Valero’s Q4 Earnings Beat Estimates, Decrease Y/Y

Valero Energy Corporation (VLO – Free Report) posted adjusted fourth-quarter 2016 income of 81 cents per share that surpassed the Zacks Consensus Estimate of 74 cents by 9.4%. However, quarterly earnings decreased from the year-ago adjusted earnings of$1.79 per share

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Total revenue for the quarter grew 7.4% year over year to $20,712.0 million from $18,777.0 million. The reported figure was also above the Zacks Consensus Estimate of $16,919.0 million.

Full-year 2016 adjusted earnings came in at $3.72 per share. The bottom line surpassed our expectations of $3.68 per share but decreased substantially from the year-ago level of $9.24. Full-year revenues declined 13.8% year over year to $75,659 million but outpaced the Zacks Consensus Estimate of $72,064 million.

Throughput Volumes

During the quarter, refining throughput volumes were approximately 2.85 million barrels per day. The quarterly figure was same as the year-earlier level.

By feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 41.5%, 19.2% and 13.4%, respectively. The remaining volumes came from residuals, other feedstock as well as blendstocks and others.

The Gulf Coast accounted for approximately 58% of the total throughput volume. The Mid-Continent, North Atlantic and West Coast regions accounted for 16%, 17% and 9%, respectively.

Throughput Margins

Company-wide throughput margins decreased to $8.22 per barrel from the year-ago level of $10.87 per barrel.

Average throughput margin realized was $8.44 per barrel in the U.S. Gulf Coast as against $10.70 per barrel in the year-earlier period. The metric was $6.85 per barrel in the U.S. Mid-Continent as against $10.34 a year ago. Throughput margin realized was $8.75 per barrel in the North Atlantic compared with $10.09 last year and $8.15 per barrel in the U.S. West Coast compared with $14.62 in the prior-year quarter.

Total operating cost per barrel was $5.50 during the quarter, up 5.2% from the year-earlier figure of $5.23. Refining operating expense per barrel was $3.83 compared with $3.47 in the year-ago quarter. Depreciation and amortization expenses decreased 5.1% year over year to $1.67 per barrel.

Capital Expenditure & Balance Sheet

Fourth-quarter capital expenditure totaled $628.0 million, including $244 million for turnarounds and catalyst expenditures. At the end of the quarter, the company had cash and temporary cash investments of $4.8 billion and debt of $8 billion. Valero also rewarded shareholders with dividends worth $271 million.