PBF Energy Reports Second Quarter 2013 Results, Declares Dividend of $0.30 Per Share and Announces C

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PBF Energy Reports Second Quarter 2013 Results, Declares Dividend of $0.30 Per Share and Announces Confidential Submission of a Registration Statement for an IPO of its Subsidiary, PBF Logistics LP

PARSIPPANY, N.J.--(BUSINESS WIRE)-- PBF Energy Inc. (NYS: PBF) today reported second quarter 2013 Operating Income of $133.0 million versus Operating Income of $579.5 million for the second quarter of 2012. Adjusted Pro Forma Net Income for the second quarter 2013 was $71.5 million, or $0.73 per share on a fully exchanged, fully diluted basis, as described below, compared to $336.2 million, or $3.45 per share, for the second quarter 2012. Net Income attributable to PBF Energy Inc. for the quarter was $16.8 million.

Adjusted Pro Forma 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.

Throughput for the quarter averaged approximately 464,600 barrels per day. Throughput in the Mid-continent averaged approximately 147,300 barrels per day and throughput on the East Coast averaged approximately 317,300 barrels per day.

For the second quarter 2013, the company's gross refining margin averaged $9.04 per barrel of throughput, with the Mid-continent contributing $17.42 per barrel and the East Coast contributing $5.16 per barrel. Operating expenses on a company-wide basis were $4.79 per barrel, with the Mid-continent and the East Coast both averaging $4.79 per barrel.

PBF continues to make progress on its rail initiatives and expects, as previously announced, to reach its full capacity of rail-delivered crude by the end of 2014. During the second quarter 2013, the company ran approximately 91,000 barrels per day of rail-delivered crudes through its East Coast system.

Tom Nimbley, PBF Energy's CEO, said, "While our refineries operated as expected in the second quarter, our results were negatively impacted by unfavorable movements in crude oil differentials, such as the WTI-Syncrude and Brent-ASCI differentials, high flat prices for feedstocks and increasing costs related to compliance with the Renewable Fuels Standard."

Tom O'Malley, PBF's Executive Chairman, commented further on Renewable Identification Numbers ("RINs"), "We expect to spend over $200 million on RINs in 2013 based on current market conditions. This is one of the company's largest single cost categories other than crude oil purchases. It exceeds the salaries and wages we pay to operate all three of our refineries." Mr. O'Malley continued, "These costs will ultimately be borne by the consumer. We believe this is an expensive, non-productive tax on the American people and that the Renewable Fuels Program administered by the EPA should be adjusted so that the public does not have to absorb the costs of the program."

PBF Energy Inc. Declares Dividend

The company announced today that it will pay a quarterly dividend of $0.30 per share of Class A common stock on August 21, 2013 to holders of record as of August 12, 2013.

Master Limited Partnership Update

PBF Energy Inc. announced today that its indirect subsidiary, PBF Logistics LP, has confidentially submitted a registration statement to the Securities and Exchange Commission ("SEC") for a possible initial public offering of its limited partnership units. PBF Logistics LP, a Master Limited Partnership ("MLP"), will be comprised of certain logistics assets to be contributed to it by subsidiaries of PBF Energy Inc. PBF Energy Inc. will indirectly own the general partner of the proposed MLP, PBF Logistics GP LLC, as well as all of the incentive distribution rights. The number of limited partnership interests to be offered and the price range for the offering have not been determined.

The proposed offering is expected to commence after the SEC completes its review process, and is subject to market and other conditions.

Important Information

This announcement is being made pursuant to and in accordance with Rule 135 under the Securities Act of 1933, as amended. As required by Rule 135, this press release does not constitute an offer to sell or the solicitation of an offer to buy securities, and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.

Conference Call Information

PBF Energy's senior management will hold a conference call at 8:30 a.m. ET, Thursday, August 1, 2013, to discuss its earnings results and provide an update on company operations. Callers may listen to the live presentation, which will be followed by a question and answer segment, by dialing 1-866-515-2914 and the passcode 19918109. A live webcast of the conference call will also be available in the Investor Relations section of the company's web site at http://www.pbfenergy.com.

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 Pro Forma Net Income, Adjusted Pro Forma Net Income per fully exchanged, fully diluted share, gross refining margin, gross refining margin per barrel of throughput, EBITDA (Earnings before Interest, Income Taxes, Depreciation and Amortization) and Adjusted EBITDA. PBF Energy Inc. 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 Energy Inc.'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.

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 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, and those of the MLP, with the SEC, as well as the risk that an initial public offering of the MLP may not occur; risks relating to the securities markets generally; the impact of adverse market conditions affecting the company or its logistics business; the timing and structure of the planned MLP may change; unanticipated developments, regulatory approvals, changes in laws and other events may delay or negatively impact the planned MLP; the impact of the planned MLP on the company's relationships with its employees, customers and vendors and the company's credit rating and cost of funds; if the initial public offering occurs, no assurance can be given as to the value of the limited partnership interests of the planned MLP, the price at which they may trade or whether a liquid market may develop for such interests; and future opportunities that the company's Board of Directors may determine present greater potential value to stockholders than the planned MLP. 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. (NYS: PBF) is one of the largest independent refiners in North America, operating, through its subsidiaries, oil refineries and related facilities in Delaware City, Delaware, Paulsboro, New Jersey and Toledo, Ohio. Our mission is to operate our facilities in a safe, reliable and environmentally sensitive 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.

(Unaudited, in thousands, except share and per share data)
Three Months Ended Six Months Ended
June 30, June 30,
2013 2012 2013 2012
Revenues $ 4,678,293 $ 5,077,015 $ 9,476,141 $ 9,793,121
Costs and expenses:
Cost of sales, excluding depreciation 4,295,979 4,279,046 8,731,081 8,939,239
Operating expenses, excluding depreciation 202,583 170,702 408,599 358,845
General and administrative expenses 19,141 25,286 49,235 39,100
Gain on sale of assets - 53 - (2,450 )
Depreciation and amortization expense   27,563     22,422     54,093     42,963  
  4,545,266     4,497,509     9,243,008     9,377,697  
Income from operations 133,027 579,506 233,133 415,424
Other income (expense)

Change in fair value of contingent consideration

- (692 ) - (1,384 )
Change in fair value of catalyst lease 6,820 5,371 5,481 (978 )
Interest expense, net   (21,708 )   (28,443 )   (43,319 )   (59,851 )
Income before income taxes 118,139 555,742 195,295 353,211
Income tax expense   (10,969 )   -     (18,413 )   -  
Net income 107,170 $ 555,742   176,882 $ 353,211  

Less: net income attributable to noncontrolling interest

  90,344     148,649  
Net income attributable to PBF Energy Inc. $ 16,826   $ 28,233  
Net income available to Class A common
stock per share:
Basic $ 0.62   $ 1.12  
Diluted $ 0.61   $ 1.08  
Weighted-average shares outstanding-basic   26,944,055     25,276,137  
Weighted-average shares outstanding-diluted   27,706,696     26,110,976  
Dividends per share $ 0.30   $ 0.60  
Adjusted pro forma net income and adjusted
pro forma net income per fully exchanged,
fully diluted shares outstanding(1):
Adjusted pro forma net income $ 71,484   $ 336,224   $ 118,166   $ 213,693  
Adjusted pro forma net income per fully
exchanged, fully diluted share $ 0.73   $ 3.45   $ 1.21   $ 2.19  
Pro forma shares outstanding -diluted   97,353,701     97,353,701     97,425,899     97,425,899  

(1) Adjusted Pro Forma information is presented in the table above as management believes that these Non-GAAP measures when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare the company's results across the periods presented and facilitates an understanding of the company's operating results. The company also uses this measure to evaluate its operating performance. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. The differences between Adjusted Pro Forma and U.S. GAAP results are explained in the "Reconciliation of Amounts Reported Under U.S. GAAP - Adjusted Pro Forma Net Income."

(Unaudited, in thousands)
June 30, December 31,
2013 2012
Balance Sheet Data:
Cash and cash equivalents $ 69,230 $ 285,884
Inventories $ 1,537,573 $ 1,497,119
Total assets $ 4,325,903 $ 4,253,702
Total long-term debt $ 815,963 $ 729,980
Total equity $ 1,741,909 $ 1,723,545
Total debt to capitalization ratio 32 % 30 %
Net debt to capitalization ratio 30 % 20 %
(Unaudited, in thousands)

  Six months ended June 30,  

2013 2012
Cash flows from (used by) operations $ (40,201 ) $ 117,374
Cash flows used in investing activities (112,724 ) (89,854 )
Cash flows used in financing activities   (63,729 )   (68,958 )
Net decrease in cash and cash equivalents (216,654 ) (41,438 )
Cash and cash equivalents, beginning of period   285,884     50,166  
Cash and cash equivalents, end of period $ 69,230   $ 8,728  
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(Unaudited, amounts in thousands except as indicated)

Three Months Ended

Six Months Ended

June 30, June 30,
Market Indicators (dollars per barrel) (1) 2013 2012 2013 2012
Dated Brent Crude $ 102.43 $ 108.29 $ 107.50 $ 113.61
West Texas Intermediate (WTI) crude oil $ 94.07 $ 93.30 $ 94.17 $ 98.16
Crack Spreads
Dated Brent (NYH) 2-1-1 $ 14.67 $ 15.32 $ 13.60 $ 12.78
WTI (Chicago) 4-3-1 $ 29.26 $ 28.17 $ 27.72 $ 23.89
Crude Oil Differentials
Dated Brent (foreign) less WTI $ 8.36 $ 14.99 $ 13.33 $ 15.45
Dated Brent less Maya (heavy, sour) $ 4.59 $ 9.16