PBF Energy Inc.

Good day, everyone, and welcome to the PBF Energy second quarter 2020 earnings conference call-in webcast. At this time, all participants have been placed in a listen-only mode, and the floor will be open for your questions following management's prepared remarks. It is now my pleasure to turn the floor over to Colin Murray of Investor Relations. Sir, you may begin.

Thank you, Leah. Good morning and welcome to today's call. With me today are Tom Nimley, our CEO, Matt Lucey, our President, Eric Young, our CFO, and several other members of our management team. A copy of today's earnings release, including supplemental information, is available on our website. Before getting started, I'd like to direct your attention to the Safe Harbor Statement contained in today's press release. In summary, it outlines that statements contained in the press release and on this call which express the company's or management's expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions under federal securities laws. There are many factors which could cause actual results to differ from our expectations, including those we describe in our filings with the SEC. Consistent with our prior quarters, we will discuss our results excluding special items. Special items included in the second quarter 2020 results, which increased net income by a net after-tax benefit of $777 million, or $642 per share, consisted of a lower-of-cost-or-market LCM inventory adjustment, change in the fair value of the earn-out provision included primarily in connection with the Martinez acquisition, and a gain on sale of hydrogen plants. slightly offset by severance costs related to a reduction in workforce. As noted in our press release, we'll be using certain non-GAAP measures while describing PBS operating performance and financial results. For reconciliations of non-GAAP measures to the appropriate GAAP figure, please refer to the supplemental tables provided in today's press release. I'll now turn the call over to Tom.

Thanks, Colin. Good morning, everyone, and thank you for joining our call today. These are trying times in many respects, and we are all finding ways to cope with our current circumstances as individuals, families, and businesses. Like many others, PBF's focus has been on safety, operational and personal. We have established a pandemic response team that is establishing and overseeing safety procedures and workplace protocols for our sites. We continue to ask employees and contractors to perform daily health screenings at all of our locations and are restricting access to our facilities for those that have been exposed to COVID in order to prevent community spread. We are enforcing the CDC recommended 14-day quarantine period for all exposed employees, including those that have traveled to regions where there has been a resurgence. For those of us in the offices on a daily basis, we require masks where social distancing is not possible. We have guidelines for the overall number of people we are allowing in our office environments until we are able to safely bring all of our employees back to the office. I am proud of all of our employees and especially those that have been dedicated to keeping all of our facilities operating safely under trying circumstances and conditions. In addition to maintaining safe operations, our focus in Q2 was the balance sheet and increasing liquidity. The steps we took operationally and financially were taken with the goal in mind of preserving cash within our system. The entire energy landscape was rocked by the unprecedented demand losses due to the pandemic. Refinery utilization dropped to levels usually only seen during major hurricanes on the US Gulf Coast and yields were shifted in accordance with gasoline demand dropping much more than distillate. Crude oil production continued unabated, culminating with the lowest price ever recorded for crude oil in late April. Since then, the market has done a lot of work towards cleaning up inventory balances, but we still have a lot of work to do. Utilization rates will likely stay on the low end of the range until the product surplus can be absorbed. Gasoline balances look far better than distillate, but just as the crude market had a miraculous recovery over the past few months, so will oil products. During the quarter, we significantly reduced expenditures. We were very measured in deploying cash into the opportunities presented by the disruption in the marketplace. In hindsight, we may have been too conservative. However, deploying incremental cash into working capital, given the uncertainty we and society were facing and the demand destruction we were witnessing, would have reduced our overall liquidity. We have moved past the low point in demand for most products, but the market is still rebalancing. There is a significant amount of product in inventory and it will take time for demand to work through that. The market is currently given few signals to materially increase utilization rates. The term structure of all the relative values we are watching are saying that product inventories, or more importantly, distillate inventories, need to draw more before utilization rates will have incentives to materially increase. This rebalancing has happened quite quickly for gasoline and for crude. Distillate will take a bit more time. With that, I will turn the call over to Matt to provide an update on our operations during the quarter and the steps we are taking moving forward.