HollyFrontier Corporation’s HFC top management has decided to forego up to 10% of its chief executive officer’s (CEO) salary for the remainder of this year in the wake of the coronavirus-induced economic downturn and other cost curtailment activities.
Authorities of this independent refiners and marketers of petroleum products company also announced a 10% cutback in the cash remuneration of its non-employee directors for the rest of this year. All these pay cuts will be effective Jul 1.
Companies across the globe are grappling with an unprecedented crisis and taking stringent measures to tackle this uncertainty amid the pandemic-led demand contraction. Suspension of production, compulsory leaves/layoffs and cost-cutting are becoming commonplace. Despite policymakers’ best efforts, companies are finding it difficult to stay afloat amid such trying times.
HollyFrontier Corporation Price
HollyFrontier Corporation price | HollyFrontier Corporation Quote
The salary reduction news soon follows Hollyfrontier’s announcement that its Cheyenne Refinery will shortly shift from a refining petroleum unit to producing renewable diesel fuel processed from soybean oil. This conversion to renewable diesel production will terminate HollyFrontier’s petroleum refining operation and cause a cutback in workforce at the Cheyenne refinery.
In April, this Dallas, TX-based company trimmed its 2020 capital spending guidance by nearly 15% from its prior expectation of $623-$729 million to the present $525-$625 million range after taking into consideration the ongoing decline in commodity prices.
Other Companies’ Cost-Saving Efforts
In response to the current downbeat market, this Zacks Rank #3 (Hold) player joins other refining entities like Phillips 66 PSX and Sunoco LP SUN in slashing budgets as oil prices persistently display a downtrend.
Even integrated majors with large downstream presence, such as BP plc BP resorted to lowering refinery rates on weak demand. These industry players aim to tide over the tough times by sustaining financial flexibility and operational excellence. Notably, strengthening the companies’ capital structure at a time when oil prices fetch no profits to most industry participants is indeed a judicious decision. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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