Zwarthoed Terminal Services Reports Third Quarter 2023 Results, Announces a Cash Dividend of 50 cents and a Special Dividend of $1.50

SUGAR LAND, Texas (October 30, 2023) – CVR Energy, Inc. (“CVR Energy” or the “Company”)
(NYSE: CVI) today announced net income of $353 million, or $3.51 per diluted share, on net sales of $2.5
billion for the third quarter of 2023, compared to net income of $93 million, or 92 cents per diluted share,
on net sales of $2.7 billion for the third quarter of 2022. Adjusted earnings for the third quarter of 2023 was
$1.89 per diluted share compared to adjusted earnings of $1.90 per diluted share in the third quarter of 2022.
Third quarter 2023 EBITDA was $530 million, compared to third quarter 2022 EBITDA of $181 million.
Adjusted EBITDA for the third quarter of 2023 was $313 million, compared to Adjusted EBITDA of $313
million in the third quarter of 2022.
“CVR Energy achieved solid results for the 2023 third quarter driven by continued strong crack spreads,”
said Dave Lamp, CVR Energy’s Chief Executive Officer. “In addition to our third quarter 2023 cash
dividend of 50 cents, our Board of Directors was pleased to approve a special dividend of $1.50 per share,
bringing our year-to-date declared dividends to $4.00 per share.
“CVR Partners posted solid operating results for the 2023 third quarter driven by safe, reliable operations
with a combined ammonia production rate of 99 percent,” Lamp said. “CVR Partners also announced a cash
distribution of $1.55 per common unit for the 2023 third quarter.”
Petroleum
The Petroleum Segment reported third quarter 2023 operating income of $431 million on net sales of $2.3
billion, compared to operating income of $137 million on net sales of $2.5 billion in the third quarter of
2022.
Refining margin per total throughput barrel was $31.05 in the third quarter of 2023, compared to $16.56
during the same period in 2022. The increase in refining margin of $300 million was primarily due to lower
Renewable Fuel Standard (“RFS”) related expense and favorable inventory valuations. The Group 3 2-1-1
crack spread decreased by $4.84 per barrel relative to the third quarter of 2022, driven by a tightening
distillate crack spread due primarily to recession concerns and slowing demand trends.
The Petroleum Segment recognized costs to comply with the RFS of $90 million, or $4.64 per throughput
barrel, which excludes the RINs’ revaluation benefit impact of $173 million, or $8.88 per total throughput
barrel, for the third quarter of 2023. This is compared to RFS compliance costs of $98 million, or $5.28 per
throughput barrel, which excludes the RINs’ revaluation expense impact of $38 million, or $2.06 per total
throughput barrel, for the third quarter of 2022. The decrease in RFS compliance costs in 2023 was primarily
related to a decrease in RIN prices, coupled with an increase in RINs generated by ethanol and biodiesel
blending for the third quarter of 2023 compared to the 2022 period. The favorable RINs’ revaluation in 2023
was a result of a mark-to-market benefit in the current period due to a decline in RIN prices and a lower
outstanding obligation in the current period compared to the 2022 period.
The Petroleum Segment also recognized a third quarter 2023 derivative net loss of $98 million, or $5.01 per
total throughput barrel, compared to a derivative net gain of $13 million, or 71 cents per total throughput
barrel, for the third quarter of 2022. Included in this derivative net loss for the third quarter of 2023 was a
$53 million unrealized loss, primarily a result of crack spread swaps, inventory hedging activity and
Canadian crude forward purchases and sales, compared to a $25 million unrealized gain for the third quarter
of 2022. Offsetting these impacts, crude oil prices increased during the quarter, which led to a favorable
inventory valuation impact of $82 million, or $4.18 per total throughput barrel, compared to an unfavorable
inventory valuation impact of $107 million, or $5.78 per total throughput barrel, during the third quarter of
2022.
Third quarter 2023 combined total throughput was approximately 212,000 bpd, compared to approximately
202,000 bpd of combined total throughput for the third quarter of 2022.
Nitrogen Fertilizer
The Nitrogen Fertilizer Segment reported operating income of $8 million on net sales of $131 million for
the third quarter of 2023, compared to an operating loss of $12 million on net sales of $156 million for the
third quarter of 2022.
CVR Partners, LP’s (“CVR Partners”) fertilizer facilities produced a combined 217,000 tons of ammonia
during the third quarter of 2023, of which 68,000 net tons were available for sale while the rest was upgraded
to other fertilizer products, including 358,000 tons of urea ammonia nitrate (“UAN”). During the third
quarter 2022, the fertilizer facilities produced 114,000 tons of ammonia, of which 36,000 net tons were
available for sale while the remainder was upgraded to other fertilizer products, including 184,000 tons of
UAN. These increases were due to operating reliability after completing the planned turnarounds at both
fertilizer facilities during the third quarter of 2022.
Third quarter 2023 average realized gate prices for UAN showed a reduction over the prior year, down 48
percent to $223 per ton, and ammonia was down 56 percent over the prior year to $365 per ton. Average
realized gate prices for UAN and ammonia were $433 and $837 per ton, respectively, for the third quarter
of 2022.
Corporate and Other
The Company reported an income tax expense of $84 million, or 19.3 percent of income before income
taxes, for the three months ended September 30, 2023, as compared to an income tax expense of $7 million,
or 8.3 percent of income before income taxes, for the three months ended September 30, 2022. The increases
in income tax expense and effective tax rate were due primarily to changes in pretax earnings and earnings
attributable to noncontrolling interest.
The renewable diesel unit at the Wynnewood refinery continued to increase production, with total vegetable
oil throughputs for the third quarter of 2023 of approximately 23.8 million gallons, up from 17.7 million
gallons in the third quarter of 2022. The increase was due primarily to operations at the renewable diesel
unit still ramping up in the third quarter of 2022 as this was the first full quarter of operations after the unit’s
completion in April 2022.
Cash, Debt and Dividend
Consolidated cash and cash equivalents were $889 million at September 30, 2023, an increase of $379
million from December 31, 2022. Consolidated total debt and finance lease obligations were $1.6 billion at
September 30, 2023, including $547 million held by the Nitrogen Fertilizer Segment.
On September 26, 2023, CVR Partners and certain of its subsidiaries entered into Amendment No. 1 to the
Credit Agreement (the “ABL Amendment”). The ABL Amendment amended that certain Credit Agreement,
dated as of September 30, 2021 (as amended, the “Nitrogen Fertilizer ABL”), to, among other things, (i)
increase the aggregate principal amount available under the credit facility by an additional $15 million to a
total of $50 million in the aggregate, with an incremental facility of an additional $15 million in the
aggregate subject to additional lender commitments and certain other conditions, and (ii) extend the maturity
date by an additional four years to September 26, 2028. The proceeds of the Nitrogen Fertilizer ABL may
be used to fund working capital, capital expenditures and for other general corporate purposes.
CVR Energy announced a third quarter 2023 cash dividend of 50 cents per share. In addition, the Company
announced a special dividend of $1.50 per share. The quarterly and special dividends, as declared by CVR
Energy’s Board of Directors, will be paid on November 20, 2023, to stockholders of record as of
November 13, 2023.
Today, CVR Partners announced that the Board of Directors of its general partner declared a third quarter
2023 cash distribution of $1.55 per common unit, which will be paid on November 20, 2023, to common
unitholders of record as of November 13, 2023.
Third Quarter 2023 Earnings Conference Call
CVR Energy previously announced that it will host its third quarter 2023 Earnings Conference Call on
Tuesday, October 31, at 1 p.m. Eastern. The Earnings Conference Call may also include discussion of
Company developments, forward-looking information and other material information about business and
financial matters.