HF Sinclair Corporation

Welcome to HF Sinclair Corporation's second quarter 2024 conference call and webcast. Hosting the call today is Tim Goh, Chief Executive Officer, HF Sinclair. He is joined by Atanas Atanasoff, Chief Financial Officer, Steve Ledbetter, EVP of Commercial, Father Repompa, EVP of Operations, and Matt Joyce, SVP of Lubricants and Specialties. At this time, all participants have been placed in a listen-only mode and the floor will be open for your questions following the presentation. Would like to ask a question at that time, please press star one on your touchtone phone. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. If you should require operator assistance, please press star zero. We ask that you please limit yourself to one question and one follow-up. Additionally, we ask that you pick up your handset to allow optimal sound quality. Please note that this conference is being recorded. It is now my pleasure to turn the floor over to Craig Berry, Vice President Investor Relations. Craig, you may begin.

Thank you, Mark. Good morning, everyone, and welcome to HF Sinclair Corporation's second quarter earnings call. This morning, we issued a press release announcing results for the quarter ending June 30th, 2024. If you would like a copy of the earnings press release, you may find them on our website at hfsinclair.com. Before we proceed with remarks, please note the safe harbor disclosure statement in today's press release. In summary, it says statements made regarding management expectations, judgments, or predictions are forward-looking statements. These statements are intended to be covered under the safe harbor provisions of federal security laws. There are many factors that could cause results to differ from expectations, including those noted in our SEC filings. The call also may include discussion of non-GAAP measures. Please see the earnings press release for reconciliations to GAAP financial measures. Also, please note any time sensitive information provided on today's call may no longer be accurate at the time of any webcast replay or rereading of the transcript. And with that, I'll turn the call over to Tim.

Good morning, everyone. Our second quarter 2024 performance reflects continued progress on our commitment to deliver safe and reliable operations, resulting in higher utilization and lower operating costs per barrel in our refining business. In fact, We are seeing the benefits of our strategic initiatives across all of our businesses, including strong contributions from our lubricants and midstream business segments again this quarter. During the second quarter, we also returned $467 million in cash to shareholders, and today announced a 50 cent quarterly dividend, demonstrating our continued commitment to shareholder returns. Now, let me cover our segment highlights before turning over to Agnes. In refining for the second quarter of 2024, improved reliability efforts resulted in increased utilization rates and sales volumes versus the first quarter. The scheduled turnaround at our PARCO refinery was completed on time and on budget, marking another successful example of improved execution. Our operating expenses were $7.29 per throughput barrel for the second quarter, which represents significant progress towards our near-term target of $7.25. We continue to focus on improving safe and reliable operations and lowering operating expenses across the refinery fleet. In renewables, for the second quarter of 2024, I am pleased to report we achieved positive EBITDA through our team's optimization efforts. Despite continued weakness in RINs and LCFS credit prices, and the planned maintenance at our Parco Renewable Diesel facility. We are continuing to, one, reduce the level of high-cost inventories, two, increase our low-CI feedstock mix and pretreatment unit utilization rates, and three, lower our operating expenses through improved reliability. In marketing, in the second quarter of 2024, we continue to benefit from the margin uplift for our branded fuels and we grew our branded site count by 17 locations. Looking forward, we have signed new contracts to convert 150 stores to our branded wholesale sites, which translates into expected growth of approximately 10% over the next six to 12 months. In lubricants and specialties, our strong second quarter was largely driven by continued optimization in our sales mix, operational efficiency initiatives, and furthering our base oil integration efforts. We continue to see opportunities to organically grow the business by high grading our finished products portfolio, accelerating growth with strategic channel partnerships, and introducing new offerings that provide solutions to meet current and emerging market needs. In our midstream business, for the second quarter of 2024, we are realizing the value of our fully integrated assets post acquisition. We achieved record volumes for the period, and we believe we will continue to grow this business as we continue to optimize it with our refining and marketing segments. In the second quarter, we returned over $467 million to shareholders through share repurchases and dividends. Since March 2022, we have repurchased approximately 55 million shares, which represents two-thirds of the shares we issued for the Sinclair and HEP transactions. As of June 30, 2024, we have approximately $925 million outstanding on our share repurchase authorization, and we remain committed to our long-term cash return strategy and long-term payout ratio while maintaining a strong balance sheet and investment grade rating. Today, we also announced that our Board of Directors declared a regularly a regular quarterly dividend of 50 cents per share, payable on September 5th, 2024, to holders of record on August 21st, 2024. Looking forward, we remain focused on executing our corporate strategy as we strive to continue to, one, improve reliability, two, optimize and integrate our expanded portfolio, and three, generate strong cash flows to support our cash return strategy. With that, let me turn the call over to Ennis.