HOUSTON, Aug. 4 /PRNewswire-FirstCall/ -- Frontier Oil Corporation
(NYSE: FTO) today announced net income of $66.0 million, or $1.16 per diluted
share for the quarter ended June 30, 2005, compared to net income of
$49.5 million, or $0.91 per diluted share, for the same period of 2004.
Frontier's income before taxes of $105.7 million for the second quarter of
2005 is a record for the Company, significantly higher than the previous
record $92.8 million earned in the second quarter of 2001. For the six months
ended June 30, 2005, net income totaled a record $100.4 million, or $1.78 per
diluted share, considerably above the $45.7 million, or $0.84 per diluted
share for the six months ended June 30, 2004 and our previous record of
$83.4 million, or $1.53 per diluted share for the six months ended June 30,
2001.
Frontier continues to benefit from record diesel crack spreads and wide
crude oil differentials. The diesel crack spread increased to an average of
$15.51 per barrel for the recent quarter, more than double the $7.39 per
barrel in the second quarter of 2004 while the gasoline crack spread declined
to an average of $12.50 per barrel in the second quarter compared to an
average $14.23 per barrel in 2004. The light/heavy crude oil differential
increased to $14.15 per barrel for the quarter compared to $8.81 for the same
period in 2004. Similarly, the WTI/WTS crude oil differential increased to
$4.67 per barrel for the quarter compared to $3.29 per barrel for the second
quarter of 2004.
Frontier's high refinery utilization rates also contributed to the
outstanding second quarter 2005 results. Crude oil charge for the quarter
averaged 156,352 barrels per day. In addition, Frontier had built significant
intermediate inventory in the first quarter of 2005 due to turnaround activity
at its El Dorado Refinery and was able to process that inventory into finished
products in the second quarter. As a result, total product sales averaged
176,514 barrels per day for the second quarter 2005, compared to
171,460 barrels per day in the second quarter of 2004.
Frontier's Chairman, President and CEO, James Gibbs, commented, "Our net
income of $100.4 million for the first six months of this year is close to the
record $107.7 million we earned for the entire year of 2001. Crack spreads
and crude oil differentials remain strong and we are extremely confident 2005
should be the best year in our Company's history."
Frontier's balance sheet was in excellent shape at quarter end with a cash
balance of $168.0 million and no borrowings under the Company's revolving
credit facility. Frontier's cash exceeded its debt by $18 million as of
June 30, 2005.
The second quarter 2005 results include an after-tax inventory loss of
approximately $1.0 million, or $0.02 per diluted share, compared to a gain of
$5.7 million, or $0.11 per diluted share, for the same period of 2004. The
six months ended June 30, 2005 include an after-tax inventory gain of
$18.4 million, or $0.33 per diluted share, compared to a gain of
$14.7 million, or $0.27 per diluted share, for the six-month period ended
June 30, 2004.
Conference Call
A conference call is scheduled for today, August 4, 2005, at 11:00 a.m.
eastern time, to discuss the financial results. To access the call, please
dial (800) 949-2165. For those individuals outside the United States, please
call (312) 461-0285. A recorded replay of the call may be heard through
August 18, 2005 by dialing (888) 203-1112 (international callers
(719) 457-0820) and entering the code 5477634. In addition, the real-time
conference call and a recorded replay will be webcast by PR Newswire. To
access the call or the replay via the Internet, go to
http://www.frontieroil.com and register from the Investor Relations page of
the site.
Frontier operates a 110,000 barrel-per-day refinery located in El Dorado,
Kansas, and a 52,000 barrel-per-day refinery located in Cheyenne, Wyoming, and
markets its refined products principally along the eastern slope of the Rocky
Mountains and in other neighboring plains states. Information about the
Company may be found on its web site http://www.frontieroil.com .
This press release includes "forward-looking statements" as defined by the
Securities and Exchange Commission. Such statements are those concerning
strategic plans, expectations and objectives for future operations. All
statements, other than statements of historical facts, included in this press
release that address activities, events or developments that the Company
expects, believes or anticipates will or may occur in the future are forward-
looking statements. These statements are based on certain assumptions made by
the Company based on its experience and perception of historical trends,
current conditions, expected future developments and other factors it believes
are appropriate in the circumstances. Such statements are subject to a number
of assumptions, risks and uncertainties, many of which are beyond the control
of the Company. Investors are cautioned that any such statements are not
guarantees of future performance and that actual results or developments may
differ materially from those projected in the forward-looking statements.
FRONTIER OIL CORPORATION
Six Months Ended Three Months Ended
June 30 June 30
2005 2004 2005 2004
INCOME STATEMENT DATA
($000's except per share)
Revenues $1,664,920 $1,273,236 $972,280 $735,904
Raw material, freight and
other costs 1,351,051 1,048,451 792,728 583,868
Refining operating expenses,
excluding depreciation 115,175 106,403 53,824 51,113
Selling and general expenses,
excluding depreciation 16,441 13,846 9,402 7,171
Merger termination and
legal costs 37 3,663 33 376
Operating income before
depreciation and
amortization 182,216 100,873 116,293 93,376
Depreciation and amortization 16,865 15,762 8,605 7,943
Operating income 165,351 85,111 107,688 85,433
Interest expense and
other financing costs 5,976 11,805 2,939 5,949
Interest income (1,727) (405) (990) (204)
Gain on involuntary
conversion of assets --- (594) --- (594)
Provision for income taxes 60,705 28,572 39,778 30,813
Net income $100,397 $45,733 $65,961 $49,469
Net income per diluted share $1.78 $0.84 $1.16 $0.91
Average shares outstanding
(000's) 56,390 54,448 56,820 54,625
OTHER FINANCIAL DATA ($000's)
Adjusted EBITDA (1) $182,216 $101,467 $116,293 $93,970
Cash flow before changes
in working capital 146,658 83,423 88,690 79,696
Working capital changes (47,494) (20,025) 32,221 (448)
Net cash provided by
operating activities 99,164 63,398 120,911 79,248
Net cash used by investing
activities (58,375) (30,100) (29,904) (12,111)
OPERATIONS
Consolidated
Operations (bpd)
Total charges 161,005 162,484 171,316 172,951
Gasoline yields 77,715 80,625 88,306 86,782
Diesel yields 53,610 51,188 58,060 54,917
Total sales 161,297 160,050 176,514 171,460
Refinery operating margins
information ($ per bbl)
Refined products revenue $57.01 $43.88 $60.46 $47.27
Raw material, freight and
other costs 46.28 35.99 49.35 37.42
Refinery operating expenses
excluding depreciation 3.95 3.65 3.35 3.28
Refinery depreciation and
amortization 0.57 0.52 0.53 0.49
Light/Heavy crude spread
($ per bbl) $14.13 $8.49 $14.15 $8.81
WTI/WTS Differential
($ per bbl) 4.68 3.09 4.67 3.29
BALANCE SHEET DATA
($000's) At June 30, 2005 At December 31, 2004
Cash, including cash
equivalents (a) $167,997 $124,389
Working capital 190,264 97,261
Short-term and current debt (b) --- ---
Total long-term debt (c) 150,000 150,000
Shareholders' equity (d) 350,678 240,113
Net debt to book capitalization
(b+c-a)/(b+c-a+d) -5.4% 9.6%
(1) Adjusted EBITDA represents income before interest expense, interest
income, income tax, and depreciation and amortization. Adjusted
EBITDA is not a calculation based upon generally accepted accounting
principles; however, the amounts included in the adjusted EBITDA
calculation are derived from amounts included in the consolidated
financial statements of the Company. Adjusted EBITDA should not be
considered as an alternative to net income or operating income, as
an indication of operating performance of the Company or as an
alternative to operating cash flow as a measure of liquidity.
Adjusted EBITDA is not necessarily comparable to similarly titled
measures of other companies. Adjusted EBITDA is presented here
because it enhances an investor's understanding of Frontier's
ability to satisfy principal and interest obligations with respect
to Frontier's indebtedness and to use cash for other purposes,
including capital expenditures. Adjusted EBITDA is also used for
internal analysis and as a basis for financial covenants.
Frontier's adjusted EBITDA for the six and three months ended
June 30, 2005 and 2004 is reconciled to net income as follows:
Six Months Ended Three Months Ended
June 30 June 30
2005 2004 2005 2004
Net income $100,397 $45,733 $65,961 $49,469
Add provision for
income taxes 60,705 28,572 39,778 30,813
Add interest expense
and other financing costs 5,976 11,805 2,939 5,949
Subtract interest income (1,727) (405) (990) (204)
Add depreciation and
amortization 16,865 15,762 8,605 7,943
Adjusted EBITDA $182,216 $101,467 $116,293 $93,970
SOURCE Frontier Oil Corporation
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Related links:
http://www.frontieroil.com
CONTACT:
Doug Aron of Frontier Oil Corporation,
+1-713-688-9600, ext. 145
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