PBF Energy (PBF) Q4 Earnings Beat on Strong Refining Margin

PBF Energy Inc. PBF reported fourth-quarter 2021 earnings of $1.28 per share, comfortably beating the Zacks Consensus Estimate of earnings of 69 cents. The bottom line also turned around from the year-ago loss of $4.53 per share.

Total quarterly revenues increased to $8,244 million from $3,655.1 million in the prior-year quarter and beat the Zacks Consensus Estimate of $7,239 million.

The strong quarterly results can be attributed to increased contributions from the Refining and Logistics segments.

PBF Energy Inc. Price, Consensus and EPS Surprise

PBF Energy Inc. price-consensus-eps-surprise-chart | PBF Energy Inc. Quote

Segmental Performance

The company’s operating income from the Refining segment was $323.7 million, turning around from a loss of $311.6 million a year ago.

It generated a profit of $52.6 million from the Logistics segment, reflecting an increase from the prior-year quarter’s $41.9 million.

Throughput Analysis

Volumes:

For the quarter under review, crude oil and feedstocks throughput volumes were 869 thousand barrels per day (bpd), higher than the year-ago figure of 677.3 thousand bpd.

East Coast, Mid-Continent, Gulf Coast and West Coast regions accounted for 28.9%, 14.1%, 20.7%, and 36.3%, respectively, of the total oil and feedstock throughput volume.

Margins:

Company-wide gross refining margin per barrel of throughput, excluding special items, was recorded at $12.49, significantly higher than the year-earlier figure of $0.98.

The gross refining margin per barrel of throughput was $7.91 for the East Coast, up from $0.09 in the year-ago quarter. Realized refining margin was $11.82 per barrel in the Gulf Coast, up from a loss of $1.64 in the prior-year period. The metric was $18.14 and $8.30 per barrel in the West Coast and Mid-Continent compared with respective margins of $2.72 and $2.17 a year ago.

Costs & Expenses

Total costs and expenses for the reported quarter were $7,952.9 million, significantly higher than $3,983.2 million in the year-ago period. Cost of sales — which includes operating expenses, cost of products and others and depreciation and amortization expenses — amounted to $7,865.7 million, higher than the year-ago $3,835.6 million.

Capital Expenditure & Balance Sheet

Through the fourth quarter, PBF Energy spent $165.4 million in capital on refining operations and $1.7 million on logistics businesses.

At the quarter-end, it had cash and cash equivalents of $1,341.5 million. As of Dec 31, PBF Energy had a total debt of $4,295.8 million, resulting in a total debt to capitalization of 63%.

Guidance

For 2022, PBF Energy expects total throughput volumes of 875-935 thousand bpd. It expects 830-890 thousand bpd of total throughput volumes for the first quarter of 2022.

Zacks Rank & Stocks to Consider

The company currently carries a Zacks Rank #3 (Hold).

Investors interested in the energy sector might look at the following companies that turned in strong bottom-line numbers in the fourth quarter and presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Calgary, Canada-based Cenovus Energy Inc. CVE is a leading integrated energy company. CVE reported fourth-quarter 2021 earnings per share of 43 cents, beating the Zacks Consensus Estimate of earnings of 41 cents. 

Cenovus Energy is expected to see earnings growth of 116.1% in 2022. CVE reported 2021 year-end proved reserves of 6.1 billion Boe, suggesting a year-over-year increase of 21%. As of Dec 31, 2021, the Canadian energy player had cash and cash equivalents of C$2,873 million.

Exxon Mobil Corporation XOM, based in Irving, TX, is one of the leading integrated energy companies in the world. XOM reported fourth-quarter 2021 earnings per share of $2.05 — excluding identified items — beating the Zacks Consensus Estimate of $1.96 per share.

ExxonMobil is expected to see an earnings growth of 27.3% in 2022. ExxonMobil has initiated share repurchases at the beginning of the March quarter of this year. The buybacks are associated with the repurchase plan announced earlier, representing the program of repurchasing up to $10 billion over the next 12-24 months.

Valero Energy Corporation VLO is the largest independent refiner and marketer of petroleum products in the United States. VLO reported fourth-quarter 2021 adjusted earnings of $2.47 per share, improving from a loss of $1.06 in the year-ago quarter.

Valero is expected to see an earnings growth of 152.7% in 2022. Among all the independent refiners, Valero offers the most diversified refinery base, with a capacity of 3.1 million barrels per day in its 15 refineries located throughout the United States, Canada and the Caribbean. VLO’s Refining segment was responsible for 81.7% of the total margin in 2021.

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