EXHIBIT 99.1
GIANT INDUSTRIES, INC.
NEWS RELEASE
Contact: Mark B. Cox
Executive Vice President, Treasurer, & Chief Financial Officer
Giant Industries, Inc.
(480) 585-8888
FOR IMMEDIATE RELEASE
February 27, 2007
GIANT INDUSTRIES, INC. ANNOUNCES 2006 OPERATING RESULTS
AND SHAREHOLDER APPROVAL OF MERGER
Scottsdale, Arizona, February 27, 2007 - Giant Industries, Inc. [NYSE: GI]
announced today full year 2006 net earnings of $82.8 million or $5.64 per
diluted share versus net earnings of $103.9 million or $7.62 per diluted
share in 2005. For the fourth quarter of 2006, net earnings were $1.8
million or $0.12 per diluted share compared to net earnings of $26.6
million or $1.82 per diluted share for the fourth quarter of 2005.
Fred Holliger, Giant's Chief Executive Officer, commented, "While 2006 net
earnings were by far the second best year in our Company's history, results
were hampered by operating problems in our refining operations. Our fourth
quarter 2006 earnings were negatively impacted by outages at our Ciniza
refinery and our Yorktown refinery that significantly impacted our
operating results. All units at our Ciniza refinery are now back operating
with the exception of a portion of the diesel hydrotreater. We currently
believe that the unit will resume full operations in early April. All units
at our Yorktown refinery are now back in operation."
"On a positive note, both our retail and wholesale business units continued
good growth trends. Our retail operations achieved growth in excess of 4%
in merchandise sales and fuel volumes on a comparable store basis in 2006
compared to the prior year. On top of this growth, merchandise sales
increased by approximately 6% and fuel volumes increased in excess of 11%
as a result of the two retail acquisitions that we completed in the last 18
months. This sales growth combined with stable fuel and merchandise margins
resulted in an approximate $3.4 million improvement in operating income
over the prior year level. Within our wholesale operations, we continued to
experience growth in wholesale and cardlock fuel volumes, as well as
lubricant sales. Our operating income was; however, lower by approximately
$2.4 million compared to the prior year level as a result of lower fuel and
lubricant margins. It is also worth noting, that we recently completed
another acquisition of a privately-owned wholesale distribution company
that should provide additional growth opportunities for our wholesale group
in 2007."
Commenting on first quarter operations, Holliger said, "Our current
refining margins are stronger than the same time last year, as demand for
gasoline and diesel has been strong at Yorktown and in our Four Corners'
market. In our retail operations, we are continuing to achieve growth in
both fuel volumes and merchandise sales on a comparable store basis. While
fuel margins started the year stronger than typically seen in the winter
months, recent increases in fuel costs have eroded fuel margins to lower
levels than we realized at the same time last year. However, merchandise
margins are comparable to the prior year level. In our wholesale
operations, we are continuing to experience growth in fuel volumes in our
historical business as well as from the recent acquisition. Margins, so
far, are slightly lower compared to the same time last year."
Holliger provided the following update on the Company's proposed merger
with Western Refining Company, "We are pleased to announce that we have
received the affirmative vote of more than a majority of our outstanding
shares approving our merger with Western Refining Company. We believe the
merger is an outstanding opportunity for our shareholders and are heartened
by the overwhelming positive vote. In addition, we continue to believe that
the merger will enhance opportunities for our employees as a result of
being a part of a larger organization. We also believe that our customers
and suppliers will be well served and benefit from the combined companies
greater economies of scale and the resources needed for sustained success
in our industry. Now that we received the approval of our shareholders, the
only remaining hurdle to completing the merger is the Federal Trade
Commission merger review process. On February 20, we and Western entered
into an agreement with the FTC to provide them additional information that
they have requested. We currently believe that these requests will be
satisfied by the middle of March. We and Western also agreed with the FTC
that we would not attempt to close the merger for thirty days following the
providing of this information, which can be no earlier than April 13,
2007."
Giant's senior management will hold a conference call at 8:00 a.m. EST
(6:00 a.m. MST) on February 28, 2007 to discuss this earnings release and
provide an update on Company operations. The conference call will be
broadcast live on the Company's website at www.giant.com.
Giant Industries, Inc., headquartered in Scottsdale, Arizona, is a refiner
and marketer of petroleum products. Giant owns and operates one Virginia
and two New Mexico crude oil refineries, a crude oil gathering pipeline
system based in Farmington, New Mexico, which services the New Mexico
refineries, finished products distribution terminals in Albuquerque, New
Mexico and Flagstaff, Arizona, a fleet of crude oil and finished product
truck transports, and a chain of retail service station/convenience stores
in New Mexico, Colorado, and Arizona. Giant is also the parent Company of
Phoenix Fuel Co., Inc., Dial Oil Co. and Empire Oil Co., all of which are
wholesale petroleum products distributors. For more information, please
visit Giant's website at www.giant.com.
This press release contains forward-looking statements that involve known
and unknown risks and uncertainties. Forward-looking statements are
identified by words or phrases such as "believes," "expects,"
"anticipates," "estimates," "should," "could," "plans," "intends," "will,"
variations of such words and phrases, and other similar expressions. While
these forward-looking statements are made in good faith, and reflect the
Company's current judgment regarding such matters, actual results could
vary materially from the forward-looking statements. Important factors that
could cause actual results to differ from forward-looking statements
include, but are not limited to: the risk that the Ciniza diesel
hydrotreater will not return to full operation by early April, the risk
that our refining margins will not remain stronger than last year, the risk
that our retail operations will not continue to experience growth in both
fuel and merchandise sales on a comparable store basis, the risk that
retail merchandise margins will not remain comparable to last year, the
risk that our wholesale operations will not continue to experience growth
in fuel volumes, the risk that the Western transaction will not provide the
anticipated benefits, the risk that we will not be able to respond to the
Federal Trade Commission on schedule or at all, the risk that the Federal
Trade Commission will oppose the transaction or that other conditions to
the transaction will not be satisfied, the risk that the transaction will
not close on schedule or at all, and other risks detailed from time to time
in the Company's filings with the Securities and Exchange Commission. All
subsequent written and oral forward-looking statements attributable to the
Company, or persons acting on behalf of the Company, are expressly
qualified in their entirety by the foregoing. Forward-looking statements
made by the Company represent its judgment on the dates such statements are
made. The Company assumes no obligation to update any forward-looking
statements to reflect new or changed events or circumstance.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
- -------------------------------------------------------------------------------------------------------------------
(In thousands except shares and per share data)
- -------------------------------------------------------------------------------------------------------------------
Three Months Ended December 31, Twelve Months Ended December 31,
- -------------------------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- -------------------------------------------------------------------------------------------------------------------
Net revenues $ 999,312 $ 920,938 $ 4,173,564 $ 3,581,246
Cost of products sold (excluding
depreciation and amortization) 897,534 798,110 3,776,923 3,093,191
- -------------------------------------------------------------------------------------------------------------------
Operating expenses 64,229 56,750 232,848 205,639
Depreciation and amortization 12,685 9,845 45,193 40,280
Selling, general and administrative expenses 13,474 10,100 49,521 45,173
Net loss/(gain) on disposal/write-down of assets 1,764 174 723 1,009
Gain from insurance settlement due to fire incident - - (82,003) (3,688)
- -------------------------------------------------------------------------------------------------------------------
Operating income 9,626 45,959 150,359 199,642
Interest expense (5,158) (5,327) (19,172) (24,485)
Costs associated with early debt extinguishment - - - (2,082)
Amortization of financing costs (399) (399) (1,597) (2,797)
Investment and other income 717 1,831 4,555 2,799
- -------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations
before income taxes 4,786 42,064 134,145 173,077
Provision for income taxes 2,966 15,369 51,394 69,146
- -------------------------------------------------------------------------------------------------------------------
Earnings from continuing operations 1,820 26,695 82,751 103,931
Earnings from discontinued operations, net of
income tax provision of $9 - - - 15
Cumulative effect of change in accounting
principal, net of income tax benefit of $46 - (68) - (68)
- -------------------------------------------------------------------------------------------------------------------
Net Earnings $ 1,820 $ 26,627 $ 82,751 $ 103,878
===================================================================================================================
Net Earnings per common share:
Basic
Continuing operations $ 0.12 $ 1.84 $ 5.67 $ 7.71
Discontinued operations - - - -
Cumulative effect of change in
accounting principle - (0.01) - (0.01)
- -------------------------------------------------------------------------------------------------------------------
$ 0.12 $ 1.83 $ 5.67 $ 7.70
===================================================================================================================
Assuming dilution
Continuing operations $ 0.12 $ 1.83 $ 5.64 $ 7.63
Discontinued operations - - - -
Cumulative effect of change in
accounting principle - (0.01) - (0.01)
- -------------------------------------------------------------------------------------------------------------------
$ 0.12 $ 1.82 $ 5.64 $ 7.62
===================================================================================================================
Weighted average number of shares outstanding:
Basic 14,603,365 14,518,874 14,597,074 13,485,702
Assuming dilution 14,688,775 14,626,099 14,680,443 13,629,132
===================================================================================================================
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
- -------------------------------------------------------------------------------------------
December 31, 2006 December 31, 2005
- -------------------------------------------------------------------------------------------
Assets
Current assets $ 429,287 $ 442,355
- -------------------------------------------------------------------------------------------
Property, plant and equipment 995,710 764,788
Less accumulated depreciation and amortization (327,460) (297,962)
- -------------------------------------------------------------------------------------------
668,250 466,826
Other assets 78,640 75,291
- -------------------------------------------------------------------------------------------
Total Assets $ 1,176,177 $ 984,472
===========================================================================================
Liabilities and Stockholders' Equity
Current liabilities $ 222,135 $ 208,508
Long-term debt 325,387 274,864
Deferred income taxes 117,149 76,834
Other liabilities 27,138 24,430
Stockholders' equity 484,368 399,836
- -------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $ 1,176,177 $ 984,472
===========================================================================================
OPERATING STATISTICS
4 Qtr. 2006 3 Qtr. 2006 2 Qtr. 2006 1 Qtr. 2006 4 Qtr. 2005
- -----------------------------------------------------------------------------------------------------------
Refining Group:
- --------------
Four Corners Operations:
Crude Oil/NGL Throughput (BPD) 25,878 26,572 28,658 29,122 29,033
Refinery Sourced Sales Barrels (BPD) 25,157 27,102 27,084 28,471 27,075
Avg. Crude Oil Costs ($/Bbl) $ 60.18 $ 70.50 $ 67.86 $ 62.30 $ 60.21
Refining Margins ($/Bbl) $ 11.68 $ 18.31 $ 21.97 $ 10.84 $ 16.64
Retail Fuel Volumes Sold as a % of
Four Corners Refineries' Sourced
Sales Barrels 54% 50% 47% 38% 37%
Yorktown Operations:
Crude Oil/NGL Throughput (BPD) 68,818 70,751 60,396 37,589 41,685
Refinery Sourced Sales Barrels (BPD) 73,028 68,360 61,668 33,466 45,566
Avg. Crude Oil Costs ($/Bbl) $ 57.57 $ 68.92 $ 68.36 $ 59.02 $ 57.72
Refining Margins ($/Bbl) $ 5.19 $ 3.81 $ 6.65 $ (3.50) $ 9.61
Retail Group:(1)(2)
- ------------
Fuel Gallons Sold (000's) 52,881 52,426 49,021 46,261 45,421
Fuel Margins ($/gal) $ 0.17 $ 0.25 $ 0.17 $ 0.15 $ 0.29
Merchandise Sales ($ in 000's) $ 39,835 $ 43,175 $ 40,972 $ 35,531 $ 36,828
Merchandise Margins 28% 27% 27% 27% 28%
Number of Operating Units at End of Period 155 153 134 134 135
Wholesale Group: (3)
- ---------------
Fuel Gallons Sold (000's) 155,654 150,278 149,231 140,748 141,328
Fuel Margins ($/gal) $ 0.06 $ 0.07 $ 0.06 $ 0.07 $ 0.09
Lubricant Sales ($ in 000's) $ 19,833 $ 18,388 $ 15,770 $ 17,644 $ 14,789
Lubricant Margins 13% 14% 14% 13% 15%
- -----------------------------------------------------------------------------------------------------------
Operating Income/(loss)(before
corporate allocations) (in 000's)
- -----------------------------------
Refining - Four Corners Operations $ 6,647 $ 24,572 $ 35,375 $ 11,233 $ 22,539
- Yorktown Operations 6,637 (802) 14,589 (30,805) 16,533
Retail(1)(2) 3,083 8,212 3,978 1,711 7,751
Wholesale(3) 3,901 5,202 3,527 4,175 5,109
Corporate (8,878) (8,784) (8,392) (6,102) (5,800)
Net (loss)/gain on disposal/write-down
of assets(4) (1,764) 46,500 33,051 3,493 (174)
- -----------------------------------------------------------------------------------------------------------
Total $ 9,626 $ 74,900 $ 82,128 $(16,295) $ 45,958
===========================================================================================================
Capital expenditures (in 000's)
- -------------------------------
Refining - Four Corners Operations(5) $ 27,589 $ 25,168 $ 26,263 $ 9,783 $ 5,687
- Yorktown Operations(6) 18,559 23,973 40,224 47,791 14,190
Retail 3,588 2,663 997 814 1,488
Wholesale 1,494 744 1,039 1,204 529
Corporate 172 395 398 105 375
- -----------------------------------------------------------------------------------------------------------
Total $ 51,402 $ 52,943 $ 68,921 $ 59,697 $ 22,269
===========================================================================================================
(1) Includes 12 convenience stores from Dial Oil Co ("Dial").
(2) Includes 21 convenience stores purchased from Amigo Petroleum Company ("Amigo") in August 2006.
(3) Includes Wholesale operations of Dial and Amigo.
(4) Includes insurance proceeds related to the Yorktown fire incident that occurred in November 2005.
(5) Includes disbursements related to the October 2006 Ciniza fire incident.
(6) Includes disbursements related to the November 2005 and September 2006 Yorktown fire incidents.
Selected Financial Data
December 31, 2006 December 31, 2005
- -----------------------------------------------------------------------------------------
Working Capital (In Thousands) $ 207,152 $ 233,847
Current Ratio 1.93:1 2.12:1
Long-Term Debt As A Percent of Total Capital (8) 40.2% 40.7%
Net Debt As A Percent of Total Net Capital (9) 38.8% 21.7%
Book Value Per Share (10) $ 33.08 $ 27.36
Net cash provided by operating activities $ 27,830 $ 188,808
- -----------------------------------------------------------------------------------------
(8) Total Capital represents Long-Term Debt plus Total Stockholders' Equity.
(9) Net Debt represents Long-Term Debt less Cash and cash equivalents. Total Net Capital
represents Long-Term Debt less Cash and cash equivalents plus Total Stockholders' Equity.
(10) Book Value Per Share represents Total Stockholders' Equity divided by number of common
shares outstanding.
Share Price Data (NYSE: GI)
High Low Close
- -------------------------------------------
2006 4th Quarter $81.45 $74.20 $74.95
2006 3rd Quarter $82.30 $64.49 $81.20
2006 2nd Quarter $76.97 $56.09 $66.55
2006 1st Quarter $71.00 $52.44 $69.54
2005 4th Quarter $60.50 $47.80 $51.96
RECONCILIATIONS TO AMOUNTS REPORTED UNDER GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES
REFINING GROUP
Refining Margin
Refining margin is the difference between average net sales prices and
average cost of products produced per refinery sourced sales barrel of
refined product. Refining margins for each of our refineries and all of our
refineries on a consolidated basis are calculated as shown below.
Three Months Twelve Months
Ended December 31, Ended December 31,
- ---------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- ---------------------------------------------------------------------------------------------------
AVERAGE PER BARREL
Four Corners Operations
Net sales $ 72.18 $ 78.22 $ 84.19 $ 72.42
Less cost of products 60.50 61.58 68.47 58.39
- ---------------------------------------------------------------------------------------------------
Refining margin $ 11.68 $ 16.64 $ 15.72 $ 14.03
===================================================================================================
Yorktown Operations
Net sales $ 62.80 $ 68.17 $ 70.43 $ 62.66
Less cost of products 57.61 58.56 66.48 53.94
- ---------------------------------------------------------------------------------------------------
Refining margin $ 5.19 $ 9.61 $ 3.95 $ 8.72
===================================================================================================
Consolidated
Net sales $ 65.20 $ 71.92 $ 74.73 $ 65.71
Less cost of products 58.35 56.68 67.10 55.33
- ---------------------------------------------------------------------------------------------------
Refining margin $ 6.85 $ 15.24 $ 7.63 $ 10.38
===================================================================================================
Reconciliations of refined product sales
from produced products sold per barrel to
net revenues
Four Corners Operations
Average sales price per produced barrel sold $ 72.18 $ 78.22 $ 84.19 $ 72.42
Times refinery sourced sales barrels per day 25,157 27,075 26,945 28,516
Times number of days in period 92 92 365 365
- ---------------------------------------------------------------------------------------------------
Refined product sales from produced
products sold* (000's) $ 167,057 $ 194,838 $ 828,002 $ 753,772
===================================================================================================
Yorktown Operations
Average sales price per produced barrel sold $ 62.80 $ 68.17 $ 70.43 $ 62.66
Times refinery sourced sales barrels per day 73,028 45,566 59,264 62,667
Times number of days in period 92 92 365 365
- ---------------------------------------------------------------------------------------------------
Refined product sales from produced
products sold* (000's) $ 421,927 $ 285,774 $1,523,497 $1,433,251
===================================================================================================
Consolidated (000's)
Sum of refined product sales from
produced products sold* $ 588,984 $ 480,612 $2,351,499 $2,187,023
Purchased product, transportation and
other revenues 132,868 120,306 523,161 266,484
- ---------------------------------------------------------------------------------------------------
Net revenue $ 721,852 $ 600,918 $2,874,660 $2,453,507
===================================================================================================
*Includes inter-segment net revenues.
Three Months Twelve Months
Ended December 31, Ended December 31,
- ---------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- ---------------------------------------------------------------------------------------------------
Reconciliation of average cost of products
per produced per barrel sold to total cost
of products sold (excluding depreciation
and amortization)
Four Corners Operations
Average cost of products per produced
barrel sold $ 60.50 $ 61.58 $ 68.47 $ 58.39
Times refinery sourced sales barrels per day 25,157 27,075 26,945 28,516
Times number of days in period 92 92 365 365
- ---------------------------------------------------------------------------------------------------
Cost of products for produced products
sold (000's) $ 140,024 $ 153,389 $ 673,397 $ 607,743
===================================================================================================
Yorktown Operations
Average cost of products per produced
barrel sold $ 57.61 $ 58.56 $ 66.48 $ 53.94
Times refinery sourced sales barrels per day 73,028 45,566 59,264 62,667
Times number of days in period 92 92 365 365
- ---------------------------------------------------------------------------------------------------
Cost of products for produced products
sold (000's) $ 387,057 $ 245,488 $1,438,053 $1,233,794
===================================================================================================
Consolidated
Sum of refined cost of produced products sold $ 527,081 $ 398,877 $2,111,450 $1,841,537
Purchased product, transportation and other
cost of products sold 125,138 114,554 491,733 236,363
- ---------------------------------------------------------------------------------------------------
Total cost of products sold (excluding
depreciation and amortization) $ 652,219 $ 513,431 $2,603,183 $2,077,900
===================================================================================================
RETAIL GROUP(1)(2)
Fuel Margin
Fuel margin is the difference between fuel sales less cost of fuel sales
divided by number of gallons sold.
Three Months Twelve Months
Ended December 31, Ended December 31,
- -----------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- -----------------------------------------------------------------------------------------------------
(in 000's except fuel margin per gallon)
Fuel sales $ 123,578 $ 114,277 $ 526,623 $ 408,687
Less cost of fuel sold 114,385 100,937 489,345 374,071
- -----------------------------------------------------------------------------------------------------
Fuel margin $ 9,193 $ 13,340 $ 37,278 $ 34,616
Number of gallons sold 52,881 45,421 200,590 174,510
Fuel margin per gallon $ 0.17 $ 0.29 $ 0.19 $ 0.20
Reconciliation of fuel sales to net
revenues (000's)
Fuel sales $ 123,578 $ 114,277 $ 526,623 $ 408,687
Excise taxes included in sales (21,153) (16,665) (74,178) (62,671)
- -----------------------------------------------------------------------------------------------------
Fuel sales, net of excise taxes 102,425 97,612 452,445 346,016
Merchandise sales 39,835 36,828 159,513 144,968
Other sales 5,737 5,024 20,809 17,133
- -----------------------------------------------------------------------------------------------------
Net revenues $ 147,997 $ 139,464 $ 632,767 $ 508,117
=====================================================================================================
Reconciliation of fuel cost of products sold
to total cost of products sold (excluding
depreciation and amortization) (000's)
Fuel cost of products sold $ 114,385 $ 100,937 $ 489,345 $ 374,071
Excise taxes included in cost of products sold (21,153) (16,665) (74,178) (62,671)
- -----------------------------------------------------------------------------------------------------
Fuel cost of products sold, net of excise taxes 93,232 84,272 415,167 311,400
Merchandise cost of products sold 28,874 26,574 115,723 105,391
Other cost of products sold 4,459 3,971 16,046 13,466
- -----------------------------------------------------------------------------------------------------
Total cost of products sold (excluding
depreciation and amortization) $ 126,565 $ 114,817 $ 546,936 $ 430,257
=====================================================================================================
(1) Includes 12 retail stores acquired in the Dial transaction on July 12, 2005.
(2) Includes 21 operating stores acquired from Amigo in August 2006.
WHOLESALE GROUP(1)(2)
Fuel Margin
Fuel margin is the difference between fuel sales less cost of fuel sales
divided by number of gallons sold.
Three Months Twelve Months
Ended December 31, Ended December 31,
- -----------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- -----------------------------------------------------------------------------------------------------
(in 000's except fuel margin per gallon)
Fuel sales $ 334,849 $ 319,217 $1,410,604 $1,118,796
Less cost of fuel sold 324,914 307,046 1,372,318 1,080,618
- -----------------------------------------------------------------------------------------------------
Fuel margin $ 9,935 $ 12,171 $ 38,286 $ 38,178
Number of gallons sold 155,654 141,328 595,910 520,664
Fuel margin per gallon $ 0.06 $ 0.09 $ 0.06 $ 0.07
Reconciliation of fuel sales to net
revenues (000's)
Fuel sales $ 334,849 $ 319,217 $1,410,604 $1,118,796
Excise taxes included in sales (49,135) (43,277) (192,798) (162,780)
- -----------------------------------------------------------------------------------------------------
Fuel sales, net of excise taxes 285,714 275,940 1,217,806 956,016
Lubricant sales 19,833 14,789 71,635 46,309
Other sales 4,117 583 14,199 5,087
- -----------------------------------------------------------------------------------------------------
Net revenues $ 309,664 $ 291,312 $1,303,640 $1,007,412
=====================================================================================================
Reconciliation of fuel cost of products sold
to total cost of products sold (excluding
depreciation and amortization) (000's)
Fuel cost of products sold $ 324,914 $ 307,046 $1,372,318 $1,080,618
Excise taxes included in cost of products sold (49,135) (43,277) (192,798) (162,780)
- -----------------------------------------------------------------------------------------------------
Fuel cost of products sold, net of excise taxes 275,779 263,769 1,179,520 917,838
Lubricant cost of products sold 17,165 12,635 61,912 38,962
Other cost of products sold 1,613 125 5,247 1,308
- -----------------------------------------------------------------------------------------------------
Total cost of products sold (excluding
depreciation and amortization) $ 294,557 $ 276,529 $1,246,679 $ 958,108
=====================================================================================================
(1) Includes Phoenix Fuel and Wholesale operations of Dial and Amigo that were acquired in July 2005
and August 2006, respectively.
(2) Dial presents sales and cost of sales, net of excise taxes.
CONSOLIDATED
Three Months Twelve Months
Ended December 31, Ended December 31,
- -----------------------------------------------------------------------------------------------------
2006 2005 2006 2005
- -----------------------------------------------------------------------------------------------------
Reconciliation to net revenues reported
in Condensed Consolidated Statement of
Operations (000's)
Net revenues - Refinery Group $ 721,852 $ 600,918 $2,874,660 $2,453,507
Net revenues - Retail Group 147,997 139,464 632,767 508,117
Net revenues - Wholesale Group 309,664 291,312 1,303,640 1,007,412
Net revenues - Other 72 77 296 455
Eliminations (180,273) (110,833) (637,799) (388,245)
- -----------------------------------------------------------------------------------------------------
Total net revenues reported in Condensed
Consolidated Statement of Earnings $ 999,312 $ 920,938 $4,173,564 $3,581,246
=====================================================================================================
Reconciliation to cost of products sold
(excluding depreciation and amortization)
in Condensed Consolidated Statement of
Operations (000's)
Cost of products sold - Refinery Group
(excluding depreciation and amortization) $ 652,219 $ 513,431 $2,603,183 $2,077,900
Cost of products sold - Retail Group
(excluding depreciation and amortization) 126,565 114,817 546,936 430,257
Cost of products sold - Wholesale Group
(excluding depreciation and amortization) 294,557 276,529 1,246,679 958,108
Eliminations (180,273) (110,833) (637,799) (388,245)
Other 4,466 4,166 17,924 15,171
- -----------------------------------------------------------------------------------------------------
Total cost of products sold (excluding
depreciation and amortization) reported in
Condensed Consolidated Statement of Operations $ 897,534 $ 798,110 $3,776,923 $3,093,191
=====================================================================================================
Our refining margin per barrel is calculated by subtracting cost of
products from net sales and dividing the result by the number of barrels
sold for the period. Our fuel margin per gallon is calculated by
subtracting cost of fuel sold from fuel sales and dividing the result by
the number of gallons sold for the period. We use refining margin per
barrel and fuel margin per gallon to evaluate performance, and allocate
resources. These measures may not be comparable to similarly titled
measures used by other companies. Investors and analysts use these
financial measures to help analyze and compare companies in the industry on
the basis of operating performance. These financial measures should not be
considered as alternatives to segment operating income, revenues, costs of
sales and operating expenses or any other measure of financial performance
presented in accordance with accounting principles generally accepted in
the United States of America.