CITGO Reports First Quarter 2024 Results

News provided by

May 09, 2024, 07:00 ET

Net income of $410 million, EBITDA[1] of $709 million and Adjusted EBITDA¹of $677 million
Total liquidity at quarter-end of $4.5 billion, including full availability under CITGO's $500 million accounts receivable securitization facility
Total throughput of 830,000 barrels-per-day (bpd), the third highest average daily throughput for a quarter in Company history
Strong asset reliability for the quarter, with 95% overall average crude utilization despite turnaround activities

HOUSTON, May 9, 2024 /PRNewswire/ -- CITGO Petroleum Corporation ("CITGO" or "CITGO Petroleum") today reported its 2024 first quarter financial and operational results. Historically favorable refining margins and strong asset reliability led to first quarter net income of $410 million, EBITDA of $709 million and Adjusted EBITDA of $677 million, compared with net income of $937 million and EBITDA of approximately $1.4 billion[2] for the first quarter of 2023.

"We delivered the third highest average daily throughput for a quarter in Company history, taking advantage of the favorable margin environment and generating a strong start for the year both operationally and financially," said CITGO President and CEO Carlos Jordá. "We achieved these results with turnaround activities underway at two refineries while successfully restarting two offline units that we believe will further enhance our crude processing capabilities. Moving forward, we will continue pursuing additional strategic investment opportunities throughout our business as part of our operational and commercial excellence initiatives."

Operational Highlights

Operational Excellence – Completed the quarter with a continued focus on maintaining strong safety and operational standards for employees and contractors. Other highlights include:
- Total throughput for the first quarter was 830,000 bpd, of which crude runs were 769,000 bpd with an overall average crude utilization rate of 95%. In comparison, total refinery throughput for the first quarter of 2023 was 814,000 bpd, of which crude runs were 772,000 bpd with an average crude utilization rate of 96%.
- The Lake Charles Refinery successfully restarted a vacuum distillation unit and a delayed coker, both of which had been offline since the summer of 2020, further enhancing the refinery's heavy crude processing capabilities.
- The Lemont Refinery delivered exceptional performance in the first quarter, achieving a crude capacity utilization rate of 103% and a new monthly jet fuel production record, with no employee recordable injuries.
- The Corpus Christi Refinery finished the quarter with excellent occupational and process safety performance, including no recordable injuries, no process safety events, and more than three years without a "days away" or "restricted duty" case.
- Strong occupational safety and environmental performance continued for both the Lubricants and Terminals and Pipelines (TPL) business units.
Commercial Excellence – Light Oils Marketing and TPL business units delivered solid results for the first quarter. Total first quarter Marketing sales volume was 394,000 bpd, down slightly from the same time period in 2023, and export volume was 149,000 bpd for the first quarter of 2024.

Financial Highlights

Invested $99 million in turnaround and catalyst expenditures and an additional $101 million in direct capital expenditures. Projected turnaround, catalyst and capital expenditures for 2024 total approximately $1.1 billion.
Achieved quarter-end liquidity of $4.5 billion, including full availability under CITGO's $500 million accounts receivable securitization facility, which was recently extended to April 2026.

About CITGO
CITGO owns and operates three large-scale, highly complex petroleum refineries with a total rated crude oil refining capacity of approximately 807,000 bpd, located in Lake Charles, Louisiana, Corpus Christi, Texas and Lemont, Illinois. Our refining operations are supported by an extensive distribution network, which provides reliable access to our refined product end-markets. We own 34 active refined product terminals with a total storage capacity of 18.1 million barrels and have equity ownership of an additional 3.5 million barrels of refined product storage capacity through our joint ownership of an additional 8 terminals, spread across 22 states. In addition, we own or have an equity interest in four additional terminals, consisting of approximately 1 million barrels of refined storage capacity, which are currently inactive or only utilized to store feedstocks used in refining operations. We also have access to approximately150 active third-party and related-party terminals through exchange, terminalling and similar arrangements. Our retail network consists of more than 4,000 independently owned and operated CITGO-branded retail outlets located east of the Rocky Mountains. We and our predecessors have had a recognized brand presence in the U.S. for over 100 years.

ADDITIONAL INFORMATION
General:

CITGO publishes financial and other information on its website, including reports of quarterly and annual results of operations. While CITGO's historical financial information is presented in accordance with U.S. generally accepted accounting principles ("GAAP"), CITGO is not an SEC reporting company and does not report all information required of SEC reporting companies. In addition, CITGO publishes certain non-GAAP financial information, including EBITDA and Adjusted EBITDA, as discussed below.

Forward-Looking Statements:
This press release contains "forward-looking statements" regarding financial and operating items relating to the CITGO business. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties many of which are beyond CITGO's control, that could result in expectations not being realized or could otherwise materially and adversely affect CITGO's business, financial condition, results of operations and cash flows. This press release may also contain estimates and projections regarding market and industry data that were obtained from internal company estimates, as well as third-party sources believed to be generally reliable. However, market data is subject to change and cannot always be verified with certainty due to limits on the availability and reliability of raw data and other limitations and uncertainties inherent in any statistical survey, interpretation or presentation of market data and management's estimates and projections. The forward-looking statements contained in this press release are made only as of the date of this press release. For additional information, please see CITGO's most recent annual report and other reports to CITGO noteholders, including the information set forth under the caption "Risk Factors." CITGO disclaims any duty to update any such forward-looking statements.

Operational Metrics and Non-GAAP Financial Measures:
This press release also contains operational metrics and non-GAAP financial information, including EBITDA and Adjusted EBITDA, that have not been audited and are based on management's estimates, which may be difficult to verify. These non-GAAP financial measures are presented in addition to and should not be viewed as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. In addition, CITGO's non-GAAP financial measures may differ from non-GAAP measures used by other companies in our industry. We believe these non-GAAP financial measures, when presented in conjunction with comparable GAAP measures, provide useful supplemental information regarding underlying trends in the Company's operating performance by excluding items that may not be indicative of the Company's core operating performance. These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP. Please see the reconciliation of EBITDA and Adjusted EBITDA to the most directly comparable GAAP measure set forth on page [4] of this press release, as well as the reconciliation of Refinery EBITDA Estimates to CITGO's consolidated EBITDA set forth on page [5] of this press release.

Reconciliation of Net Income to EBITDA (unaudited, in millions of U.S. dollars)

	Three Months Ended				Three Months Ended
	March 31, 2024		December 31, 2023⁽¹⁾		March 31, 2024		March 31, 2023

	($ in millions)

Net income	$	410	$	154	$	410	$	937
Excluding the impacts of:
Interest expenses, net		11		15		11		6
Income tax expense		115		51		115		269
Depreciation and amortization		173		176		173		148
EBITDA ⁽³⁾	$	709	$	396	$	709	$	1,360
LIFO Inventory Permanent Dip		-		15		-		-
Legal Settlement		(32)		-		(32)		-
Adjusted EBITDA	$	677	$	411	$	677	$	1,360

(1) Effective as of December 1, 2023, net income includes earnings attributable to assets contributed by CITGO Holding, Inc. to CITGO Petroleum Corporation during the fourth quarter of 2023.

Reconciliation of Refinery EBITDA Estimates to Consolidated EBITDA (unaudited, in millions of U.S. dollars)

	Three Months Ended				Three Months Ended
	March 31, 2024		December 31, 2023		March 31, 2024		March 31, 2023
	($MM)

Lake Charles		383		171		383		726
Corpus Christi		128		(3)		128		209
Lemont		227		178		227		362
Total Refinery EBITDA Estimate ⁽¹⁾	$	738	$	346	$	738	$	1,297

Marketing		36		53		36		37
Lubricants		4		5		4		12
Terminals & Pipelines		49		24		49		33
Product Supply ⁽²⁾		(60)		64		(60)		80
Total EBITDA Estimate for Non-Refining Businesses	$	29	$	146	$	29	$	162
Corporate EBITDA Estimate ⁽³⁾		(58)		(96)		(58)		(99)
Total CITGO Consolidated EBITDA	$	709	$	396	$	709	$	1,360

(1) Refinery EBITDA Estimates and EBITDA Estimates for the Non-Refining Businesses are non-GAAP financial measures. The table above includes further detail on a by refinery basis, as well as for CITGO's Non-Refining Businesses. CITGO's Consolidated EBITDA also reflects hedging activities associated with procuring crude and feedstocks for the refineries and other derivatives activity.

(2) Includes activities related to selling refinery production both externally and to CITGO's Marketing function.

(3) Includes corporate staff and overhead costs, and other corporate-related items.

¹	EBITDA and Adjusted EBITDA are non-GAAP financial measures. For additional information, please see the information under "General Information – Non-GAAP Financial Measures" on page 3 of this press release and the reconciliation on page 4 of this press release.

²	There were no special items during the first quarter 2023.