HollyFrontier Corporation reported net loss attributable to HollyFrontier stockholders of US$222.2 million or US$(1.13) per diluted share for the quarter ended 31 December 2014, compared to net income of US$62.9 million or US$0.31 per diluted share for the quarter ended 31 December 2013. Included in the current quarter results was a non-cash lower of cost or market inventory valuation adjustment that generated an after tax charge of US$244.0 million or US$1.25 per share.
Excluding this non-cash charge, refinery gross margins were US$10.76 per produced barrel, a 2% decrease compared to US$10.96 for 4Q13. Production levels averaged approximately 374 000 bpd and crude oil charges averaged approximately 361 000 bpd for the current quarter. Total operating expenses for the quarter were US$318.4 million with refinery operating expenses averaging US$7.29 per produced barrel sold compared to US$291.9 million or $6.41 per barrel for 4Q13. The 4Q14 operating results also included charges of US$27.0 million attributable to increased environmental accruals and US$20.0 million in asset write downs.
HollyFrontier's President & CEO, Mike Jennings, said: "For 2014, we reported full year refinery utilisation of 91.7%, a 5% improvement versus 2013 as we began to see the benefits from our risk management, reliability and process safety efforts. Improved operational performance helped offset the impact of compressing Brent/WTI spreads, which averaged US$6.70 in 2014 compared to US$10.61 in 2013. We believe new inbound pipeline capacity, storage economics and refinery maintenance activity will continue to drive Cushing inventories higher and create wider inland crude spreads during 2015. After reaching parity in early 2015, the Brent/WTI crude differential has recently widened to more than US$9.00/bbl. We believe we are well positioned to reap the benefits from widening crude spreads given our advantaged geographic location close to inland crude production, improving reliability and throughput, and limited amount of planned maintenance scheduled for 2015. During 2014, we returned approximately US$783.0 million to shareholders, or nearly US$4.00 per share, in the form of regular and special dividends and stock repurchases."
In 4Q14, net cash used for operations totalled US$47.3 million. During the period, the company declared US$0.32 regular and US$0.50 special dividends to shareholders totalling approximately US$161.0 million. At 31 December 2014, combined balance of cash and short term investments totalled US$1.0 billion and consolidated debt was US$1.1 billion. Debt, exclusive of Holly Energy Partners' debt, which is nonrecourse to HollyFrontier, was US$187.3 million at 31 December 2014. There were no cash borrowings or outstanding principal under the credit facility during the quarter.
Adapted from press release by Rosalie Starling
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