MOSCOW (MRC) -- Marathon Petroleum Corp authorized a USD5 B share buyback plan, in addition to its existing programs, after strong refining margins drove a stunning fourth-quarter profit and revenue beat, sending its shares up 5%, according to Hydrocarbonprocessing.
The Findlay, Ohio-based company said its refining and marketing margins more than doubled during the quarter amid a rebound in demand after a pandemic-induced slump.
Refining margins will be well positioned for 2022 as light product inventories remain tight, Chief Executive Officer Michael Hennigan said on a call.
Hennigan also expects to see recovery in jet fuel demand this year, even as it is "still roughly 15% below 2019 levels as business travel remains suppressed."
Marathon said it will spend USD1.7 B in 2022 and use 50% of USD1.3 B of the total investment to complete the conversion of its Martinez refinery into a renewable fuels facility.
Total project cost for Martinez is expected to be USD1.2 B.
The company posted an adjusted net income of USD794 MM, or USD1.30 per share, in the quarter ended Dec. 31, beating expectation of 56 cents per share, according to Refinitiv IBES.
"Stunning refining margin capture drives huge beat," said an analyst at Tudor, Pickering, Holt & Co.
Revenue of USD35.61 B came way ahead of analysts' average estimate of USD24.33 B.
Marathon's crude capacity utilization was 94%, resulting in a total throughput of 2.9 MMbpd in the reported quarter, compared with an 82% utilization and total throughput of 2.5 MMbpd a year earlier.
As MRC informed earlier, in May, 2021, US refiner Marathon Petroleum Corp said its board had approved the conversion of the Martinez refinery in California to a renewable diesel plant. Besides, the company made a final investment decision regarding this project. Martinez, once complete, will be one of the largest renewables facilities in the country.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.
Marathon Petroleum Corporation (MPC) is a leading, integrated, downstream energy company headquartered in Findlay, Ohio. The company operates the nation's largest refining system. MPC's marketing system includes branded locations across the United States, including Marathon brand retail outlets.
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