• Net Loss: $122 million for the third quarter of 2024.
• Loss Per Share: $1.24 for the third quarter of 2024.
• EBITDA: Loss of $35 million for the third quarter of 2024.
• Adjusted EBITDA: $63 million for the third quarter of 2024.
• Adjusted Loss Per Share: $0.50 for the third quarter of 2024.
• Petroleum Segment Throughput: Approximately 189,000 barrels per day for the third quarter of 2024.
• Crude Oil Utilization: 85% for the third quarter of 2024.
• Group 3 2-1-1 Benchmark Cracks: $19.40 per barrel for the third quarter of 2024.
• RINs Expense: $46 million or $2.62 per barrel for the third quarter of 2024.
• Direct Operating Expenses (Petroleum): $5.72 per barrel for the third quarter of 2024.
• Fertilizer Segment Adjusted EBITDA: $36 million for the third quarter of 2024.
• Cash Provided by Operations: $48 million for the third quarter of 2024.
• Free Cash Flow: $13 million for the third quarter of 2024.
• Consolidated Cash Balance: $534 million as of September 30, 2024.
• Total Liquidity: Approximately $713 million as of September 30, 2024.

• Warning! GuruFocus has detected 6 Warning Sign with CVI.

Release Date: October 29, 2024

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 strong ammonia utilization rate of 97% in its fertilizer segment, indicating efficient operations.
• The company saw an increase in nitrogen fertilizer prices compared to the previous year, reflecting strong market demand.
• CVR Energy Inc (NYSE:CVI) successfully processed approximately 20 million gallons of vegetable oil feedstocks through its renewable diesel unit, contributing positively to its results.
• The company maintained a consolidated cash balance of $534 million, providing a solid liquidity position.
• CVR Energy Inc (NYSE:CVI) is exploring potential increases in liquidity through access to capital markets, which could strengthen its financial position.

Negative Points

• CVR Energy Inc (NYSE:CVI) reported a consolidated net loss of $122 million for the third quarter, highlighting financial challenges.
• The company experienced unplanned downtime at both facilities, leading to a significant loss of profit opportunity estimated at $23 million for the quarter.
• The Board of Directors decided to suspend the quarterly dividend to preserve cash, indicating financial strain.
• The petroleum segment faced a difficult operational quarter with multiple plant interruptions, impacting crude oil utilization rates.
• CVR Energy Inc (NYSE:CVI) is dealing with ongoing challenges related to the Renewable Fuel Standard (RFS) obligations, which have negatively impacted financial results.

Q & A Highlights

Q: How should we think about the future of the dividend, especially after the recent suspension? A: David Lamp, CEO, explained that while the company prefers returning cash to shareholders via dividends, the current market conditions and upcoming major turnaround necessitate caution. The decision to suspend the dividend was difficult but deemed necessary given the forward curve and inflation impacts. The company remains committed to dividends as a preferred method of returning cash when conditions improve.

Q: Are there any plans for non-core asset sales or accessing capital markets? A: David Lamp, CEO, mentioned that while they haven't started anything in earnest, midstream assets could be considered for sale. CFO Dane Neumann added that they are assessing all options for accessing capital markets but have no specific plans to disclose yet.

Q: Is there potential to file insurance claims for downtime losses? A: David Lamp, CEO, confirmed that they have recovered some money from insurance claims related to downtime, with costs estimated around $25 million. However, the exact amount recoverable is still being determined.

Q: What are the company's thoughts on acquisitions, especially with Citgo now sold? A: David Lamp, CEO, stated that while they are open to accretive deals, there are currently no acquisitions in the pipeline. The company continues to look for opportunities to diversify and improve its portfolio.

Q: What is the outlook for refining margins and capacity closures? A: David Lamp, CEO, characterized the market as oversupplied rather than a demand issue. He noted that some refining capacity shut down during COVID has been added back, and further capacity rationalization is needed for margins to improve. The company anticipates continued pressure from EVs and LNG substitution.

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