• Full Year 2024 Net Income: $45 million.
• Full Year 2024 EBITDA: $394 million.
• Fourth Quarter 2024 Net Income: $40 million.
• Fourth Quarter 2024 EBITDA: $122 million.
• Petroleum Segment EBITDA (Full Year 2024): $223 million.
• Fertilizer Segment EBITDA (Full Year 2024): $179 million.
• Renewable Segment EBITDA (Full Year 2024): $3 million.
• Fourth Quarter 2024 Earnings Per Share: $0.28.
• Adjusted EBITDA (Fourth Quarter 2024): $67 million.
• Adjusted Loss Per Share (Fourth Quarter 2024): $0.13.
• Cash Flow from Operations (Fourth Quarter 2024): $98 million.
• Free Cash Flow (Fourth Quarter 2024): $40 million.
• Consolidated Cash Balance (End of Fourth Quarter 2024): $987 million.
• Total Liquidity (End of Fourth Quarter 2024): Approximately $1.1 billion.
• Fourth Quarter 2024 Direct Operating Expenses (Petroleum Segment): $5.13 per barrel.
• Fourth Quarter 2024 Adjusted EBITDA (Renewable Segment): $9 million.
• Fourth Quarter 2024 Adjusted EBITDA (Fertilizer Segment): $50 million.
• Fourth Quarter 2024 Distribution Declared by CVR Partners: $1.75 per common unit.
• Capital Spending (Full Year 2024): $181 million.
• Turnaround Spending (Full Year 2024): $58 million.

• Warning! GuruFocus has detected 7 Warning Sign with CVI.

Release Date: February 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• CVR Energy Inc (NYSE:CVI) reported a consolidated net income of $45 million and an EBITDA of $394 million for the full year of 2024.
• The fertilizer segment showed strong performance with an adjusted EBITDA of $50 million for the fourth quarter, driven by increased ammonia sales prices and lower feedstock costs.
• The renewable segment saw a significant improvement with an adjusted EBITDA of $9 million for the fourth quarter, compared to a negative $17 million in the same period last year.
• CVR Energy Inc (NYSE:CVI) increased its liquidity significantly by generating $318 million from a term loan issuance and $90 million from the sale of its interest in the Midway pipeline.
• The company is optimistic about potential improvements in refining market conditions in 2025 due to expected supply rationalization and increased demand.

Negative Points

• The petroleum segment faced challenges with lower crack spreads, resulting in an adjusted EBITDA of only $9 million for the fourth quarter.
• The renewable diesel unit's capacity was reduced to 80 million gallons per year due to catalyst limitations, impacting production efficiency.
• CVR Energy Inc (NYSE:CVI) is facing uncertainty in the renewable segment due to reliance on government subsidies, which are politically driven and unpredictable.
• The planned turnaround at Coffeyville is expected to extend by 10 to 15 days and increase costs by $10 million to $15 million due to unforeseen circumstances.
• The company is dealing with increased direct operating expenses in the petroleum segment, rising to $5.13 per barrel in the fourth quarter from $4.69 per barrel in the previous year.

Q & A Highlights

Q: With the free cash flow generated in the fourth quarter, what are the plans for its use post-Coffeyville turnaround? Will it be used to pay down debt or consider reinstating a dividend? A: Dane Neumann, CFO, stated that the focus is on deleveraging, particularly working off the term loan. While the term loan doesn't need to be fully paid off before considering a dividend, sustained market strength is necessary. David Lamp, CEO, added that the Board reviews the dividend every quarter, and improvements in crack spreads could increase the likelihood of reinstating it.

Q: What is the timeline and capital expenditure required for projects aimed at increasing jet fuel yield? A: David Lamp, CEO, explained that the main constraint is building a business for jet fuel, as major airlines have three-year contracts. The project involves installing a jumper and rearranging tankage at Coffeyville, with readiness expected by the end of the third quarter.

Q: Are there plans to diversify the company's refining footprint beyond the Mid-Con region? A: David Lamp, CEO, mentioned that while they look at all market opportunities, the bid/ask spread has been too wide. The focus is on diversifying away from the Group 3 market in the Mid-Con region, with a preference for moving inland and west rather than south or east.

Q: What are the constraints on renewable diesel capacity, and how do they impact production? A: David Lamp, CEO, noted that the renewable diesel unit was initially expected to handle 7,500 barrels per day, but catalyst limitations have reduced capacity. Adding another catalyst bed could restore capacity, but concerns about government subsidies make further investment risky.

Q: What are the tax implications of the $90 million Midway pipeline sale, and are there plans for further asset sales? A: Dane Neumann, CFO, stated that the tax base for the joint venture was around $15 million, with taxes to be paid in early 2025. David Lamp, CEO, added that while there are some logistics assets available, the potential for further sales is limited compared to previous estimates.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.