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Valero Energy Corporation VLO reported fourth-quarter 2021 adjusted earnings of $2.47 per share, improving from a loss of $1.06 in the year-ago quarter. The bottom line also beat the Zacks Consensus Estimate of $1.79 per share.
Total revenues increased from $16,604 million in the prior-year quarter to $35,903 million. The top line also surpassed the Zacks Consensus Estimate of $28,627 million.
The strong quarterly results of Valero Energy were supported by increased refinery throughput volumes and a higher refining margin.
Segmental Performance
Adjusted operating income in the Refining segment amounted to $1,095 million, turning around from a loss of $476 million in the year-ago quarter. Higher refinery throughput volumes aided the segment.
In the Ethanol segment, Valero Energy reported an adjusted operating profit of $475 million, up from $17 million in the year-ago quarter. Higher ethanol production volumes aided the segment. Production increased to 4,402 thousand gallons per day from 4,124 thousand gallons a year ago.
Operating income at the Renewable Diesel segment increased to $152 million from $127 million in the year-ago quarter owing to higher renewable diesel sales volumes, which increased to 1,592 thousand gallons per day from 618 thousand gallons a year ago.
Throughput Volumes
For the quarter, Valero Energy’s refining throughput volumes were 3,033 MBbls/d, up from 2,550 MBbls/d in fourth-quarter 2020.
In terms of feedstock composition, sweet crude, medium/light sour crude, and heavy sour crude accounted for 53.4%, 9.9%, and 11.2%, respectively, of its total volume. The remaining volumes came from residuals, other feedstock and blendstocks and others.
The Gulf Coast contributed approximately 59.2% to total throughput volume. Mid-Continent, North Atlantic, and West Coast regions accounted for 16%, 16.2%, and 8.5%, respectively, of the total throughput volume.
Throughput Margins
Refining margin per barrel of throughput increased to $10.73 from the year-ago level of $4.64. Refining operating expenses per barrel of throughput was $4.86 compared with $4.40 in the year-ago quarter. Depreciation and amortization expenses declined to $1.95 a barrel from $2.27 in the prior-year quarter. As such, Valero Energy’s adjusted refining operating income was recorded at $3.92 per barrel of throughput against the year-ago loss of $2.03.
Cost of Sales
Valero Energy’s total cost of sales surged to $33,993 million from the year-ago figure of $16,834 million, primarily due to the higher cost of materials and increased operating expenses.