PBF Energy (PBF) Q3 Earnings Beat Estimates, Revenues Surge

PBF Energy Inc. (NYSE:PBF) recently posted third-quarter 2018 profit of $1.13 a share, beating the Zacks Consensus Estimate of $1.04. However, the bottom line declined from the year-ago quarter’s $1.44.

Total revenues grew to $7,646.4 million from $5,479 million in the prior-year quarter. The top line also surpassed the Zacks Consensus Estimate of $6,418 million as well.

Higher throughput volumes from the all the regions except the Gulf Coast primarily led to the better-than-expected results in the third quarter of 2018. The results were partially offset by the rise in per barrel refining operating expense and year-over-year lower gross refining margin from the Gulf Coast and West Coast regions.

Segmental Performance

Operating income at the Refining segment was $321.4 million, which fell from $609.3 million in the year-ago quarter due to lower throughput margins.

The company generated profit of $37.6 million from the Logistics segment, which is below the prior-year quarter’s $39.2 million.

Throughput Volumes

In the quarter under review, crude oil and feedstocks throughput volumes were 888.4 thousand barrels per day (BPD), up from 849.7 thousand BPD in the year-ago quarter. The figure also surpassed the Zacks Consensus Estimate of 872 thousand BPD.

The East Coast, Mid-Continent, Gulf Coast and West coast regions accounted for approximately 39.9%, 19.4%, 22% and 18.7%, respectively, of the total oil and feedstocks throughput volume.

Throughput Margins

Company-wide gross refining margin per barrel of throughput — excluding special items — was recorded at $9.25, beating the Zacks Consensus Estimate of $9.08. However, the figure was down from the year-earlier quarter’s $10.22.

Refining margin per barrel of throughput was $7.52 in the East Coast, up from $6.96 in the year-earlier quarter. The metric was $14.11 per barrel in the Mid-Continent, higher than $12.87 a year ago. Throughput margin realized was $7.21 per barrel in the Gulf Coast, down from $10.36 in the prior-year quarter. The metric was $10.28 per barrel in the West Coast, down from $14.81 in the prior-year quarter.

Refining operating expense per barrel of throughput was $5.01, higher than $4.98 in the year-ago quarter.

Capital Expenditure & Balance Sheet

Through the third quarter, the company spent $79.7 million capital on refining operations and $21 million for logistics businesses.

At the end of the quarter, the company had cash and cash equivalents of $1,059.2 million, along with total debt of $2,177.1 million, with a debt-to-capitalization ratio of 37%.

Guidance

PBF Energy projects total daily throughput volumes for fourth-quarter 2018 from the East Coast in the range of 330,000-350,000 barrels, while the same from the Mid-Continent is expected in the band of 145,000-155,000 barrels. Total daily throughput volumes at the Gulf Coast are expected in the range of 185,000-195,000 barrels, while that of the West Coast it is anticipated within 165,000-175,000 barrels.

For full-year 2018, the company anticipates total daily throughput volumes from the East Coast between 320,000 barrels and 340,000 barrels. The same from the Mid-Continent is expected at 145,000-155,000 barrels, while the Gulf Coast is expected to generate 185,000-195,000 barrels. The company expects total daily throughput volumes within 170,000-180,000 barrels in the West Coast.

Along with the earnings report, the company announced that it will restart its Chalmette refinery idled cocker of 12,000 BPD capacity. It expects the unit to come online by 2019-end and cost around $110 million. PBF Energy’s total coking capacity will increase to 42,000 BPD once the idled coker restarts.

Zacks Rank & Key Picks

Currently, Parsippany, NJ-based PBF Energy has a Zacks Rank #3 (Hold). Investors interested in the energy sector can opt for some better-ranked stocks given below:

Fort Worth, TX-based Range Resources Corporation (NYSE:RRC) holds a Zacks Rank #2 (Buy). The company’s earnings for 2018 are expected to surge more than 100% year over year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

El Dorado, AR-based Murphy Oil Corporation (NYSE:MUR) carries a Zacks Rank #2. The company’s sales for 2018 are expected to grow more than 20% from 2017.

Brazilian state-run Petroleo Brasileiro S.A. or Petrobras (NYSE:PBR) has a Zacks Rank #2. Its earnings for 2018 are expected to surge more than 100% from the 2017 level.

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