CVR Energy, Inc. (NYSE:CVI) Q1 2024 Earnings Call Transcript

Dane Neumann: I’ll lever off what Dave said. It really would depend on the depth of the equity market. Is there a scenario where we’d potentially stretch if there was a very clear path of delevering? Yes, but probably not too aggressively beyond where our current targets are.

Paul Cheng: Okay. Second question. Dane, can you tell us that what is your remaining hedging position for the rest of the year? And also, Dave, when you talk about the second quarter, the RD will be reaching the capacity. Are you talking about reaching the run at 100% because previously, I think you’ve been talking about running maybe more like in the 70%. So I just want to make sure I understand your comment on that.

David Lamp: Yes, Paul, on the RD side of it is we’re planning to run this run at 5,000 barrels per day, which is about 75 of renewable diesel compared to our nameplate of 100. So we’re probably a little higher in the numbers you said, but right in that angle. And what we’re trying to explore here is catalyst life and find the optimum in that. And we’ll sneak up on that, probably the next load increasing it to maybe 6,000, and then we’ll go from there. Your other question…

Dane Neumann: Yes. On open derivative positions, Paul. So for ’24, we’re at about 8% of gasoline and diesel production. But one thing I want to caveat is that production rate does assume a full run rate of Wynnewood. So we have to – once we know more, we’ll be able to appropriately adjust what that would look like with any downtime that’s associated with the fire. And then for ’25, we’re about 4% of total gasoline-diesel production. That’s 100% of that is diesel production. So 9% on diesel production for ’25.

Paul Cheng: Dane you say 4% in – 4% in gasoline and diesel, but that’s because it’s all in diesel, so it’s 9% in diesel and 0% in gasoline, right?

Dane Neumann: Yes, that’s correct.

Paul Cheng: And is the position for the second quarter right now is making money or losing money?

David Lamp: Making money for the second half.

Paul Cheng: For the second quarter right now. Is your derivative position in the second quarter is making money or losing money?

David Lamp: Yes, we’re making money. It’s in the money right now, Paul.

Paul Cheng: Thank you.

David Lamp: You’re welcome.

Operator: Thank you. We have no further questions at this time. I would like to turn the floor back over to management for closing comments.

David Lamp: Again, I’d like to thank you all for your interest in CVR Energy. Additionally, I’d like to thank our employees for their hard work and commitment towards safe, reliable and environmentally responsible operations. We look forward to reviewing our second quarter 2024 results in our next earnings call. Thank you.

Operator: Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.