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PARSIPPANY, N.J., Nov. 2, 2023 /PRNewswire/ -- PBF Energy Inc. (NYSE:PBF) today reported third quarter 2023 income from operations of $1,077.1 million as compared to income from operations of $1,400.0 million for the third quarter of 2022. Excluding special items, third quarter 2023 income from operations was $1,145.6 million as compared to income from operations of $1,403.0 million for the third quarter of 2022.
The company reported third quarter 2023 net income of $794.1 million and net income attributable to PBF Energy Inc. of $786.4 million or $6.11 per share. This compares to net income of $1,084.2 million, and net income attributable to PBF Energy Inc. of $1,056.4 million or $8.40 per share for the third quarter 2022. Non-cash special items included in the third quarter 2023 results, which decreased net income by a net, after-tax charge of $65.0 million, or $0.50 per share, primarily consisted of a change in fair value of the contingent consideration associated with the acquisition of the Martinez refinery and related logistics assets, loss on extinguishment of debt and exit costs associated with the early termination of the Inventory Intermediation Agreement. Adjusted fully-converted net income for the third quarter 2023, excluding special items, was $857.0 million, or $6.61 per share on a fully-exchanged, fully-diluted basis, as described below, compared to adjusted fully-converted net income of $1,008.1 million or $7.96 per share, for the third quarter 2022.
Matt Lucey, PBF Energy's President and CEO, said, "With the financial results of the third quarter, PBF has further strengthened its financial condition, while continuing to invest in our assets. We reduced and extended maturities of our debt and increased liquidity." Mr. Lucey continued, "For its first quarter of operations, SBR has generated positive earnings which provides validation for our partnership and investment in the renewable fuels sector."
Mr. Lucey concluded, "Looking ahead, our balance sheet and the safe, reliable operations of all our assets remain our primary focus. We saw increased volatility in the refined product markets as we entered the fourth quarter and we expect that volatility to continue. We have actively positioned PBF, financially and operationally, to be resilient in all market conditions. PBF's path forward is bright and we are committed to generating long-term value for our investors through prudent capital allocation."
PBF Energy Inc. Declares Dividend
The company announced today that it will pay a quarterly dividend of $0.25 per share of Class A common stock on November 30, 2023, to holders of record at the close of business on November 15, 2023.
St. Bernard Renewables
As previously announced, on June 28, 2023, Eni Sustainable Mobility SpA and PBF announced the closing of the 50-50 partnership in SBR, an operating biorefinery co-located with PBF's Chalmette Refinery in Louisiana. PBF's affiliate contributed the biorefinery and other assets comprising the business to SBR and Eni Sustainable Mobility's affiliate has made capital reimbursements and contributions totaling $845.5 million to PBF following successful closing of the transaction and commencement of operations of the pre-treatment unit ("PTU").
SBR averaged over 17,000 barrels per day of renewable diesel production in the third quarter. Post start-up, operations are being optimized and production in the fourth quarter of 2023 will be impacted by an ongoing catalyst change at the renewable diesel unit during October and November.
PBF Strategic Update and Outlook
PBF remains committed to the safety and reliability of our operations. Through successful operational execution, we seek to maintain the quality of our balance sheet and preserve the ability of our assets to continue supporting our long-term strategic goal of increasing the value of our company. At quarter-end, we had approximately $1.9 billion of cash and approximately $1.2 billion of total debt. Our outstanding environmental credit payables were reduced by approximately $340 million in the third quarter, over $900 million year-to-date, and we expect to further reduce our environmental credit payables to more normalized levels over the next several quarters.
We remain active on our $1 billion share repurchase program. To date, we have repurchased approximately $590 million of equity, including approximately $115 million in the third quarter.
Our operational execution and balance sheet improvements have generated significant value for our investors in the near term and, more importantly, demonstrate our commitment to fiscal discipline, long-term value and shareholder returns.
As always, the safety and reliability of our core operations are paramount. We continue investing in all our assets and expect full-year 2023 refining capital expenditures, excluding capital expenditures related to SBR, to be in the $800 to $850 million range. We are currently conducting extensive turnaround work on the West Coast, at both our Torrance and Martinez refineries.
Timing and throughput ranges provided reflect current expectations and are subject to change based on market conditions and other factors. Fourth quarter throughput expectations are included in the table below.
Expected throughput ranges (barrels per day) | ||
Fourth Quarter 2023 | ||
Low | High | |
East Coast | 315,000 | 335,000 |
Mid-continent | 135,000 | 145,000 |
Gulf Coast | 170,000 | 180,000 |
West Coast | 250,000 | 270,000 |
Total | 870,000 | 930,000 |
Guidance provided constitutes forward-looking information and is based on current PBF Energy operating plans, company assumptions, and company configuration. Year-to-date actual throughput and quarterly guidance should be used to adjust full-year expectations. All figures and timelines are subject to change based on a variety of factors, including market and macroeconomic factors, as well as company strategic decision-making and overall company performance.
Adjusted Fully-Converted Results
Adjusted fully-converted results assume the exchange of all PBF Energy Company LLC Series A Units and dilutive securities into shares of PBF Energy Inc. Class A common stock on a one-for-one basis, resulting in the elimination of the noncontrolling interest and a corresponding adjustment to the company's tax provision.
Non-GAAP Measures
This earnings release, and the discussion during the management conference call, may include references to Non-GAAP (Generally Accepted Accounting Principles) measures including Adjusted Fully-Converted Net Income (Loss), Adjusted Fully-Converted Net Income (Loss) excluding special items, Adjusted Fully-Converted Net Income (Loss) per fully-exchanged, fully-diluted share, Income (Loss) from operations excluding special items, gross refining margin, gross refining margin excluding special items, gross refining margin per barrel of throughput, EBITDA (Earnings before Interest, Income Taxes, Depreciation and Amortization), EBITDA excluding special items, Adjusted EBITDA, net debt, net debt to capitalization ratio and net debt to capitalization ratio excluding special items. PBF believes that Non-GAAP financial measures provide useful information about its operating performance and financial results. However, these measures have important limitations as analytical tools and should not be viewed in isolation or considered as alternatives for, or superior to, comparable GAAP financial measures. PBF's Non-GAAP financial measures may also differ from similarly named measures used by other companies. See the accompanying tables and footnotes in this release for additional information on the Non-GAAP measures used in this release and reconciliations to the most directly comparable GAAP measures.
Conference Call Information
PBF Energy's senior management will host a conference call and webcast regarding quarterly results and other business matters on Thursday, November 2, 2023, at 8:30 a.m. ET. The call is being webcast and can be accessed at PBF Energy's website, http://www.pbfenergy.com. The call can also be accessed by dialing (877) 869-3847 or (201) 689-8261. The audio replay will be available approximately two hours after the end of the call and will be available through the company's website.
Forward-Looking Statements
Statements in this press release relating to future plans, results, performance, expectations, achievements and the like are considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, the Company's expectations with respect to SBR, including SBR plans, objectives, expectations and intentions with respect to future earnings and operations. These forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which may be beyond the Company's control, that may cause actual results to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors and uncertainties that may cause actual results to differ include but are not limited to the risks disclosed in the Company's filings with the SEC, our ability to operate safely, reliably, sustainably and in an environmentally responsible manner; our ability to successfully diversify our operations; our ability to make acquisitions or investments, including in renewable diesel production, and to realize the benefits from such acquisitions or investments; our ability to successfully manage the operations of our 50-50 equity method investment in SBR; our expectations with respect to our capital spending and turnaround projects; risks associated with our obligation to buy Renewable Identification Numbers and related market risks related to the price volatility thereof; the possibility that we might reduce or not pay further dividends in the future; certain developments in the global oil markets and their impact on the global macroeconomic conditions; risks relating to the securities markets generally; the impact of changes in inflation, interest rates and capital costs; and the impact of market conditions, unanticipated developments, regulatory approvals, changes in laws and other events that negatively impact the Company. All forward-looking statements speak only as of the date hereof. The Company undertakes no obligation to revise or update any forward-looking statements except as may be required by applicable law.
About PBF Energy Inc.
PBF Energy Inc. (NYSE:PBF) is one of the largest independent refiners in North America, operating, through its subsidiaries, oil refineries and related facilities in California, Delaware, Louisiana, New Jersey and Ohio. Our mission is to operate our facilities in a safe, reliable and environmentally responsible manner, provide employees with a safe and rewarding workplace, become a positive influence in the communities where we do business, and provide superior returns to our investors.
EARNINGS RELEASE TABLES | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
(Unaudited, in millions, except share and per share data) | |||||||||||
Three Months Ended | Nine Months Ended | ||||||||||
September 30, | September 30, | ||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||
Revenues | $ 10,733.5 | $ 12,764.6 | $ 29,186.1 | $ 35,984.0 | |||||||
Cost and expenses: | |||||||||||
Cost of products and other | 8,720.3 | 10,417.3 | 24,423.6 | 30,004.0 | |||||||
Operating expenses (excluding depreciation and amortization expense as reflected below) | 645.3 | 646.0 | 2,023.7 | 1,904.0 | |||||||
Depreciation and amortization expense | 140.1 | 128.1 | 424.2 | 366.5 | |||||||
Cost of sales | 9,505.7 | 11,191.4 | 26,871.5 | 32,274.5 | |||||||
General and administrative expenses (excluding depreciation and amortization expense as reflected below) | 92.9 | 168.2 | 257.1 | 374.9 | |||||||
Depreciation and amortization expense | 3.8 | 2.0 | 8.0 | 5.8 | |||||||
Change in fair value of contingent consideration, net | 65.3 | 3.0 | 32.4 | 130.9 | |||||||
Equity income in investee | (14.6) | — | (14.6) | — | |||||||
Loss (gain) on formation of SBR equity method investment | 3.2 | — | (965.7) | — | |||||||
Loss (gain) on sale of assets | 0.1 | — | (1.3) | 0.3 | |||||||
Total cost and expenses | 9,656.4 | 11,364.6 | 26,187.4 | 32,786.4 | |||||||
Income from operations | 1,077.1 | 1,400.0 | 2,998.7 | 3,197.6 | |||||||
Other income (expense): | |||||||||||
Interest expense, net | (22.7) | (52.7) | (55.2) | (216.6) | |||||||
Change in Tax Receivable Agreement liability | — | (1.7) | — | (288.2) | |||||||
Change in fair value of catalyst obligations | (0.1) | (2.6) | 1.1 | (0.3) | |||||||
Loss on extinguishment of debt | (5.7) | (69.9) | (5.7) | (66.1) | |||||||
Other non-service components of net periodic benefit cost | 0.1 | 2.2 | 0.5 | 6.6 | |||||||
Income before income taxes | 1,048.7 | 1,275.3 | 2,939.4 | 2,633.0 | |||||||
Income tax expense | 254.6 | 191.1 | 729.0 | 316.3 | |||||||
Net income | 794.1 | 1,084.2 | 2,210.4 | 2,316.7 | |||||||
Less: net income attributable to noncontrolling interests | 7.7 | 27.8 | 21.5 | 77.7 | |||||||
Net income attributable to PBF Energy Inc. stockholders | $ 786.4 | $ 1,056.4 | $ 2,188.9 | $ 2,239.0 | |||||||
Net income available to Class A common stock per share: | |||||||||||
Basic | $ 6.35 | $ 8.65 | $ 17.38 | $ 18.46 | |||||||
Diluted | $ 6.11 | $ 8.40 | $ 16.76 | $ 18.03 | |||||||
Weighted-average shares outstanding-basic | 123,793,179 | 122,113,570 | 125,938,259 | 121,299,726 | |||||||
Weighted-average shares outstanding-diluted | 129,690,375 | 126,585,809 | 131,547,028 | 125,092,933 | |||||||
Dividends per common share | $ 0.20 | $ — | $ 0.60 | $ — | |||||||
Adjusted fully-converted net income and adjusted fully-converted net income per fully exchanged, fully diluted shares outstanding (Note 1): | |||||||||||
Adjusted fully-converted net income | $ 792.0 | $ 1,063.3 | $ 2,204.4 | $ 2,254.9 | |||||||
Adjusted fully-converted net income per fully exchanged, fully diluted share | $ 6.11 | $ 8.40 | $ 16.76 | $ 18.03 | |||||||
Adjusted fully-converted shares outstanding - diluted (Note 6) | 129,690,375 | 126,585,809 | 131,547,028 | 125,092,933 | |||||||
See Footnotes to Earnings Release Tables | |||||||||||
PBF ENERGY INC. AND SUBSIDIARIES | |||||||||||||
RECONCILIATION OF AMOUNTS REPORTED UNDER U.S. GAAP | |||||||||||||
(Unaudited, in millions, except share and per share data) | |||||||||||||
RECONCILIATION OF NET INCOME TO ADJUSTED FULLY-CONVERTED NET INCOME AND ADJUSTED FULLY-CONVERTED NET INCOME EXCLUDING SPECIAL ITEMS (Note 1) | Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | ||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||
Net income attributable to PBF Energy Inc. stockholders | $ 786.4 | $ 1,056.4 | $ 2,188.9 | $ 2,239.0 | |||||||||
Less: Income allocated to participating securities | — | — | — | — | |||||||||
Income available to PBF Energy Inc. stockholders - basic | 786.4 | 1,056.4 | 2,188.9 | 2,239.0 | |||||||||
Add: Net income attributable to noncontrolling interests (Note 2) | 7.6 | 9.2 | 21.0 | 21.4 | |||||||||
Less: Income tax expense (Note 3) | (2.0) | (2.3) | (5.5) | (5.5) | |||||||||
Adjusted fully-converted net income | $ 792.0 | $ 1,063.3 | $ 2,204.4 | $ 2,254.9 | |||||||||
Special items (Note 4): | |||||||||||||
Add: Change in fair value of contingent consideration, net | 65.3 | 3.0 | 32.4 | 130.9 | |||||||||
Add: Loss on extinguishment of debt and termination of Inventory Intermediation Agreement | 19.2 | 69.9 | 19.2 | 66.1 | |||||||||
Add: Change in Tax Receivable Agreement liability | — | 1.7 | — | 288.2 | |||||||||
Add: Gain on land sales | — | — | (1.7) | — | |||||||||
Add: Loss (gain) on formation of SBR equity method investment | 3.2 | — | (965.7) | — | |||||||||
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