HF Sinclair (DINO) 1 Aug 242024 Q2 Earnings call transcript

Welcome to HF Sinclair Corporation Second Quarter 2024 Conference Call and webcast. Hosting the call today is Tim Go, Chief Executive Officer, HF Sinclair. He is joined by Atanas Atanasov, Chief Financial Officer; Steve Ledbetter, EVP of Commercial; Valerie Pompa, EVP of Operations; and Matt Joyce, SVP of Lubricants and Specialties.

[Operator Instructions] Please note that this conference is being recorded.

It is now my pleasure to turn the floor over to Craig Biery, Vice President, Investor Relations. begin. may you Craig,

June Good quarter and we earnings announcing quarter press Mark. Sinclair issued to Corporation's release ending the for second call. results XXXX. morning, you, welcome everyone, HF a XX, Thank This morning,

the If you press website hfsinclair.com. may copy our release, on earnings you them a would at like of find

statements. are There that made in safe from securities release. results In intended in under forward-looking summary, provisions harbor we remarks, note statements the please differ predictions press Before noted to These expectations, the safe or such today's statements be regarding are proceed with covered our of federal SEC expectations, to harbor could laws. management judgments including those factors disclosure statement filings. it many are cause

of today's may note measures. longer may press transcript. financial also the earnings to discussion of reading on for please be measures. webcast at Also time call the provided see call include release information of Please reconciliations any GAAP the replay no or accurate time-sensitive non-GAAP any The

with call Tim. over I'll the And to turn that,

Good everyone. morning,

performance refining quarter in lower reflects higher cost and progress in commitment to on XXXX deliver operations, safe utilization second Our operating barrel per resulting business. our and our reliable continued

benefits In contributions our quarter. businesses, initiatives segments from Midstream of fact, including our seeing we across are the this again strong strategic our all of Lubricants and

$X.XX demonstrating returned also dividend, we and in a cash announced million shareholder quarter, $XXX second the During continued quarterly commitment returns. shareholders today our to to

reliability in utilization example volumes first at of the successful over Refinery scheduled Atanas. cover quarter. let our sales In budget, another segment it resulted versus completed refining, our time for increased improved quarter XXXX, The marking me on second and execution. to and was improved the turnaround highlights on turning before Puget rates of Now efforts

expenses quarter, target near-term represents operating progress of $X.XX. throughput second barrel the which $X.XX for towards were per Our significant our

operating expenses and across safe improving reliable the focus to continue fleet. and We refinery lowering operations on

for through renewables, prices the plants Puget XXXX, renewable second our and continued I positive to and of team's EBITDA am efforts, our RINs quarter despite facility. pleased achieved credit at in In atomization LCFS the report we diesel weakness

increase feedstock of and We are high-cost pretreatment operating two, unit to mix the low and three, our CI reduce utilization level inventories; expenses reliability. improved our rates; continuing lower through

from In marketing, uplift benefit for in the we we branded XX our to the to fuels, our quarter XXXX, branded site continue second of grew count and locations. margin

XX% into have optimization contracts to efforts. continued XXX of growth forward, approximately and signed next largely oil was X Specialties, and branded to months. In XX our expected furthering new convert initiatives to over stores which sites, sales mix, by our operational base strong efficiency Moving driven the translates integration we wholesale our sector our in Lubricants

our grow to products new that growth the to to organically portfolio, see needs. We by market provide high and opportunities introducing strategic with accelerating continue meet finished offerings grading and business emerging current channel solutions partnerships

the realizing and integrated Marketing with acquisition. business, period, achieved Midstream to record grow it our and as second for this of fully the continue are our for our believe value XXXX, optimize to post continue we In volumes assets Refining quarter segments. will We we we we of business the

shares, shareholders we issued shares have In over ], through we the approximately of we represents the million dividends. Sinclair XXXX repurchased the transactions. HEP and [ returned $XXX which Since second quarter to for million repurchases XXXX, March X/X share and XX

investment-grade remain authorization, balance we sheet and our approximately we As maintaining million committed our return of long-term and $XXX strong ratio, on June share rating. XX, while XXXX, strategy long-term repurchase cash and have to payout outstanding a

of a Board per [ share XX, ] $X.XX payable on to our Today, of holders XXXX. also Directors XXXX quarterly September on of announced regular declared we dividend August record

our executing three, we or to: on focused our strong return strive generate improve to and cash integrate two, cash remain corporate we expanded one, optimize strategy. portfolio; forward, continue strategy and flows reliability; as Looking

With let over that, me turn the to call Atanas.

Thank good Tim, everyone. and you, morning,

Sinclair's net shareholders highlights. of by income These increased Today, reported financial HF reviewing $X.X or diluted second by Sinclair results special to quarter items we attributable Let's $XXX per income $X.XX HF net that reflect collectively begin share. million million.

the per adjusted compared share second XXXX. of quarter or per quarter in of $XXX million for share million same income million for items, second was the to in the these $XXX Excluding Adjusted $XXX income million XXXX. of EBITDA adjusted quarter compared diluted diluted net net was to or for $X.XX the XXXX $X period $X.XX

in sales as both EBITDA volumes. across utilization In refining rates XXXX. the our regions product higher of and lower the This margins by Mid-Con which result to segment in second a product partially was gross driven supply primarily West by decrease adjusted refinery Refining of offset million Segment, adjusted $XXX regions for quarter second higher from refined was quarter compared of Refining our was million industry, $XXX EBITDA the

last per was oil second refineries result charge day to to barrels decreased activities turnaround of of quarter primarily barrels the improved XXX,XXX Crude a averaged per compared XXXX. XXX,XXX reliability for of and compared quarter same the second year. our for the day This period increase

indicator increased quarter segment, the negative due our volumes of the gallons of for $XX second optimization for million the second quarter sales quarter In volumes principally compared stock 'XX. margins second XX million were the million $X to Renewables to in for gallons quarter XXXX. Total despite the second lower million EBITDA to for sales XXXX, XX and second as adjusted compared of quarter of we reported

compared EBITDA $XX segment second margins. by the of to of for the quarter lower quarter reported 'XX driven million primarily $XX second million for Our Marketing

quarter compared XXXX. Specialties and mix by for sales the feedstock million quarter consumption charge largely $XX.X EBITDA Lubricants benefit increase for of Our was million $XX in reported EBITDA driven increased the segment sales compared higher-priced $XX -- operational XXXX. despite of second million of integration the second XXXX efforts of This million the to second to from optimization, volume, quarter $X.X second furthering our LIFO of and quarter of efficiencies the in base oil inventory

EBITDA adjusted quarter of second primarily in reported in effect volumes $XX second of of a year, the reliability refining to increased last half that result segment Midstream million same as in million higher $XXX increased sales the compared into due went revenues period to of included Our from and tariffs the XXXX.

turnaround million capital second cash Net included totaled Sinclair's quarter. million, operations of totaled HF the provided in quarter. by the which million $XXX $XX for expenditures $XX spend

and which on facility. the HF As million, balance undrawn credit million HEP of of XXXX, cash our $XXX billion unsecured $XXX Sinclair's availability total credit June stood XX, billion, $X.X facility at included approximately liquidity $X.XX

June of had ratio and debt of debt-to-cap As of $X.X of we XX% ratio XX, billion a outstanding debt-to-cap XX%. net with

items. guidance capital XXXX, still to full expect Let's With respect including we go turnaround spending spend approximately to and capital, year sustaining through for of catalyst. $XXX some million

in to $XX ] million our capital segments. spend expect we across addition, [ business In growth investments

For will XXXX, as at XXX,XXX the we which now for turnaround of and barrels September. begin Refining reflects between day oil scheduled well third quarter our Dorado our our the of in segment, run as planned per but expect crude Parkland Refinery to XQ, refinery the El in at XXX,XXX turnaround

take to turn some to it from Mark. and questions over We're now the ready audience, I'll

is with from first Manav Our coming Instructions] question Financial. Gupta UBS [Operator

have the the out. lot a to our doing you exceeded first lubes expectations. of business. on Clearly, work It Congrats is strong very relates that helping buyback integration guys. been question My you

So this should performance expect strong continue? And help we outlook understand the us for the business? to

Yes. is Manav, this Tim.

is and example execute our deliver value has for business a We is improved million capability $XXX shareholders. per is performing been to right current EBITDA X.X good years. Lubes now Our year. of the very last believe of our well rate and to It run

was base in growth a XXXX XX% what business, to So a capturing I EBITDA business margins we segment are back oil this transforming that's from today. XX%, call cyclical specialty

we're so color maybe let to business. to Matt some this me improve what to give continue doing And ask on

our to and and figuring Yes. more oils Thanks, as the question, down being embed excellence been really to way our but and oils base of getting growth. into delivering right and people really those we've the thanks that integrating Manav. those Difficulty] on core focused us we on executing base to in operational [Technical it's Tim, getting pulls focus into specialties The applications. excellent to continues places operationally continue team use help to that priorities ways the and finished out our on strategic meaningful the a that And for right continue .

up new quarter. a continue siding. Edmonton we and bulk to build rail enables cost grow be very into example, our allows is facility, to be on storage more continue efficient of an us and and to us our it to to business served parts successfully step Just transitioned supply logistically which this operation strength be It that seamlessly and And allows in and with the to better also chain customers with savvy. country. that terminal those state-of-the-art our We strategic to the past more

announced East work Middle And industry service we a accelerate ingredients streamline high-value before. and Chemicals Specialty well simply not where coverage, allows growth that and and this chosen past Africa. our in the partnership get Europe, into Specialties quarter, -- distribution users further end in we in as Additionally, reach to our geographic strategic our that announced distributor broader did branded we business, Solar as a business we've to to business, leader as have us

grow of these that business enabling about profitably. to pieces So and we're excited are types grow of us

Perfect.

I which have were get Looks been you noticed, in there. the side. like green area Another diesel we to was renewable for aiming

you certain corner least ahead? going not gotten the Renewable make an breakeven to if going have So EBITDA, to you higher, operating the you barring should ahead, that market finally confident be exceptions, business at turned has able and seem rate

Yes. delivered very quarter. the Renewables, with this results Manav, that we're we pleased on

are in strategy netbacks, can the we op our And We're saw our breakeven last can us positive costs. exactly these slightly on advantaged be at bottom-of-cycle performance conditions. on that's to was these quarter lower product I feedstocks, quarter. goal deliver think conditions. profitable demonstrates that second we And and is second bottom-of-cycle to utilization, we working here the at and what that control, focused call now be things you

me want to renewables. Steve ask doing color with we're let provide on . you any if So what

Thanks, Tim.

said mentioned, breakeven covered Tim continue they well. key look around we think all decline as pleased the consider we've if improve that a I When pretty elements. And we quarter. low-margin quarter can you we're environment, indicators, performance. deposit, with as at our the our successful get to we and I across in competitiveness mean second

a control, on are a can we of market that we feedstock set as factors cornerstones point. we optimization the we we're looking have and product what that But of liability -- think is and to national do we that the and this the were approach some and that's volatility we that. QX thing go And control said the Those position proof in be focus profitable HF forward So do we'll our think I what can continue the to move will accretive market conditions best make it's business at. Sinclair. things to

Ryan next from is paiper Our Todd question Sandler. coming with

your Canadian crude outlook availability differentials Sound? out forward? thoughts Maybe across to mean, Puget startup from widen about your bit on what first any I for of months pricing, on and And system talk of TMX can availability a a seen both to any impact few out terms back in crude date off, here. Maybe impact started in Canadian the pipeline, going you've you of maybe the on

of would Puget. anticipated quarter-over-quarter, compress Ryan, that kit, or runs is on impacts well. impacts differential of we as the West one saw specifically course, We came Coast that that Steve. considerably all which on take our heavy the as that our throughout this that, And I'll differentials. TMX

we that take to capability. barrels for have proximity a as We there ample connected term, think our home dock we the will have be pipe be advantage longer and crude. capacity more for the advantaged settles will out, as will an be when to We're market And there. us looking the

a Again, come of we're already seeing production lot on.

new the of be capacity is some so increased build. And beginning to

those of to widen differentials out. years about so X X think And will the we back run

QX. of this As coming we you part and differentials into the see to quarter begin on widening some mentioned, back

in Some seed again, bit we've elements quite in take supply product of or some quarter a that off will that is in the some was and of second quarter, some maintenance runs that the that associated third unplanned seen announced stock of market. the and there impact and with planned

and effectively. We're on feed terms of sit bit And on hubs. we continue in matter So many that's crude we'll that and most. things think supportive the this multiple compete focus important a through trading way our to be the to to navigate our facilities, differentials. we'll production that connected able sites We

line. Yes. to I'll see throw barrel XXX,XXX coming to of increase. said Ryan, XXX,XXX, going that a from going is to Gulf day line a right And think increase going to the that just We which production what's continue in now TMX barrels year, comments. Coast West. exported more up big We We down Canadian this couple going a being that and some online continue fill to will is onto move the

we don't year the and TMX filled still long before it's gets or the to think so up, be next X, is And we happen. that still to going think going that's line

In is far, as to there's least that and barrels think the at get plenty still seen the still opportunities heavy so of meantime, for they Enbridge a portion, we it we've people want.

forecasts it. have WCS will the put be so favorable continue what there the some than out more maybe think And for of been to diff we that

gears. shift maybe then And

is cost Can the maybe bit outlook, of to improved is expense about system, in the you're yet were cost mean, your still the you trend continuing you've expecting, and across control, it to talk maybe cost what I terms we I think do down? a progress pretty came made performance, what working drive to target the and there. in little of operating continuing close Your

Ryan. Yes,

teams working costs hard operating on and general. in very are Our reliability,

me let color. -- provide come So ask and some

just what to go we before. back Sure. I'll said kind of

first. around priorities bring are OpEx That reliability gain to bring our down, down So cost. our starts control,

turn efficiency workflow around is Second and excellence. then

reliability in we've We starting scoping of impacts our We're demonstrated and turnarounds what our our the see predictability. that metrics. all turnaround renewables. of to see So

second that engaging the and priority folks. really second, efficiency workflow part then And of is our

is one strategy. So supplier we example --

specifically and So we then operate case And the benefits eliminate those operate. lower our gets adjust producing we rentals to strategies have that's supplier to those gains. base across processes organizations really work spending integrating without maximize with worked way spending sustainable streams model significant value. to And removing simplify different and us such and capital. have optimization examples, fleet. a generated a print That across that in without -- regional waste in better other are cost

the So sustainable. all to speed doing with -- make things up bolstered that those enhance technology and that we're are changes and

Our comes from the Chen. line Theresa question of next

back the to discussion. to I go wanted LSP

forward? Can an Your comments more us about high-grading completing uplift convector are help inning just finished portfolio. in, products in you And understand your of in you much that? what going how

that the in to line. on And to Yes. here. continuing very and to for for millions still business. third continue This We to we're innovate. is We're find opportunity have Matt to find of we're been build the analogies, the we we executing those And particular the is now and grow Thanks and drop we've Joyce. talking opportunities, And But actually for room of for we results, if well to the we're that look momentum roam I'd what question. to the we new ways say inning. baseball innings believe the when the multiple dollars look over by we've plenty and we nickel demonstrated this encouraged bottom in early have. are results we're years confidence on that

with the on refining expansions, coming And products latest your product coming supply having online Gold give X a incremental forward? one this to Can announced large market. operators economic going demand quarter and now PADD mid-XXXX ago weeks bring just to and online X thoughts product announced another PADD us the to multiple you pipe X side, PADD midstream couple just pipe at of on for Coast

there will fruition very we'll to to and they Yes. is announcements those Steve. Theresa, fruition, that. things watch they be come when how closely, monitor this We continued and come

see connect feedstock the refining placed. product and it way access -- Lake of product terms down the made strategic Our have our then all And looking with belief We where something have the that. that as the across offering have welcome to making that a to and chain advantages looking We're we that this people away customers basis. supplied the shy Helly secured, but footprint strategic that we can who best some advantages we have to really every we're competition, well midstream to optimize where Rockies as think very and is is of that Vegas. and And our where we from is is the the there. get on ratable We we the access focused are sure we sizable kit in won't day. as Salt

Theresa, million refineries the regions provide our I'll coming that competitively these export We up we weaken conditions, that place we just we in those have products mid-cycle advantaged just into to this, say, where to advantaged to our import continue the geographically X the and think referencing, about along that mid-cycle refining pipelines reflect the parity. to import our support crude parity. believe believe you're are chime are but our power these $XXX we've area business. And support EBITDA we think assets. said year, demographics competitively We just was as the And our power or talked continues the that earnings structural our us we'll peers. bought support we the to of the I competitive of that higher market at and continues fact start above that products earning increased what synergies at all we advantages in And parity. the go at back PADD raised at that of place are and

continue additional that to think out. to in. despite coming are despite weakening play So these pipelines play the that that's We you out I see going and think margins

is question coming [indiscernible] from Next

and specifically strength of maybe you side. talk start demand highlight I system what the terms on refining about more your your Maybe guys wanted in pockets some maybe within the weakness, or of are latest crack weakness. seeing recent thoughts on given then on getting own to macro distillate

is one. Adam, take this I'll Steve. that

So specifically think issue. we because people was in talk at I concerned second first think demand the look question. distillate quarter it, that as a really I were I'll about your

there was gas business terms on and a think flat jet. increasing of and on diesel relatively I in was demand in

planning that to of think -- and weather of a had part was contributed of the maybe I specifically in with some the we missed bit Mid-Con, the that impacts season.

overall perspective, gas. the refineries margin on larger operating balance. pushing as the of back for Europe U.S. right and PADD from and online the We Europe, Middle up on And this. of distillate draw come really X We're And as some then diesel the that coming a the back But come as starting in cracks is macro in that's slightly now demand of the think far strong but -- out. we We're the I more right the part go into some into back distillate in with are you strengths barrels environment suppressing some settling saw below inventory and midst, the we play. actual into seeing coming that, structurally, seeing see both and see now, East, levels

as as opportunity. far pockets of Now

many on chain and strategic take that move we our looking major and really go, that Jet hubs, some logistical but we going we're forward. focus were associated continues at connected that to balanced, incremental areas and to to with advantages to are extending our that the demand of being of value take debt advantage also We have to look to look we as of the optimizing advantage

saw Utilization back just we're is the demand in support I I internal than guys this second supply closer what say the that if hotter been EIA a XXXX. in yesterday the will phenomenon in really Really, margins. And and since their demand was report in The typically something having to months -- say biggest very the the there that in quarter average is, Steve what come strongest way the is you But fundamentals. the the has in industry, what issue. high, was was we market just Yes. running and often August compare our we're saw what not you utilization that the would demand is to utilization XX%, quarter And May just as I second to in of that supply. was, What numbers. reported the in squeezing meetings. a this average was you Tim. see think, destiny say XX%, would continue

going last last sustainable. several to see that just level And result, over is to We've starting couple quarter. along utilization. We've industry a into the here not weeks, sustain third starting all of years, you're high that we said improve. of to cracks the to as had even and that's to that able over you're starting see And just the the continue think

helpful. maybe then just super That's And Lubricants. switching it. gears Got on

a You've here. of demonstrated years couple profitability really of strong

a be updated further Anything So would on I potential maybe timing wanted thoughts this helpful. decision on share how of strategic to value to business. super get from you your unlock could

Yes.

value of asset As maximize we've stated Lubes business eye We strategic with Lubes business assets on before, an and optimizing the ongoing from of and is shareholder this review our value. an portfolio our simplification in continued our of believe all the we significant evaluate priority. and basis

any have the Lubes this don't updates on or it to business. we time However, make announcements

Our is question with Research. from Doug coming next Wolfe Leggate

for you the utilization impact This markets. see return asked guys Carlos perceived was filling guess specific to direct markets, build trend you your of in Cenovus that previously wining actually on Doug. across How to question shifting your especially when market? and mid-continent I a utilization What's your do that utilization. a see want we having on is in

-- thanks It's Yes. for the question.

right? numbers pheno reported have That's X, in quarter, in, seen down again, the of mentioned one that And being we high as utilization you're seeing utilization We I -- today, saw say, as come don't PADD utilization that can be second we earlier. of level think sustained. increased the

a this capability is barrels West. have to bit about the move talked we've past, our to and strategy we little overall strategy, overall our However,

And higher barrels then to Mid-Con. move can X high into And Coast we of we have Rockies have, where over capability the the which from refineries amount West the to ourselves have, think do barrels pipeline PADD continue UNEV capture we into in strategy Mid-Con some the as our barrels so west. West and upgrade in that. And need utilization they positioned the the is, our us we that ability refineries those facilities, so our through the as to give for even Midstream, Vegas. from to gets the production particular, general and And Coast know, of our think to California or will in a as the reduce we move stays the you continue

as well. be results up. what previous That's very of itself And On forward? will it on as looks had the helpful. then showing follow-up quick recession, questions obviously, like do a you've and Lubricants, given apparent one the and you diesel a point how are an quarter going segment of sustainable But in assess

It's great here. It's Matt Yes. question. Joyce a

I another to think our We've quarter compressed, just and here spread we the nice in -- be results. drive The I portfolio. those is say seen able is great to think were crack And a that pressed both We to entire our saw it to strategy And continue I past that margins optimized more the it resilient and to to again, that. great play were certainly exemplifies this deliver we'll the but Specialties and very Finished cracks. sustain business we the strengths, think business was businesses. able maintain a through our we've mentioned cycles. can

a is new business. this continue well, improve forward, looking it. So we're to tracking and norm, This we and is our to look sustainable

that. of top on comment another make just I'll Yes.

about. And passenger associated that's optimization our with the cars. industrial oils. GDP disconnecting focused really is the it And on that through base It's and the this remember, more Lubes cracks and all through with with the also oil our from efforts business that associated businesses. Lubes Finished margins growing organically than Finished is We business growing base Matt are are talked

disconnected so mentioned, Lubes. really not get and the base than that going to of strong the yet the believe oil second And talked the continues what quarter, parts in as I results, saw for we from our weakness they're in cracks much early the to about earlier, be are we weaker outlook now. you And the

is next Blair coming Our with TPH. question from Matthew

seeing In quarter? noticed in quarter. refining, third dynamics Could in talk what second up . the your asphalt a we bit you're yield little about asphalt and that QX in far you kept the so

Matt. Sure,

our value think nice the extension is I a that chain. asphalt business of is little something

of we to the locations have retail really paving can can into all those assets We we can we year product markets and get So in it the and and to crudes, extent beneficial facilities heavier the the the us. grade for that go run like are to say upgrade components, we the take pave the Southwest.

optimized few have where rail. We a elements we've

So a bit. our come structure cost has down

also price have some improvement. We had

And as business heavy of -- at this a we're so going value something extension continue grow. to to and we it's our look true that value oil heavy chain, to continue

the But I a we this little quarter. perform think the where term. market of help bit operating of long think market gave us of overall, will we're right kind in mid the

to our lot our focus customers growing logistics, costs relationships with on continue a there. is approach and of to optimization, Our

areas don't the Sinclair capturing we've one with question. for one Yes. a But Thanks -- asphalt big of of as our that get questions. synergy that was associated where of you had opportunities know, We been we asphalt combination. lot the

Sinclair's businesses. been allowing really us really that that's we as able purchases. asphalt asphalt asphalt HollyFrontier. to combine feedstock that's to our been of finished to full producing. We've wholesale take with Most internally opposed legacy a been business business. is produced And advantage have third-party And now So of those they've X our

just to the up market the conditions? some Great. plant? you that it El Was quarter. you maintenance I Or due And turnaround, then that from believe accelerate moved said the fourth there Dorado was at was on need to

it was scheduling. just and The made weeks, couple optimization from of in pull to a market of workforce sense perspective. opportunity a really the lot and efficiency think just an We around it for favorable

Gabelman next TD question is with coming from Our Cowen. Jason

there's some for to spend maintenance like on budget wanted mid-cycle guidance been benefit ask maintenance seems forward. I from kind of higher the and It the year. moving this

of Given level a your do next operations spend lower that, years you to your improve? the will you expect couple need in that do future to track operations number over targets? with higher to Or at line get continue in that, as the

Yes.

question. So great

As down will improves, our maintenance. come reliability our costs

think the what would term to -- flat but improvements, in seeing short near programs. the some I is I term, as our be say we're we're to we're in invest continue going seeing we

of reactive is proactive So business money going the that into of the programs. coming side out and

on shift to dollars we going keep those build flat spend. as out so maintenance us really to that's reliability, And relatively our

believe Jason, be we flow and our we as number term, about. going we mid-cycle near that's $X.XX Valerie long per is still think improvements process the earlier. term, assumptions still additional get $X.XX, through work right But We've to for our OpEx be show $X.XX, near-term barrel. to we about thinking talked that a updated to target mentioned can to

terms it assume Got provide it. previously on like level. returns And get your investors, Once Or you're there, shareholding should of provided? going then a is distribution to a Sinclair to you in quickly framework? are they of ratio seems their you've update target just payout we to approaching more that kind cash fulsome going XX%

you is Atanas. question. Thank This for your

to as to these we'll returning, -- And be returning shareholder XX% to remains commitment we back unchanged. of we on we're the cash our our all that pace continue To strong cash that some of shareholders. ratio. payout generate favorable to this margins flows returns exceed be seeing continue Our to extent

XXX% our year, remains we're our XX%. we meet we're commitment on at a and exceed So for reference, This year-to-date Last just did basis, year, payout. unchanged to XX%.

demonstrates think our I history So

from coming Laetsch is Morgan question next Joe with Stanley. Our

wanted marketing on to side. I start So the

mind rate X% store comments is you past. the outlook above in about the the prepared for your is or growth that to all please? greater XX% the talked target just in have growth talking you segment, Would that think I

put about The of like to online against. coming I question is DINO next opportunity XX% about. Yes, This to ways. think had front for still a advantage of us we that that and which the value what guided We the a ground a over think get looking And But in around yet resources still we that We this thanks this. this and to some XX reality in is for fulfilling year-over-year, lot months do is this the key that next that those There's grow the that, focus on of permit. think, branded for us. previously to lot we're that brand regions us. have is and and see in locations logistic untapped HS an the demand multiple is just is accretive putting is think hunting will the We years. to and reflects something growth we're go to see a XXX make Joe, to excited in focus we you several pretty X sites for marketing. what the questions. growth there And above we area sure. to continuing of where beginning. is the allocating in We're

talk has that ADP for just now can now, synergies to then opportunities any of you're you few transaction the months seeing commercial And side? helpful. That's terms been operational closed a on in the

Yes.

And have segment that performance seeing give across the identify result about. more difficult buy-in. midstream been as have the a to We're and/or pleased I for all either But value synergies are well. just days early It's with around opportunities simplification costs about for strong public retaining I'll already the cost So some we of obvious asking company still And seen the pretty one you segment and and that effectively. we're it's Thank with are as there. We've that. chain previously yet. value example. the happy some another

what ways to a finding choose. the put very concentration on molecules our that want we markets crude assets our area have we Permian. in we feedstock that leverage can we're we logistics that already more of We and strong those move and the go call the where of the Southwest And in Southwest, more fully

that that solutions see the examples, just as to other of there all of are in problems platforms. areas but back begin we we one against pull look with our common operating we'll to come up So to come as

Midstream playing I'll out volumes say continue with we you Midstream our business. to the business, just earlier, chime which our as about business. marketing in our mining and Joe, had optimize And our is all too quarter record in really in we that asked along second

refining consider that's integrating then focused to innovation continue those business grow optimization, really are we really our work have with and when on we together is really say that businesses, them. business. we're do to businesses, well and So Marketing along we the Midstream X core our what And trying to and

question. the for around thanks into again, right our plays It strategy our So

There will are back closing to for time. Tim conference I this at no the further questions turn now remarks.

Thank you, Mark.

So including in before our and a strong experience our to last as oil BP. the Counsel our for we gas business more years Eric confident legal contributor I General welcome close, leadership team. of brings I'm us XX than the going forward. be wanted Eric industry, to X new that General Counsel, will to Eric serving years Nitcher,

results. positive on throughputs, initiatives ruble improvements in and executing cost quarter lower We EBITDA per and Higher utilization diesel in Lubricants and barrel, evident are focused on earnings are strong our our second the op Midstream. strategic

indicative All employees and of of our the plan. of these are commitment hard work executing

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