD&A per bbl ($/throughput bbl) | 0.67 | 0.64 | 0.67 | 0.45 | |||||||||||||
| Feedstocks throughput (Mbpd) | 38.4 | 40.5 | 36.3 | 39.1 | |||||||||||||
| Yield (% of total throughput) | |||||||||||||||||
| Gasoline and gasoline blendstocks | 22.8 | % | 22.6 | % | 23.6 | % | 23.3 | % | |||||||||
| Distillate | 33.0 | % | 34.6 | % | 34.3 | % | 35.3 | % | |||||||||
| Asphalt | 22.5 | % | 19.4 | % | 20.9 | % | 19.0 | % | |||||||||
| Other products | 18.7 | % | 20.7 | % | 18.4 | % | 19.6 | % | |||||||||
| Total yield | 97.0 | % | 97.3 | % | 97.2 | % | 97.2 | % | |||||||||
| Refined product sales volume (Mbpd) | 40.7 | 42.0 | 40.3 | 40.9 | |||||||||||||
| Adjusted Gross Margin per bbl ($/throughput bbl) (1) | $ | 4.97 | $ | 2.16 | $ | 1.37 | $ | 5.36 | |||||||||
| Production costs per bbl ($/throughput bbl) (2) | 3.60 | 3.40 | 3.70 | 3.51 | |||||||||||||
| DD&A per bbl ($/throughput bbl) | 1.48 | 1.29 | 1.56 | 1.40 | |||||||||||||
| Three Months Ended |
Nine Months Ended |
||||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||||
| Feedstocks throughput (Mbpd) | 17.9 | 13.3 | 16.8 | 14.0 | |||||||||||||
| Yield (% of total throughput) | |||||||||||||||||
| Gasoline and gasoline blendstocks | 46.5 | % | 48.2 | % | 46.9 | % | 48.5 | % | |||||||||
| Distillate | 46.2 | % | 46.2 | % | 46.0 | % | 46.1 | % | |||||||||
| Fuel oils | 2.3 | % | 1.9 | % | 2.1 | % | 1.9 | % | |||||||||
| Other products | 2.1 | % | 1.6 | % | 2.0 | % | 1.4 | % | |||||||||
| Total yield | 97.1 | % | 97.9 | % | 97.0 | % | 97.9 | % | |||||||||
| Refined product sales volume (Mbpd) | 17.5 | 12.9 | 16.3 | 14.2 | |||||||||||||
| Adjusted Gross Margin per bbl ($/throughput bbl) (1) | $ | 27.40 | $ | 8.53 | $ | 14.17 | $ | 4.35 | |||||||||
| Production costs per bbl ($/throughput bbl) (2) | 5.92 | 7.51 | 6.49 | 7.22 | |||||||||||||
| DD&A per bbl ($/throughput bbl) | 2.77 | 4.65 | 2.83 | 4.03 | |||||||||||||
| Market Indices ($ per barrel) | |||||||||||||||||
| 3-1-2 Singapore Crack Spread (3) | $ | 6.20 | $ | 1.92 | $ | 4.80 | $ | 3.29 | |||||||||
| 18.59 | 9.39 | 15.39 | 11.51 | ||||||||||||||
| 41.78 | 19.63 | 31.01 | 17.63 | ||||||||||||||
| Crude Oil Prices ($ per barrel) | |||||||||||||||||
| Brent | $ | 73.23 | $ | 43.34 | $ | 67.92 | $ | 42.52 | |||||||||
| WTI | 70.52 | 40.92 | 64.99 | 38.31 | |||||||||||||
| ANS | 73.83 | 43.11 | 68.35 | 41.19 | |||||||||||||
|
|
70.77 | 39.44 | 64.84 | 35.59 | |||||||||||||
| WCS Hardisty | 57.54 | 30.93 | 52.39 | 25.78 | |||||||||||||
| Brent M1-M3 | 1.36 | (0.79 | ) | 1.05 | (1.17 | ) | |||||||||||
| Retail Segment | |||||||||||||||||
| Retail sales volumes (thousands of gallons) | 28,746 | 25,936 | 82,418 | 76,964 | |||||||||||||
________________________________________
(1) We calculate Adjusted Gross Margin per barrel by dividing Adjusted Gross Margin by total refining throughput. Adjusted Gross Margin for our
(2) Management uses production costs per barrel to evaluate performance and compare efficiency to other companies in the industry. There are a variety of ways to calculate production costs per barrel; different companies within the industry calculate it in different ways. We calculate production costs per barrel by dividing all direct production costs, which include the costs to run the refineries including personnel costs, repair and maintenance costs, insurance, utilities, and other miscellaneous costs, by total refining throughput. Our production costs are included in Operating expense (excluding depreciation) on our condensed consolidated statement of operations, which also includes costs related to our bulk marketing operations.
(3) We believe the 3-1-2 Singapore Crack Spread (or three barrels of Brent crude oil converted into one barrel of gasoline and two barrels of distillates (diesel and jet fuel)) is the most representative market indicator of our current operations in
(4) We believe the
(5) The profitability of our
Non-GAAP Performance Measures
Management uses certain financial measures to evaluate our operating performance that are considered non-GAAP financial measures. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP and our calculations thereof may not be comparable to similarly titled measures reported by other companies.
Adjusted Gross Margin
Adjusted Gross Margin is defined as (i) operating income (loss) adjusted for operating expense (excluding depreciation); depreciation, depletion, and amortization (“DD&A”); impairment expense; loss (gain) on sale of assets; inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, contango (gains) and backwardation losses associated with our
Management believes Adjusted Gross Margin is an important measure of operating performance and uses Adjusted Gross Margin per barrel to evaluate operating performance and compare profitability to other companies in the industry and to industry benchmarks. Management believes Adjusted Gross Margin provides useful information to investors because it eliminates the gross impact of volatile commodity prices and adjusts for certain non-cash items and timing differences created by our inventory financing agreements and lower of cost and net realizable value adjustments to demonstrate the earnings potential of the business before other fixed and variable costs, which are reported separately in Operating expense (excluding depreciation) and Depreciation, depletion, and amortization.
Adjusted Gross Margin should not be considered an alternative to operating income (loss), cash flows from operating activities, or any other measure of financial performance or liquidity presented in accordance with GAAP. Adjusted Gross Margin presented by other companies may not be comparable to our presentation since each company may define this term differently as they may include other manufacturing costs and depreciation expense in cost of revenues.
The following tables present a reconciliation of Adjusted Gross Margin to the most directly comparable GAAP financial measure, operating income (loss), on a historical basis, for selected segments, for the periods indicated (in thousands):
| Three months ended |
Refining | Logistics | Retail | ||||||||
| Operating income (loss) | $ | 86,413 | $ | 13,357 | $ | 11,201 | |||||
| Operating expense (excluding depreciation) | 55,613 | 3,754 | 18,692 | ||||||||
| Depreciation, depletion, and amortization | 14,748 | 5,545 | 2,630 | ||||||||
| Loss (gain) on sale of assets, net | — | 2 | — | ||||||||
| Inventory valuation adjustment | (727 | ) | — | — | |||||||
| LIFO liquidation adjustment | (4,151 | ) | — | — | |||||||
| RINs loss (gain) in excess of net obligation | (42,103 | ) | — | — | |||||||
| Unrealized loss (gain) on derivatives | 10,228 | — | — | ||||||||
| Adjusted Gross Margin (1) | $ | 120,021 | $ | 22,658 | $ | 32,523 | |||||
| Three months ended |
Refining | Logistics | Retail | ||||||||
| Operating income (loss) | $ | (5,106 | ) | $ | 6,434 | $ | 12,060 | ||||
| Operating expense (excluding depreciation) | 49,972 | 3,364 | 16,122 | ||||||||
| Depreciation, depletion, and amortization | 13,509 | 5,513 | 2,829 | ||||||||
| Inventory valuation adjustment | (43,980 | ) | — | — | |||||||
| LIFO liquidation adjustment | 6,211 | — | — | ||||||||
| RINs loss in excess of net obligation | 645 | — | — | ||||||||
| Unrealized loss (gain) on derivatives | (4,952 | ) | — | — | |||||||
| Adjusted Gross Margin (1) (2) | $ | 16,299 | $ | 15,311 | $ | 31,011 | |||||
| Nine Months Ended September 30, 2021 | Refining | Logistics | Retail | ||||||||
| Operating income (loss) | $ | (103,571 | ) | $ | 37,976 | $ | 73,207 | ||||
| Operating expense (excluding depreciation) | 156,895 | 11,144 | 53,029 | ||||||||
| Depreciation, depletion, and amortization | 43,373 | 16,176 | 8,164 | ||||||||
| Loss (gain) on sale of assets, net | (19,595 | ) | (19 | ) | (44,786 | ) | |||||
| Inventory valuation adjustment | 38,732 | — | — | ||||||||
| RINs loss in excess of net obligation | 11,874 | — | — | ||||||||
| Unrealized loss (gain) on derivatives | 7,620 | — | — | ||||||||
| Adjusted Gross Margin (1) (3) | $ | 135,328 | $ | 65,277 | $ | 89,614 | |||||
| Nine Months Ended September 30, 2020 | Refining | Logistics | Retail | ||||||||
| Operating income (loss) | $ | (210,433 | ) | $ | 31,513 | $ | 10,131 | ||||
| Operating expense (excluding depreciation) | 151,601 | 9,882 | 48,393 | ||||||||
| Depreciation, depletion, and amortization | 39,209 | 16,082 | 8,292 | ||||||||
| Impairment expense | 38,105 | — | 29,817 | ||||||||
| Inventory valuation adjustment | (4,635 | ) | — | — | |||||||
| LIFO liquidation adjustment | 6,211 | — | — | ||||||||
| RINs loss in excess of net obligation | 17,985 | — | — | ||||||||
| Unrealized loss (gain) on derivatives | (4,507 | ) | — | — | |||||||
| Adjusted Gross Margin (2) | $ | 33,536 | $ | 57,477 | $ | 96,633 | |||||
________________________________________
(1) There was no impairment expense recorded in Operating income (loss) by segment for the three and nine months ended
(2) There was no loss (gain) on sale of assets for the three and nine months ended
(3) There was no LIFO liquidation adjustment for the nine months ended
Adjusted Net Income (Loss) and Adjusted EBITDA
Adjusted Net Income (Loss) is defined as Net income (loss) excluding inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, contango (gains) and backwardation losses associated with our
Adjusted EBITDA is Adjusted Net Income (Loss) excluding DD&A, interest expense and financing costs, equity losses (earnings) from Laramie Energy excluding Par’s share of unrealized loss (gain) on derivatives, impairment of Par’s investment, and our share of Laramie Energy’s asset impairment losses in excess of our basis difference, and income tax expense (benefit).
We believe Adjusted Net Income (Loss) and Adjusted EBITDA are useful supplemental financial measures that allow investors to assess:
- The financial performance of our assets without regard to financing methods, capital structure, or historical cost basis;
- The ability of our assets to generate cash to pay interest on our indebtedness; and
- Our operating performance and return on invested capital as compared to other companies without regard to financing methods and capital structure.
Adjusted Net Income (Loss) and Adjusted EBITDA should not be considered in isolation or as a substitute for operating income (loss), net income (loss), cash flows provided by operating, investing, and financing activities, or other income or cash flow statement data prepared in accordance with GAAP. Adjusted Net Income (Loss) and Adjusted EBITDA presented by other companies may not be comparable to our presentation as other companies may define these terms differently.
The following table presents a reconciliation of Adjusted Net Income (Loss) and Adjusted EBITDA to the most directly comparable GAAP financial measure, net income (loss), on a historical basis for the periods indicated (in thousands):
| Three Months Ended |
Nine Months Ended |
||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net income (loss) | $ | 81,802 | $ | (14,271 | ) | $ | (89,383 | ) | $ | (277,168 | ) | ||||
| Inventory valuation adjustment | (727 | ) | (43,980 | ) | 38,732 | (4,635 | ) | ||||||||
| LIFO liquidation adjustment | (4,151 | ) | 6,211 | — | 6,211 | ||||||||||
| RINs loss (gain) in excess of net obligation | (42,103 | ) | 645 | 11,874 | 17,985 | ||||||||||
| Unrealized loss (gain) on derivatives | 10,228 | (4,952 | ) | 7,620 | (4,507 | ) | |||||||||
| Acquisition and integration costs | 1 | (155 | ) | 87 | 600 | ||||||||||
| Debt extinguishment and commitment costs | 9 | — | 8,144 | — | |||||||||||
| Changes in valuation allowance and other deferred tax items (1) | — | — | — | (21,087 | ) | ||||||||||
| Change in value of common stock warrants | — | — | — | (4,270 | ) | ||||||||||
| Severance costs | 59 | — | 75 | 245 | |||||||||||
| Loss (gain) on sale of assets, net | 2 | — | (64,400 | ) | — | ||||||||||
| Impairment expense | — | — | — | 67,922 | |||||||||||
| Impairment of Investment in |
— | — | — | 45,294 | |||||||||||
| Par’s share of Laramie Energy’s unrealized gain on derivatives (2) | — | — | — | (1,110 | ) | ||||||||||
| Adjusted Net Income (Loss) (3) | 45,120 | (56,502 | ) | (87,251 | ) | (174,520 | ) | ||||||||
| Depreciation, depletion, and amortization | 23,618 | 22,821 | 70,046 | 66,232 | |||||||||||
| Interest expense and financing costs, net | 15,374 | 17,523 | 50,711 | 52,611 | |||||||||||
| Equity losses from |
— | — | — | 2,721 | |||||||||||
| Income tax expense | 586 | 108 | 1,193 | 232 | |||||||||||
| Adjusted EBITDA | $ | 84,698 | $ | (16,050 | ) | $ | 34,699 | $ | (52,724 | ) | |||||
___________________________________
(1) Includes increases in (releases of) our valuation allowance associated with business combinations and changes in deferred tax assets and liabilities that are not offset by a change in the valuation allowance. These tax expenses (benefits) are included in Income tax benefit (expense) on our condensed consolidated statements of operations.
(2) Included in Equity losses from
(3) For the three and nine months ended
The following table sets forth the computation of basic and diluted Adjusted Net Income (Loss) per share (in thousands, except per share amounts):
| Three Months Ended |
Nine Months Ended |
||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Adjusted Net Income (Loss) | $ | 45,120 | $ | (56,502 | ) | $ | (87,251 | ) | $ | (174,520 | ) | ||||
| Undistributed Adjusted Net Income allocated to participating securities | — | — | — | — | |||||||||||
| Adjusted Net Income (Loss) attributable to common stockholders | 45,120 | (56,502 | ) | (87,251 | ) | (174,520 | ) | ||||||||
| Plus: effect of convertible securities | — | — | — | — | |||||||||||
| Numerator for diluted income (loss) per common share | $ | 45,120 | $ | (56,502 | ) | $ | (87,251 | ) | $ | (174,520 | ) | ||||
| Basic weighted-average common stock shares outstanding | 59,437 | 53,374 | 57,713 | 53,265 | |||||||||||
| Add dilutive effects of common stock equivalents (1) | 324 | — | — | — | |||||||||||
| Diluted weighted-average common stock shares outstanding | 59,761 | 53,374 | 57,713 | 53,265 | |||||||||||
| Basic Adjusted Net Income (Loss) per common share | $ | 0.76 | $ | (1.06 | ) | $ | (1.51 | ) | $ | (3.28 | ) | ||||
| Diluted Adjusted Net Income (Loss) per common share | $ | 0.76 | $ | (1.06 | ) | $ | (1.51 | ) | $ | (3.28 | ) | ||||
________________________________________
(1) Entities with a net loss from continuing operations are prohibited from including potential common shares in the computation of diluted per share amounts. We have utilized the basic shares outstanding to calculate both basic and diluted Adjusted Net Income (Loss) per common share for the nine months ended
Adjusted EBITDA by Segment
Adjusted EBITDA by segment is defined as Operating income (loss) by segment excluding depreciation, depletion, and amortization expense, inventory valuation adjustment (which adjusts for timing differences to reflect the economics of our inventory financing agreements, including lower of cost or net realizable value adjustments, the impact of the embedded derivative repurchase or terminal obligations, contango (gains) and backwardation losses associated with our
We believe Adjusted EBITDA by segment is a useful supplemental financial measure to evaluate the economic performance of our segments without regard to financing methods, capital structure, or historical cost basis. The following table presents a reconciliation of Adjusted EBITDA by segment to the most directly comparable GAAP financial measure, operating income (loss) by segment, on a historical basis, for selected segments, for the periods indicated (in thousands):
| Three Months Ended |
|||||||||||||||
| Refining | Logistics | Retail | Corporate and Other |
||||||||||||
| Operating income (loss) by segment | $ | 86,413 | $ | 13,357 | $ | 11,201 | $ | (13,178 | ) | ||||||
| Depreciation, depletion, and amortization | 14,748 | 5,545 | 2,630 | 695 | |||||||||||
| Inventory valuation adjustment | (727 | ) | — | — | — | ||||||||||
| LIFO liquidation adjustment | (4,151 | ) | — | — | — | ||||||||||
| RINs loss (gain) in excess of net obligation | (42,103 | ) | — | — | — | ||||||||||
| Unrealized loss (gain) on derivatives | 10,228 | — | — | — | |||||||||||
| Acquisition and integration costs | — | — | — | 1 | |||||||||||
| Severance costs | 53 | 6 | — | — | |||||||||||
| Loss (gain) on sale of assets, net | — | 2 | — | — | |||||||||||
| Other income (expense), net | — | — | — | (22 | ) | ||||||||||
| Adjusted EBITDA (1) | $ | 64,461 | $ | 18,910 | $ | 13,831 | $ | (12,504 | ) | ||||||
| Three Months Ended |
|||||||||||||||
| Refining | Logistics | Retail | Corporate and Other |
||||||||||||
| Operating income (loss) by segment | $ | (5,106 | ) | $ | 6,434 | $ | 12,060 | $ | (10,638 | ) | |||||
| Depreciation, depletion, and amortization | 13,509 | 5,513 | 2,829 | 970 | |||||||||||
| Inventory valuation adjustment | (43,980 | ) | — | — | — | ||||||||||
| LIFO liquidation adjustment | 6,211 | — | — | — | |||||||||||
| RINs loss (gain) in excess of net obligation | 645 | — | — | — | |||||||||||
| Unrealized loss (gain) on derivatives | (4,952 | ) | — | — | — | ||||||||||
| Acquisition and integration costs | — | — | — | (155 | ) | ||||||||||
| Other income (expense), net | — | — | — | 610 | |||||||||||
| Adjusted EBITDA (2) | $ | (33,673 | ) | $ | 11,947 | $ | 14,889 | $ | (9,213 | ) | |||||
| Nine Months Ended |
|||||||||||||||
| Refining | Logistics | Retail | Corporate and Other |
||||||||||||
| Operating income (loss) by segment | $ | (103,571 | ) | $ | 37,976 | $ | 73,207 | $ | (38,982 | ) | |||||
| Depreciation, depletion and amortization | 43,373 | 16,176 | 8,164 | 2,333 | |||||||||||
| Inventory valuation adjustment | 38,732 | — | — | — | |||||||||||
| RINs loss (gain) in excess of net obligation | 11,874 | — | — | — | |||||||||||
| Unrealized loss (gain) on derivatives | 7,620 | — | — | — | |||||||||||
| Acquisition and integration costs | — | — | — | 87 | |||||||||||
| Severance costs | 53 | 22 | — | — | |||||||||||
| Loss (gain) on sale of assets, net | (19,595 | ) | (19 | ) | (44,786 | ) | — | ||||||||
| Gain on curtailment of pension obligation | 1,802 | 228 | 2 | — | |||||||||||
| Other income (expense), net | — | — | — | 3 | |||||||||||
| Adjusted EBITDA (3) | $ | (19,712 | ) | $ | 54,383 | $ | 36,587 | $ | (36,559 | ) | |||||
| Nine Months Ended |
|||||||||||||||
| Refining | Logistics | Retail | Corporate and Other |
||||||||||||
| Operating income (loss) by segment | $ | (210,433 | ) | $ | 31,513 | $ | 10,131 | $ | (35,077 | ) | |||||
| Depreciation, depletion, and amortization | 39,209 | 16,082 | 8,292 | 2,649 | |||||||||||
| Inventory valuation adjustment | (4,635 | ) | — | — | — | ||||||||||
| LIFO liquidation adjustment | 6,211 | — | — | — | |||||||||||
| RINs loss (gain) in excess of net obligation | 17,985 | — | — | — | |||||||||||
| Unrealized loss (gain) on derivatives | (4,507 | ) | — | — | — | ||||||||||
| Acquisition and integration costs | — | — | — | 600 | |||||||||||
| Severance costs | 88 | — | — | 157 | |||||||||||
| Impairment expense | 38,105 | — | 29,817 | — | |||||||||||
| Other income (expense), net | — | — | — | 1,089 | |||||||||||
| Adjusted EBITDA (4) | $ | (117,977 | ) | $ | 47,595 | $ | 48,240 | $ | (30,582 | ) | |||||
________________________________________
(1) For the three months ended
(2) For the three months ended
(3) For the nine months ended
(4) For the nine months ended
Laramie Energy Adjusted EBITDAX
Adjusted EBITDAX is defined as net income (loss) excluding commodity derivative loss (gain), loss (gain) on settled derivative instruments, interest expense, gain on extinguishment of debt, non-cash preferred dividend, depreciation, depletion, amortization, and accretion, exploration and geological and geographical expense, bonus accrual, equity-based compensation expense, loss (gain) on disposal of assets, and expired acreage (non-cash). We believe Adjusted EBITDAX is a useful supplemental financial measure to evaluate the economic and operational performance of exploration and production companies such as Laramie Energy.
The following table presents a reconciliation of Laramie Energy’s Adjusted EBITDAX to the most directly comparable GAAP financial measure, net income (loss) for the periods indicated (in thousands):
| Three Months Ended |
Nine Months Ended |
||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Net income (loss) | (41,892 | ) | $ | (12,643 | ) | $ | (1,308 | ) | $ | (26,418 | ) | ||||
| Commodity derivative loss (gain) | 56,535 | 4,775 | 57,885 | 2,866 | |||||||||||
| Gain (loss) on settled derivative instruments | (1,679 | ) | 1,143 | (2,846 | ) | 4,777 | |||||||||
| Interest expense and loan fees | 5,225 | 2,373 | 12,428 | 6,884 | |||||||||||
| Gain on extinguishment of debt | (695 | ) | — | (695 | ) | — | |||||||||
| Non-cash preferred dividend | 1,715 | 1,740 | 5,457 | 5,009 | |||||||||||
| Depreciation, depletion, amortization, and accretion | 6,548 | 9,722 | 23,045 | 30,379 | |||||||||||
| Exploration and geological and geographical expense | — | 26 | 342 | 218 | |||||||||||
| Bonus accrual | — | 714 | 602 | 998 | |||||||||||
| Equity-based compensation expense | — | — | — | 16 | |||||||||||
| Loss (gain) on disposal of assets | 33 | 52 | (6 | ) | 233 | ||||||||||
| Expired acreage (non-cash) | 387 | 237 | 725 | 400 | |||||||||||
| Total Adjusted EBITDAX | $ | 26,177 | $ | 8,139 | $ | 95,629 | $ | 25,362 | |||||||
Source: