PBF Energy (PBF) Misses Q4 EPS by $1.36

PBF Energy (NYSE: PBF) reported Q4 EPS of ($4.53), $1.36 worse than the analyst estimate of ($3.17). Revenue for the quarter came in at $3.66 billion versus the consensus estimate of $3.91 billion.

Strategic Update and Outlook:

During the fourth quarter, PBF Energy announced the operational reconfiguration of its East Coast Refining System comprised of its Delaware City and Paulsboro refineries. The completed reconfiguration resulted in the idling of the following units at the Paulsboro refinery: the smaller of two crude units, coker, fluid catalytic cracker and several smaller units. Expected annual operating and capital expenditures savings are approximately $100.0 million and $50.0 million, respectively, relative to average historic levels.

We realized a one-time working capital benefit as a result of overall lower inventory levels required to support continuing operations. We also incurred non-recurring expenses as a result of unit shutdowns and workforce reductions.

We successfully reduced our system-wide 2020 operating expenses by $235 million, excluding energy savings, and exceeded our full-year goal of $140 million in total operating expense reductions. Including energy, our full-year 2020 operating expense reductions totaled approximately $325 million. While some of these savings are a result of reduced operational tempo, the majority are deliberate operating and other expense reductions. Looking ahead, we expect operating expenses on a system-wide basis to be reduced by $200 to $225 million annually as a result of our efforts versus historic levels, including the East Coast Reconfiguration.

During 2020, we aggressively managed our capital expenditures, with total refining capital expenditures of approximately $370 million, an almost 50% reduction to our planned 2020 expenditures. Going forward, we expect refining capital expenditures to be approximately $150 million for the first six months of 2021 and we will remain flexible for the balance of the year depending on the progress of the refining environment.

Our refineries operated at reduced rates during the fourth quarter and, based on current market conditions, we anticipate operating our refineries at lower utilization until such time that sustained product demand justifies higher production. We expect near-term throughput to be in the 675,000 to 725,000 barrel per day range for our refining system.

For earnings history and earnings-related data on PBF Energy (PBF) click here.

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