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MarketScreener Homepage  >  Equities  >  Nyse  >  HollyFrontier Corporation    HFC

HOLLYFRONTIER CORPORATION

(HFC)
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HollyFrontier : Reports Quarterly Results

11/05/2020 | 06:42am EST
View all news
HollyFrontier Corporation Reports Quarterly Results
11/05/2020
  • Reported net loss attributable to HollyFrontier stockholders of $(2.4) million, or $(0.01) per diluted share, and adjusted net loss of $(66.9) million, or $(0.41) per diluted share, for the third quarter
  • Reported EBITDA of $157.0 million and adjusted EBITDA of $65.6 million for the third quarter
  • Raised $750.0 million in a public bond offering in the third quarter to enhance liquidity and fund expansion into renewable diesel production

DALLAS--(BUSINESS WIRE)-- HollyFrontier Corporation (NYSE:HFC) ('HollyFrontier' or the 'Company') today reported third quarter net loss attributable to HollyFrontier stockholders of $(2.4) million, or $(0.01) per diluted share, for the quarter ended September 30, 2020, compared to net income of $261.8 million, or $1.58 per diluted share, for the quarter ended September 30, 2019.

The third quarter results reflect special items that collectively increased net income by a total of $64.5 million. On a pre-tax basis, these items include HollyFrontier's pro-rata share of a gain recognized upon the settlement of the Company's business interruption claim with its insurance carrier related to a loss at the Woods Cross Refinery totaling $77.1 million and a lower of cost or market inventory valuation adjustment of $62.8 million, partially offset by charges related to the Cheyenne Refinery conversion to renewable diesel production, including last-in, first-out ('LIFO') inventory liquidation costs of $33.8 million, decommissioning charges of $12.3 million and severance charges totaling $2.4 million. Excluding these items, net loss for the current quarter was $(66.9) million ($(0.41) per diluted share) compared to net income of $278.0 million ($1.68 per diluted share) for the third quarter of 2019, which excludes certain items that collectively decreased net income by $16.2 million.

HollyFrontier's President & CEO, Michael Jennings, commented, 'Despite the difficult operating environment, HollyFrontier delivered solid results in the third quarter, led by resilient financial performances from our lubricants and midstream businesses. In August, we ran the last barrel of crude oil at Cheyenne and began the conversion to renewable diesel production. I would like to thank all of the employees at Cheyenne for safely achieving this milestone. In September, we reinforced our strong liquidity position through the successful $750.0 million bond offering, providing us the necessary capital to fully fund the previously announced renewable diesel projects at our Artesia, New Mexico and Cheyenne, Wyoming facilities.'

The COVID-19 pandemic caused a decline in U.S. and global economic activity starting in the first quarter of 2020. This decrease reduced both volumes and unit margins across the Company's businesses, resulting in lower gross margins and earnings. During the third quarter of 2020, demand for transportation fuels remained challenged while lubricants and specialties saw meaningful improvement in industrial and transportation-related markets and increased global demand for base oils.

The Refining segment reported adjusted EBITDA of $(53.6) million for the third quarter of 2020 compared to $424.6 million for the third quarter of 2019. This decrease was primarily due to continued weak demand for gasoline and diesel coupled with compressed crude differentials. Refinery gross margin for the third quarter of 2020 was $4.93 per produced barrel, a 71% decrease compared to $17.23 for the third quarter of 2019. Crude oil charge averaged 390,580 barrels per day ('BPD') for the current quarter compared to 476,030 BPD for the third quarter of 2019.

The Lubricants and Specialty Products segment reported EBITDA of $60.6 million for the third quarter of 2020 compared to $38.0 million in the third quarter of 2019. This increase was driven by the strong recovery in global demand for finished lubricants and base oils, resulting in higher sales volumes and margins during the quarter.

Holly Energy Partners, L.P. ('HEP') reported EBITDA of $55.3 million for the third quarter of 2020 compared to $123.1 million in the third quarter of 2019. Reported EBITDA for the third quarter of 2020 included a $35.7 million goodwill impairment charge, and reported EBITDA for the third quarter of 2019 included a $35.2 million gain on sales-type leases, both of which eliminated on the Company's consolidation.

For the third quarter of 2020, net cash provided by operations totaled $81.7 million. During the period, HollyFrontier declared and paid a dividend of $0.35 per share to shareholders totaling $57.2 million. At September 30, 2020, the Company's cash and cash equivalents totaled $1,524.9 million, a $622.4 million increase over cash and cash equivalents of $902.5 million at June 30, 2020. Additionally, the Company's consolidated debt was $3,176.3 million. The Company's debt, exclusive of HEP debt, which is nonrecourse to HollyFrontier, was $1,736.5 million at September 30, 2020.

The Company has scheduled a webcast conference call for today, November 5, 2020, at 8:30 AM Eastern Time to discuss third quarter financial results. This webcast may be accessed at: https://event.on24.com/wcc/r/2628168/9BE4DA1E13C98135F6352CD76762D475. An audio archive of this webcast will be available using the above noted link through November 19, 2020.

HollyFrontier Corporation, headquartered in Dallas, Texas, is an independent petroleum refiner and marketer that produces high value light products such as gasoline, diesel fuel, jet fuel and other specialty products. HollyFrontier owns and operates refineries located in Kansas, Oklahoma, New Mexico and Utah and markets its refined products principally in the Southwest U.S., the Rocky Mountains extending into the Pacific Northwest and in other neighboring Plains states. In addition, HollyFrontier produces base oils and other specialized lubricants in the U.S., Canada and the Netherlands, and exports products to more than 80 countries. HollyFrontier also owns a 57% limited partner interest and a non-economic general partner interest in Holly Energy Partners, L.P., a master limited partnership that provides petroleum product and crude oil transportation, terminalling, storage and throughput services to the petroleum industry, including HollyFrontier Corporation subsidiaries.

The following is a 'safe harbor' statement under the Private Securities Litigation Reform Act of 1995: The statements in this press release relating to matters that are not historical facts are 'forward-looking statements' based on management's beliefs and assumptions using currently available information and expectations as of the date hereof, are not guarantees of future performance and involve certain risks and uncertainties, including those contained in our filings with the Securities and Exchange Commission. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that our expectations will prove correct. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements. Any differences could be caused by a number of factors, including, but not limited to, the extraordinary market environment and effects of the COVID-19 pandemic, including the continuation of a material decline in demand for refined petroleum products in markets the Company serves; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products or lubricant and specialty products in the Company's markets; the spread between market prices for refined products and market prices for crude oil; the possibility of constraints on the transportation of refined products or lubricant and specialty products; the possibility of inefficiencies, curtailments or shutdowns in refinery operations or pipelines, whether due to infection in the workforce or in response to reductions in demand; effects of governmental and environmental regulations and policies, including the effects of current restrictions on various commercial and economic activities in response to the COVID-19 pandemic; the availability and cost of financing to the Company; the effectiveness of the Company's capital investments and marketing strategies; the Company's efficiency in carrying out and consummating construction projects, including the Company's ability to complete announced capital projects, such as the conversion of the Cheyenne Refinery to a renewable diesel facility and the construction of the Artesia renewable diesel unit and pretreatment unit, on time and within budget; the Company's ability to timely obtain or maintain permits, including those necessary for operations or capital projects; the ability of the Company to acquire refined or lubricant product operations or pipeline and terminal operations on acceptable terms and to integrate any existing or future acquired operations; the possibility of terrorist or cyberattacks and the consequences of any such attacks; general economic conditions, including uncertainty regarding the timing, pace and extent of an economic recovery in the United States; further deterioration in gross margins or a prolonged economic slowdown due to COVID-19 could result in an impairment of goodwill and / or additional long-lived asset impairments; and other financial, operational and legal risks and uncertainties detailed from time to time in the Company's Securities and Exchange Commission filings. The forward-looking statements speak only as of the date made and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

RESULTS OF OPERATIONS

Financial Data (all information in this release is unaudited)

Three Months Ended
September 30,

Change from 2019

2020

2019

Change

Percent

(In thousands, except per share data)

Sales and other revenues

$

2,819,400

$

4,424,828

$

(1,605,428

)

(36

)%

Operating costs and expenses:

Cost of products sold:

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

2,377,238

3,403,767

(1,026,529

)

(30

)

Lower of cost or market inventory valuation adjustment

(62,849

)

34,062

(96,911

)

(285

)

2,314,389

3,437,829

(1,123,440

)

(33

)

Operating expenses

332,496

345,578

(13,082

)

(4

)

Selling, general and administrative expenses

74,453

87,626

(13,173

)

(15

)

Depreciation and amortization

125,280

127,016

(1,736

)

(1

)

Total operating costs and expenses

2,846,618

3,998,049

(1,151,431

)

(29

)

Income (loss) from operations

(27,218

)

426,779

(453,997

)

(106

)

Other income (expense):

Earnings of equity method investments

1,316

1,334

(18

)

(1

)

Interest income

1,011

6,164

(5,153

)

(84

)

Interest expense

(30,589

)

(36,027

)

5,438

(15

)

Gain on business interruption insurance settlement

81,000

-

81,000

-

Gain on foreign currency transactions

1,030

395

635

161

Other, net

1,368

2,356

(988

)

(42

)

55,136

(25,778

)

80,914

(314

)

Income before income taxes

27,918

401,001

(373,083

)

(93

)

Income tax expense

4,573

103,021

(98,448

)

(96

)

Net income

23,345

297,980

(274,635

)

(92

)

Less net income attributable to noncontrolling interest

25,746

36,167

(10,421

)

(29

)

Net income (loss) attributable to HollyFrontier stockholders

$

(2,401

)

$

261,813

$

(264,214

)

(101

)%

Earnings (loss) per share attributable to HollyFrontier stockholders:

Basic

$

(0.01

)

$

1.60

$

(1.61

)

(101

)%

Diluted

$

(0.01

)

$

1.58

$

(1.59

)

(101

)%

Cash dividends declared per common share

$

0.35

$

0.33

$

0.02

6

%

Average number of common shares outstanding:

Basic

162,015

163,676

(1,661

)

(1

)%

Diluted

162,015

165,011

(2,996

)

(2

)%

EBITDA

$

157,030

$

521,713

$

(364,683

)

(70

)%

Adjusted EBITDA

$

65,638

$

523,082

$

(457,444

)

(87

)%

Nine Months Ended
September 30,

Change from 2019

2020

2019

Change

Percent

(In thousands, except per share data)

Sales and other revenues

$

8,282,875

$

13,104,690

$

(4,821,815

)

(37

)%

Operating costs and expenses:

Cost of products sold:

Cost of products sold (exclusive of lower of cost or market inventory valuation adjustment)

6,647,960

10,307,856

(3,659,896

)

(36

)

Lower of cost or market inventory valuation adjustment

227,711

(150,483

)

378,194

(251

)

6,875,671

10,157,373

(3,281,702

)

(32

)

Operating expenses

964,200

1,010,422

(46,222

)

(5

)

Selling, general and administrative expenses

237,559

260,977

(23,418

)

(9

)

Depreciation and amortization

396,033

375,345

20,688

6

Long-lived asset and goodwill impairments

436,908

152,712

284,196

186

Total operating costs and expenses

8,910,371

11,956,829

(3,046,458

)

(25

)

Income (loss) from operations

(627,496

)

1,147,861

(1,775,357

)

(155

)

Other income (expense):

Earnings of equity method investments

5,186

5,217

(31

)

(1

)

Interest income

6,590

17,127

(10,537

)

(62

)

Interest expense

(85,923

)

(106,938

)

21,015

(20

)

Gain on business interruption insurance settlement

81,000

-

81,000

-

Gain on sales-type leases

33,834

-

33,834

-

Loss on early extinguishment of debt

(25,915

)

-

(25,915

)

-

Gain (loss) on foreign currency transactions

(918

)

4,873

(5,791

)

(119

)

Other, net

4,790

3,005

1,785

59

18,644

(76,716

)

95,360

(124

)

Income (loss) before income taxes

(608,852

)

1,071,145

(1,679,997

)

(157

)

Income tax expense (benefit)

(188,504

)

279,862

(468,366

)

(167

)

Net income (loss)

(420,348

)

791,283

(1,211,631

)

(153

)

Less net income attributable to noncontrolling interest

63,353

79,500

(16,147

)

(20

)

Net income (loss) attributable to HollyFrontier stockholders

$

(483,701

)

$

711,783

$

(1,195,484

)

(168

)%

Earnings (loss) per share attributable to HollyFrontier stockholders:

Basic

$

(2.99

)

$

4.23

$

(7.22

)

(171

)%

Diluted

$

(2.99

)

$

4.20

$

(7.19

)

(171

)%

Cash dividends declared per common share

$

1.05

$

0.99

$

0.06

6

%

Average number of common shares outstanding:

Basic

161,927

167,935

(6,008

)

(4

)%

Diluted

161,927

169,125

(7,198

)

(4

)%

EBITDA

$

(196,839

)

$

1,456,801

$

(1,653,640

)

(114

)%

Adjusted EBITDA

$

434,118

$

1,451,864

$

(1,017,746

)

(70

)%

Balance Sheet Data

September 30,

December 31,

2020

2019

(In thousands)

Cash and cash equivalents

$

1,524,888

$

885,162

Working capital

$

2,081,978

$

1,620,261

Total assets

$

11,579,741

$

12,164,841

Long-term debt

$

3,176,349

$

2,455,640

Total equity

$

5,876,569

$

6,509,426

Segment Information

Our operations are organized into three reportable segments, Refining, Lubricants and Specialty Products and HEP. Our operations that are not included in the Refining, Lubricants and Specialty Products and HEP segments are included in Corporate and Other. Intersegment transactions are eliminated in our consolidated financial statements and are included in Eliminations. Corporate and Other and Eliminations are aggregated and presented under the Corporate, Other and Eliminations column.

The Refining segment includes the operations of our El Dorado, Tulsa, Navajo, Cheyenne and Woods Cross refineries and HollyFrontier Asphalt Company LLC ('HFC Asphalt') (aggregated as a reportable segment). Refining activities involve the purchase and refining of crude oil and wholesale and branded marketing of refined products, such as gasoline, diesel fuel and jet fuel. These petroleum products are primarily marketed in the Mid-Continent, Southwest and Rocky Mountain regions of the United States. HFC Asphalt operates various terminals in Arizona, New Mexico and Oklahoma.

The Lubricants and Specialty Products segment involves Petro-Canada Lubricants Inc.'s ('PCLI') production operations, located in Mississauga, Ontario, that include lubricant products such as base oils, white oils, specialty products and finished lubricants and the operations of our Petro-Canada Lubricants business that includes the marketing of products to both retail and wholesale outlets through a global sales network with locations in Canada, the United States, Europe and China. Additionally, the Lubricants and Specialty Products segment includes specialty lubricant products produced at our Tulsa refineries that are marketed throughout North America and are distributed in Central and South America, the operations of Red Giant Oil, one of the largest suppliers of locomotive engine oil in North America and the operations of Sonneborn, a producer of specialty hydrocarbon chemicals such as white oils, petrolatums and waxes with manufacturing facilities in the United States and Europe.

The HEP segment involves all of the operations of HEP, a consolidated variable interest entity, which owns and operates logistics assets consisting of petroleum product and crude oil pipelines, terminals, tankage, loading rack facilities and refinery processing units in the Mid-Continent, Southwest and Rocky Mountain regions of the United States. The HEP segment also includes a 75% interest in UNEV Pipeline, LLC (an HEP consolidated subsidiary), and a 50% ownership interest in each of Osage Pipeline Company, LLC, Cheyenne Pipeline LLC and Cushing Connect Pipeline & Terminal LLC. Revenues from the HEP segment are earned through transactions with unaffiliated parties for pipeline transportation, rental and terminalling operations as well as revenues relating to pipeline transportation services provided for our refining operations. Due to certain basis differences, our reported amounts for the HEP segment may not agree to amounts reported in HEP's periodic public filings.

Refining

Lubricants
and Specialty
Products

HEP

Corporate,
Other and
Eliminations

Consolidated
Total

(In thousands)

Three Months Ended September 30, 2020

Sales and other revenues:

Revenues from external customers

$

2,339,782

$

452,878

$

26,740

$

-

$

2,819,400

Intersegment revenues

56,331

2,164

100,991

(159,486

)

-

$

2,396,113

$

455,042

$

127,731

$

(159,486

)

$

2,819,400

Cost of products sold (exclusive of lower of cost or market inventory)

$

2,211,342

$

302,703

$

-

$

(136,807

)

$

2,377,238

Lower of cost or market inventory valuation adjustment

$

(62,849

)

$

-

$

-

$

-

$

(62,849

)

Operating expenses

$

256,079

$

54,488

$

40,003

$

(18,074

)

$

332,496

Selling, general and administrative expenses

$

30,866

$

36,773

$

2,332

$

4,482

$

74,453

Depreciation and amortization

$

79,146

$

17,432

$

24,109

$

4,593

$

125,280

Income (loss) from operations

$

(118,471

)

$

43,646

$

61,287

$

(13,680

)

$

(27,218

)

Income (loss) before interest and income taxes

$

(118,471

)

$

43,120

$

70,067

$

62,780

$

57,496

Net income attributable to noncontrolling interest

$

-

$

-

$

2,293

$

23,453

$

25,746

Earnings of equity method investments

$

-

$

-

$

1,316

$

-

$

1,316

Capital expenditures

$

41,740

$

6,995

$

7,902

$

26,635

$

83,272

Three Months Ended September 30, 2019

Sales and other revenues:

Revenues from external customers

$

3,865,399

$

529,561

$

29,868

$

-

$

4,424,828

Intersegment revenues

81,571

8,157

106,027

(195,755

)

-

$

3,946,970

$

537,718

$

135,895

$

(195,755

)

$

4,424,828

Cost of products sold (exclusive of lower of cost or market inventory)

$

3,177,167

$

397,926

$

-

$

(171,326

)

$

3,403,767

Lower of cost or market inventory valuation adjustment

$

34,062

$

-

$

-

$

-

$

34,062

Operating expenses

$

276,869

$

57,974

$

44,924

$

(34,189

)

$

345,578

Selling, general and administrative expenses

$

31,707

$

43,875

$

2,714

$

9,330

$

87,626

Depreciation and amortization

$

76,765

$

22,700

$

24,121

$

3,430

$

127,016

Income (loss) from operations

$

350,400

$

15,243

$

64,136

$

(3,000

)

$

426,779

Income (loss) before interest and income taxes

$

350,400

$

15,325

$

100,778

$

(35,639

)

$

430,864

Net income attributable to noncontrolling interest

$

-

$

-

$

1,004

$

35,163

$

36,167

Earnings of equity method investments

$

-

$

-

$

1,334

$

-

$

1,334

Capital expenditures

$

53,506

$

8,697

$

6,076

$

6,310

$

74,589

Refining

Lubricants
and Specialty
Products

HEP

Corporate,
Other and
Eliminations

Consolidated
Total

(In thousands)

Nine Months Ended September 30, 2020

Sales and other revenues:

Revenues from external customers

$

6,880,444

$

1,330,021

$

72,410

$

-

$

8,282,875

Intersegment revenues

178,039

8,911

297,982

(484,932

)

-

$

7,058,483

$

1,338,932

$

370,392

$

(484,932

)

$

8,282,875

Cost of products sold (exclusive of lower of cost or market inventory)

$

6,113,530

$

952,430

$

-

$

(418,000

)

$

6,647,960

Lower of cost or market inventory valuation adjustment

$

227,711

$

-

$

-

$

-

$

227,711

Operating expenses

$

754,612

$

156,459

$

109,721

$

(56,592

)

$

964,200

Selling, general and administrative expenses

$

94,677

$

121,654

$

7,569

$

13,659

$

237,559

Depreciation and amortization

$

251,019

$

59,260

$

72,095

$

13,659

$

396,033

Long-lived asset impairment

$

215,242

$

204,708

$

16,958

$

-

$

436,908

Income (loss) from operations

$

(598,308

)

$

(155,579

)

$

164,049

$

(37,658

)

$

(627,496

)

Income (loss) before interest and income taxes

$

(598,308

)

$

(155,847

)

$

185,593

$

39,043

$

(529,519

)

Net income attributable to noncontrolling interest

$

-

$

-

$

4,158

$

59,195

$

63,353

Earnings of equity method investments

$

-

$

-

$

5,186

$

-

$

5,186

Capital expenditures

$

106,856

$

20,387

$

38,642

$

47,123

$

213,008

Nine Months Ended September 30, 2019

Sales and other revenues:

Revenues from external customers

$

11,446,841

$

1,568,241

$

89,388

$

220

$

13,104,690

Intersegment revenues

244,799

8,157

311,755

(564,711

)

-

$

11,691,640

$

1,576,398

$

401,143

$

(564,491

)

$

13,104,690

Cost of products sold (exclusive of lower of cost or market inventory)

$

9,598,539

$

1,202,296

$

-

$

(492,979

)

$

10,307,856

Lower of cost or market inventory valuation adjustment

$

(150,483

)

$

-

$

-

$

-

$

(150,483

)

Operating expenses

$

794,081

$

170,655

$

123,045

$

(77,359

)

$

1,010,422

Selling, general and administrative expenses

$

88,322

$

125,681

$

7,322

$

39,652

$

260,977

Depreciation and amortization

$

227,405

$

65,891

$

72,192

$

9,857

$

375,345

Goodwill impairment

$

-

$

152,712

$

-

$

-

$

152,712

Income (loss) from operations

$

1,133,776

$

(140,837

)

$

198,584

$

(43,662

)

$

1,147,861

Income (loss) before interest and income taxes

$

1,133,776

$

(140,518

)

$

238,910

$

(71,212

)

$

1,160,956

Net income attributable to noncontrolling interest

$

-

$

-

$

3,524

$

75,976

$

79,500

Earnings of equity method investments

$

-

$

-

$

5,217

$

-

$

5,217

Capital expenditures

$

129,167

$

25,887

$

23,828

$

16,175

$

195,057

Refining

Lubricants
and Specialty
Products

HEP

Corporate,
Other and
Eliminations

Consolidated
Total

(In thousands)

September 30, 2020

Cash and cash equivalents

$

6,085

$

211,646

$

18,091

$

1,289,066

$

1,524,888

Total assets

$

6,197,301

$

1,933,482

$

2,193,770

$

1,255,188

$

11,579,741

Long-term debt

$

-

$

-

$

1,439,874

$

1,736,475

$

3,176,349

December 31, 2019

Cash and cash equivalents

$

9,755

$

169,277

$

13,287

$

692,843

$

885,162

Total assets

$

7,189,094

$

2,223,418

$

2,205,437

$

546,892

$

12,164,841

Long-term debt

$

-

$

-

$

1,462,031

$

993,609

$

2,455,640

Refining Segment Operating Data

The following tables set forth information, including non-GAAP (Generally Accepted Accounting Principles) performance measures about our refinery operations. Refinery gross and net operating margins do not include the non-cash effects of long-lived asset impairment charges, lower of cost or market inventory valuation adjustments and depreciation and amortization. Reconciliations to amounts reported under GAAP are provided under 'Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles' below.

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Mid-Continent Region (El Dorado and Tulsa Refineries)

Crude charge (BPD) (1)

244,200

294,380

234,550

257,590

Refinery throughput (BPD) (2)

257,280

307,720

249,430

272,440

Sales of produced refined products (BPD) (3)

243,830

290,930

239,800

260,780

Refinery utilization (4)

93.9

%

113.2

%

90.2

%

99.1

%

Average per produced barrel (5)

Refinery gross margin

$

3.21

$

14.61

$

6.41

$

14.55

Refinery operating expenses (6)

5.47

5.05

5.47

5.48

Net operating margin

$

(2.26)

$

9.56

$

0.94

$

9.07

Refinery operating expenses per throughput barrel (7)

$

5.19

$

4.77

$

5.26

$

5.25

Feedstocks:

Sweet crude oil

62

%

59

%

58

%

56

%

Sour crude oil

18

%

21

%

19

%

23

%

Heavy sour crude oil

15

%

16

%

17

%

16

%

Other feedstocks and blends

5

%

4

%

6

%

5

%

Total

100

%

100

%

100

%

100

%

Sales of produced refined products:

Gasolines

53

%

49

%

52

%

51

%

Diesel fuels

35

%

34

%

34

%

32

%

Jet fuels

3

%

6

%

4

%

7

%

Fuel oil

1

%

1

%

1

%

1

%

Asphalt

2

%

4

%

3

%

3

%

Base oils

4

%

4

%

4

%

4

%

LPG and other

2

%

2

%

2

%

2

%

Total

100

%

100

%

100

%

100

%

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Southwest Region (Navajo Refinery) (8)

Crude charge (BPD) (1)

96,660

106,860

94,320

107,330

Refinery throughput (BPD) (2)

106,780

117,250

104,570

117,660

Sales of produced refined products (BPD) (3)

106,350

116,890

107,270

120,760

Refinery utilization (4)

96.7

%

106.9

%

94.3

%

107.3

%

Average per produced barrel (5)

Refinery gross margin

$

9.70

$

18.61

$

11.16

$

19.35

Refinery operating expenses (6)

5.07

5.25

5.17

4.90

Net operating margin

$

4.63

$

13.36

$

5.99

$

14.45

Refinery operating expenses per throughput barrel (7)

$

5.05

$

5.23

$

5.31

$

5.03

Feedstocks:

Sweet crude oil

25

%

22

%

24

%

21

%

Sour crude oil

66

%

69

%

66

%

70

%

Other feedstocks and blends

9

%

9

%

10

%

9

%

Total

100

%

100

%

100

%

100

%

Sales of produced refined products:

Gasolines

55

%

50

%

54

%

51

%

Diesel fuels

34

%

40

%

36

%

39

%

Fuel oil

2

%

3

%

2

%

3

%

Asphalt

8

%

5

%

6

%

5

%

LPG and other

1

%

2

%

2

%

2

%

Total

100

%

100

%

100

%

100

%

Rocky Mountain Region (Cheyenne and Woods Cross Refineries) (8)

Crude charge (BPD) (1)

49,720

74,790

63,300

78,530

Refinery throughput (BPD) (2)

57,040

81,830

69,370

85,300

Sales of produced refined products (BPD) (3)

57,110

77,680

67,070

77,890

Refinery utilization (4)

51.3

%

77.1

%

65.3

%

81.0

%

Average per produced barrel (5)

Refinery gross margin

$

3.39

$

24.97

$

10.63

$

19.73

Refinery operating expenses (6)

15.94

11.95

13.25

11.39

Net operating margin

$

(12.55

)

$

13.02

$

(2.62

)

$

8.34

Refinery operating expenses per throughput barrel (7)

$

15.96

$

11.34

$

12.81

$

10.40

Feedstocks:

Sweet crude oil

38

%

38

%

36

%

36

%

Heavy sour crude oil

19

%

30

%

33

%

33

%

Black wax crude oil

30

%

23

%

22

%

23

%

Other feedstocks and blends

13

%

9

%

9

%

8

%

Total

100

%

100

%

100

%

100

%

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

Rocky Mountain Region (Cheyenne and Woods Cross Refineries) (8)

Sales of produced refined products:

Gasolines

57

%

54

%

56

%

53

%

Diesel fuels

31

%

32

%

33

%

34

%

Fuel oil

3

%

4

%

3

%

4

%

Asphalt

5

%

5

%

5

%

5

%

LPG and other

4

%

5

%

3

%

4

%

Total

100

%

100

%

100

%

100

%

Consolidated

Crude charge (BPD) (1)

390,580

476,030

392,170

443,450

Refinery throughput (BPD) (2)

421,100

506,800

423,370

475,400

Sales of produced refined products (BPD) (3)

407,280

485,500

414,140

459,440

Refinery utilization (4)

85.5

%

104.2

%

85.8

%

97.0

%

Average per produced barrel (5)

Refinery gross margin

$

4.93

$

17.23

$

8.33

$

16.69

Refinery operating expenses (6)

6.83

6.20

6.65

6.33

Net operating margin

$

(1.90

)

$

11.03

$

1.68

$

10.36

Refinery operating expenses per throughput barrel (7)

$

6.61

$

5.94

$

6.50

$

6.12

Feedstocks:

Sweet crude oil

50

%

47

%

46

%

44

%

Sour crude oil

27

%

29

%

27

%

30

%

Heavy sour crude oil

12

%

14

%

16

%

15

%

Black wax crude oil

4

%

4

%

4

%

4

%

Other feedstocks and blends

7

%

6

%

7

%

7

%

Total

100

%

100

%

100

%

100

%

Sales of produced refined products:

Gasolines

54

%

50

%

54

%

51

%

Diesel fuels

34

%

35

%

34

%

35

%

Jet fuels

2

%

4

%

2

%

4

%

Fuel oil

1

%

2

%

1

%

2

%

Asphalt

4

%

4

%

4

%

4

%

Base oils

3

%

2

%

2

%

2

%

LPG and other

2

%

3

%

3

%

2

%

Total

100

%

100

%

100

%

100

%

(1)

Crude charge represents the barrels per day of crude oil processed at our refineries.

(2)

Refinery throughput represents the barrels per day of crude and other refinery feedstocks input to the crude units and other conversion units at our refineries.

(3)

Represents barrels sold of refined products produced at our refineries (including HFC Asphalt) and does not include volumes of refined products purchased for resale or volumes of excess crude oil sold.

(4)

Represents crude charge divided by total crude capacity ('BPSD'). Our consolidated crude capacity is 457,000 BPSD.

(5)

Represents average amount per produced barrel sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under 'Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles' below.

(6)

Represents total refining segment operating expenses, exclusive of depreciation and amortization, divided by sales volumes of
refined products produced at our refineries.

(7)

Represents total refining segment operating expenses, exclusive of depreciation and amortization, divided by refinery throughput.

(8)

As previously disclosed, our Cheyenne Refinery ceased petroleum refining operations in the third quarter of 2020. Beginning with the fourth quarter of 2020, activities associated with the conversion of our Cheyenne Refinery to renewable diesel production will be reported in the Corporate and Other segment, and the disaggregation of our refining geographic operating data will be presented in two regions, Mid-Continent and West, to best reflect the economic drivers of our refining operations. The Mid-Continent region will continue to be comprised of our El Dorado and Tulsa Refineries, and the new West region will be comprised of our Navajo and Woods Cross Refineries.

Lubricants and Specialty Products Segment Operating Data

We acquired our Sonneborn business on February 1, 2019. For the nine months ended September 30, 2019 our lubricants and specialty product operating results reflect the operations of our Sonneborn business for the period February 1, 2019 through September 30, 2019.

The following table sets forth information about our lubricants and specialty products operations.

Three Months Ended September 30,

Nine Months Ended September 30,

2020

2019

2020

2019

Lubricants and Specialty Products

Throughput (BPD)

19,020

23,190

19,050

19,920

Sales of produced products (BPD)

33,560

36,160

32,460

34,740

Sales of produced products:

Finished products

50

%

50

%

51

%

50

%

Base oils

27

%

24

%

24

%

27

%

Other

23

%

26

%

25

%

23

%

Total

100

%

100

%

100

%

100

%

Our Lubricants and Specialty Products segment includes base oil production activities, by-product sales to third parties and intra-segment base oil sales to rack forward, referred to as 'Rack Back.' 'Rack Forward' includes the purchase of base oils and the blending, packaging, marketing and distribution and sales of finished lubricants and specialty products to third parties. Supplemental financial data attributable to our Lubricants and Specialty Products segment is presented below:

Rack Back (1)

Rack Forward (2)

Eliminations (3)

Total Lubricants
and Specialty
Products

(In thousands)

Three months ended September 30, 2020

Sales and other revenues

$

110,952

$

423,418

$

(79,328

)

$

455,042

Cost of products sold

$

98,033

$

283,998

$

(79,328

)

$

302,703

Operating expenses

$

25,400

$

29,088

$

-

$

54,488

Selling, general and administrative expenses

$

5,616

$

31,157

$

-

$

36,773

Depreciation and amortization

$

5,419

$

12,013

$

-

$

17,432

Income (loss) from operations

$

(23,516

)

$

67,162

$

-

$

43,646

Income (loss) before interest and income taxes

$

(23,516

)

$

66,636

$

-

$

43,120

EBITDA

$

(18,097

)

$

78,649

$

-

$

60,552

Three months ended September 30, 2019

Sales and other revenues

$

196,355

$

477,261

$

(135,898

)

$

537,718

Cost of products sold

$

175,976

$

357,848

$

(135,898

)

$

397,926

Operating expenses

$

27,825

$

30,149

$

-

$

57,974

Selling, general and administrative expenses

$

5,862

$

38,013

$

-

$

43,875

Depreciation and amortization

$

11,390

$

11,310

$

-

$

22,700

Income (loss) from operations

$

(24,698

)

$

39,941

$

-

$

15,243

Income (loss) before interest and income taxes

$

(24,698

)

$

40,023

$

-

$

15,325

EBITDA

$

(13,308

)

$

51,333

$

-

$

38,025

Rack Back (1)

Rack Forward (2)

Eliminations (3)

Total Lubricants
and Specialty
Products

(In thousands)

Nine months ended September 30, 2020

Sales and other revenues

$

361,638

$

1,241,402

$

(264,108

)

$

1,338,932

Cost of products sold

$

345,843

$

870,695

$

(264,108

)

$

952,430

Operating expenses

$

69,703

$

86,756

$

-

$

156,459

Selling, general and administrative expenses

$

16,596

$

105,058

$

-

$

121,654

Depreciation and amortization

$

22,163

$

37,097

$

-

$

59,260

Long-lived asset impairment

$

167,017

$

37,691

$

-

$

204,708

Income (loss) from operations

$

(259,684

)

$

104,105

$

-

$

(155,579

)

Income (loss) before interest and income taxes

$

(259,684

)

$

103,837

$

-

$

(155,847

)

EBITDA

$

(237,521

)

$

140,934

$

-

$

(96,587

)

Nine months ended September 30, 2019

Sales and other revenues

$

486,035

$

1,428,786

$

(338,423

)

$

1,576,398

Cost of products sold

$

453,519

$

1,087,200

$

(338,423

)

$

1,202,296

Operating expenses

$

87,970

$

82,685

$

-

$

170,655

Selling, general and administrative expenses

$

25,707

$

99,974

$

-

$

125,681

Depreciation and amortization

$

32,991

$

32,900

$

-

$

65,891

Goodwill impairment

$

152,712

$

-

$

-

$

152,712

Income (loss) from operations

$

(266,864

)

$

126,027

$

-

$

(140,837

)

Income (loss) before interest and income taxes

$

(266,864

)

$

126,346

$

-

$

(140,518

)

EBITDA

$

(233,873

)

$

159,246

$

-

$

(74,627

)

(1)

Rack Back consists of the PCLI base oil production activities, by-product sales to third parties and intra-segment base oil sales to rack forward.

(2)

Rack Forward activities include the purchase of base oils from Rack Back and the blending, packaging, marketing and distribution and sales of finished lubricants and specialty products to third parties.

(3)

Intra-segment sales of Rack Back produced base oils to rack forward are eliminated under the 'Eliminations' column.

Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles

Reconciliations of earnings before interest, taxes, depreciation and amortization ('EBITDA') and EBITDA excluding special items ('Adjusted EBITDA') to amounts reported under generally accepted accounting principles ('GAAP') in financial statements.

Earnings before interest, taxes, depreciation and amortization, referred to as EBITDA, is calculated as net income (loss) attributable to HollyFrontier stockholders plus (i) interest expense, net of interest income, (ii) income tax expense, and (iii) depreciation and amortization. Adjusted EBITDA is calculated as EBITDA plus or minus (i) lower of cost or market inventory valuation adjustments, (ii) HollyFrontier's pro-rata share of gain on business interruption insurance settlement, (iii) long-lived asset impairment, inclusive of pro-rata share of impairment in HEP segment, (iv) goodwill impairment, (v) HollyFrontier's pro-rata share of HEP's gain on sales-type leases, (vi) HollyFrontier's pro-rata share of HEP's loss on early extinguishment of debt, (vii) severance costs, (viii) restructuring charges, (ix) Cheyenne Refinery LIFO inventory liquidation costs, (x) decommissioning costs, (xi) acquisition integration and regulatory costs, (xii) incremental cost of products sold attributable to our Sonneborn inventory value step-up and (xiii) RINs cost reductions.

EBITDA and Adjusted EBITDA are not calculations provided for under accounting principles generally accepted in the United States; however, the amounts included in these calculations are derived from amounts included in our consolidated financial statements. EBITDA and Adjusted EBITDA should not be considered as alternatives to net income or operating income as an indication of our operating performance or as an alternative to operating cash flow as a measure of liquidity. EBITDA and Adjusted EBITDA are not necessarily comparable to similarly titled measures of other companies. These are presented here because they are widely used financial indicators used by investors and analysts to measure performance. EBITDA and Adjusted EBITDA are also used by our management for internal analysis and as a basis for financial covenants.

Set forth below is our calculation of EBITDA and adjusted EBITDA.

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(In thousands)

Net income (loss) attributable to HollyFrontier stockholders

$

(2,401

)

$

261,813

$

(483,701

)

$

711,783

Add interest expense

30,589

36,027

85,923

106,938

Subtract interest income

(1,011

)

(6,164

)

(6,590

)

(17,127

)

Add (subtract) income tax expense (benefit)

4,573

103,021

(188,504

)

279,862

Add depreciation and amortization

125,280

127,016

396,033

375,345

EBITDA

$

157,030

$

521,713

$

(196,839

)

$

1,456,801

Add (subtract) lower of cost or market inventory valuation adjustment

(62,849

)

34,062

227,711

(150,483

)

Subtract HollyFrontier's pro-rata share of gain on business interruption insurance settlement

(77,143

)

-

(77,143

)

-

Add long-lived asset impairment, inclusive of pro-rata share of impairment in HEP segment

-

-

429,540

-

Add goodwill impairment

-

-

-

152,712

Subtract HollyFrontier's pro-rata share of HEP's gain on sales-type leases

-

-

(19,134

)

-

Add HollyFrontier's pro-rata share of HEP's loss on early extinguishment of debt

-

-

14,656

-

Add severance costs

2,429

-

3,546

-

Add restructuring charges

-

-

3,679

-

Add Cheyenne Refinery LIFO inventory liquidation costs

33,814

-

33,814

-

Add decommissioning costs

12,309

-

12,309

-

Add acquisition integration and regulatory costs

48

3,887

1,979

20,076

Add incremental cost of products sold attributable to Sonneborn inventory value step-up

-

-

-

9,338

Subtract RINs cost reduction

-

(36,580

)

-

(36,580

)

Adjusted EBITDA

$

65,638

$

523,082

$

434,118

$

1,451,864

EBITDA and Adjusted EBITDA attributable to our Refining segment is presented below:

Three Months Ended
September 30,

Nine Months Ended
September 30,

Refining Segment

2020

2019

2020

2019

(In thousands)

Income (loss) from operations (1)

$

(118,471

)

$

350,400

$

(598,308

)

$

1,133,776

Add depreciation and amortization

79,146

76,765

251,019

227,405

EBITDA

(39,325

)

427,165

(347,289

)

1,361,181

Add (subtract) lower of cost or market inventory valuation adjustment

(62,849

)

34,062

227,711

(150,483

)

Subtract RINs cost reduction

-

(36,580

)

-

(36,580

)

Add long-lived asset impairment

-

-

215,242

-

Add severance costs

2,429

-

3,546

-

Add restructuring charges

-

-

2,009

-

Add Cheyenne Refinery LIFO inventory liquidation costs

33,814

-

33,814

-

Add decommissioning costs

12,309

-

12,309

-

Adjusted EBITDA

$

(53,622

)

$

424,647

$

147,342

$

1,174,118

(1) Income from operations of our Refining segment represents income plus (i) interest expense, net of interest income and (ii) income tax provision.

EBITDA and Adjusted EBITDA attributable to our Lubricants and Specialty Products segment is set forth below.

Lubricants and Specialty Products Segment

Rack Back

Rack Forward

Total Lubricants
and Specialty
Products

(In thousands)

Three months ended September 30, 2020

Income (loss) before interest and income taxes (1)

$

(23,516

)

$

66,636

$

43,120

Add depreciation and amortization

5,419

12,013

17,432

EBITDA

(18,097

)

78,649

60,552

Three months ended September 30, 2019

Income (loss) before interest and income taxes (1)

$

(24,698

)

$

40,023

$

15,325

Add depreciation and amortization

11,390

11,310

22,700

EBITDA

$

(13,308

)

$

51,333

$

38,025

Nine months ended September 30, 2020

Income (loss) before interest and income taxes (1)

$

(259,684

)

$

103,837

$

(155,847

)

Add depreciation and amortization

22,163

37,097

59,260

EBITDA

$

(237,521

)

$

140,934

$

(96,587

)

Add long-lived asset impairment

167,017

37,691

204,708

Adjusted EBITDA

$

(70,504

)

$

178,625

$

108,121

Nine months ended September 30, 2019

Income (loss) before interest and income taxes (1)

$

(266,864

)

$

126,346

$

(140,518

)

Add depreciation and amortization

32,991

32,900

65,891

EBITDA

(233,873

)

159,246

(74,627

)

Add goodwill impairment

152,712

-

152,712

Add incremental cost of products sold attributable to Sonneborn inventory value step-up

-

9,338

9,338

Adjusted EBITDA

$

(81,161

)

$

168,584

$

87,423

(1) Income (loss) before interest and income taxes of our Lubricants and Specialty Products segment represents income (loss) plus (i) interest expense, net of interest income and (ii) income tax provision.

Reconciliations of refinery operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in financial statements.

Refinery gross margin and net operating margin are non-GAAP performance measures that are used by our management and others to compare our refining performance to that of other companies in our industry. We believe these margin measures are helpful to investors in evaluating our refining performance on a relative and absolute basis. Refinery gross margin per produced barrel sold is total refining segment revenues less total refining segment cost of products sold, exclusive of lower of cost or market inventory valuation adjustments, divided by sales volumes of produced refined products sold. Net operating margin per barrel sold is the difference between refinery gross margin and refinery operating expenses per produced barrel sold. These two margins do not include the non-cash effects of long-lived asset impairment charges, lower of cost or market inventory valuation adjustments or depreciation and amortization. Each of these component performance measures can be reconciled directly to our consolidated statements of income. Other companies in our industry may not calculate these performance measures in the same manner.

Below are reconciliations to our consolidated statements of income for refinery net operating and gross margin and operating expenses, in each case averaged per produced barrel sold. Due to rounding of reported numbers, some amounts may not calculate exactly.

Reconciliation of average refining segment net operating margin per produced barrel sold to refinery gross margin to total sales and other revenues

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(Dollars in thousands, except per barrel amounts)

Consolidated

Net operating margin per produced barrel sold

$

(1.90

)

$

11.03

$

1.68

$

10.36

Add average refinery operating expenses per produced barrel sold

6.83

6.20

6.65

6.33

Refinery gross margin per produced barrel sold

$

4.93

$

17.23

$

8.33

$

16.69

Times produced barrels sold (BPD)

407,280

485,500

414,140

459,440

Times number of days in period

92

92

274

273

Refining segment gross margin

$

184,726

$

769,595

$

945,241

$

2,093,379

Add (subtract) rounding

45

208

(288

)

(278

)

Total refining segment gross margin

184,771

769,803

944,953

2,093,101

Add refining segment cost of products sold

2,211,342

3,177,167

6,113,530

9,598,539

Refining segment sales and other revenues

2,396,113

3,946,970

7,058,483

11,691,640

Add lubricants and specialty products segment sales and other revenues

455,042

537,718

1,338,932

1,576,398

Add HEP segment sales and other revenues

127,731

135,895

370,392

401,143

Subtract corporate, other and eliminations

(159,486

)

(195,755

)

(484,932

)

(564,491

)

Sales and other revenues

$

2,819,400

$

4,424,828

$

8,282,875

$

13,104,690

Reconciliation of average refining segment operating expenses per produced barrel sold to total operating expenses

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(Dollars in thousands, except per barrel amounts)

Consolidated

Average operating expenses per produced barrel sold

$

6.83

$

6.20

$

6.65

$

6.33

Times produced barrels sold (BPD)

407,280

485,500

414,140

459,440

Times number of days in period

92

92

274

273

Refining segment operating expenses

$

255,918

$

276,929

$

754,604

$

793,954

Add (subtract) rounding

161

(60

)

8

127

Total refining segment operating expenses

256,079

276,869

754,612

794,081

Add lubricants and specialty products segment operating expenses

54,488

57,974

156,459

170,655

Add HEP segment operating expenses

40,003

44,924

109,721

123,045

Subtract corporate, other and eliminations

(18,074

)

(34,189

)

(56,592

)

(77,359

)

Operating expenses (exclusive of depreciation and amortization)

$

332,496

$

345,578

$

964,200

$

1,010,422

Reconciliation of net income (loss) attributable to HollyFrontier stockholders to adjusted net income attributable to HollyFrontier stockholders

Adjusted net income (loss) attributable to HollyFrontier stockholders is a non-GAAP financial measure that excludes non-cash lower of cost or market inventory valuation adjustments, gain on business interruption insurance settlement, long-lived asset and goodwill impairments, HEP's gain on sales-type leases, HEP's loss on early extinguishment of debt, severance costs, restructuring charges, Cheyenne Refinery LIFO inventory liquidation costs, decommissioning costs, acquisition integration and regulatory costs, incremental cost of products sold due to Sonneborn inventory value step-up and RINs cost reductions. We believe this measure is helpful to investors and others in evaluating our financial performance and to compare our results to that of other companies in our industry. Similarly titled performance measures of other companies may not be calculated in the same manner.

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(In thousands, except per share amounts)

Consolidated

GAAP:

Income (loss) before income taxes

$

27,918

$

401,001

$

(608,852

)

$

1,071,145

Income tax expense (benefit)

4,573

103,021

(188,504

)

279,862

Net income (loss)

23,345

297,980

(420,348

)

791,283

Less net income attributable to noncontrolling interest

25,746

36,167

63,353

79,500

Net income (loss) attributable to HollyFrontier stockholders

(2,401

)

261,813

(483,701

)

711,783

Non-GAAP adjustments to arrive at adjusted results:

Lower of cost or market inventory valuation adjustment

(62,849

)

34,062

227,711

(150,483

)

Gain on business interruption insurance settlement

(81,000

)

-

(81,000

)

-

Long-lived asset and goodwill impairments

-

-

436,908

152,712

HEP's gain on sales-type leases

-

-

(33,834

)

-

HEP's loss on early extinguishment of debt

-

-

25,915

-

Severance costs

2,429

-

3,546

-

Restructuring charges

-

-

3,679

-

Cheyenne Refinery LIFO inventory liquidation costs

33,814

-

33,814

-

Decommissioning costs

12,309

-

12,309

-

Acquisition integration and regulatory costs

48

3,887

1,979

20,076

Incremental cost of products sold attributable to Sonneborn inventory value step-up

-

-

-

9,338

RINs cost reduction

-

(36,580

)

-

(36,580

)

Total adjustments to income (loss) before income taxes

(95,249

)

1,369

631,027

(4,937

)

Adjustment to income tax expense (1)

(26,907

)

(14,818

)

168,497

(36,553

)

Adjustment to net income attributable to noncontrolling interest

(3,857

)

-

70

-

Total adjustments, net of tax

(64,485

)

16,187

462,460

31,616

Adjusted results - Non-GAAP:

Adjusted income before income taxes

(67,331

)

402,370

22,175

1,066,208

Adjusted income tax expense (2)

(22,334

)

88,203

(20,007

)

243,309

Adjusted net income

(44,997

)

314,167

42,182

822,899

Adjusted net income attributable to noncontrolling interest

21,889

36,167

63,423

79,500

Adjusted net income (loss) attributable to HollyFrontier stockholders

$

(66,886

)

$

278,000

$

(21,241

)

$

743,399

Adjusted earnings per share attributable to HollyFrontier stockholders - diluted (3)

$

(0.41

)

$

1.68

$

(0.13

)

$

4.39

Average number of common shares outstanding - diluted

162,015

165,011

161,927

169,125

(1) Represents adjustment to GAAP income tax expense to arrive at adjusted income tax expense, which is computed as follows:

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(In thousands)

Non-GAAP income tax expense (2)

$

(22,334

)

$

88,203

$

(20,007

)

$

243,309

Subtract GAAP income tax expense (benefit)

4,573

103,021

(188,504

)

279,862

Non-GAAP adjustment to income tax expense

$

(26,907

)

$

(14,818

)

$

168,497

$

(36,553

)

(2) Non-GAAP income tax expense is computed by a) adjusting HFC's consolidated estimated Annual Effective Tax Rate ('AETR') for GAAP purposes for the effects of the above Non-GAAP adjustments b) applying the resulting Adjusted Non-GAAP AETR to Non-GAAP adjusted income before income taxes and c) adjusting for discrete tax items applicable to the period.

(3) Adjusted earnings per share attributable to HollyFrontier stockholders - diluted is calculated as adjusted net income attributable to HollyFrontier stockholders divided by the average number of shares of common stock outstanding assuming dilution.

Reconciliation of effective tax rate to adjusted effective tax rate

Three Months Ended
September 30,

Nine Months Ended
September 30,

2020

2019

2020

2019

(Dollars in thousands)

GAAP:

Income (loss) before income taxes

$

27,918

$

401,001

$

(608,852

)

$

1,071,145

Income tax expense (benefit)

$

4,573

$

103,021

$

(188,504

)

$

279,862

Effective tax rate for GAAP financial statements

16.4

%

25.7

%

31.0

%

26.1

%

Adjusted - Non-GAAP:

Effect of Non-GAAP adjustments

16.8

%

(3.8

)%

(121.2

)%

(3.3

)%

Effective tax rate for adjusted results

33.2

%

21.9

%

(90.2

)%

22.8

%

View source version on businesswire.com: https://www.businesswire.com/news/home/20201105005240/en/

Richard L. Voliva III, Executive Vice President and Chief Financial Officer
Craig Biery, Vice President, Investor Relations
HollyFrontier Corporation
214-954-6510

Source: HollyFrontier Corporation

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HollyFrontier Corporation published this content on 05 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 November 2020 11:41:05 UTC


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Financials (USD)
Sales 2020 10 864 M - -
Net income 2020 -591 M - -
Net Debt 2020 1 875 M - -
P/E ratio 2020 -8,43x
Yield 2020 4,54%
Capitalization 4 970 M 4 970 M -
EV / Sales 2020 0,63x
EV / Sales 2021 0,57x
Nbr of Employees 4 074
Free-Float 62,6%
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Mean consensus HOLD
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Last Close Price 30,87 $
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Managers and Directors
NameTitle
Michael C. Jennings President, CEO, Director & Executive VP
Franklin Myers Chairman
Timothy Go Chief Operating Officer & Executive Vice President
Richard Lawrence Voliva Chief Financial Officer & Executive Vice President
Douglas Y. Bech Lead Independent Director