10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28, 2015

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                     to                     

Commission File No. 001-06198

UNITED REFINING COMPANY (Exact name of registrant as specified in its charter)

Pennsylvania	25-1411751
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
15 Bradley Street
Warren, Pennsylvania	16365
(Address of principal executive office)	(Zip Code)

814-723-1500

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “accelerated filer” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨	Accelerated filer  ¨
Non-accelerated filer  x   (Do not check if a smaller reporting company)	Smaller reporting company  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

As of April 14, 2015, there were 100 shares of common stock, par value $.10 per share, of the Registrant outstanding.

TABLE OF ADDITIONAL REGISTRANTS

Name	State of Other Jurisdiction of Incorporation	IRS Employer Identification Number		Commission File Number
Kiantone Pipeline Corporation	New York		25-1211902		333-35083-01
Kiantone Pipeline Company	Pennsylvania		25-1416278		333-35083-03
United Refining Company of Pennsylvania	Pennsylvania		25-0850960		333-35083-02
United Jet Center, Inc.	Delaware		52-1623169		333-35083-06
Kwik-Fill Corporation	Pennsylvania		25-1525543		333-35083-05
Independent Gas and Oil Company of Rochester, Inc.	New York		06-1217388		333-35083-11
Bell Oil Corp.	Michigan		38-1884781		333-35083-07
PPC, Inc.	Ohio		31-0821706		333-35083-08
Super Test Petroleum, Inc.	Michigan		38-1901439		333-35083-09
Kwik-Fil, Inc.	New York		25-1525615		333-35083-04
Vulcan Asphalt Refining Corporation	Delaware		23-2486891		333-35083-10
Country Fair, Inc.	Pennsylvania		25-1149799		333-35083-12

2

FORM 10-Q – CONTENTS

		PAGE
PART I . FINANCIAL INFORMATION			4
Item 1.	Financial Statements.		4
	Consolidated Balance Sheets – February 28, 2015 (unaudited) and August 31, 2014		4
	Consolidated Statements of Income – Quarter and Six Months Ended February  28, 2015 and 2014 (unaudited)		5
	Consolidated Statements of Comprehensive Income – Quarter and Six Months Ended February 28, 2015 and 2014 (unaudited)		6
	Consolidated Statements of Cash Flows – Six Months Ended February  28, 2015 and 2014 (unaudited)		7
	Notes to Consolidated Financial Statements (unaudited)		8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.		14
Item 3.	Quantitative and Qualitative Disclosures about Market Risk.		22
Item 4.	Controls and Procedures.		22
Item 5.	Other Information.		22
PART II. OTHER INFORMATION			23
Item 1.	Legal Proceedings.		23
Item 1A.	Risk Factors.		23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.		23
Item 3.	Defaults Upon Senior Securities.		23
Item 4.	Mine Safety Disclosures.		23
Item 5.	Other Information.		23
Item 6.	Exhibits.		23
Signatures.			24

3

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

UNITED REFINING COMPANY AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands, except share amounts)

	February 28, 2015 (Unaudited)			August 31, 2014
Assets
Current:
Cash and cash equivalents	$	59,997		$	99,037
Accounts receivable, net		72,358			92,391
Refundable income taxes		—			6,000
Inventories, net		198,779			151,472
Prepaid income taxes		23,820			13,674
Prepaid expenses and other assets		29,021			67,168
Amounts due from affiliated companies, net		143			—
Total current assets		384,118			429,742
Property, plant and equipment, net		326,697			317,519
Deferred financing costs, net		2,961			3,575
Goodwill		1,349			1,349
Tradename		10,500			10,500
Amortizable intangible assets, net		831			951
Deferred integrity and replacement costs, net		61,775			64,916
Deferred turnaround costs and other assets, net		37,123			41,912
	$	825,354		$	870,464
Liabilities and Stockholder’s Equity
Current:
Current installments of long-term debt	$	1,540		$	1,551
Accounts payable		37,873			91,881
Accrued liabilities		14,471			18,691
Sales, use and fuel taxes payable		16,516			20,550
Deferred income taxes		2,810			2,810
Amounts due to affiliated companies, net		—			1,521
Total current liabilities		73,210			137,004
Long term debt: less current installments		238,071			237,974
Deferred income taxes		65,682			44,140
Deferred retirement benefits		64,380			67,121
Total liabilities		441,343			486,239
Commitments and contingencies
Stockholder’s equity:
Common stock; $.10 par value per share – shares authorized 100; issued and outstanding 100		—			—
Series A Preferred stock; $1,000 par value per share – shares authorized 25,000; issued and outstanding 14,116		14,116			14,116
Additional paid-in capital		156,810			156,810
Retained earnings		223,021			222,495
Accumulated other comprehensive loss		(9,936	)		(9,196	)
Total stockholder’s equity		384,011			384,225
	$	825,354		$	870,464

See accompanying notes to consolidated financial statements.

4

UNITED REFINING COMPANY AND SUBSIDIARIES

Consolidated Statements of Income – (Unaudited)

(in thousands)

	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
Net sales	$	580,904		$	773,719		$	1,405,601		$	1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		518,629			622,961			1,255,797			1,461,126
Selling, general and administrative expenses		40,958			41,781			81,996			82,927
Depreciation and amortization expenses		10,525			7,140			20,877			14,130
		570,112			671,882			1,358,670			1,558,183
Operating income		10,792			101,837			46,931			107,251
Other expense:
Interest expense, net		(6,632	)		(6,569	)		(13,290	)		(13,103	)
Other, net		(1,549	)		(733	)		(2,157	)		(1,397	)
		(8,181	)		(7,302	)		(15,447	)		(14,500	)
Income before income tax expense		2,611			94,535			31,484			92,751
Income tax expense		1,008			36,865			12,267			36,168
Net income	$	1,603		$	57,670		$	19,217		$	56,583

See accompanying notes to consolidated financial statements.

5

UNITED REFINING COMPANY AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income – (Unaudited)

(in thousands)

	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
Net income	$	1,603		$	57,670		$	19,217		$	56,583
Other comprehensive loss, net of taxes:
Unrecognized post retirement loss, net of taxes of $(237) and $(120) for the three months ended February 28, 2015 and 2014, respectively and $(474) and $(239) for the six months ended February 28, 2015 and 2014, respectively		(370	)		(171	)		(740	)		(343	)
Other comprehensive loss		(370	)		(171	)		(740	)		(343	)
Total comprehensive income	$	1,233		$	57,499		$	18,477		$	56,240

See accompanying notes to consolidated financial statements.

6

UNITED REFINING COMPANY AND SUBSIDIARIES

Consolidated Statements of Cash Flows – (Unaudited)

(in thousands)

	Six Months Ended February 28,
	2015			2014
Cash flows from operating activities:
Net income	$	19,217		$	56,583
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		22,096			15,286
Deferred income taxes		22,016			1,786
Loss on asset dispositions		766			13
Cash used in working capital items		(28,569	)		(26,103	)
Change in operating assets and liabilities:
Other assets, net		137			338
Deferred retirement benefits		(3,955	)		(3,702	)
Total adjustments		12,491			(12,382	)
Net cash provided by operating activities		31,708			44,201
Cash flows from investing activities:
Additions to property, plant and equipment		(20,069	)		(20,353	)
Additions to deferred turnaround costs		(2,558	)		(3,124	)
Additions to deferred integrity and replacement costs		(28,630	)		—
Proceeds from asset dispositions		4			56
Net cash used in investing activities		(51,253	)		(23,421	)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder		(18,691	)		(4,810	)
Proceeds from issuance of long-term debt		—			1,426
Principal reductions of long-term debt		(804	)		(1,000	)
Distribution to parent under the tax sharing agreement		—			(2,593	)
Net cash used in financing activities		(19,495	)		(6,977	)
Net (decrease) increase in cash and cash equivalents		(39,040	)		13,803
Cash and cash equivalents, beginning of year		99,037			158,537
Cash and cash equivalents, end of period	$	59,997		$	172,340
Cash provided by (used in) working capital items:
Accounts receivable, net	$	20,033		$	27,157
Refundable income taxes		6,000			20,890
Inventories, net		(47,307	)		(94,602	)
Prepaid income taxes		(10,146	)		—
Prepaid expenses and other assets		38,147			11,312
Amounts due from/to affiliated companies, net		(1,664	)		(353	)
Accounts payable		(25,378	)		(2,802	)
Accrued liabilities		(4,220	)		(3,427	)
Income taxes payable		—			16,317
Sales, use, and fuel taxes payable		(4,034	)		(595	)
Total change	$	(28,569	)	$	(26,103	)
Cash paid during the period for:
Interest	$	12,758		$	12,755
Income taxes	$	339		$	16,151
Non-cash investing activities:
Property additions & capital leases	$	285		$	241

See accompanying notes to consolidated financial statements.

7

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

1. Description of Business and Basis of Presentation

The consolidated financial statements include the accounts of United Refining Company and its subsidiaries, United Refining Company of Pennsylvania and its subsidiaries, United Biofuels, Inc. and Kiantone Pipeline Corporation (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation.

The Company is a petroleum refiner and marketer in its primary market area of Western New York and Northwestern Pennsylvania. Operations are organized into two business segments: wholesale and retail.

The wholesale segment is responsible for the acquisition of crude oil, petroleum refining, supplying petroleum products to the retail segment and the marketing of petroleum products to wholesale and industrial customers. The retail segment operates a network of Company operated retail units under the Red Apple Food Mart^® and Country Fair^® brand names selling petroleum products under the Kwik Fill^®, Citgo^® and Keystone^® brand names, as well as convenience and grocery items.

The Company is a wholly-owned subsidiary of United Refining, Inc., a wholly-owned subsidiary of United Acquisition Corp., which in turn is a wholly-owned subsidiary of Red Apple Group, Inc. (the “Parent”).

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended February 28, 2015 are not necessarily indicative of the results that may be expected for the year ending August 31, 2015. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Form 10-K for the fiscal year ended August 31, 2014.

2. Inventories

Inventories are stated at the lower of cost or market, with cost being determined under the Last-in, First-out (LIFO) method for crude oil and petroleum product inventories and the First-in, First-out (FIFO) method for merchandise. Supply inventories are stated at either the lower of cost or market or replacement cost and include various parts for the refinery operations.

Inventories consist of the following:

	February 28, 2015		August 31, 2014
	(in thousands)
Crude Oil	$	41,199	$	36,667
Petroleum Products		104,357		63,252
Total @ LIFO		145,556		99,919
Merchandise		24,221		23,983
Supplies		29,002		27,570
Total @ FIFO		53,223		51,553
Total Inventory	$	198,779	$	151,472

8

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

As of February 28, 2015 and August 31, 2014, the replacement cost of LIFO inventories exceeded their LIFO carrying values by approximately $7,308,000 and $109,711,000, respectively. In accordance with ASC 270, Interim Reporting, and ASC 330, Inventory, as of February 28, 2015 the Company has not recorded any reserve against its LIFO carrying values (which amounted to $8,629,000) as the current decline in market values is reasonably expected to be temporary and be restored in the current fiscal year.

3. Segments of Business

Intersegment revenues are calculated using market prices and are eliminated upon consolidation. Summarized financial information regarding the Company’s reportable segments is presented in the following tables (in thousands):

	Three Months Ended February 28,					Six Months Ended February 28,
	2015		2014			2015		2014
Net Sales
Retail	$	298,666	$	392,756		$	677,822	$	806,484
Wholesale		282,238		380,963			727,779		858,950
	$	580,904	$	773,719		$	1,405,601	$	1,665,434
Intersegment Sales
Wholesale	$	116,350	$	203,890		$	296,606	$	417,591
Operating Income (Loss)
Retail	$	8,040	$	(5,915	)	$	17,799	$	(4,530	)
Wholesale		2,752		107,752			29,132		111,781
	$	10,792	$	101,837		$	46,931	$	107,251
Depreciation and Amortization
Retail	$	1,793	$	1,578		$	3,556	$	3,139
Wholesale		8,732		5,562			17,321		10,991
	$	10,525	$	7,140		$	20,877	$	14,130

	February 28, 2015		August 31, 2014
Total Assets	$	163,957	$	186,277
Retail		661,397		684,187
Wholesale	$	825,354	$	870,464

9

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

4. Subsidiary Guarantors

All of the Company’s wholly-owned subsidiaries fully and unconditionally guarantee on an unsecured basis, on a joint and several basis, the Company’s 10.50% Senior Secured Notes due 2018. There are no restrictions within the consolidated group on the ability of the Company or any of its subsidiaries to obtain loans from or pay dividends to other members of the consolidated group. Financial information of the Company’s wholly-owned subsidiary guarantors is as follows:

Condensed Consolidating Balance Sheets

(in thousands)

	February 28, 2015												August 31, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company  & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company  & Subsidiaries
Assets
Current:
Cash and cash equivalents	$	47,174		$	12,823		$	—		$	59,997		$	79,356		$	19,681		$	—		$	99,037
Accounts receivable, net		46,832			25,526			—			72,358			51,452			40,939			—			92,391
Refundable income taxes		—			—			—			—			6,000			—			—			6,000
Inventories, net		171,007			27,772			—			198,779			122,161			29,311			—			151,472
Prepaid income taxes		28,865			(5,045	)		—			23,820			16,918			(3,244	)		—			13,674
Prepaid expenses and other assets		22,659			6,362			—			29,021			62,889			4,279			—			67,168
Amounts due from affiliated companies, net		—			143			—			143			—			—			—			—
Intercompany		107,494			(3,677	)		(103,817	)		—			127,105			1,116			(128,221	)		—
Total current assets		424,031			63,904			(103,817	)		384,118			465,881			92,082			(128,221	)		429,742
Property, plant and equipment, net		204,973			121,724			—			326,697			199,703			117,816			—			317,519
Deferred financing costs, net		2,961			—			—			2,961			3,575			—			—			3,575
Goodwill and other non-amortizable assets		—			11,849			—			11,849			—			11,849			—			11,849
Amortizable intangible assets, net		—			831			—			831			—			951			—			951
Deferred integrity and replacement costs, net		61,775			—			—			61,775			64,916			—			—			64,916
Deferred turnaround costs & other assets		32,571			4,552			—			37,123			39,302			2,610			—			41,912
Investment in subsidiaries		45,759			—			(45,759	)		—			35,811			—			(35,811	)		—
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464
Liabilities and Stockholder’s Equity
Current:
Current installments of long-term debt	$	523		$	1,017		$	—		$	1,540		$	519		$	1,032		$	—		$	1,551
Accounts payable		17,728			20,145			—			37,873			64,965			26,916			—			91,881
Accrued liabilities		8,246			6,225			—			14,471			12,315			6,376			—			18,691
Sales, use and fuel taxes payable		12,519			3,997			—			16,516			16,037			4,513			—			20,550
Deferred income taxes		3,770			(960	)		—			2,810			3,770			(960	)		—			2,810
Amounts due to affiliated companies, net		—			—			—			—			—			1,521			—			1,521
Intercompany		—			103,817			(103,817	)		—			—			128,221			(128,221	)		—
Total current liabilities		42,786			134,241			(103,817	)		73,210			97,606			167,619			(128,221	)		137,004
Long term debt: less current installments		233,539			4,532			—			238,071			232,946			5,028			—			237,974
Deferred income taxes		48,767			16,915			—			65,682			28,816			15,324			—			44,140
Deferred retirement benefits		62,967			1,413			—			64,380			65,595			1,526			—			67,121
Total liabilities		388,059			157,101			(103,817	)		441,343			424,963			189,497			(128,221	)		486,239
Commitment and contingencies
Stockholder’s equity
Common stock; $.10 par value per share – shares authorized 100; issued and outstanding 100		—			18			(18	)		—			—			18			(18	)		—
Series A Preferred stock; $1,000 par value per share – shares authorized 25,000; issued and outstanding 14,116		14,116			—			—			14,116			14,116			—			—			14,116
Additional paid-in capital		156,810			16,626			(16,626	)		156,810			156,810			16,626			(16,626	)		156,810
Retained earnings		223,021			30,057			(30,057	)		223,021			222,495			20,143			(20,143	)		222,495
Accumulated other comprehensive loss		(9,936	)		(942	)		942			(9,936	)		(9,196	)		(976	)		976			(9,196	)
Total stockholder’s equity		384,011			45,759			(45,759	)		384,011			384,225			35,811			(35,811	)		384,225
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464

10

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

Condensed Consolidating Statements of Income

(in thousands)

	Three Months Ended February 28, 2015												Three Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company  & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Net sales	$	398,588		$	299,837		$	(117,521	)	$	580,904		$	584,853		$	393,881		$	(205,015	)	$	773,719
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		380,799			255,351			(117,521	)		518,629			464,875			363,101			(205,015	)		622,961
Selling, general and administrative expenses		6,036			34,922			—			40,958			6,473			35,308			—			41,781
Depreciation and amortization expenses		8,481			2,044			—			10,525			5,306			1,834			—			7,140
		395,316			292,317			(117,521	)		570,112			476,654			400,243			(205,015	)		671,882
Operating income (loss)		3,272			7,520			—			10,792			108,199			(6,362	)		—			101,837
Other income (expense):
Interest expense, net		(6,402	)		(230	)		—			(6,632	)		(6,331	)		(238	)		—			(6,569	)
Other, net		(1,744	)		195			—			(1,549	)		(872	)		139			—			(733	)
Equity in net income (loss) of subsidiaries		4,391			—			(4,391	)		—			(3,742	)		—			3,742			—
		(3,755	)		(35	)		(4,391	)		(8,181	)		(10,945	)		(99	)		3,742			(7,302	)
(Loss) income before income tax (benefit) expense		(483	)		7,485			(4,391	)		2,611			97,254			(6,461	)		3,742			94,535
Income tax (benefit) expense		(2,086	)		3,094			—			1,008			39,584			(2,719	)		—			36,865
Net (loss) income	$	1,603		$	4,391		$	(4,391	)	$	1,603		$	57,670		$	(3,742	)	$	3,742		$	57,670

	Six Months Ended February 28, 2015												Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company  & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company  & Subsidiaries
Net sales	$	1,024,385		$	680,183		$	(298,967	)	$	1,405,601		$	1,276,541		$	808,887		$	(419,994	)	$	1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		964,754			590,010			(298,967	)		1,255,797			1,140,600			740,520			(419,994	)		1,461,126
Selling, general and administrative expenses		12,753			69,243			—			81,996			13,004			69,923			—			82,927
Depreciation and amortization expenses		16,776			4,101			—			20,877			10,479			3,651			—			14,130
		994,283			663,354			(298,967	)		1,358,670			1,164,083			814,094			(419,994	)		1,558,183
Operating income (loss)		30,102			16,829			—			46,931			112,458			(5,207	)		—			107,251
Other income (expense):
Interest expense, net		(12,815	)		(475	)		—			(13,290	)		(12,629	)		(474	)		—			(13,103	)
Other, net		(2,517	)		360			—			(2,157	)		(1,720	)		323			—			(1,397	)
Equity in net income (loss) of subsidiaries		9,914			—			(9,914	)		—			(3,076	)		—			3,076			—
		(5,418	)		(115	)		(9,914	)		(15,447	)		(17,425	)		(151	)		3,076			(14,500	)
Income (loss) before income tax expense (benefit)		24,684			16,714			(9,914	)		31,484			95,033			(5,358	)		3,076			92,751
Income tax expense (benefit)		5,467			6,800			—			12,267			38,450			(2,282	)		—			36,168
Net income (loss)	$	19,217		$	9,914		$	(9,914	)	$	19,217		$	56,583		$	(3,076	)	$	3,076		$	56,583

11

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

Condensed Consolidating Statements of Cash Flows

(in thousands)

	Six Months Ended February 28, 2015											Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries			United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries
Net cash provided by operating activities	$	27,712		$	3,996		$	—	$	31,708		$	40,636		$	3,565		$	—	$	44,201
Cash flows from investing activities:
Additions to property, plant and equipment		(11,739	)		(8,330	)		—		(20,069	)		(12,798	)		(7,555	)		—		(20,353	)
Additions to deferred turnaround costs		(543	)		(2,015	)		—		(2,558	)		(3,014	)		(110	)		—		(3,124	)
Additions to deferred integrity and replacement costs		(28,630	)		—			—		(28,630	)		—			—			—		—
Proceeds from asset dispositions		2			2			—		4			56			—			—		56
Net cash used in investing activities		(40,910	)		(10,343	)		—		(51,253	)		(15,756	)		(7,665	)		—		(23,421	)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder		(18,691	)		—			—		(18,691	)		(4,810	)		—			—		(4,810	)
Proceeds from issuance of long-term debt		—			—			—		—			—			1,426			—		1,426
Principal reductions of long-term debt		(293	)		(511	)		—		(804	)		(467	)		(533	)		—		(1,000	)
Distribution to parent under the tax sharing agreement		—			—			—		—			(2,593	)		—			—		(2,593	)
Net cash (used in) provided by financing activities		(18,984	)		(511	)		—		(19,495	)		(7,870	)		893			—		(6,977	)
Net (decrease) increase in cash and cash equivalents		(32,182	)		(6,858	)		—		(39,040	)		17,010			(3,207	)		—		13,803
Cash and cash equivalents, beginning of year		79,356			19,681			—		99,037			141,386			17,151			—		158,537
Cash and cash equivalents, end of period	$	47,174		$	12,823		$	—	$	59,997		$	158,396		$	13,944		$	—	$	172,340

12

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

5. Employee Benefit Plans

For the periods ended February 28, 2015 and 2014, net pension and other postretirement benefit costs were comprised of the following:

	Pension Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	156		$	149		$	313		$	298
Interest cost on benefit obligation		1,212			1,311			2,425			2,622
Expected return on plan assets		(1,587	)		(1,403	)		(3,175	)		(2,806	)
Amortization and deferral of net loss		181			176			361			351
Net periodic benefit cost	$	(38	)	$	233		$	(76	)	$	465

	Other Post-Retirement Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	(151	)	$	193		$	(302	)	$	387
Interest cost on benefit obligation		(413	)		518			(826	)		1,036
Amortization and deferral of net loss		786			(465	)		1,572			(930	)
Net periodic benefit cost	$	222		$	246		$	444		$	493

As of February 28, 2015, $2,142,000 of contributions have been made to the Company pension plans for the fiscal year ending August 31, 2015.

The Company accrues post-retirement benefits other than pensions, during the years that the employees render the necessary service, of the expected cost of providing those benefits to an employee and the employee’s beneficiaries and covered dependents.

6. Fair Value Measurements

The carrying values of all financial instruments classified as a current asset or a current liability approximate fair value because of the short maturity of these instruments. The fair value of marketable securities is determined by available market prices. The fair value exceeded the carrying value of the long term debt at February 28, 2015 and August 31, 2014 by $17,812,000 and $28,041,000, respectively.

7. Subsequent Events

On April 8, 2015 (the “Execution Date”), the Company entered into a Put and Call Option Agreement with each of Enbridge Energy Limited Partnership (“Enbridge LP”) and Enbridge Pipelines Inc. (“Enbridge Inc.” and, together with Enbridge LP, the “Carriers”). The Put and Call Option Agreement entered into with Enbridge LP (the “U.S. Agreement”) is substantially similar to the Put and Call Option Agreement entered into with Enbridge Inc. (the “Canadian Agreement” and, together with the U.S. Agreement, the “Put and Call Agreement”). The Put

13

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

and Call Agreement was contemplated in that certain Letter Agreement, originally executed on July 31, 2014 and last amended on April 8, 2015 (the “Letter Agreement”), between the Company and the Carriers relating to approximately 88.85 miles of pipeline owned by the Carriers, which transports crude oil from Canada to the Company’s Kiantone Pipeline in West Seneca, New York, and serves the Company’s refinery in Warren, Pennsylvania (“Line 10”). The Letter Agreement related to the parties’ agreement concerning funding certain integrity and replacement costs for Line 10. The Letter Agreement also contemplated that the parties would enter into a put and call agreement relating to the sale of Line 10 from the Carriers to the Company.

The Carriers own the pipeline facilities generally identified as Line 10, including real property interests through and under which Line 10 passes, the Carriers’ assignable permits related to the ownership and operation of Line 10, as well as personal property, contract rights, records and incidental rights held solely in connection with Line 10 (collectively, the “Assets”). Pursuant to the Put and Call Agreement, the Carriers granted the Company a right (the “Call Option”) to purchase all of the Assets and the Company granted the Carriers the right to put all the Assets to the Company (the “Put Option” and, together with the Call Option, the “Purchase Options”) subject to the terms and conditions of the Put and Call Agreement.

The Carrier’s Put Option is exercisable beginning on the date that is the earlier of (a) January 1, 2026 and (b) the date that is 30 days after the latest of (i) the date on which the Carriers give notice that the Line 10 replacement work performed pursuant to the Letter Agreement is sufficiently completed (as contemplated in the Call and Put Agreement) and (ii) the ninth (9^th) anniversary of the Execution Date (the “Put Option Commencement Date”). The Put Option terminates on the date that is 24 months after either (a) the Put Option Commencement Date if such date is the first of a month or (b) the first day of the calendar month immediately following the Put Option Commencement Date if it is not the first day of the month (the “Put/Call Option Expiry Date”). The Company’s Call Option is exercisable at any time beginning on the Execution Date and ending on the Put/Call Option Expiry Date.

The purchase price of the Assets (the “Purchase Price”) shall be calculated as follows: the sum of (a) 70% of the book value of the Assets as of July 31, 2014 minus annual depreciation, (b) 100% of total replacement costs for any segment replacements on the Pipeline commenced by the Carrier, whether completed or ongoing on the date of Asset sale is consummated (the “Closing Date”), minus any of such expenses paid by the Company and (c) 100% of the total regulatory requirements costs for any regulatory work commenced by the Carrier, whether completed or ongoing at the Closing Date, minus any of such expenses paid by the Company. The Purchase Price shall be subject to adjustment pursuant to the Agreement with respect to certain work ongoing at the Closing Date.

Among other customary conditions to closing, Carrier’s obligation to close the sale of the Assets is conditioned on the Company’s payment of all obligations outstanding pursuant to the Put and Call Agreement and the Letter Agreement. In addition, the sale of Assets pursuant to the U.S. Agreement shall close concurrently with the sale of the Assets pursuant to the Canadian Agreement.

The Company and the Carrier agreed that certain work must be undertaken in order to carve out portions of Line 10 in Canada from the Enbridge mainline system and allow it to operate independently. In the event any work is required to similarly separate the U.S. portion of Line 10 from the Enbridge mainline system (the “Carve-Out Work”), a plan to perform such Carve-Out Work that would result in expenses greater than $38.5 million will require the approval of the Company.

In the event any of the maintenance, regulatory requirement, or replacement work contemplated in the Letter Agreement or the Put and Call Agreement (collectively, the “Work”) is outstanding at the Closing Date,

14

UNITED REFINING COMPANY AND SUBSIDIARIES

Notes to Consolidated Financial Statements

(Unaudited)

concurrently with the closing of the Asset sale, the Company and the Carriers will enter into an operating agreement (the “Operating Agreement”) pursuant to which the Carriers will provide certain operational and administrative services (the “Services”) while the Work is ongoing and complete such Work. As payment for the Services and completion of the Work, the Carriers shall be: (i) reimbursed for all expenses of providing the Services, (ii) paid a fixed fee of on an annual basis, which shall be subject to a 2% increase for each successive year following the first year of the Operating Agreement, and (ii) paid for all expenses of the Work not previously paid, as well as a 2.25% construction management fee.

The Put and Call Agreement may be terminated by the mutual consent of the Company and the Carriers and shall automatically terminate if neither Purchase Option is exercised prior to the Put/Call Option Expiry Date. Moreover, either the Company or a Carrier may terminate the Put and Call Agreement if a closing of the Asset sale shall not have occurred on or before December 31, 2028 assuming the terminating party is not then in breach of the Put and Call Agreement and if a party has breached a representation, such breach has not been cured within the time periods allotted by the Put and Call Agreement. Finally, the Company may terminate the Put and Call Agreement by notifying the Carriers to cease the replacement work contemplated in the Letter Agreement.

15

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward Looking Statements

This Quarterly Report on Form 10-Q contains certain statements that constitute “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements may include, among other things, United Refining Company and its subsidiaries current expectations with respect to future operating results, future performance of its refinery and retail operations, capital expenditures and other financial items. Words such as “expects”, “intends”, “plans”, “projects”, “believes”, “estimates”, “may”, “will”, “should”, “shall”, “anticipates”, “predicts”, and similar expressions typically identify such forward looking statements in this Quarterly Report on Form 10-Q.

By their nature, all forward looking statements involve risk and uncertainties. All phases of the Company’s operations involve risks and uncertainties, many of which are outside of the Company’s control, and any one of which, or a combination of which, could materially affect the Company’s results of operations and whether the forward looking statements ultimately prove to be correct. Actual results may differ materially from those contemplated by the forward looking statements for a number of reasons.

Although we believe our expectations are based on reasonable assumptions within the bounds of its knowledge, investors and prospective investors are cautioned that such statements are only projections and that actual events or results may differ materially depending on a variety of factors described in greater detail in the Company’s filings with the SEC, including quarterly reports on Form 10-Q, annual reports on Form 10-K, current reports on Form 8-K, etc. In addition to the factors discussed elsewhere in this Quarterly Report on Form 10-Q, the Company’s actual consolidated quarterly or annual operating results have been affected in the past, or could be affected in the future, by additional factors, including, without limitation:

• the demand for and supply of crude oil and refined products;

• the spread between market prices for refined products and market prices for crude oil;

• repayment of debt;

• general economic, business and market conditions;

• risks and uncertainties with respect to the actions of actual or potential competitive suppliers of refined petroleum products in our markets;

• the possibility of inefficiencies or shutdowns in refinery operations or pipelines;

• the availability and cost of financing to us;

• environmental, tax and tobacco legislation or regulation;

• volatility of gasoline prices, margins and supplies;

• merchandising margins;

• labor costs;

• level of capital expenditures;

• customer traffic;

• weather conditions;

• acts of terrorism and war;

• business strategies;

• expansion and growth of operations;

• future projects and investments;

• future exposure to currency devaluations or exchange rate fluctuations;

16

• expected outcomes of legal and administrative proceedings and their expected effects on our financial position, results of operations and cash flows; and

• future operating results and financial condition.

All subsequent written and oral forward looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the foregoing. We undertake no obligation to update any information contained herein or to publicly release the results of any revisions to any such forward looking statements that may be made to reflect events or circumstances that occur, or which we become aware of, after the date of this Quarterly Report on Form 10-Q.

Recent Developments

The Company continues to be impacted by the volatility in petroleum markets in fiscal 2015. NYMEX crude prices decreased $55 per barrel or 54% from August 31, 2014 to February 28, 2015. This decrease in crude price is reflected in decreased selling prices and subsequent net sales for the Company.

The lagged 3-2-1 crackspread is measured by the difference between the prices of crude oil contracts traded on the NYMEX for the preceding month to the prices of NYMEX gasoline and heating oil contracts in the current trading month. The Company uses a lagged crackspread as a margin indicator as it reflects the margin during the time period between the purchase of crude oil and its delivery to the refinery for processing. The lagged crackspread for the second quarter of fiscal 2015 was $8.04. Through April 2, 2015 the indicated lagged crackspread for the third quarter ending May 31, 2015 was $24.67, a $16.63 increase from the average for the second quarter of fiscal 2015.

Results of Operations

The Company is a petroleum refiner and marketer in its primary market area of Western New York and Northwestern Pennsylvania. Operations are organized into two business segments: wholesale and retail.

The wholesale segment is responsible for the acquisition of crude oil, petroleum refining, supplying petroleum products to the retail segment and the marketing of petroleum products to wholesale and industrial customers. The retail segment sells petroleum products under the Kwik Fill^®, Citgo^® and Keystone^® brand names through a network of Company-operated retail units and convenience and grocery items through Company-owned gasoline stations and convenience stores under the Red Apple Food Mart^® and Country Fair^® brand names.

A discussion and analysis of the factors contributing to the Company’s results of operations are presented below. The accompanying Consolidated Financial Statements and related Notes, together with the following information, are intended to supply investors with a reasonable basis for evaluating the Company’s operations, but does not serve to predict the Company’s future performance.

17

Retail Operations:

	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(dollars in thousands)
Net Sales
Petroleum	$	235,985		$	330,749		$	546,950		$	676,461
Merchandise and other		62,681			62,007			130,872			130,023
Total Net Sales	$	298,666		$	392,756		$	677,822		$	806,484
Costs of goods sold	$	254,025		$	361,878		$	587,452		$	738,155
Selling, general and administrative expenses		34,808			35,215			69,015			69,720
Depreciation and amortization expenses		1,793			1,578			3,556			3,139
Segment Operating Income (Loss)	$	8,040		$	(5,915	)	$	17,799		$	(4,530	)
Retail Operating Data:
Petroleum sales (thousands of gallons)		89,712			91,657			182,182			189,131
Petroleum margin (a)	$	28,610		$	15,363		$	56,941		$	35,756
Petroleum margin ($/gallon) (b)		.3189			.1676			.3126			.1891
Merchandise and other margins	$	16,031		$	15,515		$	33,429		$	32,573
Merchandise margin (percent of sales)		25.6	%		25.0	%		25.5	%		25.1	%

(a) Includes the effect of intersegment purchases from the Company’s wholesale segment at prices which approximate market.

(b) Company management calculates petroleum margin per gallon by dividing petroleum gross margin by petroleum sales volumes. Management uses fuel margin per gallon calculations to compare profitability to other companies in the industry. Petroleum margin per gallon may not be comparable to similarly titled measures used by other companies in the industry.

Comparison of Fiscal Quarters Ended February 28, 2015 and 2014

Net Sales

Retail sales decreased during the fiscal quarter ended February 28, 2015 by $94.1 million or 24.0% from the comparable period in fiscal 2014 from $392.8 million to $298.7 million. The decrease was due to a $94.8 million decrease in petroleum sales offset by an increase in merchandise sales of $.7 million. The petroleum sales decrease resulted from a 1.9 million gallon or a 2.1% decrease in retail petroleum volume and a 27.1% decrease in retail selling prices per gallon.

Costs of Goods Sold

Retail costs of goods sold decreased during the fiscal quarter ended February 28, 2015 by $107.9 million or 29.8% from the comparable period in fiscal 2014 from $361.9 million to $254.0 million. The decrease was primarily due to $111.6 million in petroleum purchase costs and $.1 million in freight costs offset by an increase of $.1 million in merchandise costs and fuel taxes of $3.7 million.

18

Selling, General and Administrative Expenses

Retail Selling, General and Administrative (“SG&A”) expenses remained relatively constant during the fiscal quarters ended February 28, 2015 and 2014.

Comparison of Six Months Ended February 28, 2015 and 2014

Net Sales

Retail sales decreased during the six months ended February 28, 2015 by $128.7 million or 16.0% from the comparable period in fiscal 2014 from $806.5 million to $677.8 million. The decrease was primarily due to $129.5 million in petroleum sales, offset by an increase of $.8 million in merchandise sales. The petroleum sales decrease resulted from a 16.1% decrease in retail selling prices per gallon and a 6.9 million gallon or 3.7% decrease in sales volume.

Costs of Goods Sold

Retail costs of goods sold decreased during the six months ended February 28, 2015 by $150.7 million or 20.4% from the comparable period in fiscal 2014 from $738.2 million to $587.5 million. The decrease was primarily due to $156.5 million in petroleum purchase prices and freight costs of $.3 million, offset by an increase in fuel taxes of $6.1 million.

Selling, General and Administrative Expenses

Retail Selling, General and Administrative (“SG&A”) expenses remained relatively constant during the six months ended February 28, 2015 and 2014.

Wholesale Operations:

	Three Months Ended February 28,				Six Months Ended February 28,
	2015		2014		2015		2014
	(dollars in thousands)
Net Sales (a)	$	282,238	$	380,963	$	727,779	$	858,950
Costs of goods sold (exclusive of depreciation, amortization)		264,604		261,083		668,345		722,971
Selling, general and administrative expenses		6,150		6,566		12,981		13,207
Depreciation and amortization expenses		8,732		5,562		17,321		10,991
Segment Operating Income	$	2,752	$	107,752	$	29,132	$	111,781

19

Key Wholesale Operating Statistics:

	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
Refinery Product Yield (thousands of barrels)
Gasoline and gasoline blendstock		2,659			2,420			5,192			5,132
Distillates		1,259			1,236			2,631			2,637
Asphalt		1,751			1,697			3,588			3,687
Butane, propane, residual products, internally produced fuel and other (“Other”)		560			642			1,214			1,190
Total Product Yield		6,229			5,995			12,625			12,646
% Heavy Crude Oil of Total Refinery Throughput (b)		61	%		61	%		62	%		62	%
Crude throughput (thousand barrels per day)		61.8			59.7			63.0			63.5
Product Sales (thousand of barrels) (a)
Gasoline and gasoline blendstock		1,596			1,346			3,167			2,785
Distillates		1,097			880			2,184			1,969
Asphalt		1,347			1,295			3,108			3,226
Other		161			199			353			464
Total Product Sales Volume		4,201			3,720			8,812			8,444
Product Sales (dollars in thousands) (a)
Gasoline and gasoline blendstock	$	101,894		$	152,000		$	256,131		$	314,894
Distillates		89,494			119,896			210,680			260,177
Asphalt		86,069			96,190			246,522			254,599
Other		4,781			12,877			14,446			29,280
Total Product Sales	$	282,238		$	380,963		$	727,779		$	858,950

(a) Sources of total product sales include products manufactured at the refinery located in Warren, Pennsylvania and products purchased from third parties.

(b) The Company defines “heavy” crude oil as crude oil with an American Petroleum Institute specific gravity of 26 or less.

Comparison of Fiscal Quarters Ended February 28, 2015 and 2014

Net Sales

Wholesale sales decreased during the three months ended February 28, 2015 by $98.7 million or 25.9% from the comparable period in fiscal 2014 from $380.9 million to $282.2 million. The decrease was due primarily to a 25.9% decrease in wholesale prices offset by an increase of 12.9% in wholesale volume.

Costs of Goods Sold (exclusive of depreciation and amortization)

Wholesale costs of goods sold increased during the three months ended February 28, 2015 by $3.5 million or 1.3% from the comparable period in fiscal 2014 from $261.1 million to $264.6 million. The increase in wholesale costs of goods sold during this period was primarily due to an increase in volume of raw materials.

Selling, General and Administrative Expenses

Wholesale SG&A expenses remained relatively constant during the three months ended February 28, 2015 and 2014.

20

Depreciation and Amortization

Depreciation, amortization increased during the three months ended February 28, 2015 by $3.2 million for the comparable period for fiscal 2014 from $5.5 million to $8.7 million. The increase was primarily due to increases of $1.6 million in turnaround cost amortization and $1.6 million amortization of integrity and replacement costs.

Comparison of Six Months Ended February 28, 2015 and 2014

Net Sales

Wholesale sales decreased during the six months ended February 28, 2015 by $131.2 million or 15.3% from the comparable period in fiscal 2014 from $859.0 million to $727.8 million. The decrease was due to a 15.3% decrease in wholesale prices offset by a 4.4% increase in wholesale volume.

Costs of Goods Sold (exclusive of depreciation and amortization)

Wholesale costs of goods sold decreased during the six months ended February 28, 2015 by $54.6 million or 7.6% from the comparable period in fiscal 2014 from $723.0 million to $668.4 million. The decrease in wholesale costs of goods sold was primarily due to a decrease in the cost and volume of raw materials.

Selling, General and Administrative Expenses

Wholesale SG&A expenses remained relatively constant during the six months ended February 28, 2015 and 2014.

Depreciation and Amortization

Depreciation, amortization increased during the three months ended February 28, 2015 by $6.3 million for the comparable period for fiscal 2014 from $11.0 million to $17.3 million. The increase was primarily due to increases of $3.2 million in turnaround cost amortization and $3.1 million amortization of integrity and replacement costs.

Consolidated Expenses:

Interest Expense, net

Net interest expense (interest expense less interest income) remained relatively constant during the three and six months ended February 28, 2015 and 2014.

Income Tax Expense

The Company’s effective tax rate remained approximately 39% for the three and six months ended February 28, 2015 and 2014.

Liquidity and Capital Resources

We operate in an environment where our liquidity and capital resources are impacted by changes in the price of crude oil and refined petroleum products, availability of credit, market uncertainty and a variety of additional factors beyond our control. Included in such factors are, among others, the level of customer product demand, weather conditions, governmental regulations, worldwide political conditions and overall market and economic conditions.

21

The following table summarizes selected measures of liquidity and capital sources (in thousands):

	February 28, 2015
Cash and cash equivalents	$	59,997
Working capital	$	310,908
Current ratio		5.2
Debt	$	239,611

Primary sources of liquidity have been cash and cash equivalents, and borrowing availability under our revolving credit facility (the “Amended and Restated Revolving Credit Facility”) with PNC Bank, N.A. as Administrator (the “Agent Bank”). We believe available capital resources are adequate to meet our working capital, debt service, and capital expenditure requirements for existing operations.

Our cash and cash equivalents consist of bank balances and investments in money market funds. These investments have staggered maturity dates, none of which exceed three months. They have a high degree of liquidity since the securities are traded in public markets.

Significant Uses of Cash

The changes in cash for the six months ended February 28, 2015 are described below.

The cash used in working capital is shown below:

	Six Months Ended February 28, 2015
	(in millions)
Cash used in working capital items:
Prepaid expense decrease	$	38.1
Accounts receivable decrease		20.0
Refundable income taxes decrease		6.0
Inventory increase		(47.3	)
Accounts payable decrease		(25.4	)
Prepaid income taxes increase		(10.1	)
Accrued liabilities decrease		(4.2	)
Sales, use and fuel taxes payable decrease		(4.0	)
Amounts due from affiliated companies, net		(1.7	)
Total change	$	(28.6	)

Available cash on hand decreased by $39.0 million. Other cash uses included:

• Fund operating activities used in working capital items of $28.6 million

• Fund capital expenditures and deferred turnaround costs of $22.6 million

• Dividends to preferred shareholder and common stockholder of $18.7 million

• Scheduled long-term debt repayments of $.8 million

• Fund deferred integrity and replacement costs of $28.6 million

We require a substantial investment in working capital which is susceptible to large variations during the year resulting from purchases of inventory and seasonal demands. Inventory purchasing activity is a function of sales activity and turnaround cycles for the different refinery units.

22

Maintenance and non-discretionary capital expenditures have averaged approximately $6.0 million annually over the last three years for the refining and marketing operations. Management does not foresee any increase in these maintenance and non-discretionary capital expenditures during fiscal year 2015 at this time.

Future liquidity, both short and long-term, will continue to be primarily dependent on realizing a refinery margin sufficient to cover fixed and variable expenses, including planned capital expenditures. We expect to be able to meet our working capital, capital expenditure, contractual obligations, letter of credit and debt service requirements out of cash flow from operations, cash on hand and borrowings under our Amended and Restated Revolving Credit Facility of $175,000,000. This provides the Company with flexibility relative to its cash flow requirements in light of market fluctuations, particularly involving crude oil prices and seasonal business cycles and will assist the Company in meeting its working capital, ongoing capital expenditure needs and for general corporate purposes. The agreement expires on November 29, 2017. Under the Amended and Restated Revolving Credit Facility, the applicable margin is calculated on the average unused availability as follows: (a) for base rate borrowing, at the greater of the Agent Bank’s prime rate or the Federal Funds Open Rate plus .75%; or the Daily LIBOR rate plus 2.75%; plus an applicable margin of 0% to .5%; (b) for euro-rate based borrowings, at the LIBOR Rate plus an applicable margin of 2.25% to 3.25%. The Agent Bank’s prime rate at February 28, 2015 was 3.25%.

The Amended and Restated Revolving Credit Facility is secured primarily by certain cash accounts, accounts receivable and inventory. Until maturity, we may borrow on a borrowing base formula as set forth in the facility. We had standby letters of credit of $8.8 million as of February 28, 2015 and there were no outstanding borrowings under the Amended and Restated Revolving Credit Facility resulting in net availability of $166.2 million. As of April 14, 2015, there were no outstanding borrowings under the Amended and Restated Revolving Credit Facility and there were standby letters of credit in the amount of $8.8 million, resulting in a net availability of $166.2 million and the Company had full access to it. The Company’s working capital ratio was 5.2 as of February 28, 2015.

Although we are not aware of any pending circumstances which would change our expectation, changes in the tax laws, the imposition of and changes in federal and state clean air and clean fuel requirements and other changes in environmental laws and regulations may also increase future capital expenditure levels. Future capital expenditures are also subject to business conditions affecting the industry. We continue to investigate strategic acquisitions and capital improvements to our existing facilities.

Federal, state and local laws and regulations relating to the environment affect nearly all of our operations. As is the case with all the companies engaged in similar industries, we face significant exposure from actual or potential claims and lawsuits involving environmental matters. Future expenditures related to environmental matters cannot be reasonably quantified in many circumstances due to the uncertainties as to required remediation methods and related clean-up cost estimates. We cannot predict what additional environmental legislation or regulations will be enacted or become effective in the future or how existing or future laws or regulations will be administered or interpreted with respect to products or activities to which they have not been previously applied.

Seasonal Factors

Seasonal factors affecting the Company’s business may cause variation in the prices and margins of some of the Company’s products. For example, demand for gasoline tends to be highest in spring and summer months, while demand for home heating oil and kerosene tends to be highest in winter months.

As a result, the margin on gasoline prices versus crude oil costs generally tends to increase in the spring and summer, while margins on home heating oil and kerosene tend to increase in the winter.

23

Inflation

The effect of inflation on the Company has not been significant during the last five fiscal years.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

The Company uses its Amended and Restated Revolving Credit Facility to finance a portion of its operations. This on-balance sheet financial instrument, to the extent it provides for variable rates, exposes the Company to interest rate risk resulting from changes in the Agent Bank’s Prime rate, the Federal Funds or LIBOR rate. As of April 14, 2015, there were no outstanding borrowings under the Amended and Restated Revolving Credit Facility.

From time to time, the Company uses derivatives to reduce its exposure to fluctuations in crude oil purchase costs and refining margins. Derivative products, specifically crude oil option contracts and crack spread option contracts are used to hedge the volatility of these items. The Company accounts for changes in the fair value of its contracts by marking them to market and recognizing any resulting gains or losses in its Consolidated Statements of Income. There has been no derivative activity in fiscal 2015.

Item 4. Controls and Procedures.

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of February 28, 2015. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of February 28, 2015, our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

There have not been any changes in the Company’s internal controls over financial reporting that occurred during the Company’s fiscal quarter ended February 28, 2015 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

24

Part II OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There have been no material changes in our Risk Factors disclosed in the Form 10-K for the year ended August 31, 2014.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

On April 8, 2015 (the “Execution Date”), the Company entered into a Put and Call Option Agreement with each of Enbridge Energy Limited Partnership (“Enbridge LP”) and Enbridge Pipelines Inc. (“Enbridge Inc.” and, together with Enbridge LP, the “Carriers”). The Put and Call Option Agreement entered into with Enbridge LP (the “U.S. Agreement”) is substantially similar to the Put and Call Option Agreement entered into with Enbridge Inc. (the “Canadian Agreement” and, together with the U.S. Agreement, the “Put and Call Agreement”). The Put and Call Agreement was contemplated in that certain Letter Agreement, originally executed on July 31, 2014 and last amended on April 8, 2015 (the “Letter Agreement”), between the Company and the Carriers relating to approximately 88.85 miles of pipeline owned by the Carriers, which transports crude oil from Canada to the Company’s Kiantone Pipeline in West Seneca, New York, and serves the Company’s refinery in Warren, Pennsylvania (“Line 10”). The Letter Agreement related to the parties’ agreement concerning funding certain integrity and replacement costs for Line 10. The Letter Agreement also contemplated that the parties would enter into a put and call agreement relating to the sale of Line 10 from the Carriers to the Company.

The Carriers own the pipeline facilities generally identified as Line 10, including real property interests through and under which Line 10 passes, the Carriers’ assignable permits related to the ownership and operation of Line 10, as well as personal property, contract rights, records and incidental rights held solely in connection with Line 10 (collectively, the “Assets”). Pursuant to the Put and Call Agreement, the Carriers granted the Company a right (the “Call Option”) to purchase all of the Assets and the Company granted the Carriers the right to put all the Assets to the Company (the “Put Option” and, together with the Call Option, the “Purchase Options”) subject to the terms and conditions of the Put and Call Agreement.

The Carrier’s Put Option is exercisable beginning on the date that is the earlier of (a) January 1, 2026 and (b) the date that is 30 days after the latest of (i) the date on which the Carriers give notice that the Line 10 replacement work performed pursuant to the Letter Agreement is sufficiently completed (as contemplated in the Call and Put Agreement) and (ii) the ninth (9^th) anniversary of the Execution Date (the “Put Option Commencement Date”). The Put Option terminates on the date that is 24 months after either (a) the Put Option Commencement Date if such date is the first of a month or (b) the first day of the calendar month immediately following the Put Option Commencement Date if it is not the first day of the month (the “Put/Call Option Expiry Date”). The Company’s Call Option is exercisable at any time beginning on the Execution Date and ending on the Put/Call Option Expiry Date.

25

The purchase price of the Assets (the “Purchase Price”) shall be calculated as follows: the sum of (a) 70% of the book value of the Assets as of July 31, 2014 minus annual depreciation, (b) 100% of total replacement costs for any segment replacements on the Pipeline commenced by the Carrier, whether completed or ongoing on the date of Asset sale is consummated (the “Closing Date”), minus any of such expenses paid by the Company and (c) 100% of the total regulatory requirements costs for any regulatory work commenced by the Carrier, whether completed or ongoing at the Closing Date, minus any of such expenses paid by the Company. The Purchase Price shall be subject to adjustment pursuant to the Agreement with respect to certain work ongoing at the Closing Date.

Among other customary conditions to closing, Carrier’s obligation to close the sale of the Assets is conditioned on the Company’s payment of all obligations outstanding pursuant to the Put and Call Agreement and the Letter Agreement. In addition, the sale of Assets pursuant to the U.S. Agreement shall close concurrently with the sale of the Assets pursuant to the Canadian Agreement.

The Company and the Carrier agreed that certain work must be undertaken in order to carve out portions of Line 10 in Canada from the Enbridge mainline system and allow it to operate independently. In the event any work is required to similarly separate the U.S. portion of Line 10 from the Enbridge mainline system (the “Carve-Out Work”), a plan to perform such Carve-Out Work that would result in expenses greater than $38.5 million will require the approval of the Company.

In the event any of the maintenance, regulatory requirement, or replacement work contemplated in the Letter Agreement or the Put and Call Agreement (collectively, the “Work”) is outstanding at the Closing Date, concurrently with the closing of the Asset sale, the Company and the Carriers will enter into an operating agreement (the “Operating Agreement”) pursuant to which the Carriers will provide certain operational and administrative services (the “Services”) while the Work is ongoing and complete such Work. As payment for the Services and completion of the Work, the Carriers shall be: (i) reimbursed for all expenses of providing the Services, (ii) paid a fixed fee of on an annual basis, which shall be subject to a 2% increase for each successive year following the first year of the Operating Agreement, and (ii) paid for all expenses of the Work not previously paid, as well as a 2.25% construction management fee.

The Put and Call Agreement may be terminated by the mutual consent of the Company and the Carriers and shall automatically terminate if neither Purchase Option is exercised prior to the Put/Call Option Expiry Date. Moreover, either the Company or a Carrier may terminate the Put and Call Agreement if a closing of the Asset sale shall not have occurred on or before December 31, 2028 assuming the terminating party is not then in breach of the Put and Call Agreement and if a party has breached a representation, such breach has not been cured within the time periods allotted by the Put and Call Agreement. Finally, the Company may terminate the Put and Call Agreement by notifying the Carriers to cease the replacement work contemplated in the Letter Agreement.

26

Item 6. Exhibits.

Exhibit 10.1	Amendment, dated January 30, 2015, to letter agreement between Enbridge Energy Limited Partnership and Enbridge Pipeline, Inc. and United Refining Company and Kiantone Pipeline Corporation
Exhibit 10.2	Amendment, dated February 12, 2015, to letter agreement between Enbridge Energy Limited Partnership and Enbridge Pipeline, Inc. and United Refining Company and Kiantone Pipeline Corporation
Exhibit 10.3	Amendment, dated February 19, 2015, to letter agreement between Enbridge Energy Limited Partnership and Enbridge Pipeline, Inc. and United Refining Company and Kiantone Pipeline Corporation
Exhibit 10.4	Amendment, dated March 13, 2015, to letter agreement between Enbridge Energy Limited Partnership and Enbridge Pipeline, Inc. and United Refining Company and Kiantone Pipeline Corporation
Exhibit 10.5	Amendment, dated March 27, 2015, to letter agreement between Enbridge Energy Limited Partnership and Enbridge Pipeline, Inc. and United Refining Company and Kiantone Pipeline Corporation
Exhibit 31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 101	Interactive XBRL Data

27

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

UNITED REFINING COMPANY

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

28

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

KIANTONE PIPELINE CORPORATION

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

29

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

UNITED REFINING COMPANY OF PENNSYLVANIA

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

30

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

KIANTONE PIPELINE COMPANY

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

31

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

UNITED JET CENTER, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

32

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

KWIK-FILL CORPORATION

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

33

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

INDEPENDENT GASOLINE AND OIL

COMPANY OF ROCHESTER, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

34

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

BELL OIL CORP.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

35

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

PPC, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

36

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

SUPER TEST PETROLEUM, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

37

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

KWIK-FIL, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

38

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

VULCAN ASPHALT REFINING CORPORATION

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President

/s/ James E. Murphy

James E. Murphy

Chief Financial Officer

39

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: April 14, 2015

COUNTRY FAIR, INC.

(Registrant)

/s/ Myron L. Turfitt

Myron L. Turfitt

President and Chief Operating Officer

/s/ James E. Murphy

James E. Murphy

Vice President Finance

40

EX-10.1

Exhibit 10.1

Enbridge Pipelines Inc. 3000, 425-1^st Street SW Calgary, AB T2P 3L8

Enbridge Energy Limited Partnership

1100 Louisiana Street, Suite 3300

Houston, TX 77002

January 30, 2015

United Refining Company and

Kiantone Pipeline Corporation

823 11^th Ave.

New York, New York 10019

Attention: J. Nelson Happy

Subject: Amendment to the Letter Agreement between Enbridge Pipelines Inc., Enbridge Energy Limited Partnership, United Refining Company and Kiantone Pipeline Corporation dated July 31, 2014 (the “Letter Agreement”)

The parties agree that Section C.1 of the Letter Agreement shall be amended by replacing “January 31, 2015” with “February 14, 2015.”

Please acknowledge your agreement to the terms and conditions contained herein by signing the enclosed duplicate copy in the space provided below and returning the acknowledged copy to the undersigned.

ENBRIDGE ENERGY, LIMITED PARTNERSHIP BY ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. ITS GENERAL PARTNER		ENBRIDGE PIPELINES INC.
Per:	/s/ Chris Kaitson	Per:	/s/ Paul Fisher
	Chris Kaitson Vice President – U.S. Law		Paul Fisher Vice President

Per:	/s/ Kent Cornelius
	Kent Cornelius V.P. Major Projects Execution

UNITED REFINING COMPANY		KIANTONE PIPELINE CORPORATION
Per:	/s/ John A. Catsimatidis	Per:	/s/ John A. Catsimatidis
	John A. Catsimatidis Chairman & CEO		John A. Catsimatidis Chairman & CEO

EX-10.2

Exhibit 10.2

Enbridge Pipelines Inc. 3000, 425-1^st Street SW Calgary, AB T2P 3L8

Enbridge Energy Limited Partnership

1100 Louisiana Street, Suite 3300

Houston, TX 77002

February 12, 2015

United Refining Company and

Kiantone Pipeline Corporation

823 11^th Ave.

New York, New York 10019

Attention: J. Nelson Happy

Subject: Amendment to the Letter Agreement between Enbridge Pipelines Inc., Enbridge Energy Limited Partnership, United Refining Company and Kiantone Pipeline Corporation dated July 31, 2014 (the “Letter Agreement”)

The parties agree that Section C.1 of the Letter Agreement shall be amended by replacing “February 14, 2015” with “February 20, 2015.”

Please acknowledge your agreement to the terms and conditions contained herein by signing the enclosed duplicate copy in the space provided below and returning the acknowledged copy to the undersigned.

ENBRIDGE ENERGY, LIMITED PARTNERSHIP BY ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. ITS GENERAL PARTNER		ENBRIDGE PIPELINES INC.
Per:	/s/ Joel Kanvik	Per:	/s/ R.T. Schwertz
	Joel Kanvik Corporate Secretary		R.T. Schwertz V.P., Liquid Pipelines Law & Deputy General Counsel

UNITED REFINING COMPANY		KIANTONE PIPELINE CORPORATION
Per:	/s/ John A. Catsimatidis	Per:	/s/ John A. Catsimatidis
	John A. Catsimatidis Chairman & CEO		John A. Catsimatidis Chairman & CEO

EX-10.3

Exhibit 10.3

Enbridge Pipelines Inc. 3000, 425-1^st Street SW Calgary, AB T2P 3L8

Enbridge Energy Limited Partnership

1100 Louisiana Street, Suite 3300

Houston, TX 77002

February 19, 2015

United Refining Company and

Kiantone Pipeline Corporation

823 11^th Ave.

New York, New York 10019

Attention: J. Nelson Happy

Subject: Amendment to the Letter Agreement between Enbridge Pipelines Inc., Enbridge Energy Limited Partnership, United Refining Company and Kiantone Pipeline Corporation dated July 31, 2014 (the “Letter Agreement”)

The parties agree that Section C.1 of the Letter Agreement shall be amended by replacing “February 20, 2015” with “March 6, 2015.”

Please acknowledge your agreement to the terms and conditions contained herein by signing the enclosed duplicate copy in the space provided below and returning the acknowledged copy to the undersigned.

ENBRIDGE ENERGY, LIMITED PARTNERSHIP BY ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. ITS GENERAL PARTNER		ENBRIDGE PIPELINES INC.
Per:	/s/ Joel Kanvik	Per:	/s/ R.T. Schwertz
	Joel Kanvik Corporate Secretary		R.T. Schwertz V.P., Liquid Pipelines Law & Deputy General Counsel

UNITED REFINING COMPANY		KIANTONE PIPELINE CORPORATION
Per:	/s/ John A. Catsimatidis	Per:	/s/ John A. Catsimatidis
	John A. Catsimatidis Chairman & CEO		John A. Catsimatidis Chairman & CEO

EX-10.4

Exhibit 10.4

Enbridge Pipelines Inc. 3000, 425-1^st Street SW Calgary, AB T2P 3L8

Enbridge Energy Limited Partnership

1100 Louisiana Street, Suite 3300

Houston, TX 77002

March 13, 2015

United Refining Company and

Kiantone Pipeline Corporation

823 11^th Ave.

New York, New York 10019

Attention: J. Nelson Happy

Subject: Amendment to the Letter Agreement between Enbridge Pipelines Inc., Enbridge Energy Limited Partnership, United Refining Company and Kiantone Pipeline Corporation dated July 31, 2014 (the “Letter Agreement”)

The parties agree that Section C.1 of the Letter Agreement shall be amended by replacing “March 13, 2015” with “March 27, 2015.”

Please acknowledge your agreement to the terms and conditions contained herein by signing the enclosed duplicate copy in the space provided below and returning the acknowledged copy to the undersigned.

ENBRIDGE ENERGY, LIMITED PARTNERSHIP BY ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. ITS GENERAL PARTNER		ENBRIDGE PIPELINES INC.
Per:	/s/ Chris Kaitson	Per:	/s/ R.T. Schwertz
	Chris Kaitson Vice President – U.S. Law		R.T. Schwertz V.P., Liquid Pipelines Law & Deputy General Counsel

UNITED REFINING COMPANY		KIANTONE PIPELINE CORPORATION
Per:	/s/ John A. Catsimatidis	Per:	/s/ John A. Catsimatidis
	John A. Catsimatidis Chairman & CEO		John A. Catsimatidis Chairman & CEO

EX-10.5

Exhibit 10.5

Enbridge Pipelines Inc. 3000, 425-1^st Street SW Calgary, AB T2P 3L8

Enbridge Energy Limited Partnership

1100 Louisiana Street, Suite 3300

Houston, TX 77002

March 27, 2015

United Refining Company and

Kiantone Pipeline Corporation

823 11^th Ave.

New York, New York 10019

Attention: J. Nelson Happy

Subject: Amendment to the Letter Agreement between Enbridge Pipelines Inc., Enbridge Energy Limited Partnership, United Refining Company and Kiantone Pipeline Corporation dated July 31, 2014 (the “Letter Agreement”)

The parties agree that the last sentence of Section C.1 of the Letter Agreement shall be deleted in its entirety and replaced by the following: “This paragraph C.1 (but not the other provisions of this Part c) shall be void and of no force or effect in the event the Carriers and United have not executed and delivered signature pages of the Put and Call agreement into escrow on or before April 1, 2015, with such documents to be released from escrow no later than April 8, 2015 (the “Termination Date”).

Please acknowledge your agreement to the terms and conditions contained herein by signing the enclosed duplicate copy in the space provided below and returning the acknowledged copy to the undersigned.

ENBRIDGE ENERGY, LIMITED PARTNERSHIP BY ENBRIDGE PIPELINES (LAKEHEAD) L.L.C. ITS GENERAL PARTNER		ENBRIDGE PIPELINES INC.
Per:	/s/ Joel Kanvik	Per:	/s/ R.T. Schwertz
	Joel Kanvik Corporate Secretary		R.T. Schwertz V.P., Liquid Pipelines Law & Deputy General Counsel

UNITED REFINING COMPANY		KIANTONE PIPELINE CORPORATION
Per:	/s/ John A. Catsimatidis	Per:	/s/ John A. Catsimatidis
	John A. Catsimatidis Chairman & CEO		John A. Catsimatidis Chairman & CEO

EX-31.1

Exhibit 31.1

CERTIFICATION

Pursuant to 18 U.S.C. Section 1350,

As adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, John A. Catsimatidis, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Refining Company (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 14, 2015	Signature:	/s/ John A. Catsimatidis
		John A. Catsimatidis
		Principal Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

Pursuant to 18 U.S.C. Section 1350,

As adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, James E. Murphy, certify that:

1. I have reviewed this quarterly report on Form 10-Q of United Refining Company (the “registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 14, 2015	Signature:	/s/ James E. Murphy
		James E. Murphy
		Principal Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code)

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of United Refining Company, a Pennsylvania corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Quarterly Report on Form 10-Q for the quarter ended February 28, 2015 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: April 14, 2015	By:	/s/ John A. Catsimatidis
		John A. Catsimatidis
		Principal Executive Officer

Dated: April 14, 2015	By:	/s/ James E. Murphy
		James E. Murphy
		Principal Financial Officer

XML

Subsidiary Guarantors - Schedule of Condensed Consolidating Balance Sheets (Parenthetical) (Detail) (USD $)	Feb. 28, 2015	Aug. 31, 2014
Condensed Financial Statements, Captions [Line Items]
Common stock, par value per share	$ 0.10	$ 0.10
Common stock, shares authorized	100	100
Common stock, shares issued	100	100
Common stock, shares outstanding	100	100
Guarantors [Member]
Condensed Financial Statements, Captions [Line Items]
Common stock, par value per share	$ 0.10	$ 0.10
Common stock, shares authorized	100	100
Common stock, shares issued	100	100
Common stock, shares outstanding	100	100
Series A Preferred Stock [Member]
Condensed Financial Statements, Captions [Line Items]
Preferred stock, par value per share	$ 1,000	$ 1,000
Preferred stock, shares authorized	25,000	25,000
Preferred stock, shares issued	14,116	14,116
Preferred stock, shares outstanding	14,116	14,116
Series A Preferred Stock [Member] | United Refining Company [Member]
Condensed Financial Statements, Captions [Line Items]
Preferred stock, par value per share	$ 1,000	$ 1,000
Preferred stock, shares authorized	25,000	25,000
Preferred stock, shares issued	14,116	14,116
Preferred stock, shares outstanding	14,116	14,116

XML

Inventories

6 Months Ended

Feb. 28, 2015

Inventory Disclosure [Abstract]

Inventories

2. Inventories

Inventories are stated at the lower of cost or market, with cost being determined under the Last-in, First-out (LIFO) method for crude oil and petroleum product inventories and the First-in, First-out (FIFO) method for merchandise. Supply inventories are stated at either the lower of cost or market or replacement cost and include various parts for the refinery operations.

Inventories consist of the following:

	February 28, 2015		August 31, 2014
	(in thousands)
Crude Oil	$	41,199	$	36,667
Petroleum Products		104,357		63,252
Total @ LIFO		145,556		99,919
Merchandise		24,221		23,983
Supplies		29,002		27,570
Total @ FIFO		53,223		51,553
Total Inventory	$	198,779	$	151,472

As of February 28, 2015 and August 31, 2014, the replacement cost of LIFO inventories exceeded their LIFO carrying values by approximately $7,308,000 and $109,711,000, respectively. In accordance with ASC 270, Interim Reporting, and ASC 330, Inventory, as of February 28, 2015 the Company has not recorded any reserve against its LIFO carrying values (which amounted to $8,629,000) as the current decline in market values is reasonably expected to be temporary and be restored in the current fiscal year.

XML

Employee Benefit Plans - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Feb. 28, 2015
Compensation and Retirement Disclosure [Abstract]
Defined pension plan contributions	$ 2,142

XML

Employee Benefit Plans - Components of Net Pension and Other Post-Retirement Benefit Cost (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014
Pension Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 156	$ 149	$ 313	$ 298
Interest cost on benefit obligation	1,212	1,311	2,425	2,622
Expected return on plan assets	(1,587)	(1,403)	(3,175)	(2,806)
Amortization and deferral of net loss	181	176	361	351
Net periodic benefit cost	(38)	233	(76)	465
Other Post-Retirement Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	(151)	193	(302)	387
Interest cost on benefit obligation	(413)	518	(826)	1,036
Amortization and deferral of net loss	786	(465)	1,572	(930)
Net periodic benefit cost	$ 222	$ 246	$ 444	$ 493

XML

Fair Value Measurements - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	Feb. 28, 2015	Aug. 31, 2014
Debt Instrument Fair Value Carrying Value [Abstract]
Fair value of long term debt	$ 17,812	$ 28,041

XML

Subsequent Events - Additional Information (Detail) (Subsequent Event [Member], USD $)	0 Months Ended
	Apr. 08, 2015 mi
Subsequent Event [Line Items]
Miles of pipeline	88.85
Carrier's put option terms	The Carrier’s Put Option is exercisable beginning on the date that is the earlier of (a) January 1, 2026 and (b) the date that is 30 days after the latest of (i) the date on which the Carriers give notice that the Line 10 replacement work performed pursuant to the Letter Agreement is sufficiently completed (as contemplated in the Call and Put Agreement) and (ii) the ninth (9th) anniversary of the Execution Date (the “Put Option Commencement Date”).
Put Option termination terms	The Put Option terminates on the date that is 24 months after either (a) the Put Option Commencement Date if such date is the first of a month or (b) the first day of the calendar month immediately following the Put Option Commencement Date if it is not the first day of the month (the “Put/Call Option Expiry Date”).
Percentage increase in fixed annual fees	2.00%
Percentage of construction management fees paid	2.25%
Maximum [Member]
Subsequent Event [Line Items]
Construction expenses maximum limit not requiring approval	38,500,000
Purchase Price [Member]
Subsequent Event [Line Items]
Percentage book value of assets	70.00%
Percentage of replacement costs	100.00%
Percentage of regulatory costs	100.00%

XML

Description of Business and Basis of Presentation

6 Months Ended

Feb. 28, 2015

Accounting Policies [Abstract]

Description of Business and Basis of Presentation

1. Description of Business and Basis of Presentation

The consolidated financial statements include the accounts of United Refining Company and its subsidiaries, United Refining Company of Pennsylvania and its subsidiaries, United Biofuels, Inc. and Kiantone Pipeline Corporation (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation.

The Company is a petroleum refiner and marketer in its primary market area of Western New York and Northwestern Pennsylvania. Operations are organized into two business segments: wholesale and retail.

The wholesale segment is responsible for the acquisition of crude oil, petroleum refining, supplying petroleum products to the retail segment and the marketing of petroleum products to wholesale and industrial customers. The retail segment operates a network of Company operated retail units under the Red Apple Food Mart^® and Country Fair^® brand names selling petroleum products under the Kwik Fill^®, Citgo^® and Keystone^® brand names, as well as convenience and grocery items.

The Company is a wholly-owned subsidiary of United Refining, Inc., a wholly-owned subsidiary of United Acquisition Corp., which in turn is a wholly-owned subsidiary of Red Apple Group, Inc. (the “Parent”).

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended February 28, 2015 are not necessarily indicative of the results that may be expected for the year ending August 31, 2015. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Form 10-K for the fiscal year ended August 31, 2014.

XML

Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Feb. 28, 2015	Aug. 31, 2014
Current:
Cash and cash equivalents	$ 59,997	$ 99,037
Accounts receivable, net	72,358	92,391
Refundable income taxes		6,000
Inventories, net	198,779	151,472
Prepaid income taxes	23,820	13,674
Prepaid expenses and other assets	29,021	67,168
Amounts due from affiliated companies, net	143
Total current assets	384,118	429,742
Property, plant and equipment, net	326,697	317,519
Deferred financing costs, net	2,961	3,575
Goodwill	1,349	1,349
Trade name	10,500	10,500
Amortizable intangible assets, net	831	951
Deferred integrity and replacement costs, net	61,775	64,916
Deferred turnaround costs and other assets, net	37,123	41,912
Total assets	825,354	870,464
Current:
Current installments of long-term debt	1,540	1,551
Accounts payable	37,873	91,881
Accrued liabilities	14,471	18,691
Sales, use and fuel taxes payable	16,516	20,550
Deferred income taxes	2,810	2,810
Amounts due to affiliated companies, net		1,521
Total current liabilities	73,210	137,004
Long term debt: less current installments	238,071	237,974
Deferred income taxes	65,682	44,140
Deferred retirement benefits	64,380	67,121
Total liabilities	441,343	486,239
Commitments and contingencies
Stockholder's equity:
Common stock; $.10 par value per share - shares authorized 100; issued and outstanding 100	0	0
Additional paid-in capital	156,810	156,810
Retained earnings	223,021	222,495
Accumulated other comprehensive loss	(9,936)	(9,196)
Total stockholder's equity	384,011	384,225
Total liabilities and stockholder's equity	825,354	870,464
Series A Preferred Stock [Member]
Stockholder's equity:
Series A Preferred stock; $1,000 par value per share - shares authorized 25,000; issued and outstanding 14,116	$ 14,116	$ 14,116

XML

Consolidated Statements of Comprehensive Income - (Unaudited) (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014
Statement of Comprehensive Income [Abstract]
Unrecognized post retirement loss, taxes	$ (237)	$ (120)	$ (474)	$ (239)

XML

Segments of Business - Summarized Financial Information of Company's Reportable Segments (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014	Aug. 31, 2014
Net Sales
Sales, Net	$ 580,904	$ 773,719	$ 1,405,601	$ 1,665,434
Operating Income (Loss)
Operating income	10,792	101,837	46,931	107,251
Depreciation and Amortization
Depreciation and Amortization	10,525	7,140	20,877	14,130
Total Assets
Assets, Total	825,354		825,354		870,464
Operating Segments [Member] | Retail [Member]
Net Sales
Sales, Net	298,666	392,756	677,822	806,484
Operating Income (Loss)
Operating income	8,040	(5,915)	17,799	(4,530)
Depreciation and Amortization
Depreciation and Amortization	1,793	1,578	3,556	3,139
Total Assets
Assets, Total	163,957		163,957		186,277
Operating Segments [Member] | Wholesale [Member]
Net Sales
Sales, Net	282,238	380,963	727,779	858,950
Operating Income (Loss)
Operating income	2,752	107,752	29,132	111,781
Depreciation and Amortization
Depreciation and Amortization	8,732	5,562	17,321	10,991
Total Assets
Assets, Total	661,397		661,397		684,187
Intersegment Eliminations [Member] | Wholesale [Member]
Intersegment Sales
Intersegment Sales	$ 116,350	$ 203,890	$ 296,606	$ 417,591

XML

Subsidiary Guarantors - Schedule of Condensed Consolidating Balance Sheets (Detail) (USD $) In Thousands, unless otherwise specified	Feb. 28, 2015	Aug. 31, 2014	Feb. 28, 2014	Aug. 31, 2013
Current:
Cash and cash equivalents	$ 59,997	$ 99,037	$ 172,340	$ 158,537
Accounts receivable, net	72,358	92,391
Refundable income taxes		6,000
Inventories, net	198,779	151,472
Prepaid income taxes	23,820	13,674
Prepaid expenses and other assets	29,021	67,168
Amounts due from affiliated companies, net	143
Total current assets	384,118	429,742
Property, plant and equipment, net	326,697	317,519
Deferred financing costs, net	2,961	3,575
Goodwill and other non-amortizable assets	11,849	11,849
Amortizable intangible assets, net	831	951
Deferred integrity and replacement costs, net	61,775	64,916
Deferred turnaround costs & other assets	37,123	41,912
Total assets	825,354	870,464
Current:
Current installments of long-term debt	1,540	1,551
Accounts payable	37,873	91,881
Accrued liabilities	14,471	18,691
Sales, use and fuel taxes payable	16,516	20,550
Deferred income taxes	2,810	2,810
Amounts due to affiliated companies, net		1,521
Total current liabilities	73,210	137,004
Long term debt: less current installments	238,071	237,974
Deferred income taxes	65,682	44,140
Deferred retirement benefits	64,380	67,121
Total liabilities	441,343	486,239
Commitment and contingencies
Stockholder's equity:
Common stock; $.10 par value per share - shares authorized 100; issued and outstanding 100	0	0
Additional paid-in capital	156,810	156,810
Retained earnings	223,021	222,495
Accumulated other comprehensive loss	(9,936)	(9,196)
Total stockholder's equity	384,011	384,225
Total liabilities and stockholder's equity	825,354	870,464
United Refining Company [Member]
Current:
Cash and cash equivalents	47,174	79,356	158,396	141,386
Accounts receivable, net	46,832	51,452
Refundable income taxes		6,000
Inventories, net	171,007	122,161
Prepaid income taxes	28,865	16,918
Prepaid expenses and other assets	22,659	62,889
Intercompany	107,494	127,105
Total current assets	424,031	465,881
Property, plant and equipment, net	204,973	199,703
Deferred financing costs, net	2,961	3,575
Deferred integrity and replacement costs, net	61,775	64,916
Deferred turnaround costs & other assets	32,571	39,302
Investment in subsidiaries	45,759	35,811
Total assets	772,070	809,188
Current:
Current installments of long-term debt	523	519
Accounts payable	17,728	64,965
Accrued liabilities	8,246	12,315
Sales, use and fuel taxes payable	12,519	16,037
Deferred income taxes	3,770	3,770
Total current liabilities	42,786	97,606
Long term debt: less current installments	233,539	232,946
Deferred income taxes	48,767	28,816
Deferred retirement benefits	62,967	65,595
Total liabilities	388,059	424,963
Commitment and contingencies
Stockholder's equity:
Additional paid-in capital	156,810	156,810
Retained earnings	223,021	222,495
Accumulated other comprehensive loss	(9,936)	(9,196)
Total stockholder's equity	384,011	384,225
Total liabilities and stockholder's equity	772,070	809,188
Guarantors [Member]
Current:
Cash and cash equivalents	12,823	19,681	13,944	17,151
Accounts receivable, net	25,526	40,939
Inventories, net	27,772	29,311
Prepaid income taxes	(5,045)	(3,244)
Prepaid expenses and other assets	6,362	4,279
Amounts due from affiliated companies, net	143
Intercompany	(3,677)	1,116
Total current assets	63,904	92,082
Property, plant and equipment, net	121,724	117,816
Goodwill and other non-amortizable assets	11,849	11,849
Amortizable intangible assets, net	831	951
Deferred turnaround costs & other assets	4,552	2,610
Total assets	202,860	225,308
Current:
Current installments of long-term debt	1,017	1,032
Accounts payable	20,145	26,916
Accrued liabilities	6,225	6,376
Sales, use and fuel taxes payable	3,997	4,513
Deferred income taxes	(960)	(960)
Amounts due to affiliated companies, net		1,521
Intercompany	103,817	128,221
Total current liabilities	134,241	167,619
Long term debt: less current installments	4,532	5,028
Deferred income taxes	16,915	15,324
Deferred retirement benefits	1,413	1,526
Total liabilities	157,101	189,497
Commitment and contingencies
Stockholder's equity:
Common stock; $.10 par value per share - shares authorized 100; issued and outstanding 100	18	18
Additional paid-in capital	16,626	16,626
Retained earnings	30,057	20,143
Accumulated other comprehensive loss	(942)	(976)
Total stockholder's equity	45,759	35,811
Total liabilities and stockholder's equity	202,860	225,308
Series A Preferred Stock [Member]
Stockholder's equity:
Series A Preferred stock; $1,000 par value per share - shares authorized 25,000; issued and outstanding 14,116	14,116	14,116
Series A Preferred Stock [Member] | United Refining Company [Member]
Stockholder's equity:
Series A Preferred stock; $1,000 par value per share - shares authorized 25,000; issued and outstanding 14,116	14,116	14,116
Eliminations [Member]
Current:
Intercompany	(103,817)	(128,221)
Total current assets	(103,817)	(128,221)
Investment in subsidiaries	(45,759)	(35,811)
Total assets	(149,576)	(164,032)
Current:
Intercompany	(103,817)	(128,221)
Total current liabilities	(103,817)	(128,221)
Total liabilities	(103,817)	(128,221)
Commitment and contingencies
Stockholder's equity:
Common stock; $.10 par value per share - shares authorized 100; issued and outstanding 100	(18)	(18)
Additional paid-in capital	(16,626)	(16,626)
Retained earnings	(30,057)	(20,143)
Accumulated other comprehensive loss	942	976
Total stockholder's equity	(45,759)	(35,811)
Total liabilities and stockholder's equity	$ (149,576)	$ (164,032)

XML

Consolidated Statements of Cash Flows - (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014
Cash flows from operating activities:
Net income	$ 19,217	$ 56,583
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	22,096	15,286
Deferred income taxes	22,016	1,786
Loss on asset dispositions	766	13
Cash used in working capital items	(28,569)	(26,103)
Change in operating assets and liabilities:
Other assets, net	137	338
Deferred retirement benefits	(3,955)	(3,702)
Total adjustments	12,491	(12,382)
Net cash provided by operating activities	31,708	44,201
Cash flows from investing activities:
Additions to property, plant and equipment	(20,069)	(20,353)
Additions to deferred turnaround costs	(2,558)	(3,124)
Additions to deferred integrity and replacement costs	(28,630)
Proceeds from asset dispositions	4	56
Net cash used in investing activities	(51,253)	(23,421)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder	(18,691)	(4,810)
Proceeds from issuance of long-term debt		1,426
Principal reductions of long-term debt	(804)	(1,000)
Distribution to parent under the tax sharing agreement		(2,593)
Net cash used in financing activities	(19,495)	(6,977)
Net (decrease) increase in cash and cash equivalents	(39,040)	13,803
Cash and cash equivalents, beginning of year	99,037	158,537
Cash and cash equivalents, end of period	59,997	172,340
Cash provided by (used in) working capital items:
Accounts receivable, net	20,033	27,157
Refundable income taxes	6,000	20,890
Inventories, net	(47,307)	(94,602)
Prepaid income taxes	(10,146)
Prepaid expenses and other assets	38,147	11,312
Amounts due from/to affiliated companies, net	(1,664)	(353)
Accounts payable	(25,378)	(2,802)
Accrued liabilities	(4,220)	(3,427)
Income taxes payable		16,317
Sales, use, and fuel taxes payable	(4,034)	(595)
Total change	(28,569)	(26,103)
Cash paid during the period for:
Interest	12,758	12,755
Income taxes	339	16,151
Non-cash investing activities:
Property additions & capital leases	$ 285	$ 241

XML

Consolidated Balance Sheets (Parenthetical) (USD $)	Feb. 28, 2015	Aug. 31, 2014
Common stock, par value per share	$ 0.10	$ 0.10
Common stock, shares authorized	100	100
Common stock, shares issued	100	100
Common stock, shares outstanding	100	100
Series A Preferred Stock [Member]
Preferred stock, par value per share	$ 1,000	$ 1,000
Preferred stock, shares authorized	25,000	25,000
Preferred stock, shares issued	14,116	14,116
Preferred stock, shares outstanding	14,116	14,116

XML

Subsidiary Guarantors (Tables)

6 Months Ended

Feb. 28, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets

(in thousands)

	February 28, 2015												August 31, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Assets
Current:
Cash and cash equivalents	$	47,174		$	12,823		$	—		$	59,997		$	79,356		$	19,681		$	—		$	99,037
Accounts receivable, net		46,832			25,526			—			72,358			51,452			40,939			—			92,391
Refundable income taxes		—			—			—			—			6,000			—			—			6,000
Inventories, net		171,007			27,772			—			198,779			122,161			29,311			—			151,472
Prepaid income taxes		28,865			(5,045	)		—			23,820			16,918			(3,244	)		—			13,674
Prepaid expenses and other assets		22,659			6,362			—			29,021			62,889			4,279			—			67,168
Amounts due from affiliated companies, net		—			143			—			143			—			—			—			—
Intercompany		107,494			(3,677	)		(103,817	)		—			127,105			1,116			(128,221	)		—
Total current assets		424,031			63,904			(103,817	)		384,118			465,881			92,082			(128,221	)		429,742
Property, plant and equipment, net		204,973			121,724			—			326,697			199,703			117,816			—			317,519
Deferred financing costs, net		2,961			—			—			2,961			3,575			—			—			3,575
Goodwill and other non-amortizable assets		—			11,849			—			11,849			—			11,849			—			11,849
Amortizable intangible assets, net		—			831			—			831			—			951			—			951
Deferred integrity and replacement costs, net		61,775			—			—			61,775			64,916			—			—			64,916
Deferred turnaround costs & other assets		32,571			4,552			—			37,123			39,302			2,610			—			41,912
Investment in subsidiaries		45,759			—			(45,759	)		—			35,811			—			(35,811	)		—
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464
Liabilities and Stockholder’s Equity
Current:
Current installments of long-term debt	$	523		$	1,017		$	—		$	1,540		$	519		$	1,032		$	—		$	1,551
Accounts payable		17,728			20,145			—			37,873			64,965			26,916			—			91,881
Accrued liabilities		8,246			6,225			—			14,471			12,315			6,376			—			18,691
Sales, use and fuel taxes payable		12,519			3,997			—			16,516			16,037			4,513			—			20,550
Deferred income taxes		3,770			(960	)		—			2,810			3,770			(960	)		—			2,810
Amounts due to affiliated companies, net		—			—			—			—			—			1,521			—			1,521
Intercompany		—			103,817			(103,817	)		—			—			128,221			(128,221	)		—
Total current liabilities		42,786			134,241			(103,817	)		73,210			97,606			167,619			(128,221	)		137,004
Long term debt: less current installments		233,539			4,532			—			238,071			232,946			5,028			—			237,974
Deferred income taxes		48,767			16,915			—			65,682			28,816			15,324			—			44,140
Deferred retirement benefits		62,967			1,413			—			64,380			65,595			1,526			—			67,121
Total liabilities		388,059			157,101			(103,817	)		441,343			424,963			189,497			(128,221	)		486,239
Commitment and contingencies
Stockholder’s equity
Common stock; $.10 par value per share – shares authorized 100; issued and outstanding 100		—			18			(18	)		—			—			18			(18	)		—
Series A Preferred stock; $1,000 par value per share – shares authorized 25,000; issued and outstanding 14,116		14,116			—			—			14,116			14,116			—			—			14,116
Additional paid-in capital		156,810			16,626			(16,626	)		156,810			156,810			16,626			(16,626	)		156,810
Retained earnings		223,021			30,057			(30,057	)		223,021			222,495			20,143			(20,143	)		222,495
Accumulated other comprehensive loss		(9,936	)		(942	)		942			(9,936	)		(9,196	)		(976	)		976			(9,196	)
Total stockholder’s equity		384,011			45,759			(45,759	)		384,011			384,225			35,811			(35,811	)		384,225
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464

Schedule of Condensed Consolidating Statements of Income

Condensed Consolidating Statements of Income

(in thousands)

	Three Months Ended February 28, 2015												Three Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Net sales	$	398,588		$	299,837		$	(117,521	)	$	580,904		$	584,853		$	393,881		$	(205,015	)	$	773,719
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		380,799			255,351			(117,521	)		518,629			464,875			363,101			(205,015	)		622,961
Selling, general and administrative expenses		6,036			34,922			—			40,958			6,473			35,308			—			41,781
Depreciation and amortization expenses		8,481			2,044			—			10,525			5,306			1,834			—			7,140
		395,316			292,317			(117,521	)		570,112			476,654			400,243			(205,015	)		671,882
Operating income (loss)		3,272			7,520			—			10,792			108,199			(6,362	)		—			101,837
Other income (expense):
Interest expense, net		(6,402	)		(230	)		—			(6,632	)		(6,331	)		(238	)		—			(6,569	)
Other, net		(1,744	)		195			—			(1,549	)		(872	)		139			—			(733	)
Equity in net income (loss) of subsidiaries		4,391			—			(4,391	)		—			(3,742	)		—			3,742			—
		(3,755	)		(35	)		(4,391	)		(8,181	)		(10,945	)		(99	)		3,742			(7,302	)
(Loss) income before income tax (benefit) expense		(483	)		7,485			(4,391	)		2,611			97,254			(6,461	)		3,742			94,535
Income tax (benefit) expense		(2,086	)		3,094			—			1,008			39,584			(2,719	)		—			36,865
Net (loss) income	$	1,603		$	4,391		$	(4,391	)	$	1,603		$	57,670		$	(3,742	)	$	3,742		$	57,670

	Six Months Ended February 28, 2015												Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Net sales	$	1,024,385		$	680,183		$	(298,967	)	$	1,405,601		$	1,276,541		$	808,887		$	(419,994	)	$	1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		964,754			590,010			(298,967	)		1,255,797			1,140,600			740,520			(419,994	)		1,461,126
Selling, general and administrative expenses		12,753			69,243			—			81,996			13,004			69,923			—			82,927
Depreciation and amortization expenses		16,776			4,101			—			20,877			10,479			3,651			—			14,130
		994,283			663,354			(298,967	)		1,358,670			1,164,083			814,094			(419,994	)		1,558,183
Operating income (loss)		30,102			16,829			—			46,931			112,458			(5,207	)		—			107,251
Other income (expense):
Interest expense, net		(12,815	)		(475	)		—			(13,290	)		(12,629	)		(474	)		—			(13,103	)
Other, net		(2,517	)		360			—			(2,157	)		(1,720	)		323			—			(1,397	)
Equity in net income (loss) of subsidiaries		9,914			—			(9,914	)		—			(3,076	)		—			3,076			—
		(5,418	)		(115	)		(9,914	)		(15,447	)		(17,425	)		(151	)		3,076			(14,500	)
Income (loss) before income tax expense (benefit)		24,684			16,714			(9,914	)		31,484			95,033			(5,358	)		3,076			92,751
Income tax expense (benefit)		5,467			6,800			—			12,267			38,450			(2,282	)		—			36,168
Net income (loss)	$	19,217		$	9,914		$	(9,914	)	$	19,217		$	56,583		$	(3,076	)	$	3,076		$	56,583

Schedule of Condensed Consolidating Statements of Cash Flows

Condensed Consolidating Statements of Cash Flows

(in thousands)

	Six Months Ended February 28, 2015											Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries			United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries
Net cash provided by operating activities	$	27,712		$	3,996		$	—	$	31,708		$	40,636		$	3,565		$	—	$	44,201
Cash flows from investing activities:
Additions to property, plant and equipment		(11,739	)		(8,330	)		—		(20,069	)		(12,798	)		(7,555	)		—		(20,353	)
Additions to deferred turnaround costs		(543	)		(2,015	)		—		(2,558	)		(3,014	)		(110	)		—		(3,124	)
Additions to deferred integrity and replacement costs		(28,630	)		—			—		(28,630	)		—			—			—		—
Proceeds from asset dispositions		2			2			—		4			56			—			—		56
Net cash used in investing activities		(40,910	)		(10,343	)		—		(51,253	)		(15,756	)		(7,665	)		—		(23,421	)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder		(18,691	)		—			—		(18,691	)		(4,810	)		—			—		(4,810	)
Proceeds from issuance of long-term debt		—			—			—		—			—			1,426			—		1,426
Principal reductions of long-term debt		(293	)		(511	)		—		(804	)		(467	)		(533	)		—		(1,000	)
Distribution to parent under the tax sharing agreement		—			—			—		—			(2,593	)		—			—		(2,593	)
Net cash (used in) provided by financing activities		(18,984	)		(511	)		—		(19,495	)		(7,870	)		893			—		(6,977	)
Net (decrease) increase in cash and cash equivalents		(32,182	)		(6,858	)		—		(39,040	)		17,010			(3,207	)		—		13,803
Cash and cash equivalents, beginning of year		79,356			19,681			—		99,037			141,386			17,151			—		158,537
Cash and cash equivalents, end of period	$	47,174		$	12,823		$	—	$	59,997		$	158,396		$	13,944		$	—	$	172,340

XML

Document and Entity Information	6 Months Ended
	Feb. 28, 2015	Apr. 14, 2015
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Feb. 28, 2015
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2
Trading Symbol	UNRF
Entity Registrant Name	UNITED REFINING CO
Entity Central Index Key	0000101462
Current Fiscal Year End Date	--08-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		100

XML

Employee Benefit Plans (Tables)

6 Months Ended

Feb. 28, 2015

Compensation and Retirement Disclosure [Abstract]

Components of Net Pension and Other Post-Retirement Benefit Cost

For the periods ended February 28, 2015 and 2014, net pension and other postretirement benefit costs were comprised of the following:

	Pension Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	156		$	149		$	313		$	298
Interest cost on benefit obligation		1,212			1,311			2,425			2,622
Expected return on plan assets		(1,587	)		(1,403	)		(3,175	)		(2,806	)
Amortization and deferral of net loss		181			176			361			351
Net periodic benefit cost	$	(38	)	$	233		$	(76	)	$	465

	Other Post-Retirement Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	(151	)	$	193		$	(302	)	$	387
Interest cost on benefit obligation		(413	)		518			(826	)		1,036
Amortization and deferral of net loss		786			(465	)		1,572			(930	)
Net periodic benefit cost	$	222		$	246		$	444		$	493

XML

Consolidated Statements of Income - (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014
Income Statement [Abstract]
Net sales	$ 580,904	$ 773,719	$ 1,405,601	$ 1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)	518,629	622,961	1,255,797	1,461,126
Selling, general and administrative expenses	40,958	41,781	81,996	82,927
Depreciation and amortization expenses	10,525	7,140	20,877	14,130
Total costs and expenses	570,112	671,882	1,358,670	1,558,183
Operating income	10,792	101,837	46,931	107,251
Other expense:
Interest expense, net	(6,632)	(6,569)	(13,290)	(13,103)
Other, net	(1,549)	(733)	(2,157)	(1,397)
Total other income (expense)	(8,181)	(7,302)	(15,447)	(14,500)
Income before income tax expense	2,611	94,535	31,484	92,751
Income tax expense	1,008	36,865	12,267	36,168
Net income	$ 1,603	$ 57,670	$ 19,217	$ 56,583

XML

Employee Benefit Plans

6 Months Ended

Feb. 28, 2015

Compensation and Retirement Disclosure [Abstract]

Employee Benefit Plans

5. Employee Benefit Plans

For the periods ended February 28, 2015 and 2014, net pension and other postretirement benefit costs were comprised of the following:

	Pension Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	156		$	149		$	313		$	298
Interest cost on benefit obligation		1,212			1,311			2,425			2,622
Expected return on plan assets		(1,587	)		(1,403	)		(3,175	)		(2,806	)
Amortization and deferral of net loss		181			176			361			351
Net periodic benefit cost	$	(38	)	$	233		$	(76	)	$	465

	Other Post-Retirement Benefits
	Three Months Ended February 28,						Six Months Ended February 28,
	2015			2014			2015			2014
	(in thousands)
Service cost	$	(151	)	$	193		$	(302	)	$	387
Interest cost on benefit obligation		(413	)		518			(826	)		1,036
Amortization and deferral of net loss		786			(465	)		1,572			(930	)
Net periodic benefit cost	$	222		$	246		$	444		$	493

As of February 28, 2015, $2,142,000 of contributions have been made to the Company pension plans for the fiscal year ending August 31, 2015.

The Company accrues post-retirement benefits other than pensions, during the years that the employees render the necessary service, of the expected cost of providing those benefits to an employee and the employee’s beneficiaries and covered dependents.

XML

Subsidiary Guarantors

6 Months Ended

Feb. 28, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Subsidiary Guarantors

4. Subsidiary Guarantors

All of the Company’s wholly-owned subsidiaries fully and unconditionally guarantee on an unsecured basis, on a joint and several basis, the Company’s 10.50% Senior Secured Notes due 2018. There are no restrictions within the consolidated group on the ability of the Company or any of its subsidiaries to obtain loans from or pay dividends to other members of the consolidated group. Financial information of the Company’s wholly-owned subsidiary guarantors is as follows:

Condensed Consolidating Balance Sheets

(in thousands)

	February 28, 2015												August 31, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Assets
Current:
Cash and cash equivalents	$	47,174		$	12,823		$	—		$	59,997		$	79,356		$	19,681		$	—		$	99,037
Accounts receivable, net		46,832			25,526			—			72,358			51,452			40,939			—			92,391
Refundable income taxes		—			—			—			—			6,000			—			—			6,000
Inventories, net		171,007			27,772			—			198,779			122,161			29,311			—			151,472
Prepaid income taxes		28,865			(5,045	)		—			23,820			16,918			(3,244	)		—			13,674
Prepaid expenses and other assets		22,659			6,362			—			29,021			62,889			4,279			—			67,168
Amounts due from affiliated companies, net		—			143			—			143			—			—			—			—
Intercompany		107,494			(3,677	)		(103,817	)		—			127,105			1,116			(128,221	)		—
Total current assets		424,031			63,904			(103,817	)		384,118			465,881			92,082			(128,221	)		429,742
Property, plant and equipment, net		204,973			121,724			—			326,697			199,703			117,816			—			317,519
Deferred financing costs, net		2,961			—			—			2,961			3,575			—			—			3,575
Goodwill and other non-amortizable assets		—			11,849			—			11,849			—			11,849			—			11,849
Amortizable intangible assets, net		—			831			—			831			—			951			—			951
Deferred integrity and replacement costs, net		61,775			—			—			61,775			64,916			—			—			64,916
Deferred turnaround costs & other assets		32,571			4,552			—			37,123			39,302			2,610			—			41,912
Investment in subsidiaries		45,759			—			(45,759	)		—			35,811			—			(35,811	)		—
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464
Liabilities and Stockholder’s Equity
Current:
Current installments of long-term debt	$	523		$	1,017		$	—		$	1,540		$	519		$	1,032		$	—		$	1,551
Accounts payable		17,728			20,145			—			37,873			64,965			26,916			—			91,881
Accrued liabilities		8,246			6,225			—			14,471			12,315			6,376			—			18,691
Sales, use and fuel taxes payable		12,519			3,997			—			16,516			16,037			4,513			—			20,550
Deferred income taxes		3,770			(960	)		—			2,810			3,770			(960	)		—			2,810
Amounts due to affiliated companies, net		—			—			—			—			—			1,521			—			1,521
Intercompany		—			103,817			(103,817	)		—			—			128,221			(128,221	)		—
Total current liabilities		42,786			134,241			(103,817	)		73,210			97,606			167,619			(128,221	)		137,004
Long term debt: less current installments		233,539			4,532			—			238,071			232,946			5,028			—			237,974
Deferred income taxes		48,767			16,915			—			65,682			28,816			15,324			—			44,140
Deferred retirement benefits		62,967			1,413			—			64,380			65,595			1,526			—			67,121
Total liabilities		388,059			157,101			(103,817	)		441,343			424,963			189,497			(128,221	)		486,239
Commitment and contingencies
Stockholder’s equity
Common stock; $.10 par value per share – shares authorized 100; issued and outstanding 100		—			18			(18	)		—			—			18			(18	)		—
Series A Preferred stock; $1,000 par value per share – shares authorized 25,000; issued and outstanding 14,116		14,116			—			—			14,116			14,116			—			—			14,116
Additional paid-in capital		156,810			16,626			(16,626	)		156,810			156,810			16,626			(16,626	)		156,810
Retained earnings		223,021			30,057			(30,057	)		223,021			222,495			20,143			(20,143	)		222,495
Accumulated other comprehensive loss		(9,936	)		(942	)		942			(9,936	)		(9,196	)		(976	)		976			(9,196	)
Total stockholder’s equity		384,011			45,759			(45,759	)		384,011			384,225			35,811			(35,811	)		384,225
	$	772,070		$	202,860		$	(149,576	)	$	825,354		$	809,188		$	225,308		$	(164,032	)	$	870,464

Condensed Consolidating Statements of Income

(in thousands)

	Three Months Ended February 28, 2015												Three Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Net sales	$	398,588		$	299,837		$	(117,521	)	$	580,904		$	584,853		$	393,881		$	(205,015	)	$	773,719
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		380,799			255,351			(117,521	)		518,629			464,875			363,101			(205,015	)		622,961
Selling, general and administrative expenses		6,036			34,922			—			40,958			6,473			35,308			—			41,781
Depreciation and amortization expenses		8,481			2,044			—			10,525			5,306			1,834			—			7,140
		395,316			292,317			(117,521	)		570,112			476,654			400,243			(205,015	)		671,882
Operating income (loss)		3,272			7,520			—			10,792			108,199			(6,362	)		—			101,837
Other income (expense):
Interest expense, net		(6,402	)		(230	)		—			(6,632	)		(6,331	)		(238	)		—			(6,569	)
Other, net		(1,744	)		195			—			(1,549	)		(872	)		139			—			(733	)
Equity in net income (loss) of subsidiaries		4,391			—			(4,391	)		—			(3,742	)		—			3,742			—
		(3,755	)		(35	)		(4,391	)		(8,181	)		(10,945	)		(99	)		3,742			(7,302	)
(Loss) income before income tax (benefit) expense		(483	)		7,485			(4,391	)		2,611			97,254			(6,461	)		3,742			94,535
Income tax (benefit) expense		(2,086	)		3,094			—			1,008			39,584			(2,719	)		—			36,865
Net (loss) income	$	1,603		$	4,391		$	(4,391	)	$	1,603		$	57,670		$	(3,742	)	$	3,742		$	57,670

	Six Months Ended February 28, 2015												Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries			United Refining Company			Guarantors			Eliminations			United Refining Company & Subsidiaries
Net sales	$	1,024,385		$	680,183		$	(298,967	)	$	1,405,601		$	1,276,541		$	808,887		$	(419,994	)	$	1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)		964,754			590,010			(298,967	)		1,255,797			1,140,600			740,520			(419,994	)		1,461,126
Selling, general and administrative expenses		12,753			69,243			—			81,996			13,004			69,923			—			82,927
Depreciation and amortization expenses		16,776			4,101			—			20,877			10,479			3,651			—			14,130
		994,283			663,354			(298,967	)		1,358,670			1,164,083			814,094			(419,994	)		1,558,183
Operating income (loss)		30,102			16,829			—			46,931			112,458			(5,207	)		—			107,251
Other income (expense):
Interest expense, net		(12,815	)		(475	)		—			(13,290	)		(12,629	)		(474	)		—			(13,103	)
Other, net		(2,517	)		360			—			(2,157	)		(1,720	)		323			—			(1,397	)
Equity in net income (loss) of subsidiaries		9,914			—			(9,914	)		—			(3,076	)		—			3,076			—
		(5,418	)		(115	)		(9,914	)		(15,447	)		(17,425	)		(151	)		3,076			(14,500	)
Income (loss) before income tax expense (benefit)		24,684			16,714			(9,914	)		31,484			95,033			(5,358	)		3,076			92,751
Income tax expense (benefit)		5,467			6,800			—			12,267			38,450			(2,282	)		—			36,168
Net income (loss)	$	19,217		$	9,914		$	(9,914	)	$	19,217		$	56,583		$	(3,076	)	$	3,076		$	56,583

Condensed Consolidating Statements of Cash Flows

(in thousands)

	Six Months Ended February 28, 2015											Six Months Ended February 28, 2014
	United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries			United Refining Company			Guarantors			Eliminations		United Refining Company and Subsidiaries
Net cash provided by operating activities	$	27,712		$	3,996		$	—	$	31,708		$	40,636		$	3,565		$	—	$	44,201
Cash flows from investing activities:
Additions to property, plant and equipment		(11,739	)		(8,330	)		—		(20,069	)		(12,798	)		(7,555	)		—		(20,353	)
Additions to deferred turnaround costs		(543	)		(2,015	)		—		(2,558	)		(3,014	)		(110	)		—		(3,124	)
Additions to deferred integrity and replacement costs		(28,630	)		—			—		(28,630	)		—			—			—		—
Proceeds from asset dispositions		2			2			—		4			56			—			—		56
Net cash used in investing activities		(40,910	)		(10,343	)		—		(51,253	)		(15,756	)		(7,665	)		—		(23,421	)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder		(18,691	)		—			—		(18,691	)		(4,810	)		—			—		(4,810	)
Proceeds from issuance of long-term debt		—			—			—		—			—			1,426			—		1,426
Principal reductions of long-term debt		(293	)		(511	)		—		(804	)		(467	)		(533	)		—		(1,000	)
Distribution to parent under the tax sharing agreement		—			—			—		—			(2,593	)		—			—		(2,593	)
Net cash (used in) provided by financing activities		(18,984	)		(511	)		—		(19,495	)		(7,870	)		893			—		(6,977	)
Net (decrease) increase in cash and cash equivalents		(32,182	)		(6,858	)		—		(39,040	)		17,010			(3,207	)		—		13,803
Cash and cash equivalents, beginning of year		79,356			19,681			—		99,037			141,386			17,151			—		158,537
Cash and cash equivalents, end of period	$	47,174		$	12,823		$	—	$	59,997		$	158,396		$	13,944		$	—	$	172,340

XML

Subsidiary Guarantors - Additional Information (Detail) (10.50% Senior Secured Notes [Member])	Feb. 28, 2015
10.50% Senior Secured Notes [Member]
Guarantor Obligations [Line Items]
Senior Secured Notes, interest rate	10.50%

XML

Description of Business and Basis of Presentation - Additional Information (Detail)	6 Months Ended
	Feb. 28, 2015 Segment
Accounting Policies [Abstract]
Number of business segments	2

XML

Inventories (Tables)

6 Months Ended

Feb. 28, 2015

Inventory Disclosure [Abstract]

Schedule of Inventories

Inventories consist of the following:

	February 28, 2015		August 31, 2014
	(in thousands)
Crude Oil	$	41,199	$	36,667
Petroleum Products		104,357		63,252
Total @ LIFO		145,556		99,919
Merchandise		24,221		23,983
Supplies		29,002		27,570
Total @ FIFO		53,223		51,553
Total Inventory	$	198,779	$	151,472

XML

Fair Value Measurements

6 Months Ended

Feb. 28, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

6. Fair Value Measurements

The carrying values of all financial instruments classified as a current asset or a current liability approximate fair value because of the short maturity of these instruments. The fair value of marketable securities is determined by available market prices. The fair value exceeded the carrying value of the long term debt at February 28, 2015 and August 31, 2014 by $17,812,000 and $28,041,000, respectively.

XML

Subsequent Events

6 Months Ended

Feb. 28, 2015

Subsequent Events [Abstract]

Subsequent Events

7. Subsequent Events

On April 8, 2015 (the “Execution Date”), the Company entered into a Put and Call Option Agreement with each of Enbridge Energy Limited Partnership (“Enbridge LP”) and Enbridge Pipelines Inc. (“Enbridge Inc.” and, together with Enbridge LP, the “Carriers”). The Put and Call Option Agreement entered into with Enbridge LP (the “U.S. Agreement”) is substantially similar to the Put and Call Option Agreement entered into with Enbridge Inc. (the “Canadian Agreement” and, together with the U.S. Agreement, the “Put and Call Agreement”). The Put and Call Agreement was contemplated in that certain Letter Agreement, originally executed on July 31, 2014 and last amended on April 8, 2015 (the “Letter Agreement”), between the Company and the Carriers relating to approximately 88.85 miles of pipeline owned by the Carriers, which transports crude oil from Canada to the Company’s Kiantone Pipeline in West Seneca, New York, and serves the Company’s refinery in Warren, Pennsylvania (“Line 10”). The Letter Agreement related to the parties’ agreement concerning funding certain integrity and replacement costs for Line 10. The Letter Agreement also contemplated that the parties would enter into a put and call agreement relating to the sale of Line 10 from the Carriers to the Company.

The Carriers own the pipeline facilities generally identified as Line 10, including real property interests through and under which Line 10 passes, the Carriers’ assignable permits related to the ownership and operation of Line 10, as well as personal property, contract rights, records and incidental rights held solely in connection with Line 10 (collectively, the “Assets”). Pursuant to the Put and Call Agreement, the Carriers granted the Company a right (the “Call Option”) to purchase all of the Assets and the Company granted the Carriers the right to put all the Assets to the Company (the “Put Option” and, together with the Call Option, the “Purchase Options”) subject to the terms and conditions of the Put and Call Agreement.

The Carrier’s Put Option is exercisable beginning on the date that is the earlier of (a) January 1, 2026 and (b) the date that is 30 days after the latest of (i) the date on which the Carriers give notice that the Line 10 replacement work performed pursuant to the Letter Agreement is sufficiently completed (as contemplated in the Call and Put Agreement) and (ii) the ninth (9^th) anniversary of the Execution Date (the “Put Option Commencement Date”). The Put Option terminates on the date that is 24 months after either (a) the Put Option Commencement Date if such date is the first of a month or (b) the first day of the calendar month immediately following the Put Option Commencement Date if it is not the first day of the month (the “Put/Call Option Expiry Date”). The Company’s Call Option is exercisable at any time beginning on the Execution Date and ending on the Put/Call Option Expiry Date.

The purchase price of the Assets (the “Purchase Price”) shall be calculated as follows: the sum of (a) 70% of the book value of the Assets as of July 31, 2014 minus annual depreciation, (b) 100% of total replacement costs for any segment replacements on the Pipeline commenced by the Carrier, whether completed or ongoing on the date of Asset sale is consummated (the “Closing Date”), minus any of such expenses paid by the Company and (c) 100% of the total regulatory requirements costs for any regulatory work commenced by the Carrier, whether completed or ongoing at the Closing Date, minus any of such expenses paid by the Company. The Purchase Price shall be subject to adjustment pursuant to the Agreement with respect to certain work ongoing at the Closing Date.

Among other customary conditions to closing, Carrier’s obligation to close the sale of the Assets is conditioned on the Company’s payment of all obligations outstanding pursuant to the Put and Call Agreement and the Letter Agreement. In addition, the sale of Assets pursuant to the U.S. Agreement shall close concurrently with the sale of the Assets pursuant to the Canadian Agreement.

The Company and the Carrier agreed that certain work must be undertaken in order to carve out portions of Line 10 in Canada from the Enbridge mainline system and allow it to operate independently. In the event any work is required to similarly separate the U.S. portion of Line 10 from the Enbridge mainline system (the “Carve-Out Work”), a plan to perform such Carve-Out Work that would result in expenses greater than $38.5 million will require the approval of the Company.

In the event any of the maintenance, regulatory requirement, or replacement work contemplated in the Letter Agreement or the Put and Call Agreement (collectively, the “Work”) is outstanding at the Closing Date, concurrently with the closing of the Asset sale, the Company and the Carriers will enter into an operating agreement (the “Operating Agreement”) pursuant to which the Carriers will provide certain operational and administrative services (the “Services”) while the Work is ongoing and complete such Work. As payment for the Services and completion of the Work, the Carriers shall be: (i) reimbursed for all expenses of providing the Services, (ii) paid a fixed fee of on an annual basis, which shall be subject to a 2% increase for each successive year following the first year of the Operating Agreement, and (ii) paid for all expenses of the Work not previously paid, as well as a 2.25% construction management fee.

The Put and Call Agreement may be terminated by the mutual consent of the Company and the Carriers and shall automatically terminate if neither Purchase Option is exercised prior to the Put/Call Option Expiry Date. Moreover, either the Company or a Carrier may terminate the Put and Call Agreement if a closing of the Asset sale shall not have occurred on or before December 31, 2028 assuming the terminating party is not then in breach of the Put and Call Agreement and if a party has breached a representation, such breach has not been cured within the time periods allotted by the Put and Call Agreement. Finally, the Company may terminate the Put and Call Agreement by notifying the Carriers to cease the replacement work contemplated in the Letter Agreement.

XML

Segments of Business (Tables)

6 Months Ended

Feb. 28, 2015

Segment Reporting [Abstract]

Summarized Financial Information of Company's Reportable Segments

Summarized financial information regarding the Company’s reportable segments is presented in the following tables (in thousands):

	Three Months Ended February 28,					Six Months Ended February 28,
	2015		2014			2015		2014
Net Sales
Retail	$	298,666	$	392,756		$	677,822	$	806,484
Wholesale		282,238		380,963			727,779		858,950
	$	580,904	$	773,719		$	1,405,601	$	1,665,434
Intersegment Sales
Wholesale	$	116,350	$	203,890		$	296,606	$	417,591
Operating Income (Loss)
Retail	$	8,040	$	(5,915	)	$	17,799	$	(4,530	)
Wholesale		2,752		107,752			29,132		111,781
	$	10,792	$	101,837		$	46,931	$	107,251
Depreciation and Amortization
Retail	$	1,793	$	1,578		$	3,556	$	3,139
Wholesale		8,732		5,562			17,321		10,991
	$	10,525	$	7,140		$	20,877	$	14,130

	February 28, 2015		August 31, 2014
Total Assets	$	163,957	$	186,277
Retail		661,397		684,187
Wholesale	$	825,354	$	870,464

XML

Inventories - Additional Information (Detail) (USD $)	Feb. 28, 2015	Aug. 31, 2014
Inventory [Line Items]
Replacement cost of LIFO, over LIFO carrying values	$ 7,308,000	$ 109,711,000
Reserve against its LIFO carrying values	0
LIFO inventories	145,556,000	99,919,000
Carrying Value [Member]
Inventory [Line Items]
LIFO inventories	$ 8,629,000

XML

Subsidiary Guarantors - Schedule of Condensed Consolidating Statements of Operations (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014
Condensed Financial Statements, Captions [Line Items]
Net sales	$ 580,904	$ 773,719	$ 1,405,601	$ 1,665,434
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)	518,629	622,961	1,255,797	1,461,126
Selling, general and administrative expenses	40,958	41,781	81,996	82,927
Depreciation and amortization expenses	10,525	7,140	20,877	14,130
Total expenses	570,112	671,882	1,358,670	1,558,183
Operating income (loss)	10,792	101,837	46,931	107,251
Other income (expense):
Interest expense, net	(6,632)	(6,569)	(13,290)	(13,103)
Other, net	(1,549)	(733)	(2,157)	(1,397)
Total other income (expense)	(8,181)	(7,302)	(15,447)	(14,500)
(Loss) income before income tax (benefit) expense	2,611	94,535	31,484	92,751
Income tax (benefit) expense	1,008	36,865	12,267	36,168
Net (loss) income	1,603	57,670	19,217	56,583
United Refining Company [Member]
Condensed Financial Statements, Captions [Line Items]
Net sales	398,588	584,853	1,024,385	1,276,541
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)	380,799	464,875	964,754	1,140,600
Selling, general and administrative expenses	6,036	6,473	12,753	13,004
Depreciation and amortization expenses	8,481	5,306	16,776	10,479
Total expenses	395,316	476,654	994,283	1,164,083
Operating income (loss)	3,272	108,199	30,102	112,458
Other income (expense):
Interest expense, net	(6,402)	(6,331)	(12,815)	(12,629)
Other, net	(1,744)	(872)	(2,517)	(1,720)
Equity in net income (loss) of subsidiaries	4,391	(3,742)	9,914	(3,076)
Total other income (expense)	(3,755)	(10,945)	(5,418)	(17,425)
(Loss) income before income tax (benefit) expense	(483)	97,254	24,684	95,033
Income tax (benefit) expense	(2,086)	39,584	5,467	38,450
Net (loss) income	1,603	57,670	19,217	56,583
Guarantors [Member]
Condensed Financial Statements, Captions [Line Items]
Net sales	299,837	393,881	680,183	808,887
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)	255,351	363,101	590,010	740,520
Selling, general and administrative expenses	34,922	35,308	69,243	69,923
Depreciation and amortization expenses	2,044	1,834	4,101	3,651
Total expenses	292,317	400,243	663,354	814,094
Operating income (loss)	7,520	(6,362)	16,829	(5,207)
Other income (expense):
Interest expense, net	(230)	(238)	(475)	(474)
Other, net	195	139	360	323
Total other income (expense)	(35)	(99)	(115)	(151)
(Loss) income before income tax (benefit) expense	7,485	(6,461)	16,714	(5,358)
Income tax (benefit) expense	3,094	(2,719)	6,800	(2,282)
Net (loss) income	4,391	(3,742)	9,914	(3,076)
Eliminations [Member]
Condensed Financial Statements, Captions [Line Items]
Net sales	(117,521)	(205,015)	(298,967)	(419,994)
Costs and expenses:
Costs of goods sold (exclusive of depreciation and amortization)	(117,521)	(205,015)	(298,967)	(419,994)
Total expenses	(117,521)	(205,015)	(298,967)	(419,994)
Other income (expense):
Equity in net income (loss) of subsidiaries	(4,391)	3,742	(9,914)	3,076
Total other income (expense)	(4,391)	3,742	(9,914)	3,076
(Loss) income before income tax (benefit) expense	(4,391)	3,742	(9,914)	3,076
Net (loss) income	$ (4,391)	$ 3,742	$ (9,914)	$ 3,076

XML

Consolidated Statements of Comprehensive Income - (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014	Feb. 28, 2015	Feb. 28, 2014
Statement of Comprehensive Income [Abstract]
Net income	$ 1,603	$ 57,670	$ 19,217	$ 56,583
Other comprehensive loss, net of taxes:
Unrecognized post retirement loss, net of taxes of $(237) and $(120) for the three months ended February 28, 2015 and 2014, respectively and $(474) and $(239) for the six months ended February 28, 2015 and 2014, respectively	(370)	(171)	(740)	(343)
Other comprehensive loss	(370)	(171)	(740)	(343)
Total comprehensive income	$ 1,233	$ 57,499	$ 18,477	$ 56,240

XML

Segments of Business

6 Months Ended

Feb. 28, 2015

Segment Reporting [Abstract]

Segments of Business

3. Segments of Business

Intersegment revenues are calculated using market prices and are eliminated upon consolidation. Summarized financial information regarding the Company’s reportable segments is presented in the following tables (in thousands):

	Three Months Ended February 28,					Six Months Ended February 28,
	2015		2014			2015		2014
Net Sales
Retail	$	298,666	$	392,756		$	677,822	$	806,484
Wholesale		282,238		380,963			727,779		858,950
	$	580,904	$	773,719		$	1,405,601	$	1,665,434
Intersegment Sales
Wholesale	$	116,350	$	203,890		$	296,606	$	417,591
Operating Income (Loss)
Retail	$	8,040	$	(5,915	)	$	17,799	$	(4,530	)
Wholesale		2,752		107,752			29,132		111,781
	$	10,792	$	101,837		$	46,931	$	107,251
Depreciation and Amortization
Retail	$	1,793	$	1,578		$	3,556	$	3,139
Wholesale		8,732		5,562			17,321		10,991
	$	10,525	$	7,140		$	20,877	$	14,130

	February 28, 2015		August 31, 2014
Total Assets	$	163,957	$	186,277
Retail		661,397		684,187
Wholesale	$	825,354	$	870,464

XML

Subsidiary Guarantors - Schedule of Condensed Consolidating Statements of Cash Flows (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Feb. 28, 2015	Feb. 28, 2014
Condensed Financial Statements, Captions [Line Items]
Net cash provided by operating activities	$ 31,708	$ 44,201
Cash flows from investing activities:
Additions to property, plant and equipment	(20,069)	(20,353)
Additions to deferred turnaround costs	(2,558)	(3,124)
Additions to deferred integrity and replacement costs	(28,630)
Proceeds from asset dispositions	4	56
Net cash used in investing activities	(51,253)	(23,421)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder	(18,691)	(4,810)
Proceeds from issuance of long-term debt		1,426
Principal reductions of long-term debt	(804)	(1,000)
Distribution to parent under the tax sharing agreement		(2,593)
Net cash (used in) provided by financing activities	(19,495)	(6,977)
Net (decrease) increase in cash and cash equivalents	(39,040)	13,803
Cash and cash equivalents, beginning of year	99,037	158,537
Cash and cash equivalents, end of period	59,997	172,340
United Refining Company [Member]
Condensed Financial Statements, Captions [Line Items]
Net cash provided by operating activities	27,712	40,636
Cash flows from investing activities:
Additions to property, plant and equipment	(11,739)	(12,798)
Additions to deferred turnaround costs	(543)	(3,014)
Additions to deferred integrity and replacement costs	(28,630)
Proceeds from asset dispositions	2	56
Net cash used in investing activities	(40,910)	(15,756)
Cash flows from financing activities:
Dividends to preferred shareholder and common stockholder	(18,691)	(4,810)
Principal reductions of long-term debt	(293)	(467)
Distribution to parent under the tax sharing agreement		(2,593)
Net cash (used in) provided by financing activities	(18,984)	(7,870)
Net (decrease) increase in cash and cash equivalents	(32,182)	17,010
Cash and cash equivalents, beginning of year	79,356	141,386
Cash and cash equivalents, end of period	47,174	158,396
Guarantors [Member]
Condensed Financial Statements, Captions [Line Items]
Net cash provided by operating activities	3,996	3,565
Cash flows from investing activities:
Additions to property, plant and equipment	(8,330)	(7,555)
Additions to deferred turnaround costs	(2,015)	(110)
Proceeds from asset dispositions	2
Net cash used in investing activities	(10,343)	(7,665)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		1,426
Principal reductions of long-term debt	(511)	(533)
Net cash (used in) provided by financing activities	(511)	893
Net (decrease) increase in cash and cash equivalents	(6,858)	(3,207)
Cash and cash equivalents, beginning of year	19,681	17,151
Cash and cash equivalents, end of period	$ 12,823	$ 13,944

XML

Inventories - Schedule of Inventories (Detail) (USD $) In Thousands, unless otherwise specified	Feb. 28, 2015	Aug. 31, 2014
Inventory Disclosure [Abstract]
Crude Oil	$ 41,199	$ 36,667
Petroleum Products	104,357	63,252
Total @ LIFO	145,556	99,919
Merchandise	24,221	23,983
Supplies	29,002	27,570
Total @ FIFO	53,223	51,553
Total Inventory	$ 198,779	$ 151,472