HF Sinclair (U.S.) beats profit estimates as refining margins soar
Refiner HF Sinclair beat Wall Street estimates for 2Q profit on Thursday as higher refining margins in the mid-continent region (U.S.) helped offset lower refined product sales volumes.
Top U.S. refiners are posting improved results in 2Q, rebounding from 1Q losses as stronger-than-expected diesel margins lift earnings. Peers such as Valero Energy and Phillips 66 have also surpassed Wall Street estimates.
Dallas, Texas-based HF Sinclair reported 2Q refining margins of $16.50 per barrel, up about 46% from a year ago. Refining margins for the mid-continent region jumped about 85%, to $15.52 per barrel, during the quarter.
Its adjusted profit reached $1.70 per share, compared with analysts' average estimate of $1.02 per share, according to data compiled by LSEG.
"There was a lot of concern earlier in the year that capacity growth would outshine demand growth. And really what we've seen play out over this year is that that's not happening," said Tim Goh, CEO of HF Sinclair. "If you look at (the) longer term, the policies of this new administration are also strengthening the outlook for the refining industry."
The higher quarterly margins helped offset throughput volumes, which were down 2.4% at 660,640 bpd from a year earlier, while refinery utilization was down at 90.8% from 93.6% in the same period.
The lower volumes were due to turnaround activities at its Tulsa, Oklahoma and Parco, Wyoming refineries in the reported quarter, the company said in a statement.
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