|
|
|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
|
Delaware
|
|
35-1811116
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification Number)
|
|
|
|
2780 Waterfront Parkway East Drive, Suite 200
|
|
|
Indianapolis, Indiana
|
|
46214
|
(Address of Principal Executive Officers)
|
|
(Zip Code)
|
|
|
Large accelerated filer
|
|
☐
|
|
Accelerated filer
|
|
☒
|
Non-accelerated filer
|
|
☐ (Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
|
☐
|
Emerging growth company
|
|
☐
|
|
|
|
|
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|
Page
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
|
(Unaudited)
|
|
|
||||
|
(In millions, except unit data)
|
||||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
26.5
|
|
|
$
|
4.2
|
|
Accounts receivable, net:
|
|
|
|
||||
Trade
|
338.8
|
|
|
216.4
|
|
||
Other
|
2.9
|
|
|
22.3
|
|
||
|
341.7
|
|
|
238.7
|
|
||
Inventories
|
324.4
|
|
|
386.2
|
|
||
Derivative assets
|
0.3
|
|
|
0.8
|
|
||
Prepaid expenses and other current assets
|
15.8
|
|
|
11.0
|
|
||
Current assets held for sale
|
125.0
|
|
|
—
|
|
||
Total current assets
|
833.7
|
|
|
640.9
|
|
||
Property, plant and equipment, net
|
1,410.4
|
|
|
1,678.0
|
|
||
Investment in unconsolidated affiliates
|
9.9
|
|
|
10.3
|
|
||
Goodwill
|
172.0
|
|
|
177.2
|
|
||
Other intangible assets, net
|
153.9
|
|
|
178.5
|
|
||
Other noncurrent assets, net
|
18.4
|
|
|
40.3
|
|
||
Noncurrent assets held for sale
|
215.1
|
|
|
—
|
|
||
Total assets
|
$
|
2,813.4
|
|
|
$
|
2,725.2
|
|
LIABILITIES AND PARTNERS’ CAPITAL
|
|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
261.3
|
|
|
$
|
295.5
|
|
Accrued interest payable
|
55.4
|
|
|
52.5
|
|
||
Accrued salaries, wages and benefits
|
32.3
|
|
|
11.5
|
|
||
Other taxes payable
|
24.1
|
|
|
20.8
|
|
||
Obligations under inventory financing agreements
|
92.8
|
|
|
—
|
|
||
Other current liabilities
|
59.7
|
|
|
99.6
|
|
||
Current portion of long-term debt
|
4.3
|
|
|
3.5
|
|
||
Derivative liabilities
|
8.3
|
|
|
14.8
|
|
||
Current liabilities held for sale
|
74.5
|
|
|
—
|
|
||
Total current liabilities
|
612.7
|
|
|
498.2
|
|
||
Deferred income taxes
|
1.0
|
|
|
2.3
|
|
||
Pension and postretirement benefit obligations
|
3.6
|
|
|
11.3
|
|
||
Other long-term liabilities
|
0.8
|
|
|
1.0
|
|
||
Long-term debt, less current portion
|
1,986.6
|
|
|
1,993.7
|
|
||
Noncurrent liabilities held for sale
|
7.1
|
|
|
—
|
|
||
Total liabilities
|
2,611.8
|
|
|
2,506.5
|
|
||
Commitments and contingencies
|
|
|
|
||||
Partners’ capital:
|
|
|
|
||||
Limited partners’ interest 76,729,706 units and 76,392,258 units, issued and outstanding as of September 30, 2017 and December 31, 2016, respectively
|
194.3
|
|
|
211.2
|
|
||
General partner’s interest
|
15.5
|
|
|
15.8
|
|
||
Accumulated other comprehensive loss
|
(8.2
|
)
|
|
(8.3
|
)
|
||
Total partners’ capital
|
201.6
|
|
|
218.7
|
|
||
Total liabilities and partners’ capital
|
$
|
2,813.4
|
|
|
$
|
2,725.2
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In millions, except per unit and unit data)
|
||||||||||||||
Sales
|
$
|
1,097.4
|
|
|
$
|
966.6
|
|
|
$
|
3,065.7
|
|
|
$
|
2,652.5
|
|
Cost of sales
|
945.9
|
|
|
856.3
|
|
|
2,614.3
|
|
|
2,324.7
|
|
||||
Gross profit
|
151.5
|
|
|
110.3
|
|
|
451.4
|
|
|
327.8
|
|
||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Selling
|
28.0
|
|
|
26.2
|
|
|
83.7
|
|
|
82.9
|
|
||||
General and administrative
|
41.6
|
|
|
28.2
|
|
|
107.0
|
|
|
80.6
|
|
||||
Transportation
|
36.1
|
|
|
42.2
|
|
|
117.8
|
|
|
126.4
|
|
||||
Taxes other than income taxes
|
7.0
|
|
|
4.8
|
|
|
17.4
|
|
|
14.7
|
|
||||
Asset impairment
|
—
|
|
|
—
|
|
|
0.4
|
|
|
33.4
|
|
||||
Other expense (income)
|
3.8
|
|
|
(1.0
|
)
|
|
6.8
|
|
|
1.3
|
|
||||
Operating income (loss)
|
35.0
|
|
|
9.9
|
|
|
118.3
|
|
|
(11.5
|
)
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(47.4
|
)
|
|
(44.6
|
)
|
|
(135.8
|
)
|
|
(117.7
|
)
|
||||
Gain (loss) on derivative instruments
|
(12.0
|
)
|
|
(6.7
|
)
|
|
(5.0
|
)
|
|
3.4
|
|
||||
Loss from unconsolidated affiliates
|
(0.2
|
)
|
|
(0.3
|
)
|
|
(0.4
|
)
|
|
(18.5
|
)
|
||||
Loss from sale of unconsolidated affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(113.4
|
)
|
||||
Other
|
0.9
|
|
|
0.7
|
|
|
1.6
|
|
|
1.6
|
|
||||
Total other expense
|
(58.7
|
)
|
|
(50.9
|
)
|
|
(139.6
|
)
|
|
(244.6
|
)
|
||||
Net loss before income taxes
|
(23.7
|
)
|
|
(41.0
|
)
|
|
(21.3
|
)
|
|
(256.1
|
)
|
||||
Income tax benefit
|
(0.1
|
)
|
|
(7.6
|
)
|
|
(1.1
|
)
|
|
(7.1
|
)
|
||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
Allocation of net loss:
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
Less:
|
|
|
|
|
|
|
|
||||||||
General partner’s interest in net loss
|
(0.5
|
)
|
|
(0.7
|
)
|
|
(0.4
|
)
|
|
(5.0
|
)
|
||||
Net loss available to limited partners
|
$
|
(23.1
|
)
|
|
$
|
(32.7
|
)
|
|
$
|
(19.8
|
)
|
|
$
|
(244.0
|
)
|
Weighted average limited partner units outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic and Diluted
|
77,632,784
|
|
|
77,331,347
|
|
|
77,537,531
|
|
|
76,767,975
|
|
||||
Limited partners’ interest basic and diluted net loss per unit
|
$
|
(0.30
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(3.18
|
)
|
Cash distributions declared per limited partner unit
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.685
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In millions)
|
||||||||||||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
||||||||
Cash flow hedge gain reclassified to net loss
|
—
|
|
|
(4.8
|
)
|
|
—
|
|
|
(9.2
|
)
|
||||
Defined benefit pension and retiree health benefit plans
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
||||
Total other comprehensive income (loss)
|
0.1
|
|
|
(4.8
|
)
|
|
0.1
|
|
|
(9.1
|
)
|
||||
Comprehensive loss attributable to partners’ capital
|
$
|
(23.5
|
)
|
|
$
|
(38.2
|
)
|
|
$
|
(20.1
|
)
|
|
$
|
(258.1
|
)
|
|
Accumulated Other
Comprehensive Loss
|
|
Partners’ Capital
|
|
|
||||||||||
|
|
General
Partner
|
|
Limited
Partners
|
|
Total
|
|||||||||
|
(In millions)
|
||||||||||||||
Balance at December 31, 2016
|
$
|
(8.3
|
)
|
|
$
|
15.8
|
|
|
$
|
211.2
|
|
|
$
|
218.7
|
|
Other comprehensive income
|
0.1
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
||||
Net loss
|
—
|
|
|
(0.4
|
)
|
|
(19.8
|
)
|
|
(20.2
|
)
|
||||
Amortization of phantom units
|
—
|
|
|
—
|
|
|
3.3
|
|
|
3.3
|
|
||||
Settlement of tax withholdings on equity-based incentive compensation
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
||||
Contributions from Calumet GP, LLC
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Balance at September 30, 2017
|
$
|
(8.2
|
)
|
|
$
|
15.5
|
|
|
$
|
194.3
|
|
|
$
|
201.6
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Operating activities
|
|
|
|
||||
Net loss
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
130.6
|
|
|
127.1
|
|
||
Amortization of turnaround costs
|
20.4
|
|
|
25.3
|
|
||
Non-cash interest expense
|
7.6
|
|
|
7.2
|
|
||
Provision for doubtful accounts
|
0.2
|
|
|
0.4
|
|
||
Unrealized gain on derivative instruments
|
(2.2
|
)
|
|
(23.5
|
)
|
||
Asset impairment
|
0.4
|
|
|
33.4
|
|
||
(Gain) loss on disposal of fixed assets
|
3.9
|
|
|
(0.5
|
)
|
||
Non-cash equity based compensation
|
8.4
|
|
|
3.9
|
|
||
Deferred income tax benefit
|
(0.2
|
)
|
|
(0.4
|
)
|
||
Lower of cost or market inventory adjustment
|
(19.1
|
)
|
|
(33.3
|
)
|
||
Loss from unconsolidated affiliates
|
0.4
|
|
|
18.5
|
|
||
Loss from sale of unconsolidated affiliates
|
—
|
|
|
113.4
|
|
||
Other non-cash activities
|
5.0
|
|
|
3.7
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(155.1
|
)
|
|
(69.8
|
)
|
||
Inventories
|
8.0
|
|
|
16.3
|
|
||
Prepaid expenses and other current assets
|
(4.8
|
)
|
|
(6.6
|
)
|
||
Derivative activity
|
(0.3
|
)
|
|
(18.1
|
)
|
||
Turnaround costs
|
(11.3
|
)
|
|
(8.7
|
)
|
||
Other assets
|
(0.4
|
)
|
|
(0.3
|
)
|
||
Accounts payable
|
37.7
|
|
|
11.6
|
|
||
Accrued interest payable
|
2.9
|
|
|
24.1
|
|
||
Accrued salaries, wages and benefits
|
17.6
|
|
|
(17.0
|
)
|
||
Other taxes payable
|
7.4
|
|
|
5.4
|
|
||
Other liabilities
|
(39.7
|
)
|
|
19.9
|
|
||
Pension and postretirement benefit obligations
|
(0.5
|
)
|
|
(1.8
|
)
|
||
Net cash used in operating activities
|
(3.3
|
)
|
|
(18.8
|
)
|
||
Investing activities
|
|
|
|
||||
Additions to property, plant and equipment
|
(45.6
|
)
|
|
(117.3
|
)
|
||
Investment in unconsolidated affiliates
|
—
|
|
|
(41.0
|
)
|
||
Proceeds from sale of unconsolidated affiliates
|
—
|
|
|
29.0
|
|
||
Proceeds from sale of property, plant and equipment
|
—
|
|
|
1.9
|
|
||
Net cash used in investing activities
|
(45.6
|
)
|
|
(127.4
|
)
|
||
Financing activities
|
|
|
|
||||
Proceeds from borrowings — revolving credit facility
|
781.2
|
|
|
823.2
|
|
||
Repayments of borrowings — revolving credit facility
|
(791.3
|
)
|
|
(934.1
|
)
|
||
Proceeds from borrowings — senior notes
|
—
|
|
|
393.1
|
|
||
Repayments of borrowings — related party note
|
—
|
|
|
(55.4
|
)
|
||
Payments on capital lease obligations
|
(6.7
|
)
|
|
(6.2
|
)
|
||
Proceeds from inventory financing agreements
|
91.6
|
|
|
—
|
|
||
Other financing activities
|
(1.1
|
)
|
|
6.9
|
|
||
Debt issuance costs
|
(2.2
|
)
|
|
(10.1
|
)
|
||
Contributions from Calumet GP, LLC
|
0.1
|
|
|
0.2
|
|
||
Taxes paid for phantom unit grants
|
(0.4
|
)
|
|
(1.8
|
)
|
||
Distributions to partners
|
—
|
|
|
(57.4
|
)
|
||
Net cash provided by financing activities
|
71.2
|
|
|
158.4
|
|
||
Net increase in cash and cash equivalents
|
22.3
|
|
|
12.2
|
|
||
Cash and cash equivalents at beginning of period
|
4.2
|
|
|
5.6
|
|
||
Cash and cash equivalents at end of period
|
$
|
26.5
|
|
|
$
|
17.8
|
|
Supplemental disclosure of non-cash financing and investing activities
|
|
|
|
||||
Non-cash property, plant and equipment additions
|
$
|
8.9
|
|
|
$
|
16.4
|
|
Non-cash capital lease
|
$
|
—
|
|
|
$
|
2.3
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
RINs Obligation
|
$
|
41.0
|
|
|
$
|
79.3
|
|
Other
|
18.7
|
|
|
20.3
|
|
||
Total
|
$
|
59.7
|
|
|
$
|
99.6
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
Titled
Inventory
|
|
Supply and Offtake
Agreements
(1)
|
|
Total
|
|
Titled
Inventory
|
|
Supply and Offtake
Agreements
(1)
|
|
Total
|
||||||||||||
Raw materials
|
$
|
31.1
|
|
|
$
|
14.4
|
|
|
$
|
45.5
|
|
|
$
|
57.4
|
|
|
$
|
—
|
|
|
$
|
57.4
|
|
Work in process
|
35.1
|
|
|
24.5
|
|
|
59.6
|
|
|
74.2
|
|
|
—
|
|
|
74.2
|
|
||||||
Finished goods
|
174.9
|
|
|
44.4
|
|
|
219.3
|
|
|
254.6
|
|
|
—
|
|
|
254.6
|
|
||||||
|
$
|
241.1
|
|
|
$
|
83.3
|
|
|
$
|
324.4
|
|
|
$
|
386.2
|
|
|
$
|
—
|
|
|
$
|
386.2
|
|
|
(1)
|
Amounts represent LIFO value and do not necessarily represent the value at which the inventory was sold. Refer to
Note 7
for further information.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net income before income taxes
|
$
|
17.0
|
|
|
$
|
19.5
|
|
|
$
|
82.5
|
|
|
$
|
54.5
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||
|
Investment
|
|
Percent Ownership
|
|
Investment
|
|
Percent Ownership
|
||||||
Pacific New Investment Limited
|
$
|
9.5
|
|
|
23.8
|
%
|
|
$
|
9.6
|
|
|
23.8
|
%
|
Other
|
0.4
|
|
|
|
|
0.7
|
|
|
|
||||
Total
|
$
|
9.9
|
|
|
|
|
$
|
10.3
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||
Borrowings under amended and restated senior secured revolving credit agreement with third-party lenders, interest payments quarterly, borrowings due July 2019, weighted average interest rate of 7.4% and 4.8% for the nine months ended September 30, 2017 and year ended December 31, 2016, respectively.
|
$
|
0.1
|
|
|
$
|
10.2
|
|
Borrowings under 2021 Secured Notes, interest at a fixed rate of 11.5%, interest payments semiannually, borrowings due January 2021, effective interest rate of 12.3% and 12.2% for the nine months ended September 30, 2017 and year ended December 31, 2016, respectively.
|
400.0
|
|
|
400.0
|
|
||
Borrowings under 2021 Notes, interest at a fixed rate of 6.5%, interest payments semiannually, borrowings due April 2021, effective interest rate of 6.8% for the nine months ended September 30, 2017 and year ended December 31, 2016.
|
900.0
|
|
|
900.0
|
|
||
Borrowings under 2022 Notes, interest at a fixed rate of 7.625%, interest payments semiannually, borrowings due January 2022, effective interest rate of 8.0% for the nine months ended September 30, 2017 and year ended December 31, 2016.
(1)
|
352.2
|
|
|
352.5
|
|
||
Borrowings under 2023 Notes, interest at a fixed rate of 7.75%, interest payments semiannually, borrowings due April 2023, effective interest rate of 8.0% for the nine months ended September 30, 2017 and year ended December 31, 2016.
|
325.0
|
|
|
325.0
|
|
||
Other
|
6.9
|
|
|
8.0
|
|
||
Capital lease obligations, at various interest rates, interest and principal payments monthly through November 2034.
|
44.7
|
|
|
46.5
|
|
||
Less unamortized debt issuance costs
(2)
|
(27.7
|
)
|
|
(33.2
|
)
|
||
Less unamortized discounts
|
(10.3
|
)
|
|
(11.8
|
)
|
||
Total long-term debt
|
$
|
1,990.9
|
|
|
$
|
1,997.2
|
|
Less current portion of long-term debt
|
4.3
|
|
|
3.5
|
|
||
|
$
|
1,986.6
|
|
|
$
|
1,993.7
|
|
|
(1)
|
The balance includes a fair value interest rate hedge adjustment, which increased the debt balance by
$2.2 million
and
$2.5 million
as of
September 30, 2017
and
December 31, 2016
, respectively (refer to
Note 9
for additional information on the interest rate swap designated as a fair value hedge).
|
(2)
|
Deferred debt issuance costs are being amortized by the effective interest rate method over the lives of the related debt instruments. These amounts are net of accumulated amortization of
$19.8 million
and
$14.5 million
at
September 30, 2017
and
December 31, 2016
, respectively.
|
Year
|
Maturity
|
||
2017
|
$
|
0.8
|
|
2018
|
4.2
|
|
|
2019
|
2.9
|
|
|
2020
|
2.4
|
|
|
2021
|
1,303.3
|
|
|
Thereafter
|
713.1
|
|
|
Total
|
$
|
2,026.7
|
|
•
|
crude oil purchases and sales;
|
•
|
fuel product sales and purchases;
|
•
|
natural gas purchases;
|
•
|
precious metals purchases; and
|
•
|
fluctuations in the value of crude oil between geographic regions and between the different types of crude oil such as New York Mercantile Exchange West Texas Intermediate (“NYMEX WTI”), Light Louisiana Sweet (“LLS”), Western Canadian Select (“WCS”), Mixed Sweet Blend (“MSW”) and ICE Brent.
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
|
Balance Sheet Location
|
|
Gross Amounts of Recognized Assets
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Assets Presented
in the Condensed Consolidated Balance Sheets
|
|
Gross Amounts of Recognized Assets
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Assets Presented
in the Condensed Consolidated Balance Sheets
|
||||||||||||
Derivative instruments not designated as hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Specialty products segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Natural gas swaps
|
|
Derivative assets
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
0.1
|
|
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
Fuel products segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Crude oil swaps
|
|
Derivative assets
|
|
1.9
|
|
|
(1.4
|
)
|
|
0.5
|
|
|
10.3
|
|
|
(7.4
|
)
|
|
2.9
|
|
||||||
Crude oil basis swaps
|
|
Derivative assets
|
|
1.0
|
|
|
(0.5
|
)
|
|
0.5
|
|
|
—
|
|
|
(2.1
|
)
|
|
(2.1
|
)
|
||||||
Crude oil percentage basis swaps
|
|
Derivative assets
|
|
0.7
|
|
|
—
|
|
|
0.7
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
|
||||||
Gasoline crack spread swaps
|
|
Derivative assets
|
|
0.2
|
|
|
(0.5
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Diesel crack spread swap
|
|
Derivative assets
|
|
—
|
|
|
(0.8
|
)
|
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total derivative instruments
|
|
|
|
$
|
3.8
|
|
|
$
|
(3.5
|
)
|
|
$
|
0.3
|
|
|
$
|
10.5
|
|
|
$
|
(9.7
|
)
|
|
$
|
0.8
|
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
|
|
Balance Sheet Location
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Liabilities Presented
in the Condensed Consolidated Balance Sheets
|
|
Gross Amounts of Recognized Liabilities
|
|
Gross Amounts Offset in the Condensed Consolidated Balance Sheets
|
|
Net Amounts of Liabilities Presented
in the Condensed Consolidated Balance Sheets
|
||||||||||||
Derivative instruments not designated as hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Specialty products segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Natural gas swaps
|
|
Derivative liabilities
|
|
$
|
(0.7
|
)
|
|
$
|
0.3
|
|
|
$
|
(0.4
|
)
|
|
$
|
(1.2
|
)
|
|
$
|
0.1
|
|
|
$
|
(1.1
|
)
|
Fuel products segment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Inventory financing obligation
|
|
Obligations under inventory financing agreements
|
|
(3.8
|
)
|
|
—
|
|
|
(3.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Crude oil swaps
|
|
Derivative liabilities
|
|
(2.0
|
)
|
|
1.4
|
|
|
(0.6
|
)
|
|
(8.2
|
)
|
|
7.4
|
|
|
(0.8
|
)
|
||||||
Crude oil basis swaps
|
|
Derivative liabilities
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|
(7.1
|
)
|
|
2.1
|
|
|
(5.0
|
)
|
||||||
Crude oil percentage basis swaps
|
|
Derivative liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
0.1
|
|
|
(0.5
|
)
|
||||||
Gasoline swaps
|
|
Derivative liabilities
|
|
(0.3
|
)
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Gasoline crack spread swaps
|
|
Derivative liabilities
|
|
(2.6
|
)
|
|
0.5
|
|
|
(2.1
|
)
|
|
(3.5
|
)
|
|
—
|
|
|
(3.5
|
)
|
||||||
Diesel swaps
|
|
Derivative liabilities
|
|
(0.4
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Diesel crack spread swaps
|
|
Derivative liabilities
|
|
(5.8
|
)
|
|
0.8
|
|
|
(5.0
|
)
|
|
(1.4
|
)
|
|
—
|
|
|
(1.4
|
)
|
||||||
2/1/1 crack spread swaps
|
|
Derivative liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.5
|
)
|
|
—
|
|
|
(2.5
|
)
|
||||||
Total derivative instruments
|
|
|
$
|
(15.6
|
)
|
|
$
|
3.5
|
|
|
$
|
(12.1
|
)
|
|
$
|
(24.5
|
)
|
|
$
|
9.7
|
|
|
$
|
(14.8
|
)
|
Type of Derivative
|
Amount of Realized Gain (Loss) Recognized in Gain (Loss) on Derivative Instruments
|
|
Amount of Unrealized Gain (Loss) Recognized in Gain (Loss) on Derivative Instruments
|
||||||||||||
Three Months Ended September 30,
|
|
Three Months Ended September 30,
|
|||||||||||||
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Specialty products segment:
|
|
|
|
|
|
|
|
||||||||
Natural gas swaps
|
$
|
(1.2
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
1.1
|
|
|
$
|
0.9
|
|
Natural gas collars
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
|
0.3
|
|
||||
Fuel products segment:
|
|
|
|
|
|
|
|
||||||||
Inventory financing obligation
|
—
|
|
|
—
|
|
|
(2.9
|
)
|
|
—
|
|
||||
Crude oil swaps
|
(1.0
|
)
|
|
2.1
|
|
|
2.6
|
|
|
(5.4
|
)
|
||||
Crude oil basis swaps
|
2.0
|
|
|
(1.7
|
)
|
|
(1.5
|
)
|
|
(0.1
|
)
|
||||
Crude oil percentage basis swaps
|
0.9
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
—
|
|
||||
Crude oil options
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
||||
Gasoline swaps
|
(0.2
|
)
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
||||
Gasoline crack spread swaps
|
(1.2
|
)
|
|
—
|
|
|
(2.4
|
)
|
|
—
|
|
||||
Diesel swaps
|
(0.2
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
||||
Diesel crack spread swaps
|
(1.4
|
)
|
|
—
|
|
|
(5.8
|
)
|
|
—
|
|
||||
Natural gas swaps
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
0.1
|
|
||||
Total
|
$
|
(2.3
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
(9.7
|
)
|
|
$
|
(4.9
|
)
|
Type of Derivative
|
Amount of Realized Gain (loss) Recognized in Gain (Loss) on Derivative Instruments
|
|
Amount of Unrealized Gain (Loss) Recognized in Gain (Loss) on Derivative Instruments
|
||||||||||||
Nine Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|||||||||||||
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Specialty products segment:
|
|
|
|
|
|
|
|
||||||||
Natural gas swaps
|
$
|
(2.9
|
)
|
|
$
|
(8.4
|
)
|
|
$
|
0.5
|
|
|
$
|
9.4
|
|
Natural gas collars
|
—
|
|
|
(1.0
|
)
|
|
—
|
|
|
0.9
|
|
||||
Fuel products segment:
|
|
|
|
|
|
|
|
||||||||
Inventory financing obligation
|
—
|
|
|
—
|
|
|
(3.8
|
)
|
|
—
|
|
||||
Crude oil swaps
|
(2.5
|
)
|
|
1.3
|
|
|
(2.2
|
)
|
|
7.6
|
|
||||
Crude oil basis swaps
|
2.6
|
|
|
(1.6
|
)
|
|
7.9
|
|
|
(5.0
|
)
|
||||
Crude oil percentage basis swaps
|
1.5
|
|
|
(4.3
|
)
|
|
1.2
|
|
|
5.4
|
|
||||
Crude oil options
|
—
|
|
|
(1.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
||||
Crude oil futures
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
—
|
|
||||
Gasoline swaps
|
(0.2
|
)
|
|
—
|
|
|
(0.3
|
)
|
|
—
|
|
||||
Gasoline crack spread swaps
|
(2.8
|
)
|
|
(1.2
|
)
|
|
2.4
|
|
|
4.3
|
|
||||
Diesel swaps
|
(0.2
|
)
|
|
—
|
|
|
(0.4
|
)
|
|
—
|
|
||||
Diesel crack spread swaps
|
(1.7
|
)
|
|
—
|
|
|
(3.1
|
)
|
|
—
|
|
||||
2/1/1 crack spread swaps
|
(1.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Natural gas swaps
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
|
1.4
|
|
||||
Total
|
$
|
(7.2
|
)
|
|
$
|
(20.1
|
)
|
|
$
|
2.2
|
|
|
$
|
23.5
|
|
Natural Gas Swap Contracts by Expiration Dates
|
MMBtu
|
|
$/MMBtu
|
|||
Fourth Quarter 2017
|
960,000
|
|
|
$
|
3.72
|
|
Total
|
960,000
|
|
|
|
||
Average price
|
|
|
$
|
3.72
|
|
Natural Gas Swap Contracts by Expiration Dates
|
MMBtu
|
|
$/MMBtu
|
|||
First Quarter 2017
|
1,350,000
|
|
|
$
|
3.88
|
|
Second Quarter 2017
|
1,320,000
|
|
|
$
|
3.87
|
|
Third Quarter 2017
|
1,320,000
|
|
|
$
|
3.87
|
|
Fourth Quarter 2017
|
960,000
|
|
|
$
|
3.72
|
|
Total
|
4,950,000
|
|
|
|
||
Average price
|
|
|
$
|
3.85
|
|
Crude Oil Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
419,161
|
|
|
4,556
|
|
|
$
|
49.05
|
|
Calendar Year 2018
|
28,000
|
|
|
77
|
|
|
$
|
48.25
|
|
Total
|
447,161
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
49.00
|
|
Crude Oil Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
133,216
|
|
|
1,448
|
|
|
$
|
41.56
|
|
Total
|
133,216
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
41.56
|
|
Crude Oil Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2017
|
320,049
|
|
|
3,556
|
|
|
$
|
48.87
|
|
Second Quarter 2017
|
323,605
|
|
|
3,556
|
|
|
$
|
48.87
|
|
Third Quarter 2017
|
327,161
|
|
|
3,556
|
|
|
$
|
48.87
|
|
Fourth Quarter 2017
|
327,161
|
|
|
3,556
|
|
|
$
|
48.87
|
|
Total
|
1,297,976
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
48.87
|
|
Crude Oil Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2017
|
130,320
|
|
|
1,448
|
|
|
$
|
41.56
|
|
Second Quarter 2017
|
131,768
|
|
|
1,448
|
|
|
$
|
41.56
|
|
Third Quarter 2017
|
133,216
|
|
|
1,448
|
|
|
$
|
41.56
|
|
Fourth Quarter 2017
|
133,216
|
|
|
1,448
|
|
|
$
|
41.56
|
|
Total
|
528,520
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
41.56
|
|
Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Differential to NYMEX WTI
($/Bbl) |
||||
Fourth Quarter 2017
|
644,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Total
|
644,000
|
|
|
|
|
|
|||
Average differential
|
|
|
|
|
$
|
(13.22
|
)
|
Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Differential to NYMEX WTI
($/Bbl) |
||||
First Quarter 2017
|
630,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Second Quarter 2017
|
637,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Third Quarter 2017
|
644,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Fourth Quarter 2017
|
644,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Total
|
2,555,000
|
|
|
|
|
|
|||
Average differential
|
|
|
|
|
$
|
(13.22
|
)
|
Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Fourth Quarter 2017
|
276,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Total
|
276,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
72.3
|
%
|
Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
First Quarter 2017
|
270,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Second Quarter 2017
|
273,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Third Quarter 2017
|
276,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Fourth Quarter 2017
|
276,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Total
|
1,095,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
|
|
72.3
|
%
|
Gasoline Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
1,149,000
|
|
|
12,489
|
|
|
$
|
12.98
|
|
Calendar Year 2018
|
826,000
|
|
|
2,263
|
|
|
$
|
12.24
|
|
Total
|
1,975,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
12.67
|
|
Gasoline Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2017
|
590,000
|
|
|
6,556
|
|
|
$
|
10.21
|
|
Total
|
590,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
10.21
|
|
Gasoline Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
46,000
|
|
|
500
|
|
|
$
|
62.75
|
|
Calendar Year 2018
|
14,000
|
|
|
38
|
|
|
$
|
61.35
|
|
Total
|
60,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
62.42
|
|
Diesel Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
1,149,000
|
|
|
12,489
|
|
|
$
|
18.17
|
|
Calendar Year 2018
|
826,000
|
|
|
2,263
|
|
|
$
|
17.58
|
|
Total
|
1,975,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
17.92
|
|
Diesel Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2017
|
590,000
|
|
|
6,556
|
|
|
$
|
13.67
|
|
Total
|
590,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
13.67
|
|
Diesel Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
Fourth Quarter 2017
|
46,000
|
|
|
500
|
|
|
$
|
67.58
|
|
Calendar Year 2018
|
14,000
|
|
|
38
|
|
|
$
|
66.35
|
|
Total
|
60,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
67.29
|
|
2/1/1 Crack Spread Swap Contracts by Expiration Dates
|
Barrels Sold
|
|
BPD
|
|
Average Swap
($/Bbl) |
||||
First Quarter 2017
|
590,000
|
|
|
6,556
|
|
|
$
|
11.91
|
|
Total
|
590,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
11.91
|
|
•
|
Level 1 — inputs include observable unadjusted quoted prices in active markets for identical assets or liabilities
|
•
|
Level 2 — inputs include other than quoted prices in active markets that are either directly or indirectly observable
|
•
|
Level 3 — inputs include unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Natural gas swaps
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Gasoline crack spread swaps
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|
$
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Diesel crack spread swaps
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|
$
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Crude oil swaps
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
|
2.9
|
|
||||||||
Crude oil percentage basis swaps
|
—
|
|
|
—
|
|
|
0.7
|
|
|
0.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Crude oil basis swaps
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
(2.1
|
)
|
||||||||
Total derivative assets
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
0.8
|
|
||||||||
Pension plan investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
||||||||
Total recurring assets at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
0.8
|
|
|
$
|
1.1
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivative liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Inventory financing obligation
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(3.8
|
)
|
|
$
|
(3.8
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Crude oil swaps
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|
(0.8
|
)
|
||||||||
Crude oil basis swaps
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
(5.0
|
)
|
|
(5.0
|
)
|
||||||||
Crude oil percentage basis swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
(0.5
|
)
|
||||||||
Gasoline swaps
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Gasoline crack spread swaps
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
(2.1
|
)
|
|
—
|
|
|
—
|
|
|
(3.5
|
)
|
|
(3.5
|
)
|
||||||||
Diesel swaps
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Diesel crack spread swaps
|
—
|
|
|
—
|
|
|
(5.0
|
)
|
|
(5.0
|
)
|
|
—
|
|
|
—
|
|
|
(1.4
|
)
|
|
(1.4
|
)
|
||||||||
2/1/1 crack spread swaps
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.5
|
)
|
|
(2.5
|
)
|
||||||||
Natural gas swaps
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|
—
|
|
|
—
|
|
|
(1.1
|
)
|
|
(1.1
|
)
|
||||||||
Total derivative liabilities
|
—
|
|
|
—
|
|
|
(12.1
|
)
|
|
(12.1
|
)
|
|
—
|
|
|
—
|
|
|
(14.8
|
)
|
|
(14.8
|
)
|
||||||||
RINs Obligation
|
—
|
|
|
(41.0
|
)
|
|
—
|
|
|
(41.0
|
)
|
|
—
|
|
|
(79.3
|
)
|
|
—
|
|
|
(79.3
|
)
|
||||||||
Liability Awards
|
(4.1
|
)
|
|
—
|
|
|
—
|
|
|
(4.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Total recurring liabilities at fair value
|
$
|
(4.1
|
)
|
|
$
|
(41.0
|
)
|
|
$
|
(12.1
|
)
|
|
$
|
(57.2
|
)
|
|
$
|
—
|
|
|
$
|
(79.3
|
)
|
|
$
|
(14.8
|
)
|
|
$
|
(94.1
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Fair value at January 1,
|
$
|
(14.0
|
)
|
|
$
|
(33.9
|
)
|
Realized loss on derivative instruments
|
7.2
|
|
|
20.1
|
|
||
Unrealized gain on derivative instruments
|
2.2
|
|
|
23.5
|
|
||
Settlements
|
(7.2
|
)
|
|
(20.0
|
)
|
||
Fair value at September 30,
|
$
|
(11.8
|
)
|
|
$
|
(10.3
|
)
|
Total gain included in net loss attributable to changes in unrealized gain relating to financial assets and liabilities held as of September 30,
|
$
|
2.2
|
|
|
$
|
23.5
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
Level
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||
Financial Instrument:
|
|
|
|
|
|
|
|
|
|
||||||||
Senior notes
|
1
|
|
$
|
1,543.9
|
|
|
$
|
1,555.4
|
|
|
$
|
1,334.1
|
|
|
$
|
1,552.2
|
|
Senior secured notes
|
2
|
|
$
|
464.1
|
|
|
$
|
386.8
|
|
|
$
|
458.8
|
|
|
$
|
384.5
|
|
Revolving credit facility
|
3
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
$
|
6.0
|
|
|
$
|
6.0
|
|
Capital lease and other obligations
|
3
|
|
$
|
51.6
|
|
|
$
|
51.6
|
|
|
$
|
54.5
|
|
|
$
|
54.5
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Interest cost
|
$
|
0.6
|
|
|
$
|
0.6
|
|
|
$
|
1.8
|
|
|
$
|
1.9
|
|
Expected return on assets
|
(0.7
|
)
|
|
(0.8
|
)
|
|
(2.3
|
)
|
|
(2.4
|
)
|
||||
Amortization of net loss
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
||||
Net periodic benefit income
|
$
|
—
|
|
|
$
|
(0.2
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
(0.4
|
)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
Level 1
|
|
Total
|
|
Level 1
|
|
Total
|
||||||||
Plan assets subject to leveling:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
Total plan assets subject to leveling
|
$
|
—
|
|
|
—
|
|
|
$
|
0.3
|
|
|
0.3
|
|
||
Plan assets measured at net asset value:
|
|
|
|
|
|
|
|
||||||||
Domestic equities
|
|
|
6.1
|
|
|
|
|
8.6
|
|
||||||
Foreign equities
|
|
|
6.2
|
|
|
|
|
8.7
|
|
||||||
Fixed income
|
|
|
22.1
|
|
|
|
|
32.2
|
|
||||||
Total plan assets measured at net asset value
|
|
|
34.4
|
|
|
|
|
49.5
|
|
||||||
Total plan assets
|
|
|
$
|
34.4
|
|
|
|
|
$
|
49.8
|
|
Components of Accumulated Other Comprehensive Loss
|
Amount Reclassified From Accumulated Other Comprehensive Loss
|
|
Location of Gain (Loss)
|
||||||||||||||
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
||||||||||||||
2017
|
|
2016
|
|
2017
|
|
2016
|
|
||||||||||
Derivative gains (losses) reflected in gross profit:
|
|
|
|
|
|
|
|
|
|||||||||
|
$
|
—
|
|
|
$
|
14.5
|
|
|
$
|
—
|
|
|
$
|
45.6
|
|
|
Sales
|
|
—
|
|
|
(9.7
|
)
|
|
—
|
|
|
(36.4
|
)
|
|
Cost of sales
|
||||
|
$
|
—
|
|
|
$
|
4.8
|
|
|
$
|
—
|
|
|
$
|
9.2
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of defined benefit pension plans:
|
|
|
|||||||||||||||
Amortization of net loss
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.1
|
)
|
|
(1)
|
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.1
|
)
|
|
Total
|
|
(1)
|
This accumulated other comprehensive loss component is included in the computation of net periodic benefit income. See
Note 11
for additional details.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Numerator for basic and diluted earnings per limited partner unit:
|
|
|
|
|
|
|
|
||||||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
General partner’s interest in net loss
|
(0.5
|
)
|
|
(0.7
|
)
|
|
(0.4
|
)
|
|
(5.0
|
)
|
||||
Net loss available to limited partners
|
$
|
(23.1
|
)
|
|
$
|
(32.7
|
)
|
|
$
|
(19.8
|
)
|
|
$
|
(244.0
|
)
|
Denominator for basic and diluted earnings per limited partner unit:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted weighted average limited partner units outstanding
(1)
|
77,632,784
|
|
|
77,331,347
|
|
|
77,537,531
|
|
|
76,767,975
|
|
||||
Limited partners’ interest basic and diluted net loss per unit
|
$
|
(0.30
|
)
|
|
$
|
(0.42
|
)
|
|
$
|
(0.25
|
)
|
|
$
|
(3.18
|
)
|
|
(1)
|
Total diluted weighted average limited partner units outstanding excludes
0.3 million
for the
three and nine months ended
September 30, 2017
as compared to the
0.1 million
and
0.2 million
, respectively, of dilutive phantom units for the
three and nine months ended
September 30, 2016
.
|
•
|
Specialty Products.
The specialty products segment produces a variety of lubricating oils, solvents, waxes, synthetic lubricants and other products which are sold to customers who purchase these products primarily as raw material components for basic automotive, industrial and consumer goods. Specialty products also include synthetic lubricants used primarily in manufacturing, mining and automotive applications.
|
•
|
Fuel Products
. The fuel products segment produces primarily gasoline, diesel, jet fuel and asphalt which are primarily sold to customers located in the PADD 2, PADD 3 and PADD 4 areas within the U.S.
|
•
|
Oilfield Services.
The oilfield services segment markets its products and oilfield services including drilling fluids, completion fluids and solids control services to the oil and gas industry.
|
Three Months Ended September 30, 2017
|
Specialty
Products
|
|
Fuel
Products
|
|
Oilfield
Services
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External customers
|
$
|
305.8
|
|
|
$
|
720.7
|
|
|
$
|
70.9
|
|
|
$
|
1,097.4
|
|
|
$
|
—
|
|
|
$
|
1,097.4
|
|
Intersegment sales
|
—
|
|
|
14.9
|
|
|
—
|
|
|
14.9
|
|
|
(14.9
|
)
|
|
—
|
|
||||||
Total sales
|
$
|
305.8
|
|
|
$
|
735.6
|
|
|
$
|
70.9
|
|
|
$
|
1,112.3
|
|
|
$
|
(14.9
|
)
|
|
$
|
1,097.4
|
|
Loss from unconsolidated affiliates
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
—
|
|
|
$
|
(0.2
|
)
|
Adjusted EBITDA
|
$
|
43.0
|
|
|
$
|
46.3
|
|
|
$
|
6.4
|
|
|
$
|
95.7
|
|
|
$
|
—
|
|
|
$
|
95.7
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Depreciation and amortization
|
20.6
|
|
|
30.6
|
|
|
3.8
|
|
|
55.0
|
|
|
—
|
|
|
55.0
|
|
||||||
Unrealized loss on derivatives
|
|
|
|
|
|
|
|
|
|
|
9.7
|
|
|||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
47.4
|
|
|||||||||||
Non-cash equity based compensation and other non-cash items
|
|
|
|
|
|
|
|
|
|
|
7.3
|
|
|||||||||||
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
(0.1
|
)
|
|||||||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
$
|
(23.6
|
)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Three Months Ended September 30, 2016
|
Specialty
Products
|
|
Fuel
Products
|
|
Oilfield
Services
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External customers
|
$
|
315.7
|
|
|
$
|
616.6
|
|
|
$
|
34.3
|
|
|
$
|
966.6
|
|
|
$
|
—
|
|
|
$
|
966.6
|
|
Intersegment sales
|
0.1
|
|
|
12.7
|
|
|
—
|
|
|
12.8
|
|
|
(12.8
|
)
|
|
—
|
|
||||||
Total sales
|
$
|
315.8
|
|
|
$
|
629.3
|
|
|
$
|
34.3
|
|
|
$
|
979.4
|
|
|
$
|
(12.8
|
)
|
|
$
|
966.6
|
|
Loss from unconsolidated affiliates
|
$
|
(0.2
|
)
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
Adjusted EBITDA
|
$
|
43.4
|
|
|
$
|
13.8
|
|
|
$
|
(3.3
|
)
|
|
$
|
53.9
|
|
|
$
|
—
|
|
|
$
|
53.9
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Depreciation and amortization
|
18.8
|
|
|
28.8
|
|
|
4.8
|
|
|
52.4
|
|
|
—
|
|
|
52.4
|
|
||||||
Realized loss on derivatives, not reflected in net loss or settled in a prior period
|
(2.6
|
)
|
|
(2.2
|
)
|
|
—
|
|
|
(4.8
|
)
|
|
—
|
|
|
(4.8
|
)
|
||||||
Unrealized loss on derivatives
|
|
|
|
|
|
|
|
|
|
|
4.9
|
|
|||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
44.6
|
|
|||||||||||
Non-cash equity based compensation and other non-cash items
|
|
|
|
|
|
|
|
|
|
|
(2.2
|
)
|
|||||||||||
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
(7.6
|
)
|
|||||||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
$
|
(33.4
|
)
|
Nine Months Ended September 30, 2017
|
Specialty
Products
|
|
Fuel
Products
|
|
Oilfield
Services
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External customers
|
$
|
986.1
|
|
|
$
|
1,893.9
|
|
|
$
|
185.7
|
|
|
$
|
3,065.7
|
|
|
$
|
—
|
|
|
$
|
3,065.7
|
|
Intersegment sales
|
0.2
|
|
|
47.5
|
|
|
—
|
|
|
47.7
|
|
|
(47.7
|
)
|
|
—
|
|
||||||
Total sales
|
$
|
986.3
|
|
|
$
|
1,941.4
|
|
|
$
|
185.7
|
|
|
$
|
3,113.4
|
|
|
$
|
(47.7
|
)
|
|
$
|
3,065.7
|
|
Loss from unconsolidated affiliates
|
$
|
(0.1
|
)
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
—
|
|
|
$
|
(0.4
|
)
|
Adjusted EBITDA
|
$
|
155.7
|
|
|
$
|
117.1
|
|
|
$
|
3.2
|
|
|
$
|
276.0
|
|
|
$
|
—
|
|
|
$
|
276.0
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Depreciation and amortization
|
53.5
|
|
|
85.9
|
|
|
11.6
|
|
|
151.0
|
|
|
—
|
|
|
151.0
|
|
||||||
Asset Impairment
|
0.4
|
|
|
—
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
||||||
Unrealized gain on derivatives
|
|
|
|
|
|
|
|
|
|
|
(2.2
|
)
|
|||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
135.8
|
|
|||||||||||
Non-cash equity based compensation and other non-cash items
|
|
|
|
|
|
|
|
|
|
|
12.3
|
|
|||||||||||
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
(1.1
|
)
|
|||||||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
$
|
(20.2
|
)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Nine Months Ended September 30, 2016
|
Specialty
Products
|
|
Fuel
Products
|
|
Oilfield
Services
|
|
Combined
Segments
|
|
Eliminations
|
|
Consolidated
Total
|
||||||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
External customers
|
$
|
948.8
|
|
|
$
|
1,615.7
|
|
|
$
|
88.0
|
|
|
$
|
2,652.5
|
|
|
$
|
—
|
|
|
$
|
2,652.5
|
|
Intersegment sales
|
0.5
|
|
|
26.4
|
|
|
—
|
|
|
26.9
|
|
|
(26.9
|
)
|
|
—
|
|
||||||
Total sales
|
$
|
949.3
|
|
|
$
|
1,642.1
|
|
|
$
|
88.0
|
|
|
$
|
2,679.4
|
|
|
$
|
(26.9
|
)
|
|
$
|
2,652.5
|
|
Loss from unconsolidated affiliates
|
$
|
(0.2
|
)
|
|
$
|
(18.0
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
(18.5
|
)
|
|
$
|
—
|
|
|
$
|
(18.5
|
)
|
Adjusted EBITDA
|
$
|
160.9
|
|
|
$
|
(13.3
|
)
|
|
$
|
(17.1
|
)
|
|
$
|
130.5
|
|
|
$
|
—
|
|
|
$
|
130.5
|
|
Reconciling items to net loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Depreciation and amortization
|
56.0
|
|
|
82.0
|
|
|
14.4
|
|
|
152.4
|
|
|
—
|
|
|
152.4
|
|
||||||
Realized loss on derivatives, not reflected in net loss or settled in a prior period
|
(1.4
|
)
|
|
(7.8
|
)
|
|
—
|
|
|
(9.2
|
)
|
|
—
|
|
|
(9.2
|
)
|
||||||
Asset Impairment
|
—
|
|
|
33.4
|
|
|
—
|
|
|
33.4
|
|
|
—
|
|
|
33.4
|
|
||||||
Loss from sale of unconsolidated affiliate
|
—
|
|
|
113.9
|
|
|
—
|
|
|
113.9
|
|
|
—
|
|
|
113.9
|
|
||||||
Unrealized gain on derivatives
|
|
|
|
|
|
|
|
|
|
|
(23.5
|
)
|
|||||||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
117.7
|
|
|||||||||||
Non-cash equity based compensation and other non-cash items
|
|
|
|
|
|
|
|
|
|
|
1.9
|
|
|||||||||||
Income tax benefit
|
|
|
|
|
|
|
|
|
|
|
(7.1
|
)
|
|||||||||||
Net loss
|
|
|
|
|
|
|
|
|
|
|
$
|
(249.0
|
)
|
|
Three Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
||||||||||
Specialty products:
|
|
|
|
|
|
|
|
||||||
Lubricating oils
|
$
|
148.8
|
|
|
13.6
|
%
|
|
$
|
133.0
|
|
|
13.8
|
%
|
Solvents
|
62.6
|
|
|
5.7
|
%
|
|
60.6
|
|
|
6.3
|
%
|
||
Waxes
|
27.4
|
|
|
2.5
|
%
|
|
33.2
|
|
|
3.4
|
%
|
||
Packaged and synthetic specialty products
|
62.8
|
|
|
5.7
|
%
|
|
79.6
|
|
|
8.2
|
%
|
||
Other
|
4.2
|
|
|
0.4
|
%
|
|
9.3
|
|
|
1.0
|
%
|
||
Total
|
$
|
305.8
|
|
|
27.9
|
%
|
|
$
|
315.7
|
|
|
32.7
|
%
|
Fuel products:
|
|
|
|
|
|
|
|
||||||
Gasoline
|
$
|
260.5
|
|
|
23.7
|
%
|
|
$
|
209.4
|
|
|
21.7
|
%
|
Diesel
|
241.9
|
|
|
22.0
|
%
|
|
216.7
|
|
|
22.4
|
%
|
||
Jet fuel
|
36.0
|
|
|
3.3
|
%
|
|
32.3
|
|
|
3.3
|
%
|
||
Asphalt, heavy fuel oils and other
|
182.3
|
|
|
16.6
|
%
|
|
158.2
|
|
|
16.4
|
%
|
||
Total
|
$
|
720.7
|
|
|
65.6
|
%
|
|
$
|
616.6
|
|
|
63.8
|
%
|
Oilfield services:
|
|
|
|
|
|
|
|
||||||
Total
|
$
|
70.9
|
|
|
6.5
|
%
|
|
$
|
34.3
|
|
|
3.5
|
%
|
Consolidated sales
|
$
|
1,097.4
|
|
|
100.0
|
%
|
|
$
|
966.6
|
|
|
100.0
|
%
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
||||||||||
Specialty products:
|
|
|
|
|
|
|
|
||||||
Lubricating oils
|
$
|
453.2
|
|
|
14.8
|
%
|
|
$
|
408.5
|
|
|
15.4
|
%
|
Solvents
|
198.7
|
|
|
6.5
|
%
|
|
177.6
|
|
|
6.7
|
%
|
||
Waxes
|
87.4
|
|
|
2.9
|
%
|
|
96.7
|
|
|
3.6
|
%
|
||
Packaged and synthetic specialty products
|
224.3
|
|
|
7.3
|
%
|
|
237.1
|
|
|
8.9
|
%
|
||
Other
|
22.5
|
|
|
0.7
|
%
|
|
28.9
|
|
|
1.2
|
%
|
||
Total
|
$
|
986.1
|
|
|
32.2
|
%
|
|
$
|
948.8
|
|
|
35.8
|
%
|
Fuel products:
|
|
|
|
|
|
|
|
||||||
Gasoline
|
$
|
736.1
|
|
|
24.0
|
%
|
|
$
|
599.6
|
|
|
22.6
|
%
|
Diesel
|
658.9
|
|
|
21.5
|
%
|
|
594.2
|
|
|
22.4
|
%
|
||
Jet fuel
|
106.4
|
|
|
3.5
|
%
|
|
81.5
|
|
|
3.1
|
%
|
||
Asphalt, heavy fuel oils and other
|
392.5
|
|
|
12.8
|
%
|
|
340.4
|
|
|
12.8
|
%
|
||
Total
|
$
|
1,893.9
|
|
|
61.8
|
%
|
|
$
|
1,615.7
|
|
|
60.9
|
%
|
Oilfield services:
|
|
|
|
|
|
|
|
||||||
Total
|
$
|
185.7
|
|
|
6.0
|
%
|
|
$
|
88.0
|
|
|
3.3
|
%
|
Consolidated sales
|
$
|
3,065.7
|
|
|
100.0
|
%
|
|
$
|
2,652.5
|
|
|
100.0
|
%
|
•
|
Gasoline margins are expected to decline as domestic demand follows typical seasonal patterns. Diesel margins have been positively impacted by decreases in supply and are expected to be stable.
|
•
|
Environmental regulations continue to affect our margins in the form of the cost of Renewable Identification Numbers (“RINs”). To the extent we are unable to blend biofuels, we must purchase RINs in the open market to satisfy our annual requirement. The 6% decrease in the price of RINs during the
third quarter
2017
favorably affected our results of operations. It is not possible to predict what future RINs volumes or costs may be given the volatile price of RINs, but we continue to anticipate that RINs have the potential to remain a significant expense for our fuel products segment (inclusive of the favorable impact of exemptions received), assuming current market prices for RINs continue.
|
•
|
Asphalt demand is expected to decline due to the seasonality of the road construction and roofing industries, which have shown decreased seasonal demand in prior years.
|
•
|
Heavy sour crude oil discounts are expected to remain wide over the long term as sour crude oil remains oversupplied. Sweet crude oil discounts are expected to widen on higher domestic sweet crude oil production. Processing heavy sour crude oil in our refining system results in a lower overall delivered cost of crude oil.
|
•
|
Specialty products margins have remained relatively stable and are expected to remain stable in the near term. We continue to consider our specialty products segment our core business, over the long term, and we plan to seek appropriate ways to invest in our specialty products segment while divesting non-core businesses. Accordingly, we continue to evaluate opportunities to divest non-core businesses and assets in line with our strategy of preserving liquidity and streamlining our business to better focus on the advancement of our core business. However, there can be no assurance as to the timing or success of any such potential transaction, or any other transaction, or that we will be able to sell these assets or non-core businesses on satisfactory terms, if at all. In addition, our acquisition program targets assets that management believes
|
•
|
Our oilfield services segment was positively impacted by a
43%
increase in the land-based rig count during the
nine months ended September 30, 2017
.
|
•
|
In light of declines in certain markets we serve, an evaluation of existing and future capacity, and as part of our annual planning and budgeting process which is currently in progress, we will perform an assessment of our major long-lived assets which may result in long-lived asset impairment. We will complete our asset recoverability assessment and analyze the conclusions of that assessment in connection with the annual planning and budgeting process. Until these activities are complete, it is not practicable to reasonably estimate the existence or range of potential future impairments related to our long-lived assets.
|
•
|
sales volumes;
|
•
|
production yields;
|
•
|
specialty products, fuel products and oilfield services segment gross profit;
|
•
|
specialty products, fuel products and oilfield services segment Adjusted EBITDA; and
|
•
|
selling, general and administrative expenses.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
2017
|
|
2016
|
|
% Change
|
|
2017
|
|
2016
|
|
% Change
|
||||||
|
(In bpd)
|
|
|
|
(In bpd)
|
|
|
||||||||||
Total sales volume
(1)
|
146,228
|
|
|
141,457
|
|
|
3.4
|
%
|
|
139,011
|
|
|
140,066
|
|
|
(0.8
|
)%
|
Total feedstock runs
(2)
|
137,528
|
|
|
132,911
|
|
|
3.5
|
%
|
|
135,435
|
|
|
134,798
|
|
|
0.5
|
%
|
Facility production:
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Specialty products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Lubricating oils
|
14,220
|
|
|
13,847
|
|
|
2.7
|
%
|
|
15,095
|
|
|
14,470
|
|
|
4.3
|
%
|
Solvents
|
7,868
|
|
|
7,636
|
|
|
3.0
|
%
|
|
7,819
|
|
|
7,604
|
|
|
2.8
|
%
|
Waxes
|
1,462
|
|
|
1,637
|
|
|
(10.7
|
)%
|
|
1,437
|
|
|
1,518
|
|
|
(5.3
|
)%
|
Packaged and synthetic specialty products
(4)
|
2,121
|
|
|
1,972
|
|
|
7.6
|
%
|
|
2,495
|
|
|
2,068
|
|
|
20.6
|
%
|
Other
|
2,557
|
|
|
1,942
|
|
|
31.7
|
%
|
|
1,900
|
|
|
1,551
|
|
|
22.5
|
%
|
Total
|
28,228
|
|
|
27,034
|
|
|
4.4
|
%
|
|
28,746
|
|
|
27,211
|
|
|
5.6
|
%
|
Fuel products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gasoline
|
38,655
|
|
|
35,141
|
|
|
10.0
|
%
|
|
37,819
|
|
|
37,039
|
|
|
2.1
|
%
|
Diesel
|
36,335
|
|
|
35,166
|
|
|
3.3
|
%
|
|
34,723
|
|
|
35,190
|
|
|
(1.3
|
)%
|
Jet fuel
|
5,381
|
|
|
5,423
|
|
|
(0.8
|
)%
|
|
5,812
|
|
|
5,139
|
|
|
13.1
|
%
|
Asphalt, heavy fuels and other
|
31,969
|
|
|
31,119
|
|
|
2.7
|
%
|
|
31,703
|
|
|
30,768
|
|
|
3.0
|
%
|
Total
|
112,340
|
|
|
106,849
|
|
|
5.1
|
%
|
|
110,057
|
|
|
108,136
|
|
|
1.8
|
%
|
Total facility production
(3)
|
140,568
|
|
|
133,883
|
|
|
5.0
|
%
|
|
138,803
|
|
|
135,347
|
|
|
2.6
|
%
|
(1)
|
Total sales volume includes sales from the production at our facilities and certain third-party facilities pursuant to supply and/or processing agreements, sales of inventories and the resale of crude oil to third-party customers. Total sales volume includes the sale of purchased fuel product blendstocks, such as ethanol and biodiesel, as components of finished fuel products in our fuel products segment sales.
|
(2)
|
Total feedstock runs represent the bpd of crude oil and other feedstocks processed at our facilities and at certain third-party facilities pursuant to supply and/or processing agreements.
|
(3)
|
Total facility production represents the bpd of specialty products and fuel products yielded from processing crude oil and other feedstocks at our facilities and at certain third-party facilities pursuant to supply and/or processing agreements. The difference between total facility production and total feedstock runs is primarily a result of the time lag between the input of feedstocks and production of finished products and volume loss.
|
(4)
|
Packaged and synthetic specialty products include production at the Royal Purple, Bel-Ray, Calumet Packaging and Missouri facilities.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In millions)
|
||||||||||||||
Sales
|
$
|
1,097.4
|
|
|
$
|
966.6
|
|
|
$
|
3,065.7
|
|
|
$
|
2,652.5
|
|
Cost of sales
|
945.9
|
|
|
856.3
|
|
|
2,614.3
|
|
|
2,324.7
|
|
||||
Gross profit
|
151.5
|
|
|
110.3
|
|
|
451.4
|
|
|
327.8
|
|
||||
Operating costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Selling
|
28.0
|
|
|
26.2
|
|
|
83.7
|
|
|
82.9
|
|
||||
General and administrative
|
41.6
|
|
|
28.2
|
|
|
107.0
|
|
|
80.6
|
|
||||
Transportation
|
36.1
|
|
|
42.2
|
|
|
117.8
|
|
|
126.4
|
|
||||
Taxes other than income taxes
|
7.0
|
|
|
4.8
|
|
|
17.4
|
|
|
14.7
|
|
||||
Asset impairment
|
—
|
|
|
—
|
|
|
0.4
|
|
|
33.4
|
|
||||
Other
|
3.8
|
|
|
(1.0
|
)
|
|
6.8
|
|
|
1.3
|
|
||||
Operating income (loss)
|
35.0
|
|
|
9.9
|
|
|
118.3
|
|
|
(11.5
|
)
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
(47.4
|
)
|
|
(44.6
|
)
|
|
(135.8
|
)
|
|
(117.7
|
)
|
||||
Gain (loss) on derivative instruments
|
(12.0
|
)
|
|
(6.7
|
)
|
|
(5.0
|
)
|
|
3.4
|
|
||||
Loss from unconsolidated affiliates
|
(0.2
|
)
|
|
(0.3
|
)
|
|
(0.4
|
)
|
|
(18.5
|
)
|
||||
Loss from sale of unconsolidated affiliates
|
—
|
|
|
—
|
|
|
—
|
|
|
(113.4
|
)
|
||||
Other
|
0.9
|
|
|
0.7
|
|
|
1.6
|
|
|
1.6
|
|
||||
Total other expense
|
(58.7
|
)
|
|
(50.9
|
)
|
|
(139.6
|
)
|
|
(244.6
|
)
|
||||
Net loss before income taxes
|
(23.7
|
)
|
|
(41.0
|
)
|
|
(21.3
|
)
|
|
(256.1
|
)
|
||||
Income tax benefit
|
(0.1
|
)
|
|
(7.6
|
)
|
|
(1.1
|
)
|
|
(7.1
|
)
|
||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
EBITDA
|
$
|
72.3
|
|
|
$
|
48.1
|
|
|
$
|
245.1
|
|
|
$
|
(11.3
|
)
|
Adjusted EBITDA
|
$
|
95.7
|
|
|
$
|
53.9
|
|
|
$
|
276.0
|
|
|
$
|
130.5
|
|
Distributable Cash Flow
|
$
|
40.2
|
|
|
$
|
10.4
|
|
|
$
|
116.9
|
|
|
$
|
17.0
|
|
•
|
the financial performance of our assets without regard to financing methods, capital structure or historical cost basis;
|
•
|
the ability of our assets to generate cash sufficient to pay interest costs and support our indebtedness;
|
•
|
our operating performance and return on capital as compared to those of other companies in our industry, without regard to financing or capital structure; and
|
•
|
the viability of acquisitions and capital expenditure projects and the overall rates of return on alternative investment opportunities.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In millions)
|
||||||||||||||
Reconciliation of Net loss to EBITDA, Adjusted EBITDA and Distributable Cash Flow:
|
|
||||||||||||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
Add:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
47.4
|
|
|
44.6
|
|
|
135.8
|
|
|
117.7
|
|
||||
Depreciation and amortization
|
48.6
|
|
|
44.5
|
|
|
130.6
|
|
|
127.1
|
|
||||
Income tax benefit
|
(0.1
|
)
|
|
(7.6
|
)
|
|
(1.1
|
)
|
|
(7.1
|
)
|
||||
EBITDA
|
$
|
72.3
|
|
|
$
|
48.1
|
|
|
$
|
245.1
|
|
|
$
|
(11.3
|
)
|
Add:
|
|
|
|
|
|
|
|
||||||||
Unrealized (gain) loss on derivative instruments
|
$
|
9.7
|
|
|
$
|
4.9
|
|
|
$
|
(2.2
|
)
|
|
$
|
(23.5
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
(4.8
|
)
|
|
—
|
|
|
(9.2
|
)
|
||||
Amortization of turnaround costs
|
6.4
|
|
|
7.9
|
|
|
20.4
|
|
|
25.3
|
|
||||
Impairment charges
|
—
|
|
|
—
|
|
|
0.4
|
|
|
33.4
|
|
||||
Loss on sale of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
—
|
|
|
113.9
|
|
||||
Non-cash equity based compensation and other non-cash items
|
7.3
|
|
|
(2.2
|
)
|
|
12.3
|
|
|
1.9
|
|
||||
Adjusted EBITDA
|
$
|
95.7
|
|
|
$
|
53.9
|
|
|
$
|
276.0
|
|
|
$
|
130.5
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Replacement and environmental capital expenditures
(1)
|
$
|
10.2
|
|
|
$
|
8.8
|
|
|
$
|
21.1
|
|
|
$
|
19.9
|
|
Cash interest expense
(2)
|
44.6
|
|
|
42.0
|
|
|
128.2
|
|
|
110.5
|
|
||||
Turnaround costs
|
1.0
|
|
|
0.6
|
|
|
11.3
|
|
|
8.7
|
|
||||
Loss from unconsolidated affiliates
|
(0.2
|
)
|
|
(0.3
|
)
|
|
(0.4
|
)
|
|
(18.5
|
)
|
||||
Income tax benefit
|
(0.1
|
)
|
|
(7.6
|
)
|
|
(1.1
|
)
|
|
(7.1
|
)
|
||||
Distributable Cash Flow
|
$
|
40.2
|
|
|
$
|
10.4
|
|
|
$
|
116.9
|
|
|
$
|
17.0
|
|
|
(1)
|
Replacement capital expenditures are defined as those capital expenditures which do not increase operating capacity or reduce operating costs and exclude turnaround costs. Environmental capital expenditures include asset additions to meet or exceed environmental and operating regulations.
|
(2)
|
Represents consolidated interest expense less non-cash interest expense.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In millions)
|
||||||||||||||
Reconciliation of Segment Adjusted EBITDA to EBITDA and Net loss:
|
|
|
|
|
|
||||||||||
Segment Adjusted EBITDA
|
|
|
|
|
|
|
|
||||||||
Specialty products Adjusted EBITDA
|
$
|
43.0
|
|
|
$
|
43.4
|
|
|
$
|
155.7
|
|
|
$
|
160.9
|
|
Fuel products Adjusted EBITDA
|
46.3
|
|
|
13.8
|
|
|
117.1
|
|
|
(13.3
|
)
|
||||
Oilfield services Adjusted EBITDA
|
6.4
|
|
|
(3.3
|
)
|
|
3.2
|
|
|
(17.1
|
)
|
||||
Total segment Adjusted EBITDA
|
$
|
95.7
|
|
|
$
|
53.9
|
|
|
$
|
276.0
|
|
|
$
|
130.5
|
|
Less:
|
|
|
|
|
|
|
|
||||||||
Unrealized (gain) loss on derivative instruments
|
$
|
9.7
|
|
|
$
|
4.9
|
|
|
$
|
(2.2
|
)
|
|
$
|
(23.5
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
(4.8
|
)
|
|
—
|
|
|
(9.2
|
)
|
||||
Amortization of turnaround costs
|
6.4
|
|
|
7.9
|
|
|
20.4
|
|
|
25.3
|
|
||||
Impairment charges
|
—
|
|
|
—
|
|
|
0.4
|
|
|
33.4
|
|
||||
Loss on sale of unconsolidated affiliate
|
—
|
|
|
—
|
|
|
—
|
|
|
113.9
|
|
||||
Non-cash equity based compensation and other non-cash items
|
7.3
|
|
|
(2.2
|
)
|
|
12.3
|
|
|
1.9
|
|
||||
EBITDA
|
$
|
72.3
|
|
|
$
|
48.1
|
|
|
$
|
245.1
|
|
|
$
|
(11.3
|
)
|
Less:
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
$
|
47.4
|
|
|
$
|
44.6
|
|
|
$
|
135.8
|
|
|
$
|
117.7
|
|
Depreciation and amortization
|
48.6
|
|
|
44.5
|
|
|
130.6
|
|
|
127.1
|
|
||||
Income tax benefit
|
(0.1
|
)
|
|
(7.6
|
)
|
|
(1.1
|
)
|
|
(7.1
|
)
|
||||
Net loss
|
$
|
(23.6
|
)
|
|
$
|
(33.4
|
)
|
|
$
|
(20.2
|
)
|
|
$
|
(249.0
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Reconciliation of Distributable Cash Flow, Adjusted EBITDA and EBITDA to Net cash used in operating activities:
|
|
||||||
Distributable Cash Flow
|
$
|
116.9
|
|
|
$
|
17.0
|
|
Add:
|
|
|
|
||||
Replacement and environmental capital expenditures
(1)
|
21.1
|
|
|
19.9
|
|
||
Cash interest expense
(2)
|
128.2
|
|
|
110.5
|
|
||
Turnaround costs
|
11.3
|
|
|
8.7
|
|
||
Loss from unconsolidated affiliates
|
(0.4
|
)
|
|
(18.5
|
)
|
||
Income tax benefit
|
(1.1
|
)
|
|
(7.1
|
)
|
||
Adjusted EBITDA
|
$
|
276.0
|
|
|
$
|
130.5
|
|
Less:
|
|
|
|
||||
Unrealized gain on derivative instruments
|
$
|
(2.2
|
)
|
|
$
|
(23.5
|
)
|
Realized loss on derivatives, not included in net loss or settled in a prior period
|
—
|
|
|
(9.2
|
)
|
||
Amortization of turnaround costs
|
20.4
|
|
|
25.3
|
|
||
Impairment charges
|
0.4
|
|
|
33.4
|
|
||
Loss on sale of unconsolidated affiliate
|
—
|
|
|
113.9
|
|
||
Non-cash equity based compensation and other non-cash items
|
12.3
|
|
|
1.9
|
|
||
EBITDA
|
$
|
245.1
|
|
|
$
|
(11.3
|
)
|
Add:
|
|
|
|
||||
Unrealized gain on derivative instruments
|
$
|
(2.2
|
)
|
|
$
|
(23.5
|
)
|
Cash interest expense
(2)
|
(128.2
|
)
|
|
(110.5
|
)
|
||
Asset impairment
|
0.4
|
|
|
33.4
|
|
||
Non-cash equity based compensation
|
8.4
|
|
|
3.9
|
|
||
Lower of cost or market inventory adjustment
|
(19.1
|
)
|
|
(33.3
|
)
|
||
Deferred income tax benefit
|
(0.2
|
)
|
|
(0.4
|
)
|
||
Loss from unconsolidated affiliates
|
0.4
|
|
|
18.5
|
|
||
Loss on sale of unconsolidated affiliates
|
—
|
|
|
113.4
|
|
||
Amortization of turnaround costs
|
20.4
|
|
|
25.3
|
|
||
Income tax benefit
|
1.1
|
|
|
7.1
|
|
||
Provision for doubtful accounts
|
0.2
|
|
|
0.4
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(155.1
|
)
|
|
(69.8
|
)
|
||
Inventories
|
8.0
|
|
|
16.3
|
|
||
Other current assets
|
(4.8
|
)
|
|
(6.6
|
)
|
||
Derivative activity
|
(0.3
|
)
|
|
(18.1
|
)
|
||
Turnaround costs
|
(11.3
|
)
|
|
(8.7
|
)
|
||
Other assets
|
(0.4
|
)
|
|
(0.3
|
)
|
||
Accounts payable
|
37.7
|
|
|
11.6
|
|
||
Accrued interest payable
|
2.9
|
|
|
24.1
|
|
||
Other current liabilities
|
(14.7
|
)
|
|
8.3
|
|
||
Other, including changes in noncurrent liabilities
|
8.4
|
|
|
1.4
|
|
||
Net cash used in operating activities
|
$
|
(3.3
|
)
|
|
$
|
(18.8
|
)
|
|
(1)
|
Replacement capital expenditures are defined as those capital expenditures which do not increase operating capacity or reduce operating costs and exclude turnaround costs. Environmental capital expenditures include asset additions to meet or exceed environmental and operating regulations.
|
(2)
|
Represents consolidated interest expense less non-cash interest expense.
|
|
Three Months Ended September 30,
|
|||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||
|
(Dollars in millions, except barrel and per barrel data)
|
|||||||||
Sales by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Lubricating oils
|
$
|
148.8
|
|
|
$
|
133.0
|
|
|
11.9
|
%
|
Solvents
|
62.6
|
|
|
60.6
|
|
|
3.3
|
%
|
||
Waxes
|
27.4
|
|
|
33.2
|
|
|
(17.5
|
)%
|
||
Packaged and synthetic specialty products
(1)
|
62.8
|
|
|
79.6
|
|
|
(21.1
|
)%
|
||
Other
(2)
|
4.2
|
|
|
9.3
|
|
|
(54.8
|
)%
|
||
Total specialty products
|
$
|
305.8
|
|
|
$
|
315.7
|
|
|
(3.1
|
)%
|
Total specialty products sales volume (in barrels)
|
2,262,000
|
|
|
2,315,000
|
|
|
(2.3
|
)%
|
||
Average specialty products sales price per barrel
|
$
|
135.19
|
|
|
$
|
136.37
|
|
|
(0.9
|
)%
|
|
|
|
|
|
|
|||||
Fuel products:
|
|
|
|
|
|
|||||
Gasoline
|
$
|
260.5
|
|
|
$
|
209.4
|
|
|
24.4
|
%
|
Diesel
|
241.9
|
|
|
202.2
|
|
|
19.6
|
%
|
||
Jet fuel
|
36.0
|
|
|
32.3
|
|
|
11.5
|
%
|
||
Asphalt, heavy fuel oils and other
(3)
|
182.3
|
|
|
158.2
|
|
|
15.2
|
%
|
||
Hedging activities
|
—
|
|
|
14.5
|
|
|
(100.0
|
)%
|
||
Total fuel products
|
$
|
720.7
|
|
|
$
|
616.6
|
|
|
16.9
|
%
|
Total fuel products sales volume (in barrels)
|
11,191,000
|
|
|
10,699,000
|
|
|
4.6
|
%
|
||
Average fuel products sales price per barrel (excluding hedging activities)
|
$
|
64.40
|
|
|
$
|
56.28
|
|
|
14.4
|
%
|
Average fuel products sales price per barrel (including hedging activities)
|
$
|
64.40
|
|
|
$
|
57.63
|
|
|
11.7
|
%
|
|
|
|
|
|
|
|||||
Total oilfield services
|
$
|
70.9
|
|
|
$
|
34.3
|
|
|
106.7
|
%
|
|
|
|
|
|
|
|||||
Total sales
|
$
|
1,097.4
|
|
|
$
|
966.6
|
|
|
13.5
|
%
|
Total specialty and fuel products sales volume (in barrels)
|
13,453,000
|
|
|
13,014,000
|
|
|
3.4
|
%
|
|
(1)
|
Represents packaged and synthetic specialty products at the Royal Purple, Bel-Ray, Calumet Packaging and Missouri facilities.
|
(2)
|
Represents fuels and asphalt, produced in connection with the production of specialty products at the Princeton and Cotton Valley refineries and Dickinson and Karns City facilities.
|
(3)
|
Represents asphalt, heavy fuel oils and other products produced in connection with the production of fuels at the Shreveport, Superior, San Antonio and Great Falls refineries and crude oil sales from the Superior and San Antonio refineries to third-party customers.
|
|
Dollar Change
|
||
|
(In millions)
|
||
Volume
|
$
|
(7.2
|
)
|
Sales price
|
(2.7
|
)
|
|
Total specialty products segment sales decrease
|
$
|
(9.9
|
)
|
|
Dollar Change
|
||
|
(In millions)
|
||
Sales price
|
$
|
90.9
|
|
Volume
|
27.7
|
|
|
Hedging activities
|
(14.5
|
)
|
|
Total fuel products segment sales increase
|
$
|
104.1
|
|
|
Three Months Ended September 30,
|
|||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||
|
(Dollars in millions, except per barrel data)
|
|||||||||
Gross profit by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
69.7
|
|
|
$
|
81.0
|
|
|
(14.0
|
)%
|
Percentage of sales
|
22.8
|
%
|
|
25.7
|
%
|
|
|
|||
Specialty products gross profit per barrel
|
$
|
30.81
|
|
|
$
|
34.99
|
|
|
(11.9
|
)%
|
Fuel products:
|
|
|
|
|
|
|||||
Gross profit excluding hedging activities
|
$
|
58.0
|
|
|
$
|
19.8
|
|
|
192.9
|
%
|
Hedging activities
|
—
|
|
|
2.2
|
|
|
(100.0
|
)%
|
||
Gross profit
|
$
|
58.0
|
|
|
$
|
22.0
|
|
|
163.6
|
%
|
Percentage of sales
|
8.0
|
%
|
|
3.6
|
%
|
|
|
|||
Fuel products gross profit per barrel (excluding hedging activities)
|
$
|
5.18
|
|
|
$
|
1.85
|
|
|
180.0
|
%
|
Fuel products gross profit per barrel (including hedging activities)
|
$
|
5.18
|
|
|
$
|
2.06
|
|
|
151.5
|
%
|
Oilfield services:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
23.8
|
|
|
$
|
7.3
|
|
|
226.0
|
%
|
Percentage of sales
|
33.6
|
%
|
|
21.3
|
%
|
|
|
|||
Total gross profit
|
$
|
151.5
|
|
|
$
|
110.3
|
|
|
37.4
|
%
|
Percentage of sales
|
13.8
|
%
|
|
11.4
|
%
|
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Three months ended September 30, 2016 reported gross profit
|
$
|
81.0
|
|
Cost of materials
|
(16.8
|
)
|
|
Operating costs
|
(3.8
|
)
|
|
Volume
|
(2.9
|
)
|
|
Sales price
|
(2.7
|
)
|
|
LCM inventory adjustment
|
14.9
|
|
|
Three months ended September 30, 2017 reported gross profit
|
$
|
69.7
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Three months ended September 30, 2016 reported gross profit
|
$
|
22.0
|
|
Sales price
|
90.9
|
|
|
Volume
|
5.6
|
|
|
LCM inventory adjustment
|
3.7
|
|
|
Cost of materials
|
(54.0
|
)
|
|
Operating costs
|
(5.8
|
)
|
|
Hedging activities
|
(2.2
|
)
|
|
RINs expense
|
(2.2
|
)
|
|
Three months ended September 30, 2017 reported gross profit
|
$
|
58.0
|
|
|
Three Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Derivative gain reflected in sales
|
$
|
—
|
|
|
$
|
14.5
|
|
Derivative loss reflected in cost of sales
|
—
|
|
|
(9.7
|
)
|
||
Derivative gain reflected in gross profit
|
$
|
—
|
|
|
$
|
4.8
|
|
|
|
|
|
|
|
||
Realized loss on derivative instruments
|
$
|
(2.3
|
)
|
|
$
|
(1.8
|
)
|
Unrealized loss on derivative instruments
|
(9.7
|
)
|
|
(4.9
|
)
|
||
Total derivative loss reflected in the unaudited condensed consolidated statements of operations
|
$
|
(12.0
|
)
|
|
$
|
(1.9
|
)
|
Total loss on commodity derivative settlements
|
$
|
(2.3
|
)
|
|
$
|
(1.8
|
)
|
|
Nine Months Ended September 30,
|
|||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||
|
(Dollars in millions, except barrel and per barrel data)
|
|||||||||
Sales by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Lubricating oils
|
$
|
453.2
|
|
|
$
|
408.5
|
|
|
10.9
|
%
|
Solvents
|
198.7
|
|
|
177.6
|
|
|
11.9
|
%
|
||
Waxes
|
87.4
|
|
|
96.7
|
|
|
(9.6
|
)%
|
||
Packaged and synthetic specialty products
(1)
|
224.3
|
|
|
237.1
|
|
|
(5.4
|
)%
|
||
Other
(2)
|
22.5
|
|
|
28.9
|
|
|
(22.1
|
)%
|
||
Total specialty products
|
$
|
986.1
|
|
|
$
|
948.8
|
|
|
3.9
|
%
|
Total specialty products sales volume (in barrels)
|
7,272,000
|
|
|
7,435,000
|
|
|
(2.2
|
)%
|
||
Average specialty products sales price per barrel
|
$
|
135.60
|
|
|
$
|
127.61
|
|
|
6.3
|
%
|
|
|
|
|
|
|
|||||
Fuel products:
|
|
|
|
|
|
|||||
Gasoline
|
$
|
736.1
|
|
|
$
|
599.6
|
|
|
22.8
|
%
|
Diesel
|
658.9
|
|
|
548.6
|
|
|
20.1
|
%
|
||
Jet fuel
|
106.4
|
|
|
81.5
|
|
|
30.6
|
%
|
||
Asphalt, heavy fuel oils and other
(3)
|
392.5
|
|
|
340.4
|
|
|
15.3
|
%
|
||
Hedging activities
|
—
|
|
|
45.6
|
|
|
(100.0
|
)%
|
||
Total fuel products
|
$
|
1,893.9
|
|
|
$
|
1,615.7
|
|
|
17.2
|
%
|
Total fuel products sales volume (in barrels)
|
30,678,000
|
|
|
30,943,000
|
|
|
(0.9
|
)%
|
||
Average fuel products sales price per barrel (excluding hedging activities)
|
$
|
61.73
|
|
|
$
|
50.74
|
|
|
21.7
|
%
|
Average fuel products sales price per barrel (including hedging activities)
|
$
|
61.73
|
|
|
$
|
52.22
|
|
|
18.2
|
%
|
|
|
|
|
|
|
|||||
Total oilfield services
|
$
|
185.7
|
|
|
$
|
88.0
|
|
|
111.0
|
%
|
|
|
|
|
|
|
|||||
Total sales
|
$
|
3,065.7
|
|
|
$
|
2,652.5
|
|
|
15.6
|
%
|
Total specialty and fuel products sales volume (in barrels)
|
37,950,000
|
|
|
38,378,000
|
|
|
(1.1
|
)%
|
|
(1)
|
Represents packaged and synthetic specialty products at the Royal Purple, Bel-Ray, Calumet Packaging and Missouri facilities.
|
(2)
|
Represents fuels and asphalt produced in connection with the production of specialty products at the Princeton and Cotton Valley refineries and Dickinson and Karns City facilities.
|
(3)
|
Represents asphalt, heavy fuel oils and other products produced in connection with the production of fuels at the Shreveport, Superior, San Antonio and Great Falls refineries and crude oil sales from the Superior, San Antonio and Shreveport refineries to third-party customers.
|
|
Dollar Change
|
||
|
(In millions)
|
||
Sales price
|
$
|
58.1
|
|
Volume
|
(20.8
|
)
|
|
Total specialty products segment sales increase
|
$
|
37.3
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Sales price
|
$
|
337.2
|
|
Hedging activities
|
(45.6
|
)
|
|
Volume
|
(13.4
|
)
|
|
Total fuel products segment sales increase
|
$
|
278.2
|
|
|
Nine Months Ended September 30,
|
|||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||
|
(Dollars in millions, except per barrel data)
|
|||||||||
Gross profit by segment:
|
|
|
|
|
|
|||||
Specialty products:
|
|
|
|
|
|
|||||
Gross profit
|
$
|
255.0
|
|
|
$
|
278.8
|
|
|
(8.5
|
)%
|
Percentage of sales
|
25.9
|
%
|
|
29.4
|
%
|
|
|
|
||
Specialty products gross profit per barrel
|
$
|
35.07
|
|
|
$
|
37.50
|
|
|
(6.5
|
)%
|
Fuel products:
|
|
|
|
|
|
|||||
Gross profit excluding hedging activities
|
$
|
145.9
|
|
|
$
|
27.2
|
|
|
436.4
|
%
|
Hedging activities
|
—
|
|
|
7.8
|
|
|
(100.0
|
)%
|
||
Gross profit
|
$
|
145.9
|
|
|
$
|
35.0
|
|
|
316.9
|
%
|
Percentage of sales
|
7.7
|
%
|
|
2.2
|
%
|
|
|
|||
Fuel products gross profit per barrel (excluding hedging activities)
|
$
|
4.76
|
|
|
$
|
0.88
|
|
|
440.9
|
%
|
Fuel products gross profit per barrel (including hedging activities)
|
$
|
4.76
|
|
|
$
|
1.13
|
|
|
321.2
|
%
|
Oilfield services:
|
|
|
|
|
|
|
||||
Gross profit
|
$
|
50.5
|
|
|
$
|
14.0
|
|
|
260.7
|
%
|
Percentage of sales
|
27.2
|
%
|
|
15.9
|
%
|
|
|
|
||
Total gross profit
|
$
|
451.4
|
|
|
$
|
327.8
|
|
|
37.7
|
%
|
Percentage of sales
|
14.7
|
%
|
|
12.4
|
%
|
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Nine months ended September 30, 2016 reported gross profit
|
$
|
278.8
|
|
Cost of materials
|
(60.9
|
)
|
|
Volume
|
(9.3
|
)
|
|
LCM inventory adjustment
|
(7.0
|
)
|
|
Operating costs
|
(4.7
|
)
|
|
Sales price
|
58.1
|
|
|
Nine months ended September 30, 2017 reported gross profit
|
$
|
255.0
|
|
|
Dollar Change
|
||
|
(In millions)
|
||
Nine months ended September 30, 2016 reported gross profit
|
$
|
35.0
|
|
Sales price
|
337.2
|
|
|
RINs expense
|
86.3
|
|
|
Cost of materials
|
(283.0
|
)
|
|
Operating costs
|
(10.9
|
)
|
|
LCM inventory adjustment
|
(8.1
|
)
|
|
Hedging activities
|
(7.8
|
)
|
|
Volume
|
(2.8
|
)
|
|
Nine months ended September 30, 2017 reported gross profit
|
$
|
145.9
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Derivative gain reflected in sales
|
$
|
—
|
|
|
$
|
45.6
|
|
Derivative loss reflected in cost of sales
|
—
|
|
|
(36.4
|
)
|
||
Derivative gain reflected in gross profit
|
$
|
—
|
|
|
$
|
9.2
|
|
|
|
|
|
||||
Realized loss on derivative instruments
|
$
|
(7.2
|
)
|
|
$
|
(20.1
|
)
|
Unrealized gain on derivative instruments
|
2.2
|
|
|
23.5
|
|
||
Total derivative gain (loss) reflected in the unaudited condensed consolidated statements of operations
|
$
|
(5.0
|
)
|
|
$
|
12.6
|
|
Total loss on commodity derivative settlements
|
$
|
(7.2
|
)
|
|
$
|
(20.1
|
)
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Net cash used in operating activities
|
$
|
(3.3
|
)
|
|
$
|
(18.8
|
)
|
Net cash used in investing activities
|
(45.6
|
)
|
|
(127.4
|
)
|
||
Net cash provided by financing activities
|
71.2
|
|
|
158.4
|
|
||
Net increase in cash and cash equivalents
|
$
|
22.3
|
|
|
$
|
12.2
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Capital improvement expenditures
|
$
|
19.3
|
|
|
$
|
57.3
|
|
Replacement capital expenditures
|
14.3
|
|
|
14.5
|
|
||
Environmental capital expenditures
|
6.8
|
|
|
5.4
|
|
||
Turnaround capital expenditures
|
11.3
|
|
|
8.7
|
|
||
Joint venture contributions, net
(1)
|
—
|
|
|
12.0
|
|
||
Total
|
$
|
51.7
|
|
|
$
|
97.9
|
|
|
(1)
|
Includes proceeds from sale of unconsolidated affiliates.
|
•
|
$900.0 million
senior secured revolving credit facility maturing in July 2019, subject to borrowing base limitations, with a maximum letter of credit sublimit equal to
$600.0 million
, which amount may be increased to
90%
of revolver commitments in effect with the consent of the Agent (“revolving credit facility”);
|
•
|
$400.0 million
of 11.50% senior secured notes due 2021 (“2021 Secured Notes”);
|
•
|
$900.0 million
of 6.50% senior notes due 2021 (“2021 Notes”);
|
•
|
$350.0 million
of 7.625% senior notes due 2022 (“2022 Notes”); and
|
•
|
$325.0 million
of 7.75% senior notes due 2023 (“2023 Notes”).
|
|
|
|
Payments Due by Period
|
||||||||||||||||
|
Total
|
|
Less Than
1 Year |
|
1–3
Years |
|
3–5
Years |
|
More
Than 5 Years |
||||||||||
|
(In millions)
|
||||||||||||||||||
Operating activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest on long-term debt at contractual rates and maturities
(1)
|
$
|
750.7
|
|
|
$
|
167.6
|
|
|
$
|
327.6
|
|
|
$
|
183.6
|
|
|
$
|
71.9
|
|
Operating lease obligations
(2)
|
118.6
|
|
|
36.6
|
|
|
47.5
|
|
|
20.4
|
|
|
14.1
|
|
|||||
Letters of credit
(3)
|
100.3
|
|
|
100.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchase commitments
(4)
|
1,233.5
|
|
|
553.9
|
|
|
548.2
|
|
|
42.0
|
|
|
89.4
|
|
|||||
Employment agreements
(5)
|
2.1
|
|
|
2.0
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|||||
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Obligations under inventory financing agreements
|
95.4
|
|
|
95.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Capital lease obligations
|
44.7
|
|
|
2.9
|
|
|
2.4
|
|
|
2.1
|
|
|
37.3
|
|
|||||
Long-term debt obligations, excluding capital lease obligations
|
1,982.0
|
|
|
1.4
|
|
|
3.0
|
|
|
1,652.6
|
|
|
325.0
|
|
|||||
Total obligations
|
$
|
4,327.3
|
|
|
$
|
960.1
|
|
|
$
|
928.8
|
|
|
$
|
1,900.7
|
|
|
$
|
537.7
|
|
|
(1)
|
Interest on long-term debt at contractual rates and maturities relates primarily to interest on our senior notes, revolving credit facility interest and fees and interest on our capital lease obligations, which excludes the adjustment for the interest rate swap agreement.
|
(2)
|
We have various operating leases primarily for railcars, the use of land, storage tanks, compressor stations, equipment, precious metals and office facilities that extend through July 2055.
|
(3)
|
Letters of credit primarily supporting crude oil purchases and precious metals leasing.
|
(4)
|
Purchase commitments consist primarily of obligations to purchase fixed volumes of crude oil, other feedstocks and finished products for resale from various suppliers based on current market prices at the time of delivery.
|
(5)
|
Certain employment agreements may be terminated under certain circumstances or at certain dates prior to expiration. We expect our contracts will be renewed or replaced with similar agreements upon their expiration. Amounts due under the contracts assume the contracts are not terminated prior to their expiration.
|
•
|
crude oil purchases and sales;
|
•
|
refined product sales and purchases;
|
•
|
natural gas purchases;
|
•
|
precious metals; and
|
•
|
fluctuations in the value of crude oil between geographic regions and between the different types of crude oil such as NYMEX WTI, Light Louisiana Sweet (“LLS”), WCS, Mixed Sweet Blend (“MSW”) and ICE Brent.
|
Crack Spread Swap Contracts by Expiration Dates
|
Barrels
|
|
BPD
|
|
Average Implied Crack Spread
($/Bbl) |
||||
Fourth Quarter 2017
|
2,390,000
|
|
|
25,978
|
|
|
$
|
15.57
|
|
Calendar Year 2018
|
1,680,000
|
|
|
4,603
|
|
|
$
|
14.94
|
|
Total
|
4,070,000
|
|
|
|
|
|
|||
Average price
|
|
|
|
|
$
|
15.31
|
|
Crude Oil Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Average Differential to NYMEX WTI
($/Bbl) |
||||
Fourth Quarter 2017
|
644,000
|
|
|
7,000
|
|
|
$
|
(13.22
|
)
|
Total
|
644,000
|
|
|
|
|
|
|||
Average differential
|
|
|
|
|
$
|
(13.22
|
)
|
Crude Oil Percentage Basis Swap Contracts by Expiration Dates
|
Barrels Purchased
|
|
BPD
|
|
Fixed Percentage of NYMEX WTI
(Average % of WTI/Bbl) |
|||
Fourth Quarter 2017
|
276,000
|
|
|
3,000
|
|
|
72.3
|
%
|
Total
|
276,000
|
|
|
|
|
|
||
Average percentage
|
|
|
|
|
72.3
|
%
|
Natural Gas Swap Contracts by Expiration Dates
|
MMBtu
|
|
$/MMBtu
|
|||
Fourth Quarter 2017
|
960,000
|
|
|
$
|
3.72
|
|
Total
|
960,000
|
|
|
|
||
Average price
|
|
|
$
|
3.72
|
|
|
In millions
|
||
Crude oil swaps
|
$
|
0.3
|
|
Crude oil basis swaps
|
$
|
0.6
|
|
Crude oil percentage basis swaps
|
$
|
0.3
|
|
Natural gas swaps
|
$
|
1.0
|
|
Gasoline crack spread swaps
|
$
|
(2.0
|
)
|
Gasoline swaps
|
$
|
(0.1
|
)
|
Diesel crack spread swaps
|
$
|
(2.0
|
)
|
Diesel swaps
|
$
|
(0.1
|
)
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||
|
(In millions)
|
||||||||||||||
Financial Instrument:
|
|
|
|
|
|
|
|
||||||||
2021 Secured Notes
|
$
|
464.1
|
|
|
$
|
386.8
|
|
|
$
|
458.8
|
|
|
$
|
384.5
|
|
2021 Notes
|
$
|
881.8
|
|
|
$
|
891.9
|
|
|
$
|
763.9
|
|
|
$
|
890.2
|
|
2022 Notes
|
$
|
344.7
|
|
|
$
|
344.5
|
|
|
$
|
296.0
|
|
|
$
|
343.7
|
|
2023 Notes
|
$
|
317.4
|
|
|
$
|
319.0
|
|
|
$
|
274.2
|
|
|
$
|
318.3
|
|
|
|
CALUMET SPECIALTY PRODUCTS PARTNERS, L.P.
|
|
|
|
|
|
|
|
By:
|
Calumet GP, LLC, its general partner
|
|
|
|
|
Date:
|
December 28, 2017
|
By:
|
/s/ D. West Griffin
|
|
|
|
D. West Griffin
|
|
|
|
Executive Vice President and Chief Financial Officer of Calumet GP, LLC (Principal Accounting and Financial Officer)
|
|
|
|
(Authorized Person and Principal Accounting Officer)
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
100.INS*
|
|
XBRL Instance Document
|
|
|
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
*
|
|
Filed herewith.
|
**
|
|
Furnished herewith.
|
†
|
|
Identifies management contract and compensatory plan arrangements.
|
1.
|
Capitalized terms used but not defined herein shall have the meaning given to such terms in the Agreement.
|
2.
|
Section 2(b) of the Agreement is amended and restated as follows:
|
3.
|
Except as expressly amended herein, the terms, covenants, and conditions of the Agreement shall remain in full force and effect without modification or amendment, and the parties hereto ratify and reaffirm the same in its entirety.
|
4.
|
This Amendment may not be modified or changed in whole or in part in any manner other than by an instrument in writing duly signed by both parties hereto. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same agreement.
|
1.
|
I have reviewed this Quarterly Report of Calumet Specialty Products Partners, L.P. (the “registrant”) on Form 10-Q for the quarter ended
September 30, 2017
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date: December 28, 2017
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/s/ Timothy Go
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Timothy Go
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Chief Executive Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
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(Principal Executive Officer)
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1.
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I have reviewed this Quarterly Report of Calumet Specialty Products Partners, L.P. (the “registrant”) on Form 10-Q for the quarter ended
September 30, 2017
;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
Date: December 28, 2017
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/s/ D. West Griffin
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D. West Griffin
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Executive Vice President and Chief Financial Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
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(Principal Financial Officer)
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(a)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
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(b)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.
|
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December 28, 2017
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|
/s/ Timothy Go
|
|
|
Timothy Go
|
|
|
Chief Executive Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
|
|
(Principal Executive Officer)
|
|
|
|
December 28, 2017
|
|
/s/ D. West Griffin
|
|
|
D. West Griffin
|
|
|
Executive Vice President and Chief Financial Officer of Calumet GP, LLC, general partner of Calumet Specialty Products Partners, L.P.
|
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(Principal Financial Officer)
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