MOSCOW (MRC) -- HollyFrontier Corp posted a wider-than-expected quarterly loss on Wednesday, as the U.S. refiner faced heavy refining maintenance and weather-related downtime, sending its shares down as much as 8%, said Hydrocarbonprocessing.
Flooding in British Columbia, Canada, cut crude oil supplies to Puget Sound refinery and severe weather conditions and operating problems restricted output at processing plants in New Mexico and Oklahoma, HollyFrontier said last month.
Its refinery utilization in the reported quarter fell to 83.6%, from 93.8% in the previous year and total operating costs and expenses also rose nearly 88% to USD5.64 B. On an adjusted basis, the company posted a quarterly loss of 11 cents per share, slightly bigger than average analysts' expectation of 9 cents per share, according to Refinitiv IBES. For the current quarter, HollyFrontier expects to run between 490,000 and 510,000 bpd of crude.
The outlook reflects impact of weather-related downtime at Puget Sound refinery, a scheduled turnaround at the Woods Cross refinery, Utah, as well as maintenance activities at the Navajo refinery, New Mexico, throughout the first quarter. However, a sustained recovery in demand for fuel and refined products from the pandemic-driven lows helped narrow HollyFrontier's losses from the year-ago numbers.
Refinery gross margin for the 4Q of 2021 was USD8.70 per produced barrel, a 116% increase from the year-ago period. Throughput, or the amount of crude processed, rose 12% in the quarter to 462,740 bpd. "We believe that demand for transportation fuels will continue to strengthen as the global economy recovers from the pandemic," Chief Executive Officer Michael Jennings said on a conference call. The Dallas, Texas-based refiner said 4Q net loss attributable to stockholders narrowed to 24 cents per share, compared with a loss of 73 cents per share, a year earlier.
"Within refiners, we believe HFC is best positioned to grow earnings in the next year by adding Puget Sound, Sinclair assets and its renewable diesel projects," said Manav Gupta, analyst at Credit Suisse. Shares of HollyFrontier were trading 6.5% lower at USD32.20 in morning trade on the NYSE.
As per MRC, HollyFrontier Corporation has announced the completion of the previously announced acquisition of the Puget Sound Refinery, the on-site cogeneration facility and related logistics assets, from Equilon Enterprises LLC d/b/a Shell Oil Products US for aggregate cash consideration ofUSD613.6 mn, which consists of a base cash purchase price of USD350.0 mn, hydrocarbon inventory with an estimated closing value of approximately USD266.2 million and other closing adjustments and accrued liabilities of USD2.6 mn.
As reported MRC, Hollyfrontier and its pipeline partner will buy almost all of Sinclair Oil's assets in two deals totaling around USD2.6 billion, the companies said, adding new refining, pipeline and storage assets to their portfolio. The deals come as US fuel demand continues to recover from last year's coronavirus-led record lows, with states starting to reopen and road travel trending toward pre-pandemic levels.
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 US, 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 US, 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.
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