CVR Energy Inc.

Greetings, and welcome to the CBR Energy third quarter 2024 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, 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 Third Quarter 2024 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 2024 Third Quarter 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 for 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 disclosures related to such non-GAAP measures, including reconciliation of the most directly comparable GAAP financial measures, are included in our 2024 third quarter earnings release that we filed with the SEC and form 10Q for the period and will be discussed during the call. That said, I'll turn the call over to Dave.

Thank you, Richard. Good afternoon, everyone, and thank you for joining our earnings call. Yesterday, we reported third quarter consolidated net loss of $122 million. and a loss per share of $1.24. EBITDA was a loss of $35 million. Our results were impacted by unplanned downtime at both facilities during the quarter, partially due to external power supply outages, along with an unfavorable mark-to-market impact on our outstanding RFS obligation and negative inventory readout validation impacts due to the declining crude oil price. With the upcoming major turnaround planned at Coffeeville next year, maintaining adequate liquidity and a strong balance sheet is a primary focus as we navigate the currently challenging refining market. In light of this, the Board of Directors has elected to suspend the quarterly dividend as we look to preserve cash on the balance sheet. While this was a difficult decision, we believe it is an appropriate course of action given our near-term cash needs and the current forward strip for crack spreads into 2025. In our petroleum segment, combined total throughput for the third quarter of 2024 was approximately 189,000 barrels per day, and light product yield was 99% on crude oil process. We had a very difficult operational quarter with multiple plant interruptions, some which were related to or were the result of external power supply outages. Crude oil utilization for the quarter was 85% compared to our third quarter crude utilization rate of 95% over the past five years. We estimate lost profit opportunity was approximately $23 million in the third quarter. of which approximately 13 million was related to external power issues. Year-to-date total loss profit opportunity was approximately 73 million. Group 3-211 benchmark cracks averaged $19.40 per barrel for the third quarter of 2024 compared to $39.10 per barrel for the third quarter of last year. Average RIN prices for the third quarter of 2024 also declined from the prior year period and ended the quarter at approximately 74 cents on an RVO-weighted basis, although this was a 7% increase from last quarter. Regarding the RFS, the situation remains incomprehensible. No less than three federal courts, including the United States Supreme Court, have told EPA in no uncertain terms that small refinery hardship exemptions exist to protect small refiners who suffer disproportionate economic harm. Both the Fifth Circuit and the DC Circuits called EPA's denial of most hardship petitions arbitrary and capricious, vacating those denials and remanding them back to EPA. Incredibly, despite this express statutory obligation to rule on hardship petitions within 90 days, EPA has done nothing, even though almost a year has passed since the Fifth Circuit loss. EPA's egregious conduct has left pending petitioners hanging in limbo for years, and the financial impact of their actions threaten the very existence of small refineries like ours. That a US federal agency can be allowed to flagrantly and repeatedly violate the law without recourse shakes the very foundation of our government. No one is above the law, including EPA. So I call you out, Administrator Regan. EPA has broken the RFS, violated the law, persistently ignores very clear direction from the courts. This must stop now. For our part, we continue to seek relief in court not only to secure small refinery exemptions, the winning one deserves, but to force EPA to remedy the root cause of small refinery harm. EPA's decision to violate the RFS law allowing non-obligated parties to produce, buy, sell, trade, and hoard RINs, resulting in manipulation of the RIN market. For the third quarter of 2024, we approximately We processed approximately 20 million gallons of vegetable oil feedstocks through the renewable diesel unit at Winniewood. The hobo spread weakened slightly from the second quarter of 2024 with lower diesel prices, although this was offset by higher prices for D4 RINs and LCFS credits, which helped drive a positive result for the quarter. As a reminder, our renewable diesel business is currently reported in our corporate and other segments. In the fertilizer segment, both facilities ran well during the quarter with a consolidated ammonia utilization of 97%. Nitrogen fertilizer prices for the third quarter of 2024 increased relative to the third quarter of 2023, and we saw a strong demand for ammonia and UAN over the summer. Now let me turn the call over to Dave to discuss our financial highlights.