CVR Energy Reports 2015 First Quarter Results And Announces Cash Dividend of 50 Cents

SUGAR LAND, Texas, April 30, 2015 /PRNewswire/ -- CVR Energy, Inc. (NYSE: CVI) today announced first quarter 2015 net income of $54.9 million, or 63 cents per diluted share, on net sales of $1,388.9 million, compared to net income of $126.7 million, or $1.46 per diluted share, on net sales of $2,447.4 million for the 2014 first quarter.

First quarter 2015 adjusted EBITDA, a non-GAAP financial measure, was $163.7 million, compared to first quarter 2014 adjusted EBITDA of $154.1 million.

"CVR Energy's 2015 first quarter results reflect the solid financial and operational performance of our fertilizer and petroleum subsidiaries," said Jack Lipinski, CVR Energy's chief executive officer. "Group 3 refining margins gradually improved from the extreme lows of early January and peaked at the end of February. Margins leveled off in late March, but continue to be favorable.

"CVR Partners benefitted from strong customer demand for UAN and high on-stream rates at its fertilizer plant during the quarter," Lipinski said.

The company also announced a first quarter 2015 cash dividend of 50 cents per share. The dividend, as declared by CVR Energy's Board of Directors, will be paid on May 18, 2015, to stockholders of record on May 11, 2015.

Today, CVR Refining announced a 2015 first quarter cash distribution of 76 cents per common unit, and CVR Partners announced a 2015 first quarter cash distribution of 45 cents per common unit.

Petroleum Business

The petroleum business, which is operated by CVR Refining and includes the Coffeyville and Wynnewood refineries, reported first quarter 2015 operating income of $109.2 million on net sales of $1,304.4 million, compared to operating income of $164.6 million on net sales of $2,375.3 million in the first quarter of 2014.

Refining margin adjusted for FIFO impact per crude oil throughput barrel, a non-GAAP financial measure, was $15.03 in the 2015 first quarter, compared to $15.98 during the same period in 2014. Direct operating expenses per barrel sold, exclusive of depreciation and amortization, for the 2015 first quarter was $4.44, compared to $5.08 in the first quarter of 2014.

First quarter 2015 throughputs of crude oil and all other feedstocks and blendstocks totaled 215,023 barrels per day (bpd), compared to first quarter 2014 throughputs of crude oil and all other feedstocks and blendstocks of 214,056 bpd.

Nitrogen Fertilizers Business

The fertilizer business, operated by CVR Partners, reported first quarter 2015 operating income of $31.5 million on net sales of $93.1 million, compared to operating income of $23.1 million on net sales of $80.3 million for the first quarter of 2014.

For the first quarter of 2015, average realized gate prices for urea ammonium nitrate (UAN) and ammonia were $263 per ton and $553 per ton, respectively, compared to $253 per ton and $479 per ton, respectively, for the same period in 2014.

CVR Partners produced 96,000 tons of ammonia and purchased an additional 21,200 tons of ammonia during the first quarter of 2015, of which 14,600 net tons were available for sale while the rest was upgraded to 252,100 tons of UAN. In the 2014 first quarter, the plant produced 91,000 tons of ammonia and purchased an additional 22,900 tons of ammonia, of which 8,900 net tons were available for sale while the remainder was upgraded to 257,200 tons of UAN.

Cash and Debt

Consolidated cash and cash equivalents, which included $422.1 million for CVR Refining and $72.6 million for CVR Partners, was $852.2 million at March 31, 2015. Consolidated total debt was $674.6 million at March 31, 2015. The company had no debt exclusive of CVR Refining's and CVR Partners' debt.

First Quarter 2015 Earnings Conference Call

CVR Energy previously announced that it will host its first quarter 2015 Earnings Conference Call for analysts and investors on Thursday, April 30, at 3 p.m. Eastern.

The Earnings Conference Call will be broadcast live over the Internet athttp://www.videonewswire.com/event.asp?id=102100. For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8291.

For those unable to listen live, the Webcast will be archived and available for 14 days athttp://www.videonewswire.com/event.asp?id=102100. A repeat of the conference call can be accessed by dialing (877) 660-6853, conference ID 13606920.

Forward-Looking Statements

This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. You can generally identify forward-looking statements by our use of forward-looking terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "explore," "evaluate," "intend," "may," "might," "plan," "potential," "predict," "seek," "should," or "will," or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. For a discussion of risk factors which may affect our results, please see the risk factors and other disclosures included in our most recent Annual Report on Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q and our other SEC filings. These risks may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this press release are made only as of the date hereof. CVR Energy disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

About CVR Energy, Inc.

Headquartered in Sugar Land, Texas, CVR Energy is a diversified holding company primarily engaged in the petroleum refining and nitrogen fertilizer manufacturing industries through its holdings in two limited partnerships, CVR Refining, LP and CVR Partners, LP. CVR Energy subsidiaries serve as the general partner and own a majority of the common units representing limited partner interests of CVR Refining and CVR Partners.

For further information, please contact:

Investor Contact:Jay FinksCVR Energy, Inc.913-982-0481[email protected]

Media Relations:Angie DasbachCVR Energy, Inc. 281-207-3550[email protected]

Segment Information

Our operations are organized into two reportable segments, Petroleum and Nitrogen Fertilizer. Our operations that are not included in the Petroleum and Nitrogen Fertilizer segments are included in the Corporate and Other segment (along with elimination of intersegment transactions). The Petroleum segment is operated by CVR Refining, LP ("CVR Refining"), in which we own a majority interest as well as the general partner. The Petroleum segment includes the operations of the Coffeyville, Kansas and Wynnewood, Oklahoma refineries along with the crude oil gathering and pipeline systems. Detailed operating results for the Petroleum segment for the quarter ended March 31, 2015 are included in CVR Refining's press release dated April 30, 2015. The Nitrogen Fertilizer segment is operated by CVR Partners, LP, ("CVR Partners") in which we own a majority interest as well as the general partner. It consists of a nitrogen fertilizer manufacturing facility that utilizes a pet coke gasification process in producing nitrogen fertilizer. Detailed operating results for the Nitrogen Fertilizer segment for the quarter ended March 31, 2015 are included in CVR Partners' press release dated April 30, 2015.

Petroleum Segment Operating Data

The following tables set forth information about our consolidated Petroleum segment operated by CVR Refining, LP, of which we own a majority interest and serve as general partner, and the Coffeyville and Wynnewood refineries. Reconciliations of certain non-GAAP financial measures are provided under "Use of Non-GAAP Financial Measures" below. Additional discussion of operating results for the Petroleum segment for the quarter ended March 31, 2015 are included in CVR Refining's press release dated April 30, 2015.

Nitrogen Fertilizer Segment Operating Data

The following tables set forth information about the Nitrogen Fertilizer segment operated by CVR Partners, of which we own a majority interest and serve as general partner. Reconciliations of certain non-GAAP financial measures are provided under "Use of Non-GAAP Financial Measures" below. Additional discussion of operating results for the Nitrogen Fertilizer segment for the quarter ended March 31, 2015 are included in CVR Partners' press release dated April 30, 2015.

Cost of product sold, direct operating expenses and selling, general and administrative expenses are all reflected exclusive of depreciation and amortization.

* See Use of Non-GAAP Financial Measures below.

Use of Non-GAAP Financial Measures

To supplement the Company's actual results in accordance with GAAP for the applicable periods, the Company also uses non-GAAP financial measures as noted above which are reconciled to our GAAP-based results below. These non-GAAP financial measures should not be considered an alternative for GAAP results. The adjustments are provided to enhance an overall understanding of the Company's financial performance for the applicable periods and are indicators management believes are relevant and useful for planning and forecasting future periods.

Adjusted net income is not a recognized term under GAAP and should not be substituted for net income as a measure of our performance but rather should be utilized as a supplemental measure of financial performance in evaluating our business. Management believes that adjusted net income provides relevant and useful information that enables external users of our financial statements, such as industry analysts, investors, lenders and rating agencies, to better understand and evaluate our ongoing operating results and allow for greater transparency in the review of our overall financial, operational and economic performance. Adjusted net income per diluted share represents adjusted net income divided by weighted-average diluted shares outstanding.

Refining margin per crude oil throughput barrel is a measurement calculated as the difference between the Petroleum segment's net sales and cost of product sold (exclusive of depreciation and amortization). Refining margin is a non-GAAP measure that we believe is important to investors in evaluating the refineries' performance as a general indication of the amount above their cost of product sold at which they are able to sell refined products. Our calculation of refining margin may differ from similar calculations of other companies in the industry, thereby limiting its usefulness as a comparative measure. In order to derive the refining margin per crude oil throughput barrel, we utilize the total dollar figures for refining margin as derived above and divide by the applicable number of crude oil throughput barrels for the period. We believe that refining margin is important to enable investors to better understand and evaluate the Petroleum segment's ongoing operating results and allow for greater transparency in the review of our overall financial, operational and economic performance.

Refining margin per crude oil throughput barrel adjusted for FIFO impact is a measurement calculated as the difference between the Petroleum segment's net sales and cost of product sold (exclusive of depreciation and amortization) adjusted for FIFO impacts. Refining margin adjusted for FIFO impact is a non-GAAP measure that we believe is important to investors in evaluating the refineries' performance as a general indication of the amount above their cost of product sold (taking into account the impact of the utilization of FIFO) that they are able to sell refined products. Our calculation of refining margin adjusted for FIFO impact may differ from calculations of other companies in the industry, thereby limiting its usefulness as a comparative measure. Under the FIFO accounting method, changes in crude oil prices can cause fluctuations in the inventory valuation of crude oil, work in process and finished goods, thereby resulting in favorable FIFO impacts when crude oil prices increase and unfavorable FIFO impacts when crude oil prices decrease.

Gross profit is calculated as the difference between the Petroleum segment's net sales, cost of product sold (exclusive of depreciation and amortization), direct operating expenses (exclusive of depreciation and amortization), major scheduled turnaround expenses and depreciation and amortization. Gross profit per crude throughput barrel is calculated as gross profit as derived above divided by the refineries' crude oil throughput volumes for the respective periods presented. Gross profit is a non-GAAP measure that should not be substituted for operating income. Management believes it is important to investors in evaluating the refineries' performance and the Petroleum segment's ongoing operating results. Our calculation of gross profit may differ from similar calculations of other companies in the industry, thereby limiting its usefulness as a comparative measure.

EBITDA and Adjusted EBITDA. EBITDA represents net income before (i) interest expense and other financing costs, net of interest income, (ii) income tax expense and (iii) depreciation and amortization. Adjusted EBITDA represents EBITDA adjusted for (i) FIFO impacts (favorable) unfavorable, (ii) share-based compensation, (iii) loss on extinguishment of debt, (iv) major scheduled turnaround expenses, (v) (gain) loss on derivatives, net and (vi) current period settlements on derivative contracts. EBITDA and Adjusted EBITDA are not recognized terms under GAAP and should not be substituted for net income or cash flow from operations. Management believes that EBITDA and Adjusted EBITDA enable investors to better understand and evaluate our ongoing operating results and allow for greater transparency in reviewing our overall financial, operational and economic performance. EBITDA and Adjusted EBITDA presented by other companies may not be comparable to our presentation, since each company may define these terms differently. Below is a reconciliation of net income to EBITDA and EBITDA to Adjusted EBITDA for the three months ended March 31, 2015 and 2014:

Petroleum and Nitrogen Fertilizer EBITDA and Adjusted EBITDA. EBITDA by operating segment represents net income before (i) interest expense and other financing costs, net of interest income, (ii) income tax expense and (iii) depreciation and amortization. Adjusted EBITDA by operating segment represents EBITDA by operating segment adjusted for (i) FIFO impacts (favorable) unfavorable; (ii) share-based compensation, non-cash; (iii) loss of extinguishment of debt; (iv) major scheduled turnaround expenses; (v) (gain) loss on derivatives, net; and (vi) current period settlements on derivative contracts. We present Adjusted EBITDA by operating segment because it is the starting point for CVR Refining's and CVR Partners' calculation of available cash for distribution. Adjusted EBITDA by operating segment is not a recognized term under GAAP and should not be substituted for net income as a measure of performance. Management believes that Adjusted EBITDA by operating segment enables investors to better understand CVR Refining's and CVR Partners' ability to make distributions to their common unitholders, helps investors evaluate our ongoing operating results and allows for greater transparency in reviewing our overall financial, operational and economic performance. Adjusted EBITDA presented by other companies may not be comparable to our presentation, since each company may define these terms differently. Below is a reconciliation of net income to EBITDA and EBITDA to Adjusted EBITDA for the Petroleum and Nitrogen Fertilizer segments for the three months ended March 31, 2015 and 2014:

Derivatives Summary. The Petroleum segment enters into commodity swap contracts through crack spread swap agreements with financial counterparties to fix the spread risk between the refineries' crude oil purchases and the refined products the refineries produce for sale. Through these swaps, the Petroleum segment will sell a fixed differential for the value between the selected refined product benchmark and the benchmark crude oil price, thereby locking in a margin for a portion of the refineries' production. The physical volumes are not exchanged and these contracts are net settled with cash. From time to time, the Petroleum segment holds various NYMEX positions through a third-party clearing house.

The table below summarizes the Petroleum segment's open commodity swap positions as of March 31, 2015. The positions are primarily in the form of crack spread swap agreements with financial counterparties, wherein the Petroleum segment has locked in differentials at the fixed prices noted below. As of March 31, 2015, the open commodity swap positions below were comprised of approximately 65.1% for distillate crack swaps and 34.9% for gasoline crack swaps.

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SOURCE CVR Energy, Inc.