HF Sinclair 8-K Holly Corporation Reports Record Quarterly Results

Exhibit 99.1

For Immediate Release

HOLLY CORPORATION REPORTS RECORD QUARTERLY RESULTS

HOLLY CORPORATION ANNOUNCES $100 MILLION INCREASE IN STOCK
REPURCHASE PROGRAM

     Dallas, Texas, August 9, 2007 — Holly Corporation (NYSE-HOC) (“Holly” or the “Company”) today reported quarterly net income of $158.6 million ($2.89 per basic and $2.84 per diluted share) for the three months ended June 30, 2007, compared to net income of $93.1 million ($1.62 per basic and $1.60 per diluted share) for the three months ended June 30, 2006. Our second quarter 2007 net income was the highest quarterly net income in our Company’s history. Income from continuing operations was $158.6 million ($2.89 per basic and $2.84 per diluted share) for the three months ended June 30, 2007, compared to income from continuing operations of $87.7 million ($1.53 per basic and $1.51 per diluted share) for the three months ended June 30, 2006. Net income was $226.2 million ($4.11 per basic and $4.03 per diluted share) for the six months ended June 30, 2007, compared to net income of $139.9 million ($2.42 per basic and $2.37 per diluted share) for the six months ended June 30, 2006. Income from continuing operations was $226.2 million ($4.11 per basic and $4.03 per diluted share) for the six months ended June 30, 2007, compared to income from continuing operations of $118.9 million ($2.06 per basic and $2.01 per diluted share) for the six months ended June 30, 2006.

     The Board of Directors has authorized a $100.0 million increase in our current common stock repurchase program. Before this increase, we had $50.0 million remaining under the repurchase program announced in November 2005 and increased to $300.0 million in October 2006. Repurchases under the expanded program will be made from time to time in the open market or privately negotiated transactions based on market conditions, securities law limitations and other factors.

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     On March 31, 2006 we sold our petroleum refinery in Great Falls, Montana (the “Montana Refinery”) to a subsidiary of Connacher Oil and Gas Limited. Accordingly, the results of operations of the Montana Refinery and a net gain of $14.0 million are shown in discontinued operations for the three and six months ended June 30, 2006.

     Income from continuing operations increased $70.9 million for the three months ended June 30, 2007, an increase of 81%, as compared to the three months ended June 30, 2006, and increased $107.3 million for the six months ended June 30, 2007, an increase of 90%, as compared to the six months ended June 30, 2006, principally due to improved refined product margins experienced in the current year and an increase in volumes of produced refined products sold. These favorable factors were partially offset by the effects of higher operating and general and administrative expenses for the three months ended June 30, 2007 and higher depreciation, depletion and amortization and general and administrative expenses for the six months ended June 30, 2007. Overall sales of produced refined products from continuing operations increased by 25% for the three months ended June 30, 2007 and 17% for the six months ended June 30, 2007 as compared to the three and six months ended June 30, 2006, respectively. Overall refinery gross margins from continuing operations were $28.36 per produced barrel for the three months ended June 30, 2007, as compared to $22.37 per produced barrel for the three months ended June 30, 2006, and $22.35 per produced barrel for the six months ended June 30, 2007, as compared to $16.95 for the six months ended June 30, 2006.

     The large increase in volume of produced refined products sold is attributable to increased production levels for the three and six months ended June 30, 2007, as compared to the same periods in 2006. Our production levels were lower for the three and six months ended June 30, 2006 due to planned downtime at our Navajo and Woods Cross Refineries during the second quarter of 2006. Diesel fuel produced at both of our refineries was required to meet certain nationwide ultra low sulfur diesel fuel (“ULSD”) requirements as of June 30, 2006. To meet this requirement, we completed certain ULSD projects at both refineries during the second quarter of 2006. In conjunction with these ULSD projects, we timed other refinery maintenance projects and an expansion of our Navajo Refinery. Downtime incurred from these capital projects was the principal factor in our reduced production levels during the three and six months ended June 30, 2006. Also contributing to our production increase for the three and six months ended June 30, 2007

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is an increase in production levels following our 8,000 BPSD Navajo Refinery expansion in mid-year 2006.

     Sales and other revenues from continuing operations increased 9% for the three months ended June 30, 2007 and 12% for the six months ended June 30, 2007, as compared to the three and six months ended June 30, 2006, respectively, due principally to higher refined product sales prices and an increase in volumes of produced refined products sold. For the three months ended June 30, 2007, cost of products sold decreased by 1%, as compared to the three months ended June 30, 2006 due principally to a per unit decrease in the cost of produced refined products sold, partially offset by an increase in volumes of produced refined products sold. For the six months ended June 30, 2007, cost of products sold increased by 4%, as compared to the six months ended June 30, 2006, due principally to an increase in volumes of produced refined products sold, partially offset by a per unit decrease in the cost of produced refined products sold. For the three months ended June 30, 2007, operating expenses, exclusive of depreciation, depletion and amortization, increased principally due to higher utility costs, as compared to the three months ended June 30, 2006. For the three and six months ended June 30, 2007, general and administrative expenses increased principally due to increased equity-based incentive compensation expense and software implementation costs, as compared to the same periods in 2006. The increase in equity-based compensation expense was due to an increase in our stock price.

     “Strong industry-wide refinery margins coupled with record production levels resulted in our best ever quarterly results. Our Southwest and Rocky Mountain markets provided particularly strong gasoline and diesel fuel crack spreads during the second quarter of 2007. Expanded use of lower priced black wax crudes at our Woods Cross Refinery and a widening of discounts to WTI for the sour crudes processed in our Navajo Refinery also contributed to improved results. For the second quarter of 2007, we generated earnings before interest, taxes and depreciation (“EBITDA”) of $252.1 million, a 72% increase over the $146.4 million of EBITDA for the second quarter of 2006.”

     “Strong financial performances during the first six months of 2007 allowed us to expend $72.5 million under our capital expansion programs and $43.0 million for the purchase of

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common stock under our stock repurchase program while increasing our cash and investments in marketable securities by $155.3 million to $411.3 million. With continued confidence in industry fundamentals and our strong financial position, our Board of Directors has authorized a $100.0 million increase to our current stock repurchase program. We believe the combination of our previously announced feedstock flexibility and capacity expansion capital programs with an expanded stock repurchase program will continue to add shareholder value in a prudent manner” said Matthew Clifton, Chairman of the Board and Chief Executive Officer of Holly.

     The Company has scheduled a conference call for today, August 9, 2007 at 10:00AM EDT to discuss financial results. Listeners may access this call by dialing (888) 548-4639. The ID# for this call is 10413372. Listeners may access the call via the internet at:http://www.videonewswire.com/event.asp?id=41254. Additionally, listeners may replay this call approximately two hours after the call concludes by dialing (800) 642-1687. This audio archive will be available for two weeks.

     Holly Corporation, headquartered in Dallas, Texas, is an independent petroleum refiner and marketer that produces high value light products such as gasoline, diesel fuel and jet fuel. Holly operates through its subsidiaries an 83,000 barrels per stream day (“bpsd”) refinery located in New Mexico and a 26,000 bpsd refinery in Utah. Holly also owns a 45% interest (including the general partner interest) in Holly Energy Partners, L.P., which through subsidiaries owns or leases approximately 1,700 miles of petroleum product pipelines in Texas, New Mexico and Oklahoma and refined product terminals in several Southwest and Rocky Mountain states.

     The following is a “safe harbor” statement under the Private Securities Litigation Reform Act of 1995: The statements in this press release relating to matters that are not historical facts are “forward-looking statements” based on management’s beliefs and assumptions using currently available information and expectations as of the date hereof, are not guarantees of future performance and involve certain risks and uncertainties, including those contained in our filings with the Securities and Exchange Commission. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that our expectations will prove correct. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements. Such differences could be caused

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by a number of factors including, but not limited to, risks and uncertainties with respect to the actions of actual or potential competitive suppliers of refined petroleum products in the Company’s markets, the demand for and supply of crude oil and refined products, the spread between market prices for refined products and market prices for crude oil, the possibility of constraints on the transportation of refined products, the possibility of inefficiencies, curtailments or shutdowns in refinery operations or pipelines, effects of governmental regulations and policies, the availability and cost of financing to the Company, the effectiveness of the Company’s capital investments and marketing strategies, the ability of the Company to acquire refined product operations or pipeline and terminal operations on acceptable terms and to integrate any future acquired operations, the Company’s efficiency in carrying out construction projects, the possibility of terrorist attacks and the consequences of any such attacks, general economic conditions, and other financial, operational and legal risks and uncertainties detailed from time to time in the Company’s Securities and Exchange Commission filings. The forward-looking statements speak only as of the date made and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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RESULTS OF OPERATIONS

Financial Data (all information in this release is unaudited)

	Three Months Ended
	June 30,						Change from 2006
	2007			2006			Change			Percent
	(In thousands, except per share data)
Sales and other revenues	$	1,216,997		$	1,120,840		$	96,157			8.6	%
Operating costs and expenses:
Cost of products sold (exclusive of depreciation, depletion and amortization)		897,237			908,009			(10,772	)		(1.2	)
Operating expenses (exclusive of depreciation, depletion and amortization)		51,116			49,092			2,024			4.1
General and administrative expenses (exclusive of depreciation, depletion and amortization)		21,348			18,731			2,617			14.0
Depreciation, depletion and amortization		10,641			10,683			(42	)		(0.4	)
Exploration expenses, including dry holes		105			100			5			5.0
Total operating costs and expenses		980,447			986,615			(6,168	)		(0.6	)
Income from operations		236,550			134,225			102,325			76.2
Other income (expense):
Equity in earnings of HEP		4,954			1,516			3,438			226.8
Interest income		3,550			2,408			1,142			47.4
Interest expense		(291	)		(272	)		(19	)		7.0
		8,213			3,652			4,561			124.9
Income from continuing operations before income taxes		244,763			137,877			106,886			77.5
Income tax provision		86,136			50,148			35,988			71.8
Income from continuing operations		158,627			87,729			70,898			80.8
Income from discontinued operations, net of taxes		—			5,372			(5,372	)		(100.0	)
Net income	$	158,627		$	93,101		$	65,526			70.4	%
Basic earnings per share:
Continuing operations	$	2.89		$	1.53		$	1.36			88.9	%
Discontinued operations		—			0.09			(0.09	)		(100.0	)
Net income	$	2.89		$	1.62		$	1.27			78.4	%
Diluted earnings per share:
Continuing operations	$	2.84		$	1.51		$	1.33			88.1	%
Discontinued operations		—			0.09			(0.09	)		(100.0	)
Net income	$	2.84		$	1.60		$	1.24			77.5	%
Cash dividends declared per common share	$	0.12		$	0.08		$	0.04			50.0	%
Average number of common shares outstanding:
Basic		54,959			57,186			(2,227	)		(3.9	)%
Diluted		55,953			58,363			(2,410	)		(4.1	)%

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	Six Months Ended
	June 30,						Change from 2006
	2007			2006			Change			Percent
	(In thousands, except per share data)
Sales and other revenues	$	2,142,864		$	1,912,434		$	230,430			12.0	%
Operating costs and expenses:
Cost of products sold (exclusive of depreciation, depletion and amortization)		1,648,951			1,583,494			65,457			4.1
Operating expenses (exclusive of depreciation, depletion and amortization)		101,245			101,559			(314	)		(0.3	)
General and administrative expenses (exclusive of depreciation, depletion and amortization)		37,195			32,247			4,948			15.3
Depreciation, depletion and amortization		22,092			18,707			3,385			18.1
Exploration expenses, including dry holes		257			227			30			13.2
Total operating costs and expenses		1,809,740			1,736,234			73,506			4.2
Income from operations		333,124			176,200			156,924			89.1
Other income (expense):
Equity in earnings of HEP		8,300			4,728			3,572			75.6
Interest income		6,110			4,143			1,967			47.5
Interest expense		(543	)		(547	)		4			(0.7	)
		13,867			8,324			5,543			66.6
Income from continuing operations before income taxes		346,991			184,524			162,467			88.0
Income tax provision		120,822			65,635			55,187			84.1
Income from continuing operations		226,169			118,889			107,280			90.2
Income from discontinued operations, net of taxes		—			21,016			(21,016	)		(100.0	)
Net income	$	226,169		$	139,905		$	86,264			61.7	%
Basic earnings per share:
Continuing operations	$	4.11		$	2.06		$	2.05			99.5	%
Discontinued operations		—			0.36			(0.36	)		(100.0	)
Net income	$	4.11		$	2.42		$	1.69			69.8	%
Diluted earnings per share:
Continuing operations	$	4.03		$	2.01		$	2.02			100.5	%
Discontinued operations		—			0.36			(0.36	)		(100.0	)
Net income	$	4.03		$	2.37		$	1.66			70.0	%
Cash dividends declared per common share	$	0.22		$	0.13		$	0.09			69.2	%
Average number of common shares outstanding:
Basic		55,073			57,819			(2,746	)		(4.7	)%
Diluted		56,079			59,072			(2,993	)		(5.1	)%

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Balance Sheet Data (Unaudited)

	June 30,		December 31,
	2007		2006
	(In thousands)
Cash, cash equivalents and investments in marketable securities	$	411,286	$	255,953
Working capital	$	321,259	$	240,181
Total assets	$	1,457,477	$	1,237,869
Stockholders’ equity	$	640,000	$	466,094

Other Financial Data (Unaudited)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2007			2006			2007			2006
	(In thousands)
Net cash provided by operating activities	$	194,283		$	98,135		$	280,584		$	79,795
Net cash provided by (used for) investing activities	$	(220,646	)	$	(43,760	)	$	(274,421	)	$	76,128
Net cash used for financing activities	$	(17,679	)	$	(31,130	)	$	(53,143	)	$	(87,131	)
Capital expenditures	$	45,781		$	35,259		$	72,531		$	67,494
EBITDA from continuing operations(1)	$	252,145		$	146,424		$	363,516		$	199,635

(1) Earnings before interest, taxes, depreciation and amortization, which we refer to as EBITDA as presented above is reconciled to net income under “Reconciliations to Amounts Reported under Generally Accepted Accounting Principles” below.

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Refining Operating Data

Our refinery operations include the Navajo Refinery and the Woods Cross Refinery. The following tables set forth information, including non-GAAP performance measures about our refinery operations. The cost of products and refinery gross margin do not include the effect of depreciation, depletion and amortization. Reconciliations to amounts reported under GAAP are provided under “Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles” below.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2007			2006			2007			2006
Navajo Refinery
Crude charge (BPD)(1)		82,730			60,380			79,790			66,420
Refinery production (BPD)(2)		90,940			65,600			88,540			73,320
Sales of produced refined products (BPD)		90,660			66,320			88,040			73,000
Sales of refined products (BPD)(3)		100,840			83,940			98,610			87,340
Refinery utilization(4)		99.7	%		80.5	%		96.1	%		88.6	%
Average per produced barrel(5)
Net sales	$	93.17		$	90.76		$	84.69		$	82.49
Cost of products(6)		65.63			67.34			62.45			64.90
Refinery gross margin		27.54			23.42			22.24			17.59
Refinery operating expenses(7)		4.26			5.37			4.22			5.07
Net operating margin	$	23.28		$	18.05		$	18.02		$	12.52
Feedstocks:
Sour crude oil		78	%		80	%		76	%		81	%
Sweet crude oil		10	%		9	%		10	%		7	%
Other feedstocks and blends		12	%		11	%		14	%		12	%
Total		100	%		100	%		100	%		100	%
Sales of produced refined products:
Gasolines		58	%		57	%		59	%		60	%
Diesel fuels		30	%		27	%		29	%		26	%
Jet fuels		3	%		5	%		3	%		5	%
Fuel oil		3	%		—	%		3	%		—	%
Asphalt		3	%		4	%		3	%		3	%
LPG and other		3	%		7	%		3	%		6	%
Total		100	%		100	%		100	%		100	%
Woods Cross Refinery
Crude charge (BPD)(1)		25,800			25,270			25,230			24,010
Refinery production (BPD)(2)		27,280			27,030			26,920			25,530
Sales of produced refined products (BPD)		26,130			27,500			27,120			25,410
Sales of refined products (BPD)(3)		26,230			28,800			27,390			26,640
Refinery utilization(4)		99.2	%		97.2	%		97.0	%		92.3	%
Average per produced barrel(5)
Net sales	$	96.51		$	89.63		$	83.67		$	80.52
Cost of products(6)		65.29			69.80			60.95			65.42
Refinery gross margin		31.22			19.83			22.72			15.10
Refinery operating expenses(7)		4.22			4.36			4.50			4.99
Net operating margin	$	27.00		$	15.47		$	18.22		$	10.11

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	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2007			2006			2007			2006
Woods Cross Refinery
Feedstocks:
Sour crude oil		2	%		3	%		1	%		4	%
Sweet crude oil		90	%		89	%		90	%		87	%
Other feedstocks and blends		8	%		8	%		9	%		9	%
Total		100	%		100	%		100	%		100	%
Sales of produced refined products:
Gasolines		58	%		64	%		61	%		63	%
Diesel fuels		31	%		30	%		28	%		28	%
Jet fuels		3	%		1	%		2	%		2	%
Fuel oil		7	%		4	%		7	%		5	%
LPG and other		1	%		1	%		2	%		2	%
Total		100	%		100	%		100	%		100	%
Consolidated
Crude charge (BPD)(1)		108,530			85,650			105,020			90,430
Refinery production (BPD)(2)		118,220			92,630			115,460			98,850
Sales of produced refined products (BPD)		116,790			93,820			115,160			98,410
Sales of refined products (BPD)(3)		127,070			112,740			126,000			113,980
Refinery utilization(4)		99.6	%		84.8	%		96.3	%		89.5	%
Average per produced barrel(5)
Net sales	$	93.92		$	90.43		$	84.45		$	81.98
Cost of products(6)		65.56			68.06			62.10			65.03
Refinery gross margin		28.36			22.37			22.35			16.95
Refinery operating expenses(7)		4.25			5.08			4.29			5.05
Net operating margin	$	24.11		$	17.29		$	18.06		$	11.90
Feedstocks:
Sour crude oil		60	%		58	%		59	%		61	%
Sweet crude oil		28	%		32	%		29	%		28	%
Other feedstocks and blends		12	%		10	%		12	%		11	%
Total		100	%		100	%		100	%		100	%
Sales of produced refined products:
Gasolines		58	%		59	%		59	%		61	%
Diesel fuels		30	%		27	%		29	%		27	%
Jet fuels		3	%		4	%		3	%		4	%
Fuel oil		4	%		1	%		4	%		1	%
Asphalt		2	%		3	%		2	%		2	%
LPG and other		3	%		6	%		3	%		5	%
Total		100	%		100	%		100	%		100	%

(1)	Crude charge represents the barrels per day of crude oil processed at the crude units at our refineries.
(2)	Refinery production represents the barrels per day of refined products yielded from processing crude and other refinery feedstocks through the crude units and other conversion units at our refineries.
(3)	Includes refined products purchased for resale.
(4)	Represents crude charge divided by total crude capacity (BPSD). Crude capacity for the Navajo Refinery was increased from 75,000 BPSD to 83,000 BPSD in mid-year 2006, increasing our consolidated crude capacity from 101,000 BPSD to 109,000 BPSD.
(5)	Represents average per barrel amounts for produced refined products sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are located under “Reconciliations to Amounts Reported under Generally Accepted Accounting Principles” below.
(6)	Transportation costs billed from HEP are included in cost of products.
(7)	Represents operating expenses of our refineries, exclusive of depreciation, depletion, and amortization, and excludes refining segment expenses of product pipelines and terminals.

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Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles

Reconciliations of earnings before interest, taxes, depreciation and amortization (“EBITDA”) to amounts reported under generally accepted accounting principles in financial statements.

Earnings before interest, taxes, depreciation and amortization, which we refer to as EBITDA, is calculated as net income plus (i) interest expense net of interest income, (ii) income tax provision, and (iii) depreciation, depletion and amortization. EBITDA is not a calculation based upon accounting principles generally accepted in the United States; however, the amounts included in the EBITDA calculation are derived from amounts included in our consolidated financial statements. EBITDA should not be considered as an alternative to net income or operating income as an indication of our operating performance or as an alternative to operating cash flow as a measure of liquidity. EBITDA is not necessarily comparable to similarly titled measures of other companies. EBITDA is presented here because it is a widely used financial indicator used by investors and analysts to measure performance. EBITDA is also used by our management for internal analysis and as a basis for financial covenants. We are reporting EBITDA from continuing operations.

Set forth below is our calculation of EBITDA from continuing operations.

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2007			2006			2007			2006
				(In thousands)
Income from continuing operations	$	158,627		$	87,729		$	226,169		$	118,889
Add provision for income tax		86,136			50,148			120,822			65,635
Add interest expense		291			272			543			547
Subtract interest income		(3,550	)		(2,408	)		(6,110	)		(4,143	)
Add depreciation and amortization		10,641			10,683			22,092			18,707
EBITDA from continuing operations	$	252,145		$	146,424		$	363,516		$	199,635

Reconciliations of refinery operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in financial statements.

Refinery gross margin and net operating margin are non-GAAP performance measures that are used by our management and others to compare our refining performance to that of other companies in our industry. We believe these margin measures are helpful to investors in evaluating our refining performance on a relative and absolute basis.

We calculate refinery gross margin and net operating margin using net sales, cost of products and operating expenses, in each case averaged per produced barrel sold. These two margins do not include the effect of depreciation, depletion and amortization. Each of these component performance measures can be reconciled directly to our Statements of Income.

Other companies in our industry may not calculate these performance measures in the same manner.

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Refinery Gross Margin

Refinery gross margin per barrel is the difference between average net sales price and average cost of products per barrel of produced refined products. Refinery gross margin for each of our refineries and for both of our refineries on a consolidated basis is calculated as shown below.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Average per produced barrel:
Navajo Refinery
Net sales	$	93.17	$	90.76	$	84.69	$	82.49
Less cost of products		65.63		67.34		62.45		64.90
Refinery gross margin	$	27.54	$	23.42	$	22.24	$	17.59
Woods Cross Refinery
Net sales	$	96.51	$	89.63	$	83.67	$	80.52
Less cost of products		65.29		69.80		60.95		65.42
Refinery gross margin	$	31.22	$	19.83	$	22.72	$	15.10
Consolidated
Net sales	$	93.92	$	90.43	$	84.45	$	81.98
Less cost of products		65.56		68.06		62.10		65.03
Refinery gross margin	$	28.36	$	22.37	$	22.35	$	16.95

Net Operating Margin

Net operating margin per barrel is the difference between refinery gross margin and refinery operating expenses per barrel of produced refined products. Net operating margin for each of our refineries and for both of our refineries on a consolidated basis is calculated as shown below.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Average per produced barrel:
Navajo Refinery
Refinery gross margin	$	27.54	$	23.42	$	22.24	$	17.59
Less refinery operating expenses		4.26		5.37		4.22		5.07
Net operating margin	$	23.28	$	18.05	$	18.02	$	12.52
Woods Cross Refinery
Refinery gross margin	$	31.22	$	19.83	$	22.72	$	15.10
Less refinery operating expenses		4.22		4.36		4.50		4.99
Net operating margin	$	27.00	$	15.47	$	18.22	$	10.11
Consolidated
Refinery gross margin	$	28.36	$	22.37	$	22.35	$	16.95
Less refinery operating expenses		4.25		5.08		4.29		5.05
Net operating margin	$	24.11	$	17.29	$	18.06	$	11.90

Below are reconciliations to our Consolidated Statements of Income for (i) net sales, cost of products and operating expenses, in each case averaged per produced barrel sold, and (ii) net operating margin and refinery gross margin. Due to rounding of reported numbers, some amounts may not calculate exactly.

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Reconciliations of refined product sales from produced products sold to total sales and other revenue

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2007		2006			2007		2006
Navajo Refinery
Average sales price per produced barrel sold	$	93.17	$	90.76		$	84.69	$	82.49
Times sales of produced refined products sold (BPD)		90,660		66,320			88,040		73,000
Times number of days in period		91		91			181		181
Refined product sales from produced products sold	$	768,658	$	547,747		$	1,349,555	$	1,089,940
Woods Cross Refinery
Average sales price per produced barrel sold	$	96.51	$	89.63		$	83.67	$	80.52
Times sales of produced refined products sold (BPD)		26,130		27,500			27,120		25,410
Times number of days in period		91		91			181		181
Refined product sales from produced products sold	$	229,484	$	224,299		$	410,713	$	370,328
Sum of refined products sales from produced products sold from our two refineries(4)	$	998,142	$	772,046		$	1,760,268	$	1,460,268
Add refined product sales from purchased products and rounding(1)		91,747		168,064			171,093		252,343
Total refined products sales		1,089,889		940,110			1,931,361		1,712,611
Add direct sales of excess crude oil(2)		91,843		131,275			153,523		131,275
Add other refining segment revenue(3)		35,045		49,453			57,475		68,300
Total refining segment revenue		1,216,777		1,120,838			2,142,359		1,912,186
Add corporate and other revenues		114		143			505		524
Subtract consolidations and eliminations		106		(141	)		—		(276	)
Sales and other revenues	$	1,216,997	$	1,120,840		$	2,142,864	$	1,912,434

(1)	We purchase finished products when opportunities arise that provide a profit on the sale of such products, or to meet delivery commitments.
(2)	We purchase crude oil and enter into buy/sell exchanges in excess of the needs to supply our refineries. Certain direct sales of this excess crude oil are made to purchasers or users of crude oil. Under new accounting guidance, these sales and related purchases starting April 1, 2006 are being measured at fair value and accounted for as revenues with the related acquisition costs included as cost of products sold. Prior to April 1, 2006, sales and cost of sales attributable to such excess crude oil direct sales were netted and presented in cost of products sold.
(3)	Other refining segment revenue includes the revenues associated with NK Asphalt Partners and revenue derived from sulfur credit sales.
(4)	The above calculations of refined product sales from produced products sold can also be computed on a consolidated basis. These amounts may not calculate exactly due to rounding of reported numbers.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Average sales price per produced barrel sold	$	93.92	$	90.43	$	84.45	$	81.98
Times sales of produced refined products sold (BPD)		116,790		93,820		115,160		98,410
Times number of days in period		91		91		181		181
Refined product sales from produced products sold	$	998,142	$	772,046	$	1,760,268	$	1,460,268

Reconciliation of average cost of products per produced barrel sold to total costs of products sold

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Navajo Refinery
Average cost of products per produced barrel sold	$	65.63	$	67.34	$	62.45	$	64.90
Times sales of produced refined products sold (BPD)		90,660		66,320		88,040		73,000
Times number of days in period		91		91		181		181
Cost of products for produced products sold	$	541,451	$	406,405	$	995,156	$	857,524

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	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2007		2006			2007		2006
Woods Cross Refinery
Average cost of products per produced barrel sold	$	65.29	$	69.80		$	60.95	$	65.42
Times sales of produced refined products sold (BPD)		26,130		27,500			27,120		25,410
Times number of days in period		91		91			181		181
Cost of products for produced products sold	$	155,249	$	174,675		$	299,186	$	300,880
Sum of cost of products for produced products sold from our two refineries(4)	$	696,700	$	581,080		$	1,294,342	$	1,158,404
Add refined product costs from purchased products sold and rounding(1)		86,404		172,348			168,556		257,966
Total refined cost of products sold		783,104		753,428			1,462,898		1,416,370
Add crude oil cost of direct sales of excess crude oil(2)		92,054		131,061			153,906		131,061
Add other refining segment costs of products sold(3)		21,973		23,661			32,147		36,339
Total refining segment cost of products sold		897,131		908,150			1,648,951		1,583,770
Subtract consolidations and eliminations		106		(141	)		—		(276	)
Costs of products sold (exclusive of depreciation, depletion and amortization)	$	897,237	$	908,009		$	1,648,951	$	1,583,494

(1)	We purchase finished products when opportunities arise that provide a profit on the sale of such products, or to meet delivery commitments.
(2)	We purchase crude oil and enter into buy/sell exchanges in excess of the needs to supply our refineries. Certain direct sales of this excess crude oil are made to purchasers or users of crude oil. Under new accounting guidance, these sales and related purchases starting April 1, 2006 are being measured at fair value and accounted for as revenues with the related acquisition costs included as cost of products sold. Prior to April 1, 2006, sales and cost of sales attributable to such excess crude oil direct sales were netted and presented in cost of products sold.
(3)	Other refining segment costs of products sold includes the costs of products for NK Asphalt Partners and costs attributable to sulfur credit sales.
(4)	The above calculations of costs of products from produced products sold can also be computed on a consolidated basis. These amounts may not calculate exactly due to rounding of reported numbers.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Average cost of products per produced barrel sold	$	65.56	$	68.06	$	62.10	$	65.03
Times sales of produced refined products sold (BPD)		116,790		93,820		115,160		98,410
Times number of days in period		91		91		181		181
Cost of products for produced products sold	$	696,700	$	581,080	$	1,294,342	$	1,158,404

Reconciliation of average refinery operating expenses per produced barrel sold to total operating expenses

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Navajo Refinery
Average refinery operating expenses per produced barrel sold	$	4.26	$	5.37	$	4.22	$	5.07
Times sales of produced refined products sold (BPD)		90,660		66,320		88,040		73,000
Times number of days in period		91		91		181		181
Refinery operating expenses for produced products sold	$	35,145	$	32,409	$	67,247	$	66,990
Woods Cross Refinery
Average refinery operating expenses per produced barrel sold	$	4.22	$	4.36	$	4.50	$	4.99
Times sales of produced refined products sold (BPD)		26,130		27,500		27,120		25,410
Times number of days in period		91		91		181		181
Refinery operating expenses for produced products sold	$	10,034	$	10,911	$	22,089	$	22,950

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	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2007		2006			2007		2006
Sum of refinery operating expenses per produced products sold from our two refineries(2)	$	45,179	$	43,320		$	89,336	$	89,940
Add other refining segment operating expenses and rounding(1)		5,934		5,790			11,895		11,603
Total refining segment operating expenses		51,113		49,110			101,231		101,543
Add corporate and other costs		3		(18	)		14		16
Operating expenses (exclusive of depreciation, depletion and amortization)	$	51,116	$	49,092		$	101,245	$	101,559

(1)	Other refining segment operating expenses include the marketing costs associated with our refining segment and the operating expenses of NK Asphalt Partners.
(2)	The above calculations of refinery operating expenses from produced products sold can also be computed on a consolidated basis. These amounts may not calculate exactly due to rounding of reported numbers.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Average refinery operating expenses per produced barrel sold	$	4.25	$	5.08	$	4.29	$	5.05
Times sales of produced refined products sold (BPD)		116,790		93,820		115,160		98,410
Times number of days in period		91		91		181		181
Refinery operating expenses for produced products sold	$	45,179	$	43,320	$	89,336	$	89,940

Reconciliation of net operating margin per barrel to refinery gross margin per barrel to total sales and other revenues

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2007		2006			2007		2006
Navajo Refinery
Net operating margin per barrel	$	23.28	$	18.05		$	18.02	$	12.52
Add average refinery operating expenses per produced barrel		4.26		5.37			4.22		5.07
Refinery gross margin per barrel		27.54		23.42			22.24		17.59
Add average cost of products per produced barrel sold		65.63		67.34			62.45		64.90
Average net sales per produced barrel sold	$	93.17	$	90.76		$	84.69	$	82.49
Times sales of produced refined products sold (BPD)		90,660		66,320			88,040		73,000
Times number of days in period		91		91			181		181
Refined products sales from produced products sold	$	768,658	$	547,747		$	1,349,555	$	1,089,940
Woods Cross Refinery
Net operating margin per barrel	$	27.00	$	15.47		$	18.22	$	10.11
Add average refinery operating expenses per produced barrel		4.22		4.36			4.50		4.99
Refinery gross margin per barrel		31.22		19.83			22.72		15.10
Add average cost of products per produced barrel sold		65.29		69.80			60.95		65.42
Average net sales per produced barrel sold	$	96.51	$	89.63		$	83.67	$	80.52
Times sales of produced refined products sold (BPD)		26,130		27,500			27,120		25,410
Times number of days in period		91		91			181		181
Refined products sales from produced products sold	$	229,484	$	224,299		$	410,713	$	370,328
Sum of refined products sales from produced products sold from our two refineries(4)	$	998,142	$	772,046		$	1,760,268	$	1,460,268
Add refined product sales from purchased products and rounding(1)		91,747		168,064			171,093		252,343
Total refined products sales		1,089,889		940,110			1,931,361		1,712,611
Add direct sales of excess crude oil(2)		91,843		131,275			153,523		131,275
Add other refining segment revenue(3)		35,045		49,453			57,475		68,300
Total refining segment revenue		1,216,777		1,120,838			2,142,359		1,912,186
Add corporate and other revenues		114		143			505		524
Subtract consolidations and eliminations		106		(141	)		—		(276	)
Sales and other revenues	$	1,216,997	$	1,120,840		$	2,142,864	$	1,912,434

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(1)	We purchase finished products when opportunities arise that provide a profit on the sale of such products or to meet delivery commitments.
(2)	We purchase crude oil and enter into buy/sell exchanges in excess of the needs to supply our refineries. Certain direct sales of this excess crude oil are made to purchasers or users of crude oil. Under new accounting guidance, these sales and related purchases starting April 1, 2006 are being measured at fair value and accounted for as revenues with the related acquisition costs included as cost of products sold. Prior to April 1, 2006, sales and cost of sales attributable to such excess crude oil direct sales were netted and presented in cost of products sold.
(3)	Other refining segment revenue includes the revenues associated with NK Asphalt Partners and revenue derived from sulfur credit sales.
(4)	The above calculations of refined product sales from produced products sold can also be computed on a consolidated basis. These amounts may not calculate exactly due to rounding of reported numbers.

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2007		2006		2007		2006
Net operating margin per barrel	$	24.11	$	17.29	$	18.06	$	11.90
Add average refinery operating expenses per produced barrel		4.25		5.08		4.29		5.05
Refinery gross margin per barrel		28.36		22.37		22.35		16.95
Add average cost of products per produced barrel sold		65.56		68.06		62.10		65.03
Average sales price per produced barrel sold	$	93.92	$	90.43	$	84.45	$	81.98
Times sales of produced refined products sold (BPD)		116,790		93,820		115,160		98,410
Times number of days in period		91		91		181		181
Refined product sales from produced products sold	$	998,142	$	772,046	$	1,760,268	$	1,460,268

FOR FURTHER INFORMATION, Contact:

Stephen J. McDonnell,
Vice President and Chief Financial Officer

M. Neale Hickerson,
Vice President, Investor Relations
Holly Corporation
214/871-3555

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