Valero sets strong tone for US refiners with record quarterly profit as margins surge
VLO•Valero Energy reported record third-quarter adjusted profit of $23.90 per share, beating analysts’ $21.07 estimate, as its refining margin per barrel nearly tripled to $39.24. Adjusted refining segment operating earnings rose more than 400% to $8.8 billion.
1. Record quarterly results
Valero Energy posted its highest-ever quarterly profit, with adjusted earnings of $23.90 per share for the third quarter, its second straight quarter of record profit. Analysts had expected $21.07 per share. The company’s refining margin per barrel of throughput nearly tripled to $39.24, while adjusted operating earnings in the refining segment rose more than 400% year over year to $8.8 billion.
2. Margins surge across industry
The US 3-2-1 crack spread, a measure of refinery margins, gained more than 150% year over year during July to September as disruptions caused by the Middle East conflict lifted margins. Valero said its refineries operated at near-record utilization rates, supplying transportation fuels. US refiners have been running at 95% to 100% of capacity, with many postponing planned maintenance.
3. Refinery capacity update
Valero said it completed an FCC unit optimization project at its St. Charles refinery, increasing capacity for products including alkylate and gasoline. CEO Lane Riggs said the company’s refineries provided a reliable supply of critical transportation fuels during the quarter.
