HF Sinclair Corporation

HF Sinclair. He is joined by Agnes Atenasov, Chief Financial Officer, Steve Ledbetter, EVP of Commercial, Valerie Pompa, 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. If you would like to ask a question during that time, please press star and then one on your touch phone keypad. 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 limit your questions to one question and one follow-up. Additionally, we ask that you pick up your handset to allow optimal sound quality, and please note that this conference is being recorded. It is now my pleasure to turn the floor over to Craig Beery, Vice President, Investor Relations. Craig, you may now go ahead, please.

Thank you, Ellie. Good morning, everyone, and welcome to HF Sinclair Corporation's second quarter 2025 earnings call. This morning, we issued a press release announcing results for the quarter ending June 30, 2025. If you would like a copy of the earnings press release, you may find it 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. Thank you for joining our call. During the second quarter of 2025, we made strong progress against our strategic priorities to improve reliability, optimization, and integration. And I'm pleased to report we delivered sequential improvements over the last three quarters in our three key metrics, refining throughput, capture, and lower operating costs, allowing us to return $145 million to stockholders through dividend and share repurchases in the current period. Looking forward, we remain focused on advancing these priorities further, and with the majority of our turnarounds behind us in 2025, we believe we are well positioned to continue to execute our strategy and return excess cash to our shareholders. Now let me cover our segment highlights. In refining for the second quarter, we successfully completed the scheduled turnaround activities at our Tulsa and Parco refineries. We also delivered sequential quarter improvements in capture and crude throughput Despite heavy maintenance, weaker crude differentials, and a rising RIN price environment. In addition, we achieved operating expense per throughput barrel of $7.32, showing significant progress again towards our near-term goal of $7.25 per barrel. Looking ahead, we have one remaining turnaround at our Puget Sound refinery scheduled to begin at the end of the third quarter. In renewable, We continue to deliver near break-even EBITDA results in this tough economic environment as we continue to maximize our low CI feedstock mix while controlling our operating expenses. These results are indicative of how much we've improved our renewable diesel business, especially in light of the significant loss of BTC year over year. In the second quarter, we began to partially recognize some benefits from the producer's tax credit and expect to capture additional incremental PTC value in the third quarter. Our marketing segment delivered $25 million in EBITDA and achieved an adjusted gross margin of 10 cents per gallon delivered by optimizing our business since the Sinclair acquisition. We also grew our branded supplied stores by a net of 55 sites during the quarter and up a net 155 stores over the past 12 months both records for a quarter and for a trailing 12 month period. And we have over 80 additional supplied branded sites signed and targeted to bring online over the next six to 12 months. In lubricants and specialties, we reported $55 million in EBITDA, which includes a significant $20 million in FIFO headwinds due to falling feedstock prices. During the period, Sales volumes and product mix were impacted by our Mississauga turnaround. However, we continue to execute on our strategy of forward integrating our base oils into both finished and specialty businesses, most notably launching a Sinclair Lubricants product offering in the United States. In our midstream business, we delivered $112 million in adjusted EBITDA as we benefited from higher pipeline revenues and lower operating costs. from our focused integration efforts since the HEP buy-in. During the quarter, we returned $145 million in cash to shareholders consisting of 50 million in share repurchases and $95 million in regular dividends. Since the Sinclair acquisition in March 2022, we have returned over $4.2 billion in cash to shareholders and have reduced our share count by over 58 million shares. As of June 30th, 2025, we had approximately $750 million remaining on our share repurchase authorization. We remain committed to returning excess cash to shareholders while maintaining our investment grade balance sheet. Also today, we announced that our board of directors declared a regular quarterly dividend of 50 cents per share payable on September 4th, 2025 to holders of record on August 21st, 2025. Looking forward, we are encouraged by the continued strength in refining margins across our system, particularly in distillates. We believe our overall strategy is working and delivering visible organic growth to our bottom line, both in refining and our non-refining segments. And we remain committed to executing our strategic priorities in order to continue to return cash to our shareholders. With that, let me turn the call over to Ed.