- Reported net income attributable to HollyFrontier stockholders
of $558.3 million or $3.39 per diluted share and adjusted net
income of $250.1 million or $1.52 per diluted share, for the
year
- Reported EBITDA of $1,306.9 million and adjusted EBITDA of
$915.7 million, for the year
HollyFrontier Corporation (NYSE:HFC) (“HollyFrontier” or the
“Company”) today reported fourth quarter net loss attributable to
HollyFrontier stockholders of $(39.5) million or $(0.24) per
diluted share for the quarter ended December 31, 2021, compared to
$(117.7) million or $(0.73) per diluted share for the quarter ended
December 31, 2020.
The fourth quarter results reflect special items that
collectively increased net loss by a total of $21.9 million. On a
pre-tax basis, these items include acquisition integration costs of
$15.8 million, a lower of cost or market inventory valuation
adjustment of $8.7 million and charges related to the Cheyenne
Refinery conversion to renewable diesel production, including
decommissioning charges of $2.8 million. Excluding these items,
adjusted net loss for the fourth quarter was $(17.6) million
($(0.11) per diluted share) compared to $(118.6) million ($(0.74)
per diluted share) for the fourth quarter of 2020, which excludes
certain items that collectively decreased net loss by $0.9 million
for the three months ended December 31, 2020.
HollyFrontier’s CEO, Michael Jennings, commented, “Despite heavy
planned and unplanned refining maintenance and weather-related
downtime in the fourth quarter, HollyFrontier delivered solid
financial results in 2021, highlighted by record earnings in our
Lubricants and Specialties business and the closing of our
acquisition of the Puget Sound Refinery. Looking forward to 2022,
we remain constructive on the macro environment and are focused on
the execution of our strategic initiatives: the successful
completion and start-up of our renewables business, closing on our
acquisition of Sinclair and accelerating returns of capital to our
shareholders.”
Refining segment loss before interest and income taxes was
$(63.5) million for the fourth quarter of 2021 compared to $(66.1)
million in the fourth quarter of 2020. The segment reported EBITDA
of $25.0 million for the fourth quarter of 2021 compared to $7.5
million for the fourth quarter of 2020. This increase was driven by
stronger product demand, which resulted in a consolidated refinery
gross margin of $8.70 per produced barrel, a 116% increase compared
to $4.02 for the fourth quarter of 2020. Crude oil charge averaged
421,000 barrels per day (“BPD”) for the fourth quarter of 2021
compared to 379,910 BPD for the fourth quarter of 2020.
Lubricants and Specialty Products segment income before interest
and income taxes was $53.7 million for the fourth quarter of 2021
compared to a loss before interest and income taxes of $(54.1)
million in the fourth quarter of 2020. The segment reported EBITDA
of $74.9 million for the fourth quarter of 2021 compared to $(32.7)
million in the fourth quarter of 2020. Fourth quarter of 2020
included a goodwill impairment charge of $81.9 million related to
Sonneborn.
Holly Energy Partners, L.P. (“HEP”) reported EBITDA of $70.8
million for the fourth quarter of 2021 compared to $86.8 million in
the fourth quarter of 2020.
For the fourth quarter of 2021, net cash used for operations
totaled $332.8 million. At December 31, 2021, the Company's cash
and cash equivalents totaled $234.4 million, a $1,247.1 million
decrease over cash and cash equivalents of $1,481.6 million at
September 30, 2021 inclusive of our purchase of the Puget Sound
Refinery. Additionally, the Company's consolidated debt was
$3,072.7 million. The Company's debt, exclusive of HEP debt, which
is nonrecourse to HollyFrontier, was $1,739.7 million at December
31, 2021.
The Company has scheduled a webcast conference call for today,
February 23, 2022, at 8:30 AM Eastern Time to discuss fourth
quarter financial results. This webcast may be accessed at:
https://events.q4inc.com/attendee/868741482. An audio archive of
this webcast will be available using the above noted link through
March 9, 2022.
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, Washington 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 HEP, a master limited
partnership that provides petroleum product and crude oil
transportation, terminalling, storage and throughput services to
the petroleum industry, including subsidiaries of HollyFrontier
Corporation.
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.
Forward-looking statements use words such as “anticipate,”
“project,” “expect,” “plan,” “goal,” “forecast,” “strategy,”
“intend,” “should,” “would,” “could,” “believe,” “may,” and similar
expressions and statements regarding our plans and objectives for
future operations. 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 Company’s ability to successfully close the
pending acquisition by the Company and HEP of Sinclair Oil
Corporation and Sinclair Transportation Company (collectively,
“Sinclair”, and such transactions, the “Sinclair Transactions”), or
once closed, integrate the operations of Sinclair with its existing
operations and fully realize the expected synergies of the Sinclair
Transactions or on the expected timeline; the satisfaction or
waivers of the conditions precedent to the proposed Sinclair
Transactions, including without limitation, regulatory approvals
(including clearance by antitrust authorities necessary to complete
the Sinclair Transactions on the terms and timeline desired), risks
relating to the value of HF Sinclair common stock and the value of
HEP’s limited partner common units to be issued at the closing of
the Sinclair Transactions from sales in anticipation of closing and
from sales by the Sinclair holders following the closing of the
Sinclair Transactions; the cost and potential for a delay in
closing as a result of litigation against the Company or HEP
challenging the Sinclair Transactions; the Company's ability to
successfully integrate the operation of the Puget Sound Refinery
with the Company's existing operations; the demand for and supply
of crude oil and refined products, including uncertainty regarding
the effects of the continuing coronavirus (“COVID-19”) pandemic on
future demand and increasing societal expectations that companies
address climate change; 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; the effects of current and/or future
governmental and environmental regulations and policies, including
the effects of current and/or future 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 construction of
the Artesia renewable diesel unit and pretreatment unit, on time
and within capital guidance; 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; a prolonged economic
slowdown due to the COVID-19 pandemic which could result in an
impairment of goodwill and/or 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
December 31,
Change from 2020
2021
2020
Change
Percent
(In thousands, except per share
data)
Sales and other revenues
$
5,622,667
$
2,900,768
$
2,721,899
94
%
Operating costs and expenses:
Cost of products sold:
Cost of products sold (exclusive of lower
of cost or market inventory valuation adjustment)
4,958,160
2,510,845
2,447,315
97
Lower of cost or market inventory
valuation adjustment
8,739
(149,212
)
157,951
(106
)
4,966,899
2,361,633
2,605,266
110
Operating expenses
430,858
336,077
94,781
28
Selling, general and administrative
expenses
111,225
76,041
35,184
46
Depreciation and amortization
134,198
124,879
9,319
7
Goodwill and long-lived asset
impairments
—
108,385
(108,385
)
(100
)
Total operating costs and
expenses
5,643,180
3,007,015
2,636,165
88
Loss from operations
(20,513
)
(106,247
)
85,734
(81
)
Other income (expense):
Earnings of equity method investments
3,557
1,461
2,096
143
Interest income
941
1,043
(102
)
(10
)
Interest expense
(30,955
)
(40,604
)
9,649
(24
)
Gain on foreign currency transactions
1,288
3,119
(1,831
)
(59
)
Gain on sale of assets and other
2,532
3,034
(502
)
(17
)
(22,637
)
(31,947
)
9,310
(29
)
Loss before income taxes
(43,150
)
(138,194
)
95,044
(69
)
Income tax benefit
(26,046
)
(43,643
)
17,597
(40
)
Net loss
(17,104
)
(94,551
)
77,447
(82
)
Less net income attributable to
noncontrolling interest
22,426
23,196
(770
)
(3
)
Net loss attributable to HollyFrontier
stockholders
$
(39,530
)
$
(117,747
)
$
78,217
(66
)%
Loss per share:
Basic
$
(0.24
)
$
(0.73
)
$
0.49
(67
)%
Diluted
$
(0.24
)
$
(0.73
)
$
0.49
(67
)%
Cash dividends declared per common
share
$
—
$
0.35
$
(0.35
)
(100
)%
Average number of common shares
outstanding:
Basic
162,721
162,151
570
—
%
Diluted
162,721
162,151
570
—
%
EBITDA
$
98,636
$
3,050
$
95,586
3,134
%
Adjusted EBITDA
$
126,026
$
(21,898
)
$
147,924
(676
)%
Years Ended December
31,
Change from 2020
2021
2020
Change
Percent
(In thousands, except per share
data)
Sales and other revenues
$
18,389,142
$
11,183,643
$
7,205,499
64
%
Operating costs and expenses:
Cost of products sold:
Cost of products sold (exclusive of lower
of cost or market inventory valuation adjustment)
15,567,052
9,158,805
6,408,247
70
Lower of cost or market inventory
valuation adjustment
(310,123
)
78,499
(388,622
)
(495
)
15,256,929
9,237,304
6,019,625
65
Operating expenses
1,517,478
1,300,277
217,201
17
Selling, general and administrative
expenses
362,010
313,600
48,410
15
Depreciation and amortization
503,539
520,912
(17,373
)
(3
)
Goodwill and long-lived asset
impairments
—
545,293
(545,293
)
(100
)
Total operating costs and
expenses
17,639,956
11,917,386
5,722,570
48
Income (loss) from operations
749,186
(733,743
)
1,482,929
(202
)
Other income (expense):
Earnings of equity method investments
12,432
6,647
5,785
87
Interest income
4,019
7,633
(3,614
)
(47
)
Interest expense
(125,175
)
(126,527
)
1,352
(1
)
Gain on business interruption insurance
settlement
—
81,000
(81,000
)
(100
)
Gain on tariff settlement
51,500
—
51,500
—
Gain on sales-type lease
—
33,834
(33,834
)
(100
)
Loss on early extinguishment of debt
—
(25,915
)
25,915
(100
)
Gain (loss) on foreign currency
transactions
(2,938
)
2,201
(5,139
)
(233
)
Gain on sale of assets and other
98,128
7,824
90,304
1,154
37,966
(13,303
)
51,269
(385
)
Income (loss) before income
taxes
787,152
(747,046
)
1,534,198
(205
)
Income tax expense (benefit)
123,898
(232,147
)
356,045
(153
)
Net income (loss)
663,254
(514,899
)
1,178,153
(229
)
Less net income attributable to
noncontrolling interest
104,930
86,549
18,381
21
Net income (loss) attributable to
HollyFrontier stockholders
$
558,324
$
(601,448
)
$
1,159,772
(193
)%
Earnings (loss) per share:
Basic
$
3.39
$
(3.72
)
$
7.11
(191
)%
Diluted
$
3.39
$
(3.72
)
$
7.11
(191
)%
Cash dividends declared per common
share
$
0.35
$
1.40
$
(1.05
)
(75
)%
Average number of common shares
outstanding:
Basic
162,569
161,983
586
—
%
Diluted
162,569
161,983
586
—
%
EBITDA
$
1,306,917
$
(193,789
)
$
1,500,706
(774
)%
Adjusted EBITDA
$
915,665
$
412,220
$
503,445
122
%
Balance Sheet Data
Years Ended December
31,
2021
2020
(In thousands)
Cash and cash equivalents
$
234,444
$
1,368,318
Working capital
$
1,696,990
$
1,935,605
Total assets
$
12,916,613
$
11,506,864
Long-term debt
$
3,072,737
$
3,142,718
Total equity
$
6,294,465
$
5,722,203
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 represents the operations of our El Dorado,
Tulsa, Navajo and Woods Cross refineries, HollyFrontier Asphalt
Company LLC (“HFC Asphalt”) and also our recently acquired Puget
Sound Refinery from the closing date on November 1, 2021
(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 Mountains extending into the
Pacific Northwest geographic regions of the United States. HFC
Asphalt operates various asphalt terminals in Arizona, New Mexico
and Oklahoma. The Refining segment also included the operations of
our Cheyenne Refinery until it permanently ceased petroleum
refining operations during the third quarter of 2020.
Beginning in the fourth quarter of 2020, activities associated
with the conversion of Cheyenne Refinery to renewable diesel
production, along with the construction of renewable diesel and
pre-treatment units in Artesia, New Mexico were reported in
Corporate and Other. The Cheyenne renewable diesel unit was
mechanically complete in the fourth quarter of 2021. The
pre-treatment unit is expected to be completed in the first quarter
of 2022, and the Artesia renewable diesel unit is expected to be
completed in the second quarter of 2022. Beginning in the first
quarter of 2022, renewable diesel operations will cease to be
reported in Corporate and Other and will be reported under a new
Renewables segment.
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 includes all of the operations of HEP, a
consolidated variable interest entity, which owns and operates
logistics and refinery 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 geographic regions of the United States. The HEP
segment also includes a 75% ownership 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 December 31,
2021
Sales and other revenues:
Revenues from external customers
$
4,896,994
$
699,838
$
25,837
$
(2
)
$
5,622,667
Intersegment revenues
168,599
488
92,656
(261,743
)
—
$
5,065,593
$
700,326
$
118,493
$
(261,745
)
$
5,622,667
Cost of products sold (exclusive of lower
of cost or market inventory adjustment)
$
4,686,200
$
510,528
$
—
$
(238,568
)
$
4,958,160
Lower of cost or market inventory
valuation adjustment
$
—
$
—
$
—
$
8,739
$
8,739
Operating expenses
$
317,831
$
69,453
$
44,298
$
(724
)
$
430,858
Selling, general and administrative
expenses
$
36,586
$
45,543
$
2,973
$
26,123
$
111,225
Depreciation and amortization
$
88,455
$
21,268
$
20,090
$
4,385
$
134,198
Income (loss) from operations
$
(63,479
)
$
53,534
$
51,132
$
(61,700
)
$
(20,513
)
Income (loss) before interest and income
taxes
$
(63,479
)
$
53,665
$
54,873
$
(58,195
)
$
(13,136
)
Net income attributable to noncontrolling
interest
$
—
$
—
$
3,190
$
19,236
$
22,426
Earnings of equity method investments
$
—
$
—
$
3,557
$
—
$
3,557
Capital expenditures
$
46,106
$
13,344
$
11,403
$
194,211
$
265,064
Three Months Ended December 31,
2020
Sales and other revenues:
Revenues from external customers
$
2,406,214
$
462,724
$
25,629
$
6,201
$
2,900,768
Intersegment revenues
74,492
1,554
101,827
(177,873
)
—
$
2,480,706
$
464,278
$
127,456
$
(171,672
)
$
2,900,768
Cost of products sold (exclusive of lower
of cost or market inventory adjustment)
$
2,326,150
$
318,857
$
—
$
(134,162
)
$
2,510,845
Lower of cost or market inventory
valuation adjustment
$
(145,497
)
$
—
$
—
$
(3,715
)
$
(149,212
)
Operating expenses
$
233,433
$
59,609
$
37,971
$
5,064
$
336,077
Selling, general and administrative
expenses
$
32,621
$
36,162
$
2,420
$
4,838
$
76,041
Depreciation and amortization
$
73,598
$
21,396
$
23,350
$
6,535
$
124,879
Goodwill and long-lived asset
impairments
$
26,518
$
81,867
$
—
$
—
$
108,385
Income (loss) from operations
$
(66,117
)
$
(53,613
)
$
63,715
$
(50,232
)
$
(106,247
)
Income (loss) before interest and income
taxes
$
(66,117
)
$
(54,056
)
$
65,428
$
(43,888
)
$
(98,633
)
Net income attributable to noncontrolling
interest
$
—
$
—
$
1,124
$
22,072
$
23,196
Earnings of equity method investments
$
—
$
—
$
1,461
$
—
$
1,461
Capital expenditures
$
45,870
$
12,086
$
20,641
$
38,555
$
117,152
Refining
Lubricants and Specialty
Products
HEP
Corporate, Other and
Eliminations
Consolidated Total
(In thousands)
Year Ended December 31, 2021
Sales and other revenues:
Revenues from external customers
$
15,734,870
$
2,550,624
$
103,646
$
2
$
18,389,142
Intersegment revenues
623,688
9,988
390,849
(1,024,525
)
—
$
16,358,558
$
2,560,612
$
494,495
$
(1,024,523
)
$
18,389,142
Cost of products sold (exclusive of lower
of cost or market inventory adjustment)
$
14,673,062
$
1,815,802
$
—
$
(921,812
)
$
15,567,052
Lower of cost or market inventory
valuation adjustment
$
(318,353
)
$
—
$
—
$
8,230
$
(310,123
)
Operating expenses
$
1,090,424
$
252,456
$
170,524
$
4,074
$
1,517,478
Selling, general and administrative
expenses
$
127,563
$
170,155
$
12,637
$
51,655
$
362,010
Depreciation and amortization
$
334,365
$
79,767
$
86,998
$
2,409
$
503,539
Income (loss) from operations
$
451,497
$
242,432
$
224,336
$
(169,079
)
$
749,186
Income (loss) before interest and income
taxes
$
449,747
$
329,203
$
267,623
$
(138,265
)
$
908,308
Net income attributable to noncontrolling
interest
$
—
$
—
$
7,217
$
97,713
$
104,930
Earnings of equity method investments
$
—
$
—
$
12,432
$
—
$
12,432
Capital expenditures
$
160,431
$
30,878
$
88,336
$
533,764
$
813,409
Year Ended December 31, 2020
Sales and other revenues:
Revenues from external customers
$
9,286,658
$
1,792,745
$
98,039
$
6,201
$
11,183,643
Intersegment revenues
252,531
10,465
399,809
(662,805
)
—
$
9,539,189
$
1,803,210
$
497,848
$
(656,604
)
$
11,183,643
Cost of products sold (exclusive of lower
of cost or market inventory adjustment)
$
8,439,680
$
1,271,287
$
—
$
(552,162
)
$
9,158,805
Lower of cost or market inventory
valuation adjustment
$
82,214
$
—
$
—
$
(3,715
)
$
78,499
Operating expenses
$
988,045
$
216,068
$
147,692
$
(51,528
)
$
1,300,277
Selling, general and administrative
expenses
$
127,298
$
157,816
$
9,989
$
18,497
$
313,600
Depreciation and amortization
$
324,617
$
80,656
$
95,445
$
20,194
$
520,912
Goodwill impairment
$
241,760
$
286,575
$
16,958
$
—
$
545,293
Income (loss) from operations
$
(664,425
)
$
(209,192
)
$
227,764
$
(87,890
)
$
(733,743
)
Income (loss) before interest and income
taxes
$
(664,425
)
$
(209,903
)
$
251,021
$
(4,845
)
$
(628,152
)
Net income attributable to noncontrolling
interest
$
—
$
—
$
5,282
$
81,267
$
86,549
Earnings of equity method investments
$
—
$
—
$
6,647
$
—
$
6,647
Capital expenditures
$
152,726
$
32,473
$
59,283
$
85,678
$
330,160
Refining
Lubricants and Specialty
Products
HEP
Corporate, Other and
Eliminations
Consolidated Total
(In thousands)
December 31, 2021
Cash and cash equivalents
$
—
$
113,474
$
14,381
$
106,589
$
234,444
Total assets
$
9,736,851
$
2,073,638
$
2,250,115
$
(1,143,991
)
$
12,916,613
Long-term debt
$
—
$
—
$
1,333,049
$
1,739,688
$
3,072,737
December 31, 2020
Cash and cash equivalents
$
3,106
$
163,729
$
21,990
$
1,179,493
$
1,368,318
Total assets
$
6,203,847
$
1,864,313
$
2,198,478
$
1,240,226
$
11,506,864
Long-term debt
$
—
$
—
$
1,405,603
$
1,737,115
$
3,142,718
Refining Segment Operating Data
As of December 31, 2021, our refinery operations included the El
Dorado, Tulsa, Puget Sound, Navajo and Woods Cross Refineries. The
refinery operations of the Puget Sound Refinery are included for
the period November 1, 2021 (date of acquisition) through December
31, 2021. 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 December
31,
Years Ended December
31,
2021
2020
2021
2020
Mid-Continent Region (El Dorado and
Tulsa Refineries)
Crude charge (BPD) (1)
265,770
260,780
260,350
241,140
Refinery throughput (BPD) (2)
287,300
279,670
276,430
257,030
Sales of produced refined products (BPD)
(3)
285,250
273,710
265,470
248,320
Refinery utilization (4)
102.2
%
100.3
%
100.1
%
92.7
%
Average per produced barrel (5)
Refinery gross margin
$
6.18
$
1.93
$
9.44
$
5.17
Refinery operating expenses (6)
5.73
5.42
6.42
5.46
Net operating margin
$
0.45
$
(3.49
)
$
3.02
$
(0.29
)
Refinery operating expenses per throughput
barrel (7)
$
5.69
$
5.30
$
6.17
$
5.27
Feedstocks:
Sweet crude oil
55
%
59
%
61
%
58
%
Sour crude oil
21
%
19
%
15
%
19
%
Heavy sour crude oil
17
%
15
%
18
%
17
%
Other feedstocks and blends
7
%
7
%
6
%
6
%
Total
100
%
100
%
100
%
100
%
Sales of produced refined products:
Gasolines
53
%
54
%
52
%
52
%
Diesel fuels
32
%
33
%
33
%
34
%
Jet fuels
6
%
4
%
5
%
4
%
Fuel oil
1
%
1
%
1
%
1
%
Asphalt
2
%
3
%
3
%
3
%
Base oils
4
%
4
%
4
%
4
%
LPG and other
2
%
1
%
2
%
2
%
Total
100
%
100
%
100
%
100
%
Three Months Ended
December 31,
Years Ended
December 31,
2021 (8)
2020
2021 (8)
2020
West Region (Puget Sound, Navajo and
Wood Cross Refineries)
Crude charge (BPD) (1)
155,230
119,130
140,370
124,050
Refinery throughput (BPD) (2)
175,440
133,110
155,440
138,050
Sales of produced refined products (BPD)
(3)
188,980
144,280
158,630
143,350
Refinery utilization (4)
63.7
%
82.2
%
82.7
%
85.6
%
Average per produced barrel (5)
Refinery gross margin
$
12.50
$
7.98
$
13.32
$
10.97
Refinery operating expenses (6)
9.63
7.31
8.09
7.07
Net operating margin
$
2.87
$
0.67
$
5.23
$
3.90
Refinery operating expenses per throughput
barrel (7)
$
10.38
$
7.93
$
9.27
$
7.34
Feedstocks:
Sweet crude oil
20
%
29
%
22
%
30
%
Sour crude oil
56
%
48
%
58
%
49
%
Heavy sour crude oil
2
%
—
%
1
%
—
%
Black wax crude oil
11
%
12
%
10
%
11
%
Other feedstocks and blends
11
%
11
%
9
%
10
%
Total
100
%
100
%
100
%
100
%
Sales of produced refined products:
Gasolines
56
%
57
%
54
%
56
%
Diesel fuels
29
%
34
%
35
%
35
%
Jet fuels
4
%
—
%
1
%
—
%
Fuel oil
3
%
3
%
3
%
3
%
Asphalt
3
%
3
%
4
%
4
%
LPG and other
5
%
3
%
3
%
2
%
Total
100
%
100
%
100
%
100
%
Consolidated
Crude charge (BPD) (1)
421,000
379,910
400,720
365,190
Refinery throughput (BPD) (2)
462,740
412,780
431,870
395,080
Sales of produced refined products (BPD)
(3)
474,230
417,990
424,100
391,670
Refinery utilization (4)
83.6
%
93.8
%
93.1
%
90.2
%
Average per produced barrel (5)
Refinery gross margin
$
8.70
$
4.02
$
10.89
$
7.29
Refinery operating expenses (6)
7.28
6.07
7.04
6.05
Net operating margin
$
1.42
$
(2.05
)
$
3.85
$
1.24
Refinery operating expenses per throughput
barrel (7)
$
7.47
$
6.15
$
6.92
$
6.00
Feedstocks:
Sweet crude oil
41
%
49
%
47
%
48
%
Sour crude oil
34
%
29
%
31
%
29
%
Heavy sour crude oil
12
%
10
%
12
%
11
%
Black wax crude oil
4
%
4
%
4
%
4
%
Other feedstocks and blends
9
%
8
%
6
%
8
%
Total
100
%
100
%
100
%
100
%
Three Months Ended
December 31,
Years Ended
December 31,
2021
2020
2021
2020
Consolidated
Sales of produced refined products:
Gasolines
54
%
55
%
53
%
54
%
Diesel fuels
31
%
33
%
34
%
34
%
Jet fuels
6
%
3
%
4
%
3
%
Fuel oil
1
%
2
%
1
%
1
%
Asphalt
3
%
3
%
3
%
4
%
Base oils
2
%
2
%
2
%
2
%
LPG and other
3
%
2
%
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"). As a result of our acquisition of the
Puget Sound Refinery on November 1, 2021, our consolidated crude
capacity increased from 405,000 BPSD to 554,000 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 Mid-Continent and West
regions operating expenses, exclusive of long-lived asset
impairment charges and depreciation and amortization, divided by
sales volumes of refined products produced at our refineries.
(7)
Represents total Mid-Continent and West
regions operating expenses, exclusive of long-lived asset
impairment charges and depreciation and amortization, divided by
refinery throughput.
(8)
We acquired the Puget Sound Refinery on
November 1, 2021. Refining operating data for the quarter and year
ended December 31, 2021 includes crude oil and feedstocks processed
and refined products sold at our Puget Sound Refinery for the
period November 1, 2021 through December 31, 2021 only, averaged
over the 92 days and 365 days in the quarter and year ended
December 31, 2021, respectively.
Lubricants and Specialty Products Segment Operating
Data
The following table sets forth information about our lubricants
and specialty products operations.
Three Months Ended
December 31,
Years Ended
December 31,
2021
2020
2021
2020
Lubricants and Specialty
Products
Throughput (BPD)
18,760
21,425
19,177
19,645
Sales of produced products (BPD)
35,120
33,559
34,016
32,902
Sales of produced products:
Finished products
46
%
49
%
51
%
49
%
Base oils
26
%
28
%
27
%
26
%
Other
28
%
23
%
22
%
25
%
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 December 31,
2021
Sales and other revenues
$
307,018
$
631,221
$
(237,913
)
$
700,326
Cost of products sold
$
202,124
$
546,317
$
(237,913
)
$
510,528
Operating expenses
$
33,977
$
35,476
$
—
$
69,453
Selling, general and administrative
expenses
$
7,360
$
38,183
$
—
$
45,543
Depreciation and amortization
$
8,183
$
13,085
$
—
$
21,268
Income (loss) from operations
$
55,374
$
(1,840
)
$
—
$
53,534
Income (loss) before interest and income
taxes
$
55,374
$
(1,709
)
$
—
$
53,665
EBITDA
$
63,557
$
11,376
$
—
$
74,933
Three Months Ended December 31,
2020
Sales and other revenues
$
143,786
$
426,407
$
(105,915
)
$
464,278
Cost of products sold
$
110,351
$
314,421
$
(105,915
)
$
318,857
Operating expenses
$
26,760
$
32,849
$
—
$
59,609
Selling, general and administrative
expenses
$
5,680
$
30,482
$
—
$
36,162
Depreciation and amortization
$
6,908
$
14,488
$
—
$
21,396
Goodwill impairment
$
—
$
81,867
$
—
$
81,867
Loss from operations
$
(5,913
)
$
(47,700
)
$
—
$
(53,613
)
Loss before interest and income taxes
$
(5,913
)
$
(48,143
)
$
—
$
(54,056
)
EBITDA
$
995
$
(33,655
)
$
—
$
(32,660
)
Rack Back (1)
Rack Forward (2)
Eliminations (3)
Total Lubricants and Specialty
Products
(In thousands)
Year Ended December 31, 2021
Sales and other revenues
$
1,005,152
$
2,378,332
$
(822,872
)
$
2,560,612
Cost of products sold
$
646,107
$
1,992,567
$
(822,872
)
$
1,815,802
Operating expenses
$
120,750
$
131,706
$
—
$
252,456
Selling, general and administrative
expenses
$
27,071
$
143,084
$
—
$
170,155
Depreciation and amortization
$
28,093
$
51,674
$
—
$
79,767
Income from operations
$
183,131
$
59,301
$
—
$
242,432
Income before interest and income
taxes
$
269,149
$
60,054
$
—
$
329,203
EBITDA
$
297,242
$
111,728
$
—
$
408,970
Year Ended December 31, 2020
Sales and other revenues
$
505,424
$
1,667,809
$
(370,023
)
$
1,803,210
Cost of products sold
$
456,194
$
1,185,116
$
(370,023
)
$
1,271,287
Operating expenses
$
96,463
$
119,605
$
—
$
216,068
Selling, general and administrative
expenses
$
22,276
$
135,540
$
—
$
157,816
Depreciation and amortization
$
29,071
$
51,585
$
—
$
80,656
Goodwill impairment
$
167,017
$
119,558
$
—
$
286,575
Income (loss) from operations
$
(265,597
)
$
56,405
$
—
$
(209,192
)
Income (loss) before interest and income
taxes
$
(265,597
)
$
55,694
$
—
$
(209,903
)
EBITDA
$
(236,526
)
$
107,279
$
—
$
(129,247
)
(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 provision and
(iii) depreciation and amortization. Adjusted EBITDA is calculated
as EBITDA plus or minus (i) lower of cost or market inventory
valuation adjustments, (ii) gain on sale of real property, (iii)
goodwill impairment, (iv) HollyFrontier's pro-rata share of gain on
business interruption insurance settlement, (v) long-lived asset
impairment, inclusive of pro-rata share of impairment in HEP
segment, (vi) HollyFrontier's pro-rata share of HEP's gain on
sales-type leases, (vii) HollyFrontier's pro-rata share of HEP's
loss on early extinguishment of debt, (viii) severance costs, (ix)
restructuring charges, (x) Cheyenne Refinery LIFO inventory
liquidation costs, (xi) decommissioning costs, (xii) pre-close
acquisition integration costs, (xiii) acquisition integration and
regulatory costs and (xiv) gain on tariff settlement.
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
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(In thousands)
Net income (loss) attributable to
HollyFrontier stockholders
$
(39,530
)
$
(117,747
)
$
558,324
$
(601,448
)
Add (subtract) income tax expense
(benefit)
(26,046
)
(43,643
)
123,898
(232,147
)
Add interest expense
30,955
40,604
125,175
126,527
Subtract interest income
(941
)
(1,043
)
(4,019
)
(7,633
)
Add depreciation and amortization
134,198
124,879
503,539
520,912
EBITDA
$
98,636
$
3,050
$
1,306,917
$
(193,789
)
Add (subtract) lower of cost or market
inventory valuation adjustment
8,739
(149,212
)
(310,123
)
78,499
Subtract gain on sale of real property
—
—
(86,018
)
—
Add goodwill impairment
—
81,867
—
81,867
Subtract HollyFrontier's pro-rata share of
gain on business interruption insurance settlement
—
—
—
(77,143
)
Add long-lived asset impairment, inclusive
of pro-rata share of impairment in HEP segment
—
26,518
—
456,058
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
82
296
988
3,842
Add restructuring charges
—
—
7,813
3,679
Add Cheyenne Refinery LIFO inventory
liquidation costs
—
3,129
923
36,943
Add decommissioning costs
2,774
12,439
25,835
24,748
Add pre-close acquisition integration
costs
12,278
—
17,313
—
Add acquisition integration and regulatory
costs
3,517
15
3,517
1,994
Subtract gain on tariff settlement
—
—
(51,500
)
—
Adjusted EBITDA
$
126,026
$
(21,898
)
$
915,665
$
412,220
EBITDA and Adjusted EBITDA attributable to our Refining segment
is presented below:
Three Months Ended
December 31,
Years Ended
December 31,
Refining Segment
2021
2020
2021
2020
(In thousands)
Income (loss) before interest and income
taxes (1)
$
(63,479
)
$
(66,117
)
$
449,747
$
(664,425
)
Add depreciation and amortization
88,455
73,598
334,365
324,617
EBITDA
$
24,976
$
7,481
$
784,112
$
(339,808
)
Add (subtract) lower of cost or market
inventory valuation adjustment
—
(145,497
)
(318,353
)
82,214
Add long-lived asset impairment
—
26,518
—
241,760
Add severance costs
—
—
—
3,546
Add restructuring charges
—
—
—
2,009
Add Cheyenne Refinery LIFO inventory
liquidation costs
—
—
—
33,814
Add decommissioning costs
—
—
—
12,309
Adjusted EBITDA
$
24,976
$
(111,498
)
$
465,759
$
35,844
(1)
Income (loss) before interest and income
taxes of our Refining segment represents income (loss) 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 December 31,
2021
Income (loss) before interest and income
taxes (1)
$
55,374
$
(1,709
)
$
53,665
Add depreciation and amortization
8,183
13,085
21,268
EBITDA
$
63,557
$
11,376
$
74,933
Three Months Ended December 31,
2020
Loss before interest and income taxes
(1)
$
(5,913
)
$
(48,143
)
$
(54,056
)
Add depreciation and amortization
6,908
14,488
21,396
EBITDA
$
995
$
(33,655
)
$
(32,660
)
Add goodwill impairment
—
81,867
81,867
Adjusted EBITDA
$
995
$
48,212
$
49,207
Year Ended December 31, 2021
Income before interest and income taxes
(1)
$
269,149
$
60,054
$
329,203
Add depreciation and amortization
28,093
51,674
79,767
EBITDA
297,242
111,728
408,970
Subtract gain on sale of real property
(86,018
)
—
(86,018
)
Add restructuring charges
$
1,079
$
6,734
$
7,813
Adjusted EBITDA
$
212,303
$
118,462
$
330,765
Year Ended December 31, 2020
Income (loss) before interest and income
taxes (1)
$
(265,597
)
$
55,694
$
(209,903
)
Add depreciation and amortization
29,071
51,585
80,656
EBITDA
(236,526
)
107,279
(129,247
)
Add goodwill impairment
167,017
119,558
286,575
Adjusted EBITDA
$
(69,509
)
$
226,837
$
157,328
(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
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(Dollars in thousands, except per
barrel amounts)
Consolidated
Net operating margin per produced barrel
sold
$
1.42
$
(2.05
)
$
3.85
$
1.24
Add average refinery operating expenses
per produced barrel sold
7.28
6.07
7.04
6.05
Refinery gross margin per produced barrel
sold
$
8.70
$
4.02
$
10.89
$
7.29
Times produced barrels sold (BPD)
474,230
417,990
424,100
391,670
Times number of days in period
92
92
365
366
Refining gross margin
$
379,574
$
154,589
$
1,685,734
$
1,045,030
Add (subtract) rounding
(181
)
(33
)
(238
)
523
West and Mid-Continent regions gross
margin
379,393
154,556
1,685,496
1,045,553
Add West and Mid-Continent regions cost of
products sold
4,686,200
2,326,150
14,673,062
7,992,047
Add Cheyenne Refinery sales and other
revenues
—
—
—
501,589
Refining segment sales and other
revenues
5,065,593
2,480,706
16,358,558
9,539,189
Add lubricants and specialty products
segment sales and other revenues
700,326
464,278
2,560,612
1,803,210
Add HEP segment sales and other
revenues
118,493
127,456
494,495
497,848
Subtract corporate, other and
eliminations
(261,745
)
(171,672
)
(1,024,523
)
(656,604
)
Sales and other revenues
$
5,622,667
$
2,900,768
$
18,389,142
$
11,183,643
Reconciliation of average refining segment
operating expenses per produced barrel sold to total operating
expenses
Three Months Ended
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(Dollars in thousands, except per
barrel amounts)
Consolidated
Average operating expenses per produced
barrel sold
$
7.28
$
6.07
$
7.04
$
6.05
Times produced barrels sold (BPD)
474,230
417,990
424,100
391,670
Times number of days in period
92
92
365
366
Refining operating expenses
$
317,620
$
233,422
$
1,089,767
$
867,275
Add (subtract) rounding
211
11
657
(381
)
West and Mid-Continent regions operating
expenses
317,831
233,433
1,090,424
866,894
Add Cheyenne Refinery operating
expenses
—
—
—
121,151
Total refining segment operating
expenses
317,831
233,433
1,090,424
988,045
Add lubricants and specialty products
segment operating expenses
69,453
59,609
252,456
216,068
Add HEP segment operating expenses
44,298
37,971
170,524
147,692
Add (subtract) corporate, other and
eliminations
(724
)
5,064
4,074
(51,528
)
Operating expenses (exclusive of
depreciation and amortization)
$
430,858
$
336,077
$
1,517,478
$
1,300,277
Reconciliation of net income (loss)
attributable to HollyFrontier stockholders to adjusted net income
(loss) 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
sale of real property, goodwill and long-lived asset impairments,
gain on business interruption insurance settlement, 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, pre-close
acquisition integration costs, acquisition integration and
regulatory costs and gain on tariff settlement. 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
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(Dollars in thousands, except per
share amounts)
Consolidated
GAAP:
Income (loss) before income taxes
$
(43,150
)
$
(138,194
)
$
787,152
$
(747,046
)
Income tax expense (benefit)
(26,046
)
(43,643
)
123,898
(232,147
)
Net income (loss)
(17,104
)
(94,551
)
663,254
(514,899
)
Less net income attributable to
noncontrolling interest
22,426
23,196
104,930
86,549
Net income (loss) attributable to
HollyFrontier stockholders
(39,530
)
(117,747
)
558,324
(601,448
)
Non-GAAP adjustments to arrive at
adjusted results:
Lower of cost or market inventory
valuation adjustment
8,739
(149,212
)
(310,123
)
78,499
Gain on sale of real property
—
—
(86,018
)
—
Gain on business interruption insurance
settlement
—
—
—
(81,000
)
Goodwill and long-lived asset
impairments
—
108,385
—
545,293
HEP's gain on sales-type lease
—
—
—
(33,834
)
HEP's loss on early extinguishment of
debt
—
—
—
25,915
Severance costs
82
296
988
3,842
Restructuring charges
—
—
7,813
3,679
Cheyenne Refinery LIFO inventory
liquidation costs
—
3,129
923
36,943
Decommissioning costs
2,774
12,439
25,835
24,748
Pre-close acquisition and regulatory
costs
12,278
—
17,313
—
Acquisition integration and regulatory
costs
3,517
15
3,517
1,994
Gain on tariff settlement
—
—
(51,500
)
—
Total adjustments to income (loss) before
income taxes
27,390
(24,948
)
(391,252
)
606,079
Adjustment to income tax expense (benefit)
(1)
5,443
(24,077
)
(83,049
)
144,424
Adjustment to net income attributable to
noncontrolling interest
—
—
—
70
Total adjustments, net of tax
21,947
(871
)
(308,203
)
461,585
Adjusted results - Non-GAAP:
Adjusted income (loss) before income
taxes
(15,760
)
(163,142
)
395,900
(140,967
)
Adjusted income tax expense (benefit)
(2)
(20,603
)
(67,720
)
40,849
(87,723
)
Adjusted net income (loss)
4,843
(95,422
)
355,051
(53,244
)
Less net income attributable to
noncontrolling interest
22,426
23,196
104,930
86,619
Adjusted net income (loss) attributable to
HollyFrontier stockholders
$
(17,583
)
$
(118,618
)
$
250,121
$
(139,863
)
Adjusted earnings (loss) per share -
diluted (3)
$
(0.11
)
$
(0.74
)
$
1.52
$
(0.87
)
(1)
Represents adjustment to GAAP income tax
expense to arrive at adjusted income tax expense, which is computed
as follows:
Three Months Ended
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(Dollars in thousands)
Non-GAAP income tax expense (benefit)
(2)
$
(20,603
)
$
(67,720
)
$
40,849
$
(87,723
)
Subtract GAAP income tax expense
(benefit)
(26,046
)
(43,643
)
123,898
(232,147
)
Non-GAAP adjustment to income tax
expense
$
5,443
$
(24,077
)
$
(83,049
)
$
144,424
(2)
Non-GAAP income tax expense (benefit) 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 - diluted is
calculated as adjusted net income (loss) attributable to
HollyFrontier stockholders divided by the average number of shares
of common stock outstanding assuming dilution, which is based on
weighted-average diluted shares outstanding as that used in the
GAAP diluted earnings per share calculation. Income allocated to
participating securities, if applicable, in the adjusted earnings
per share calculation is the same as that used in GAAP diluted
earnings per share calculation.
Reconciliation of effective tax rate to
adjusted effective tax rate
Three Months Ended
December 31,
Years Ended
December 31,
2021
2020
2021
2020
(Dollars in thousands)
GAAP:
Income before income taxes
$
(43,150
)
$
(138,194
)
$
787,152
$
(747,046
)
Income tax expense
$
(26,046
)
$
(43,643
)
$
123,898
$
(232,147
)
Effective tax rate for GAAP financial
statements
60.4
%
31.6
%
15.7
%
31.1
%
Adjusted - Non-GAAP:
Effect of Non-GAAP adjustments
70.4
%
9.9
%
(5.4
) %
31.1
%
Effective tax rate for adjusted
results
130.8
%
41.5
%
10.3
%
62.2
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220223005349/en/
Richard L. Voliva III, Executive Vice President and Chief
Financial Officer Craig Biery, Vice President, Investor Relations
HollyFrontier Corporation 214-954-6510
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