CVR Energy Inc.

Greetings, and welcome to the CVR Energy fourth quarter 2023 conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Richard Roberts, Vice President, Financial Planning and Analysis and Investor Relations. Thank you, sir. You may begin.

Thank you, Christine. Good afternoon, everyone. We very much appreciate you joining us this afternoon for our CVR Energy fourth quarter 2023 earnings call. With me today are Dave Lamp, our chief executive officer, Dane Newman, our chief financial officer, and other members of management. Prior to discussing our 2023 fourth quarter and four-year results, let me remind you that this conference call may contain forward-looking statements, as that term is defined under federal securities laws. For this purpose, any statements made during this call that are not statements of historical facts may be deemed to be forward-looking statements. You are cautioned that these statements may be affected by important factors set forth in our filing from the Securities and Exchange Commission and in our latest earnings release. As a result, actual operations or results may differ materially from the results discussed in the forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise, except to the extent required by law. This call also includes various non-GAAP financial measures. The disposures related to such non-GAAP measures, including reconciliation and the most directly comparable GAAP financial measures, are included in our 2023 fourth quarter earnings release that we filed with the SEC and form 10-K for the period and will be discussed during the call. With that said, I'll turn the call over to Dave.

Thank you, Richard. Good afternoon, everyone, and thank you for joining our earnings call. For the full year of 2023, we reported a consolidated net income of $878 million, earnings per share of $7.65, and EBITDA of $1.4 billion. At the segment level, we generated 1.2 billion of EBITDA in the petroleum segment and 281 million of EBITDA in the fertilizer segment. Fourth quarter consolidated income was 97 million, and earnings per share were 91 cents. EBITDA for the quarter was 204 million. Despite year-over-year declines in crack spreads and fertilizer prices in the fourth quarter, we posted another quarter of solid results driven by lower rent expenses, higher utilization of our assets, and reduced operating costs, mainly due to lower natural gas and electricity prices. We are pleased to announce that the Board of Directors has authorized a fourth quarter regular dividend of 50 cents per share, which will be paid on March 11th of 2024 to shareholders of record at the close of the market on March 4th. For the full year of 2023, the Board authorized regular and special dividends of $4.50 per share for a total payout ratio of approximately 64% of free cash flow generated for the year. In the petroleum segment, combined total throughput for the fourth quarter of 2023 was approximately 223,000 barrels per day of crude. Crude utilization for the quarter was approximately 97% of nameplate capacity, and electric product yield was 103 on crude oil processed. Benchmark cracks softened during the fourth quarter, with Group 211 averaging $23.66 per barrel. The bulk of the decrease from the third quarter came from the decline in distillate crack which was driven in part by increased inventories as the U.S. refining fleet ran hard through the winter. Rent prices declined from extremely elevated levels we have seen over the past few years, averaging $4.67 per barrel for the fourth quarter, although they are still too high. We were pleased with our favorable ruling from the Fifth Circuit Court of Appeals in November, holding that EPA's denial of the Winnie Wood refinery company's small refinery exemptions for 2017 through 2021 were permissively retroactive, contrary to the law, and arbitrary and capricious. The Fifth Circuit vacated those denials and remanded our small refinery exemptions back to EPA, which has yet to act. In addition to our lawsuits against EPA, we recently sent EPA a petition for rulemaking demanding they cure the violation of the renewable fuel standard, which we believe clearly requires that only obligated parties who over-comply with their RFS obligations can sell those excess RINs to other obligated parties. Instead, unlike every other credit program in EPA history, EPA allows anyone to buy, generate, and sell RINs including non-obligated parties who exploit the RIN market for profit. Allowing this activity harms not only small and merchant refiners, but also the American consumer, who by EPA's own admission, pay the ultimate cost of the RFS through higher prices at the pump. EPA has not responded yet to our petition, and if they don't, we will see them once again in court. For the fourth quarter of 2023, we processed approximately 18 million gallons of vegetable oil feedstock in our renewable diesel unit at Winniewood. The hobo spread improved from the third quarter, primarily due to declines in soybean oil prices. However, this was more than offset by the decline in D4 RID prices and a weaker basis for California diesel. In the fertilizer segment, both facilities ran well during the quarter, with a consolidated ammonia utilization of 94%. Relative to our prior year period, fertilizer prices were lower, primarily due to lower natural gas prices and the return of some European nitrogen facility production capacity that had been curtailed. Demand was strong for the fall ammonia application, and despite softening In grain prices, we believe farmer economics remain favorable at these fertilizer prices. Now, let me turn the call over to Dane to discuss our financial highlights.