Alon USA Energy, Inc. Reports Third Quarter 2015 Results

Existing Logistics Assets

Assumed Utilization

Estimated Annual EBITDA

(dollars in thousands)

Alon USA Partners - Big Spring Refinery:

Wholesale marketing business

75,000 bpd

$

24,000

Crude and product storage*

2.56 MMBbls

9,000

Other assets (rail and truck racks, product rack, pipelines, salt wells, etc.)

4,000

Total Alon USA Partners Logistics EBITDA

$

37,000

Alon USA Energy - Krotz Springs Refinery:

Crude and product docks

64,000 bpd

$

17,000

Crude and product storage*

2.68 MMBbls

14,000

Other assets (truck rack, pipeline)

3,000

Total Krotz Springs Logistics EBITDA

$

34,000

*

Represents shell capacity.

ALON USA ENERGY, INC. AND SUBSIDIARIES CONSOLIDATED

EARNINGS RELEASE

RESULTS OF OPERATIONS - FINANCIAL DATA

(ALL INFORMATION IN THIS PRESS RELEASE EXCEPT FOR BALANCE SHEET DATA AS OF DECEMBER 31, 2014, IS UNAUDITED)

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands, except per share data)

STATEMENT OF OPERATIONS DATA:

Net sales (1)

$

1,151,204

$

1,850,097

$

3,555,785

$

5,276,225

Operating costs and expenses:

Cost of sales

914,193

1,608,080

2,878,612

4,695,072

Direct operating expenses

65,047

70,356

192,108

208,664

Selling, general and administrative expenses (2)

54,100

44,114

148,889

129,836

Depreciation and amortization (3)

31,033

32,170

94,262

91,501

Total operating costs and expenses

1,064,373

1,754,720

3,313,871

5,125,073

Gain (loss) on disposition of assets

23

(1,372)

595

745

Operating income

86,854

94,005

242,509

151,897

Interest expense

(20,696)

(28,202)

(59,950)

(85,473)

Equity earnings of investees

3,451

1,982

4,725

2,801

Other income, net

92

20

151

641

Income before income tax expense

69,701

67,805

187,435

69,866

Income tax expense

17,325

14,331

53,142

14,454

Net income

52,376

53,474

134,293

55,412

Net income attributable to non-controlling interest

10,440

14,992

29,008

23,662

Net income available to stockholders

$

41,936

$

38,482

$

105,285

$

31,750

Earnings per share, basic

$

0.60

$

0.56

$

1.51

$

0.46

Weighted average shares outstanding, basic (in thousands)

69,893

69,153

69,687

68,873

Earnings per share, diluted

$

0.58

$

0.55

$

1.46

$

Weighted average shares outstanding, diluted (in thousands)

72,526

69,556

72,281

69,261

Cash dividends per share

$

0.15

$

0.10

$

0.40

$

0.22

CASH FLOW DATA:

Net cash provided by (used in):

Operating activities

$

60,419

$

112,942

$

176,310

$

144,584

Investing activities

(44,353)

(43,746)

(78,298)

(84,753)

Financing activities

(41,032)

(72,779)

(74,109)

(90,762)

OTHER DATA:

Adjusted net income available to stockholders (4)

$

41,981

$

40,603

$

110,119

$

41,389

Adjusted earnings per share (4)

$

0.60

$

0.59

$

1.58

$

0.60

Adjusted EBITDA (5)

$

120,318

$

130,813

$

332,038

$

256,869

Capital expenditures (6)

26,211

19,141

57,262

73,796

Capital expenditures for turnarounds and catalysts

7,047

25,123

11,410

51,392

September 30, 2015

December 31, 2014

BALANCE SHEET DATA (end of period):

(dollars in thousands)

Cash and cash equivalents

$

238,864

$

214,961

Working capital

161,573

126,665

Total assets

2,220,029

2,200,874

Total debt

560,825

563,687

Total debt less cash and cash equivalents

321,961

348,726

Total equity

739,936

673,778

REFINING AND MARKETING SEGMENT

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands, except per barrel data and pricing statistics)

STATEMENT OF OPERATIONS DATA:

Net sales (7)

$

950,926

$

1,617,281

$

3,036,458

$

4,643,523

Operating costs and expenses:

Cost of sales

781,731

1,414,827

2,505,983

4,186,884

Direct operating expenses

58,162

60,086

170,454

178,362

Selling, general and administrative expenses

23,190

15,637

59,469

44,637

Depreciation and amortization

26,363

27,506

80,366

77,587

Total operating costs and expenses

889,446

1,518,056

2,816,272

4,487,470

Gain (loss) on disposition of assets

1

523

Operating income

$

61,481

$

98,028

$

220,709

$

154,797

KEY OPERATING STATISTICS:

Per barrel of throughput:

Refinery operating margin – Big Spring (8)

$

16.71

$

19.98

$

15.95

$

17.35

Refinery operating margin – Krotz Springs (8)

6.66

9.48

8.05

8.68

Refinery direct operating expense – Big Spring (9)

3.46

3.74

3.53

4.69

Refinery direct operating expense – Krotz Springs (9)

3.82

3.88

3.70

4.01

Capital expenditures

$

18,627

$

11,468

$

35,503

$

55,323

Capital expenditures for turnarounds and catalysts

7,047

25,123

11,410

51,392

PRICING STATISTICS:

Crack spreads (3/2/1) (per barrel):

Gulf Coast (10)

$

19.77

$

15.90

$

19.08

$

16.37

Crack spreads (2/1/1) (per barrel):

Gulf Coast high sulfur diesel (10)

$

12.57

$

11.07

$

12.05

$

11.43

WTI Cushing crude oil (per barrel)

$

46.41

$

97.55

$

50.91

$

99.74

Crude oil differentials (per barrel):

WTI Cushing less WTI Midland (11)

$

(0.72)

$

9.93

$

0.60

$

7.31

WTI Cushing less WTS (11)

(1.46)

8.14

0.02

6.58

LLS less WTI Cushing (11)

3.89

3.41

4.27

4.09

Brent less LLS (11)

(0.26)

1.72

0.30

4.43

Brent less WTI Cushing (11)

3.78

4.15

4.28

7.25

Product prices (dollars per gallon):

Gulf Coast unleaded gasoline

$

1.61

$

2.65

$

1.66

$

2.71

Gulf Coast ultra-low sulfur diesel

1.52

2.80

1.68

2.88

Gulf Coast high sulfur diesel

1.39

2.68

1.54

2.78

Natural gas (per MMBtu)

2.73

3.95

2.76

4.41

THROUGHPUT AND PRODUCTION DATA:

BIG SPRING REFINERY

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

bpd

%

bpd

%

bpd

%

bpd

%

Refinery throughput:

WTS crude

30,810

40.6

37,566

50.2

35,041

47.0

28,524

45.7

WTI crude

42,503

56.1

34,633

46.3

36,834

49.4

31,330

50.2

Blendstocks

2,484

3.3

2,639

3.5

2,687

3.6

2,528

4.1

Total refinery throughput (12)

75,797

100.0

74,838

100.0

74,562

100.0

62,382

100.0

Refinery production:

Gasoline

37,503

49.5

36,842

49.0

37,155

49.6

30,207

48.4

Diesel/jet

28,623

37.8

28,857

38.4

27,596

36.9

21,964

35.2

Asphalt

2,452

3.2

3,052

4.1

2,733

3.7

2,705

4.3

Petrochemicals

4,588

6.1

4,305

5.7

4,770

6.4

3,514

5.6

Other

2,595

3.4

2,078

2.8

2,510

3.4

4,030

6.5

Total refinery production (13)

75,761

100.0

75,134

100.0

74,764

100.0

62,420

100.0

Refinery utilization (14)

100.4

%

98.9

%

98.5

%

97.0

%

THROUGHPUT AND PRODUCTION DATA:

KROTZ SPRINGS REFINERY

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

bpd

%

bpd

%

bpd

%

bpd

%

Refinery throughput:

WTI crude

21,347

30.4

31,182

40.5

27,010

36.9

28,346

39.5

Gulf Coast sweet crude

43,338

61.7

44,473

57.8

41,838

57.1

42,139

58.8

Blendstocks

5,588

7.9

1,279

1.7

4,390

6.0

1,195

1.7

Total refinery throughput (12)

70,273

100.0

76,934

100.0

73,238

100.0

71,680

100.0

Refinery production:

Gasoline

32,802

45.7

35,532

45.2

34,274

45.8

33,459

45.7

Diesel/jet

29,943

41.8

34,246

43.6

31,041

41.5

31,292

42.8

Heavy Oils

1,299

1.8

1,421

1.8

1,337

1.8

1,129

1.5

Other

7,676

10.7

7,414

9.4

8,168

10.9

7,289

10.0

Total refinery production (13)

71,720

100.0

78,613

100.0

74,820

100.0

73,169

100.0

Refinery utilization (14)

87.4

%

102.2

%

93.0

%

95.2

%

ASPHALT SEGMENT

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands, except per ton data)

STATEMENT OF OPERATIONS DATA:

Net sales (15)

$

88,436

$

136,992

$

208,988

$

350,840

Operating costs and expenses:

Cost of sales (15) (16)

59,031

134,116

174,085

329,651

Direct operating expenses

6,885

10,270

21,654

30,302

Selling, general and administrative expenses

2,706

1,348

7,237

6,375

Depreciation and amortization

1,313

1,219

3,665

3,581

Total operating costs and expenses

69,935

146,953

206,641

369,909

Gain (loss) on disposition of assets

—

(136)

—

1,878

Operating income (loss) (19)

$

18,501

$

(10,097)

$

2,347

$

(17,191)

KEY OPERATING STATISTICS:

Blended asphalt sales volume (tons in thousands) (17)

174

186

347

412

Non-blended asphalt sales volume (tons in thousands) (18)

8

15

41

41

Blended asphalt sales price per ton (17)

$

494.45

$

587.31

$

496.63

$

571.15

Non-blended asphalt sales price per ton (18)

132.13

422.93

281.22

393.07

Asphalt margin per ton (19)

120.39

14.31

106.60

46.77

Capital expenditures

$

840

$

1,053

$

2,484

$

4,272

RETAIL SEGMENT

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands, except per gallon data)

STATEMENT OF OPERATIONS DATA:

Net sales (1)

$

208,856

$

249,120

$

591,475

$

723,027

Operating costs and expenses:

Cost of sales (16)

170,445

212,433

479,680

619,702

Selling, general and administrative expenses

28,024

26,951

81,651

78,296

Depreciation and amortization

3,024

2,847

9,004

8,544

Total operating costs and expenses

201,493

242,231

570,335

706,542

Gain (loss) on disposition of assets

22

(39)

72

124

Operating income

$

7,385

$

6,850

$

21,212

$

16,609

KEY OPERATING STATISTICS:

Number of stores (end of period) (20)

308

296

308

296

Retail fuel sales (thousands of gallons)

51,386

48,567

146,992

142,850

Retail fuel sales (thousands of gallons per site per month) (20)

59

57

57

56

Retail fuel margin (cents per gallon) (21)

21.7

20.8

21.8

19.5

Retail fuel sales price (dollars per gallon) (22)

$

2.38

$

3.38

$

2.34

$

3.37

Merchandise sales

$

86,567

$

84,794

$

247,547

$

241,311

Merchandise sales (per site per month) (20)

$

96

$

95

$

93

$

91

Merchandise margin (23)

31.4

%

31.2

%

32.1

%

31.1

%

Capital expenditures

$

5,365

$

5,872

$

14,883

$

12,094

(1)

Includes excise taxes on sales by the retail segment of $20,068 and $19,012 for the three months ended September 30, 2015 and 2014, respectively, and $57,493 and $55,923 for the nine months ended September 30, 2015 and 2014, respectively.

(2)

Includes corporate headquarters selling, general and administrative expenses of $180 and $178 for the three months ended September 30, 2015 and 2014, respectively, and $532 and $528 for the nine months ended September 30, 2015 and 2014, respectively, which are not allocated to our three operating segments.

(3)

Includes corporate depreciation and amortization of $333 and $598 for the three months ended September 30, 2015 and 2014, respectively, and $1,227 and $1,789 for the nine months ended September 30, 2015 and 2014, respectively, which are not allocated to our three operating segments.

(4)

The following table provides a reconciliation of net income available to stockholders under United States generally accepted accounting principles ("GAAP") to adjusted net income available to stockholders utilized in determining adjusted earnings per share, excluding after-tax write-off of original issuance discount, after-tax write-off of debt issuance costs, after-tax employee retention expense, after-tax (gain) loss on asphalt inventory adjustment, after-tax unrealized (gains) losses on commodity swaps and after-tax (gain) loss on disposition of assets. Adjusted net income available to stockholders is not a recognized measurement under GAAP; however, the amounts included in adjusted net income available to stockholders are derived from amounts included in our consolidated financial statements. Our management believes that the presentation of adjusted net income available to stockholders and adjusted earnings per share, excluding these items, is useful to investors because it provides a more meaningful measurement for evaluation of our Company's operating results.

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands)

Net income available to stockholders

$

41,936

$

38,482

$

105,285

$

31,750

Plus: Write-off of original issuance discount, net of tax

—

46

—

278

Plus: Write-off of debt issuance costs, net of tax

—

46

—

277

Plus: Employee retention expense, net of tax

6,417

7,060

Less: (Gain) loss on asphalt inventory adjustment, net of tax

(5,549)

—

4,558

—

Less: Unrealized (gains) losses on commodity swaps, net of tax

(806)

973

(6,364)

9,660

Less: (Gain) loss on disposition of assets, net of tax

(17)

1,056

(420)

(576)

Adjusted net income available to stockholders

$

41,981

$

40,603

$

110,119

$

41,389

Adjusted earnings per share *

$

0.60

$

0.59

$

1.58

$

0.60

*  Adjusted earnings per share includes the effects of dividends on preferred stock on adjusted net income   available to stockholders necessary to calculate earnings per share.

Adjusted EBITDA represents earnings before net income attributable to non-controlling interest, income tax expense, interest expense, depreciation and amortization, (gain) loss on disposition of assets and unrealized (gains) losses on commodity swaps. Adjusted EBITDA is not a recognized measurement under GAAP; however, the amounts included in Adjusted EBITDA are derived from amounts included in our consolidated financial statements. Our management believes that the presentation of Adjusted EBITDA is useful to investors because it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. In addition, our management believes that Adjusted EBITDA is useful in evaluating our operating performance compared to that of other companies in our industry because the calculation of Adjusted EBITDA generally eliminates the effects of net income attributable to non-controlling interest, income tax expense, interest expense, (gain) loss on disposition of assets, unrealized (gains) losses on commodity swaps and the accounting effects of capital expenditures and acquisitions, items that may vary for different companies for reasons unrelated to overall operating performance.

Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

• Adjusted EBITDA does not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

• Adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;

• Adjusted EBITDA does not reflect the prior claim that non-controlling interest have on the income generated by non-wholly-owned subsidiaries;

• Adjusted EBITDA does not reflect changes in or cash requirements for our working capital needs; and

• Our calculation of Adjusted EBITDA may differ from EBITDA calculations of other companies in our industry, limiting its usefulness as a comparative measure.

Because of these limitations, Adjusted EBITDA should not be considered a measure of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA only supplementally.

The following table reconciles net income available to stockholders to Adjusted EBITDA for the three and nine months ended September 30, 2015 and 2014:

For the Three Months Ended

For the Nine Months Ended

September 30,

September 30,

2015

2014

2015

2014

(dollars in thousands)

Net income available to stockholders

$

41,936

$

38,482

$

105,285

$

31,750

Net income attributable to non-controlling interest

10,440

14,992

29,008

23,662

Income tax expense

17,325

14,331

53,142

14,454

Interest expense

20,696

28,202

59,950

85,473

Depreciation and amortization

31,033

32,170

94,262

91,501

(Gain) loss on disposition of assets

(23)

1,372

(595)

(745)

Unrealized (gains) losses on commodity swaps

(1,089)

1,264

(9,014)

10,774

Adjusted EBITDA

$

120,318

$

130,813

$

332,038

$

256,869

Adjusted EBITDA does not exclude a (gain) loss of $(7,494) and $6,456 for the three and nine months ended September 30, 2015, respectively, resulting from a price adjustment related to asphalt inventory.

(6)

Includes corporate capital expenditures of $1,379 and $748 for the three months ended September 30, 2015 and 2014, respectively, and $4,392 and $2,107 for the nine months ended September 30, 2015 and 2014, respectively, which are not allocated to our three operating segments.

(7)

Net sales include intersegment sales to our asphalt and retail segments at prices which approximate wholesale market prices. These intersegment sales are eliminated through consolidation of our financial statements.

(8)

Refinery operating margin is a per barrel measurement calculated by dividing the margin between net sales and cost of sales (exclusive of substantial hedge positions and certain inventory adjustments) attributable to each refinery by the refinery's throughput volumes. Industry-wide refining results are driven and measured by the margins between refined product prices and the prices for crude oil, which are referred to as crack spreads. We compare our refinery operating margins to these crack spreads to assess our operating performance relative to other participants in our industry.

The refinery operating margin for the three and nine months ended September 30, 2015 excludes realized and unrealized gains on commodity swaps of $12,101 and $49,456, respectively. For the nine months ended September 30, 2015, $8,569 related substantially to inventory adjustments was not included in cost of sales for the Big Spring refinery and the Krotz Springs refinery.

The refinery operating margin for the three and nine months ended September 30, 2014 excludes realized and unrealized losses on commodity swaps of $1,264 and $9,891, respectively.

(9)

Refinery direct operating expense is a per barrel measurement calculated by dividing direct operating expenses at our refineries by the applicable refinery's total throughput volumes.

(10)

We compare our Big Spring refinery's operating margin to the Gulf Coast 3/2/1 crack spread. A Gulf Coast 3/2/1 crack spread is calculated assuming that three barrels of WTI Cushing crude oil are converted, or cracked, into two barrels of Gulf Coast conventional gasoline and one barrel of Gulf Coast ultra-low sulfur diesel.

We compare our Krotz Springs refinery's operating margin to the Gulf Coast 2/1/1 high sulfur diesel crack spread. A Gulf Coast 2/1/1 high sulfur diesel crack spread is calculated assuming that two barrels of LLS crude oil are converted into one barrel of Gulf Coast conventional gasoline and one barrel of Gulf Coast high sulfur diesel.

(11)

The WTI Cushing less WTI Midland spread represents the differential between the average price per barrel of WTI Cushing crude oil and the average price per barrel of WTI Midland crude oil. The WTI Cushing less WTS, or sweet/sour, spread represents the differential between the average price per barrel of WTI Cushing crude oil and the average price per barrel of WTS crude oil. The LLS less WTI Cushing spread represents the differential between the average price per barrel of LLS crude oil and the average price per barrel of WTI Cushing crude oil. The Brent less LLS spread represents the differential between the average price per barrel of Brent crude oil and the average price per barrel of LLS crude oil. The Brent less WTI Cushing spread represents the differential between the average price per barrel of Brent crude oil and the average price per barrel of WTI Cushing crude oil.

(12)

Total refinery throughput represents the total barrels per day of crude oil and blendstock inputs in the refinery production process.

(13)

Total refinery production represents the barrels per day of various products produced from processing crude and other refinery feedstocks through the crude units and other conversion units at the refineries.

(14)

Refinery utilization represents average daily crude oil throughput divided by crude oil capacity, excluding planned periods of downtime for maintenance and turnarounds.

(15)

Net sales and cost of sales include asphalt purchases sold as part of a supply and offtake arrangement of $1,344 and $21,409 for the three months ended September 30, 2015 and 2014, respectively, and $25,126 and $99,409 for the nine months ended September 30, 2015 and 2014, respectively. The volumes associated with these sales are excluded from the Key Operating Statistics.

(16)

Cost of sales includes intersegment purchases of asphalt blends and motor fuels from our refining and marketing segment at prices which approximate wholesale market prices. These intersegment purchases are eliminated through consolidation of our financial statements.

(17)

Blended asphalt represents base material asphalt that has been blended with other materials necessary to sell the asphalt as a finished product.

(18)

Non-blended asphalt represents base material asphalt and other components that require additional blending before being sold as a finished product.

(19)

Asphalt margin is a per ton measurement calculated by dividing the margin between net sales and cost of sales by the total sales volume. Asphalt margins are used in the asphalt industry to measure operating results related to asphalt sales.

Asphalt margin for the three and nine months ended September 30, 2015 excludes a (gain) loss of $(7,494) and $6,456, respectively, resulting from a price adjustment related to asphalt inventory. This (gain) loss is included in the operating income (loss) of the asphalt segment.

(20)

At September 30, 2015, we had 308 retail convenience stores of which 297 sold fuel. At September 30, 2014, we had 296 retail convenience stores of which 284 sold fuel.

The 14 stores acquired in mid-August 2015 have been included in the per site key operating statistics only for the period after acquisition.

(21)

Retail fuel margin represents the difference between retail fuel sales revenue and the net cost of purchased retail fuel, including transportation costs and associated excise taxes, expressed on a cents-per-gallon basis. Retail fuel margins are frequently used in the retail industry to measure operating results related to retail fuel sales.

(22)

Retail fuel sales price per gallon represents the average sales price for retail fuels sold through our retail convenience stores.

(23)

Merchandise margin represents the difference between merchandise sales revenues and the delivered cost of merchandise purchases, net of rebates and commissions, expressed as a percentage of merchandise sales revenues. Merchandise margins, also referred to as in-store margins, are commonly used in the retail industry to measure in-store, or non-fuel, operating results.

Contacts:

Stacey Hudson, Investor Relations Manager

Alon USA Energy, Inc.

972-367-3808

Investors: Jack Lascar/Stephanie Zhadkevich

Dennard - Lascar Associates, LLC

713-529-6600

Media: Blake LewisLewis Public Relations214-635-3020