HF Sinclair Earnings Climb as Refining Margins Expand
Second-quarter revenue rose 53% to $10.39 billion.
HF Sinclair (DINO), the petroleum refiner, more than tripled adjusted earnings to $5.31 a share as stronger margins lifted results across refining, renewables and specialty products.
The quarter preceded a significant reshaping of the company. HF Sinclair plans to separate Lubricants & Specialties into an independent publicly traded company within 12 to 18 months and retire its Mississauga base-oil refining assets, with the transition expected to be substantially completed during 2027.
Sales and other revenue increased from $6.78 billion a year earlier, while operating income rose 325% to $1.17 billion. Net income attributable to stockholders climbed to $892 million, or $4.93 a diluted share, from $208 million, or $1.10 a share. Adjusted EBITDA increased 123% to $1.48 billion.
Refining supplied the largest contribution, with adjusted EBITDA more than doubling to $1.02 billion. Adjusted refinery gross margin expanded 57% to $25.95 per produced barrel, while crude charge increased to 639,680 barrels a day. Mid-Continent utilization reached 104.8%, compared with 97.2% a year earlier.
Renewables swung to $123 million of adjusted EBITDA from a $2 million loss as adjusted gross margin widened to $2.46 per produced gallon from $0.36. Produced-product sales also increased to 59.9 million gallons. Marketing EBITDA edged up to $28 million as branded-fuel volumes rose about 15%, while margin held at $0.10 per gallon.
Lubricants & Specialties adjusted EBITDA climbed to $207 million from $55 million as volumes and prices increased, aided by a $46 million FIFO benefit that reversed a $20 million charge a year earlier. Midstream adjusted EBITDA remained at $112 million despite higher total pipeline and terminal volumes, as affiliate growth coincided with lower third-party refined-product pipeline and terminal volumes.
HF Sinclair returned $265 million to stockholders, including $179 million of share repurchases, and raised its quarterly dividend 5% to $0.525 a share. Cash increased to $2.26 billion at June 30 while debt held near $2.77 billion, leaving the company with additional liquidity as it prepared the specialty-products separation.