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PBF Energy (PBF) Beats Earnings & Revenue Estimates in Q4

Zacks Equity Research
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PBF Energy Inc. PBF posted fourth-quarter 2018 profit of $1.03 a share, beating the Zacks Consensus Estimate of 77 cents. In the year-earlier quarter, the company reported a loss of 4 cents. Higher refining margins primarily backed the company’s strong quarterly earnings. This was partially offset by lower crude oil and feedstocks throughput volumes.

Total revenues fell to $6,293 million from $6,536 million in the prior-year quarter. The top line, however, beat the Zacks Consensus Estimate of $6,123 million.  

Segmental Performance

Operating loss at the Refining segment was $397.7 million against a profit of $293 million in the year-ago quarter due to lower crude oil and feedstocks throughput volumes.

The company generated profit of $38.6 million from the Logistics segment, which shows an improvement from the prior-year quarter’s $35.6 million.

Throughput Volumes

In the quarter under review, crude oil and feedstocks throughput volumes were 842.7 thousand barrels per day (BPD), down from 870.9 thousand BPD in the year-ago quarter.

The East Coast, Mid-Continent, Gulf Coast and West coast regions accounted for approximately 39.3%, 17.8%, 22.4% and 20.5%, respectively, of the total oil and feedstocks throughput volume. 

Throughput Margins

Company-wide gross refining margin per barrel of throughput — excluding special items — was recorded at $10, higher than the year-earlier quarter’s $7.06.

Refining margin per barrel of throughput was $8.55 in the East Coast, up from $4.02 in the year-earlier quarter. The metric was $17.76 a barrel in the Mid-Continent, higher than $12.17 a year ago. Refining margin realized was $5.83 per barrel in the Gulf Coast, down from $6.12 in the prior-year quarter. The metric was $10.57 per barrel in the West Coast, marginally up from $10.24 in the prior-year quarter.

Refining operating expense per barrel of throughput was $5.56, higher than $5.01 in the year-ago quarter.

Capital Expenditure & Balance Sheet

Through the fourth quarter, the company spent $175.3 million capital on refining operations and $89.1 million on logistics businesses.

At the end of the quarter, the company had cash and cash equivalents of $597.3 million along with total debt of $1.9 billion, the debt-to-capitalization ratio being 37.3%. 

Guidance

PBF Energy projects total daily throughput volumes for first-quarter 2019 from the East Coast in the range of 300,000-320,000 barrels, while the same from the Mid-Continent is expected in the band of 135,000-145,000 barrels. Total daily throughput volumes at the Gulf Coast are expected in the range of 175,000-185,000 barrels, while that at the West Coast is anticipated within 130,000-140,000 barrels.

Through 2019, the company anticipates total daily throughput volumes from the East Coast between 325,000 barrels and 345,000 barrels. The same from the Mid-Continent is projected at 150,000-160,000 barrels, while the Gulf Coast is anticipated to generate 195,000-205,000 barrels.

Zacks Rank and Key Picks

Currently, PBF Energy carries a Zacks Rank #4 (Sell). Meanwhile, better-ranked players in the energy space include Jones Energy Inc. JONE, Golar LNG Partners LP GMLP and Sunoco LP SUN. Jones and Sunoco carry a Zacks Rank #2 (Buy), while Golar LNG sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Jones Energy expects 2019 earnings growth of 19% year over year.

Golar LNG delivered average positive earnings surprise of 92.8% in the preceding four quarters.

Sunoco LP has average positive earnings surprise of 18.39% for the trailing four quarters.

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