Delaware | 1-36550 | 84-1060803 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
800 Gessner Road, Suite 875 Houston, Texas | 77024 | |
(Address of principal executive offices) | (Zip Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(d) | Exhibits |
99.1 | Press release dated November 4, 2015. |
Par Pacific Holdings, Inc. | |||||
Dated: November 4, 2015 | /s/ James Matthew Vaughn | ||||
James Matthew Vaughn Senior Vice President and General Counsel |
• | Net Income of $14.7 million, or $0.39 per diluted share |
• | Adjusted Net Income of $23.8 million, or $0.64 per diluted share |
• | Adjusted EBITDA of $34.3 million |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Revenues | |||||||||||||||
Refining and distribution revenues | $ | 403,165 | $ | 736,284 | $ | 1,352,724 | $ | 2,118,023 | |||||||
Retail revenues | 81,434 | 62,929 | 209,091 | 174,179 | |||||||||||
Commodity marketing and logistics revenues | 10,904 | 53,406 | 58,873 | 102,384 | |||||||||||
Natural gas and oil revenues | — | 1,667 | 2,185 | 5,083 | |||||||||||
Total operating revenues | 495,503 | 854,286 | 1,622,873 | 2,399,669 | |||||||||||
Operating expenses | |||||||||||||||
Cost of revenues | 405,153 | 830,438 | 1,387,690 | 2,322,788 | |||||||||||
Operating expense, excluding depreciation, depletion and amortization expense | 38,047 | 42,729 | 102,798 | 109,897 | |||||||||||
Lease operating expense | 1,575 | 1,204 | 4,614 | 3,963 | |||||||||||
Depreciation, depletion and amortization | 4,596 | 3,918 | 12,852 | 10,269 | |||||||||||
Impairment expense | 9,639 | — | 9,639 | — | |||||||||||
Loss on sale of assets, net | — | 624 | — | 624 | |||||||||||
General and administrative expense | 9,939 | 8,115 | 31,878 | 18,782 | |||||||||||
Acquisition and integration expense | 280 | 3,856 | 1,811 | 9,126 | |||||||||||
Total operating expenses | 469,229 | 890,884 | 1,551,282 | 2,475,449 | |||||||||||
Operating income (loss) | 26,274 | (36,598 | ) | 71,591 | (75,780 | ) | |||||||||
Other income (expense) | |||||||||||||||
Interest expense and financing costs, net | (4,387 | ) | (7,076 | ) | (15,769 | ) | (13,980 | ) | |||||||
Loss on termination of financing agreements | — | — | (19,229 | ) | — | ||||||||||
Other income (expense), net | (45 | ) | (164 | ) | (199 | ) | (304 | ) | |||||||
Change in value of common stock warrants | (1,023 | ) | 2,401 | (2,732 | ) | 4,118 | |||||||||
Change in value of contingent consideration | (4,255 | ) | 996 | (18,679 | ) | 5,758 | |||||||||
Equity earnings (losses) from Laramie Energy Company | (1,355 | ) | 835 | (6,131 | ) | 1,374 | |||||||||
Total other income (expense), net | (11,065 | ) | (3,008 | ) | (62,739 | ) | (3,034 | ) | |||||||
Income (loss) before income taxes | 15,209 | (39,606 | ) | 8,852 | (78,814 | ) | |||||||||
Income tax benefit (expense) | (469 | ) | 150 | 18,073 | 113 | ||||||||||
Net income (loss) | $ | 14,740 | $ | (39,456 | ) | $ | 26,925 | $ | (78,701 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net income (loss) | $ | 14,740 | $ | (39,456 | ) | $ | 26,925 | $ | (78,701 | ) | |||||
Adjustments to Net income (loss): | |||||||||||||||
Inventory valuation adjustment | (13,390 | ) | — | (13,390 | ) | — | |||||||||
Loss on sale of assets, net | — | 624 | — | 624 | |||||||||||
Unrealized loss (gain) on derivatives | 4,360 | 4,786 | |||||||||||||
Lower of cost or market adjustment | 2,628 | — | 493 | ||||||||||||
Acquisition and integration expense | 280 | 3,856 | 1,811 | 9,126 | |||||||||||
Change in value of common stock warrants | 1,023 | (2,401 | ) | 2,732 | (4,118 | ) | |||||||||
Change in value of contingent consideration | 4,255 | (996 | ) | 18,679 | (5,758 | ) | |||||||||
Impairment expense | 9,639 | — | 9,639 | — | |||||||||||
Loss on termination of financing agreements | — | — | 19,229 | — | |||||||||||
Release of valuation allowance due to Mid Pac acquisition | 295 | (18,290 | ) | ||||||||||||
Adjusted Net Income (Loss) | $ | 23,830 | $ | (38,373 | ) | $ | 52,614 | $ | (78,827 | ) | |||||
Depreciation, depletion and amortization | 4,596 | 3,918 | 12,852 | 10,269 | |||||||||||
Interest expense and financing costs, net | 4,387 | 7,076 | 15,769 | 13,980 | |||||||||||
Equity earnings (losses) from Laramie Energy Company | 1,355 | (835 | ) | 6,131 | (1,374 | ) | |||||||||
Income tax expense (benefit) | 174 | (150 | ) | 217 | (113 | ) | |||||||||
Adjusted EBITDA | $ | 34,342 | $ | (28,364 | ) | $ | 87,583 | $ | (56,065 | ) |
Weighted average shares outstanding: | |||||||||||||||
Basic | 37,390 | 33,137 | 37,304 | 31,311 | |||||||||||
Diluted | 37,400 | 33,137 | 37,331 | 31,311 | |||||||||||
Earnings per share | |||||||||||||||
Basic | $ | 0.39 | $ | (1.19 | ) | $ | 0.72 | $ | (2.51 | ) | |||||
Diluted | $ | 0.39 | $ | (1.19 | ) | $ | 0.72 | $ | (2.51 | ) | |||||
Adjusted Net Income (Loss) per share | |||||||||||||||
Basic | $ | 0.64 | $ | (1.16 | ) | $ | 1.41 | $ | (2.52 | ) | |||||
Diluted | $ | 0.64 | $ | (1.16 | ) | $ | 1.41 | $ | (2.52 | ) |
September 30, 2015 | December 31, 2014 | ||||||
Balance Sheet Data | |||||||
Cash and cash equivalents | $ | 101,841 | $ | 89,210 | |||
Working capital (1) | $ | 15,044 | $ | 89,873 | |||
Debt, including current portion | $ | 169,625 | $ | 136,610 | |||
Total stockholders' equity | $ | 330,517 | $ | 292,159 |
(1 | ) | Working capital is calculated as (i) total current assets, excluding cash and cash equivalents less (ii) total current liabilities, excluding current portion of long-term debt. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||
Refining and Distribution Segment | |||||||||||
Total Crude Oil Throughput (Mbpd) | 73.5 | 68.5 | 76.3 | 68.7 | |||||||
Source of Crude Oil: | |||||||||||
North America | 31.9 | % | 28.2 | % | 46.7 | % | 47.9 | % | |||
Latin America | 5.3 | % | 18.0 | % | 9.8 | % | 23.9 | % | |||
Africa | 2.2 | % | — | % | 10.3 | % | 0.1 | % | |||
Asia | 60.6 | % | — | % | 30.4 | % | 1.7 | % | |||
Middle East | — | % | 53.8 | % | 2.8 | % | 26.4 | % | |||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||
Yield (% of total throughput) | |||||||||||
Gasoline and gasoline blendstocks | 25.3 | % | 24.2 | % | 25.9 | % | 24.4 | % | |||
Distillate | 45.4 | % | 42.5 | % | 44.3 | % | 39.4 | % | |||
Fuel oils | 21.1 | % | 25.4 | % | 22.1 | % | 30.5 | % | |||
Other products | 4.4 | % | 4.8 | % | 4.6 | % | 3.3 | % | |||
Total yield | 96.2 | % | 96.9 | % | 96.9 | % | 97.6 | % | |||
Refined product sales volume (Mbpd) | |||||||||||
On-island sales volume | 57.2 | 56.5 | 59.8 | 53.1 | |||||||
Exports sale volume | 17.0 | 15.8 | 17.1 | 16.4 | |||||||
Total refined product sales volume | 74.2 | 72.3 | 76.9 | 69.5 | |||||||
4-1-2-1 Mid Pacific Crack Spread (1) | $7.93 | $7.46 | $8.93 | $6.80 | |||||||
Mid Pacific Crude Oil Differential (2) | $(0.56) | $(0.85) | $(1.43) | $(0.63) | |||||||
Gross refining margin per bbl ($/throughput bbl) (3) | $10.72 | $1.65 | $8.80 | $2.13 | |||||||
Production costs before DD&A expense per barrel ($/throughput bbl) (4) | $4.18 | $5.47 | $3.80 | $4.69 | |||||||
Net operating margin per bbl ($/throughput bbl) (5) | $6.54 | $(3.82) | $5.00 | $(2.56) | |||||||
Retail Segment | |||||||||||
Retail sales volumes (thousands of gallons) | 23,247 | 13,087 | 58,034 | 36,687 |
(1) | The profitability of our Hawaii business is heavily influenced by crack spreads in both the Singapore and West Coast markets. These markets reflect the closest, liquid market alternatives to source refined products for Hawaii. We believe the Singapore 4-1-2-1 crack spread (or four barrels of Brent crude converted into one barrel of gasoline, two barrels of distillate (gasoil and jet fuel), and one barrel of fuel oil) best reflects a market indicator for our operations. However, a portion of our sales reference the West Coast market. Calculated using a ratio of 80% Singapore and 20% San Francisco indexes. |
(2) | Weighted average differentials, excluding shipping costs, of a blend of crudes with an API of 31.98 and sulphur wt% of 0.65% that is indicative of our typical crude oil mix quality compared to Brent crude. |
(3) | Management uses gross refining margin per barrel to evaluate performance and compare profitability to other companies in the industry. There are a variety of ways to calculate gross refining margin per barrel; different companies within the industry may calculate it in different ways. We calculate gross refining margin per barrel |
(4) | Management uses production costs before DD&A expense per barrel to evaluate performance and compare efficiency to other companies in the industry. There are a variety of ways to calculate production cost before DD&A expense per barrel; different companies within the industry calculate it in different ways. We calculate production costs before DD&A expense per barrel by dividing all direct production costs by total refining throughput. |
(5) | Calculated as gross refining margin less production costs before DD&A expense. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Gross Margin | |||||||||||||||
Refining and distribution | $ | 72,463 | $ | 10,408 | $ | 183,437 | $ | 39,985 | |||||||
Retail | 20,779 | 10,984 | 50,708 | 26,828 | |||||||||||
Commodity marketing and logistics | (2,892 | ) | 789 | (1,147 | ) | 4,985 | |||||||||
Natural gas and oil | — | 1,667 | 2,185 | 5,083 | |||||||||||
Total gross margin | 90,350 | 23,848 | 235,183 | 76,881 | |||||||||||
Operating expense, excluding depreciation, depletion, and amortization expense | 38,047 | 42,729 | 102,798 | 109,897 | |||||||||||
Lease operating expense | 1,575 | 1,204 | 4,614 | 3,963 | |||||||||||
Depreciation, depletion, and amortization | 4,596 | 3,918 | 12,852 | 10,269 | |||||||||||
Impairment expense | 9,639 | — | 9,639 | — | |||||||||||
Loss on sale of assets, net | — | 624 | — | 624 | |||||||||||
General and administrative expense | 9,939 | 8,115 | 31,878 | 18,782 | |||||||||||
Acquisition and integration costs | 280 | 3,856 | 1,811 | 9,126 | |||||||||||
Total operating expenses | 64,076 | 60,446 | 163,592 | 152,661 | |||||||||||
Operating income (loss) | $ | 26,274 | $ | (36,598 | ) | $ | 71,591 | $ | (75,780 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Adjusted EBITDA | $ | 34,342 | $ | (28,364 | ) | $ | 87,583 | $ | (56,065 | ) | |||||
Income tax benefit (expense) | (174 | ) | 150 | (217 | ) | 113 | |||||||||
Equity earnings (losses) from Laramie Energy Company | (1,355 | ) | 835 | (6,131 | ) | 1,374 | |||||||||
Interest expense and financing costs, net | (4,387 | ) | (7,076 | ) | (15,769 | ) | (13,980 | ) | |||||||
Depreciation, depletion and amortization | (4,596 | ) | (3,918 | ) | (12,852 | ) | (10,269 | ) | |||||||
Adjusted Net Income (Loss) | 23,830 | (38,373 | ) | 52,614 | (78,827 | ) | |||||||||
Impairment expense | (9,639 | ) | — | (9,639 | ) | — | |||||||||
Change in value of contingent consideration | (4,255 | ) | 996 | (18,679 | ) | 5,758 | |||||||||
Change in value of common stock warrants | (1,023 | ) | 2,401 | (2,732 | ) | 4,118 | |||||||||
Loss on termination of financing agreements | — | — | (19,229 | ) | — | ||||||||||
Release of valuation allowance due to Mid Pac Acquisition | (295 | ) | — | 18,290 | — | ||||||||||
Acquisition and integration expense | (280 | ) | (3,856 | ) | (1,811 | ) | (9,126 | ) | |||||||
Lower of cost or market adjustment | (2,628 | ) | — | (493 | ) | — | |||||||||
Unrealized loss on derivatives | (4,360 | ) | — | (4,786 | ) | — | |||||||||
Inventory valuation adjustment | 13,390 | — | 13,390 | — | |||||||||||
Loss on sale of assets, net | — | (624 | ) | $ | — | $ | (624 | ) | |||||||
Net income (loss) | $ | 14,740 | $ | (39,456 | ) | $ | 26,925 | $ | (78,701 | ) |
• | The financial performance of our assets without regard to financing methods, capital structure or historical cost basis; |
• | The ability of our assets to generate cash to pay interest on our indebtedness; and |
• | Our operating performance and return on invested capital as compared to other companies without regard to financing methods and capital structure. |
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