Calumet, Inc

Good day. Thank you for standing by. Welcome to the second quarter 2022 Calumet Specialty Products Partners LP Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. Please be advised, today's conference is being recorded. I would now like to hand the conference over to your speaker today, Brad McMurray, Investor Relations. Please go ahead, sir.

Good morning. Thank you for joining us today for our second quarter 2022 earnings call. With me on today's call are Todd Boardman, CEO, Vince DiNargo, CFO, Bruce Fleming, EVP, Montana Renewables and Corporate Development, Scott Obermeyer, EVP Specialty Products and Solutions, Mark Lawn, EVP Performance Brands, and Steve Maher, our Executive Chairman. Before we proceed, I'll remind everyone that during this call, we may provide various forward-looking statements. Please refer to the partnerships press release that was issued this morning as well as our latest filings with the Securities and Exchange Commission for a list of factors that may affect our actual results and cause them to differ from expectations. You may now download the slides that accompany the remarks made on today's conference call, which can be accessed in the investor relations section of our website at www.calumetspecialty.com. Also, a webcast replay of this call will be available on our site within a few hours. With that, I'll pass the call to Todd. Todd?

Thanks, Brad. Good morning, all, and thank you for joining us today. This morning, we shared two announcements. First, we reported second quarter adjusted EBITDA of $175 million, which is a Calumet quarterly record. We also reported that we've concluded a set of transactions at Montana Renewables that placed the pre-commissioning enterprise value of $2.25 billion on MRL. These are game-changing accomplishments, and I thank our employees, customers, and investors for the effort, commitment, and faith you've demonstrated in Calumet. Honestly, A couple of short years ago, many didn't believe that Calumet would be sitting here today. And the grit and determination of our employees is the fundamental reason that we are. It's fun to see that type of commitment rewarded with phenomenal results. Before we dive into the quarter, let's flip to slide three and revisit our strategic plan to create and separate two independent leading businesses, our specialty products business and our renewable diesel business. As we highlight the quarter on slide four, I'll come at it through the lens of these two businesses. Let's start with specialty products. The second quarter demonstrates the upside power of our integrated specialty business. This business is unique, and it's been built one brick at a time over decades. We believe Calumet benefits from industry-leading flexibility and optionality, and we have an unparalleled ability to provide a full portfolio of specialty products across a wide array of world-class customers and in markets. Our brand names are well known. and they are built on years of specific technical interactions with our customers to meet their specific needs. Our replicable asset base provides the ability to meet these needs at scale, and they have demonstrated the flexibility required to succeed in all business cycles. In tough times, we have the ability to scale back volume and target our production towards specific market niches that are business cycle agnostic, which was demonstrated during COVID. In a strong market, like we're seeing now, we can run all out. with a focus on generating as much product as possible, including the fuels that are made as byproducts of our specialty manufacturing process. We've talked before about the competitive advantage of integration, and we estimate the value difference between running specialty feedstocks only and running our fully integrated system was worth more than $70 million in the second quarter. As you might expect in an integrated business, every product line and even business segment doesn't respond the same to changing market dynamics. Our specialty products and solutions segment benefited tremendously from both the favorable market demand and the team's commitment to commercial excellence, as specialty margins not only kept up with the commodity super cycle, but actually elevated to levels similar to the all-time highs seen late last year. Conversely, our retail business and the performance brand segment is seeing the effect of this market, as a rising material cost increase and the coinciding price increases are caught in a timing delay. Calumet as a whole is happy to make that trade, as we sell 20 times more base oil and gasoline molecules in our system than we consume in Royal Purple, Bellray, and TruFuel. So we're seeing the high cycle results that we'd expect, and in a low cycle, as we saw a couple years ago, we'll see the stickier pricing, higher margin side of our business carry a larger portion of the weight. We think this dynamic puts the floor under our business risk, and we believe the favorable misbalance of upside reward and downside risk protection is something that sets Calumet apart. Next, let's talk Montana renewables. Since our last earnings call, we've essentially completed the standing up of MRL. Production is expected within the next 60 to 70 days. Our renewable diesel and sustainable aviation fuel has been sold at commercial terms superior to what we expected in our financial models. Feed purchasing continues to progress. much better than anyone expected, and cars have been arriving throughout the quarter as our tanks fill. And this morning, we announced the two transactions that complete the capitalization of Montana Renewables. The transactions highlight a free startup MRL enterprise value of $2.25 billion, which demonstrates why MRL is so transformative for Calumet and our unit holders. The transaction supports our hypothesis that this is the leading independent renewable diesel project in North America. I'll come back to Montana Renewables later this morning. In the meantime, I'd like to hand the call over to Vince to discuss the quarter. Vince?