Valero Energy Reports 2021 Fourth Quarter and Full Year Results

  • Reported net income attributable to Valero stockholders of $1,009 million, or $2.46 per share, for the fourth quarter and $930 million, or $2.27 per share, for the year.
  • Reported adjusted net income attributable to Valero stockholders of $1,012 million, or $2.47 per share, for the fourth quarter and $1,152 million, or $2.81 per share, for the year.
  • Returned $401 million in cash to stockholders in the fourth quarter and $1.6 billion in the year through dividends.
  • Reduced Valero’s long-term debt by $693 million in the fourth quarter and by $1.3 billion in 2021.
  • Startup of the Diamond Green Diesel project at Port Arthur (DGD 3) is now expected to be in the first quarter of 2023.

SAN ANTONIO–(BUSINESS WIRE)–Valero Energy Corporation (NYSE: VLO, “Valero”) today reported net income attributable to Valero stockholders of $1,009 million, or $2.46 per share, for the fourth quarter of 2021, compared to a net loss of $359 million, or $0.88 per share, for the fourth quarter of 2020. Excluding the adjustments shown in the accompanying earnings release tables, fourth quarter 2021 adjusted net income attributable to Valero stockholders was $1,012 million, or $2.47 per share, compared to an adjusted net loss of $429 million, or $1.06 per share, for the fourth quarter of 2020.

For 2021, net income attributable to Valero stockholders was $930 million, or $2.27 per share, compared to a net loss of $1,421 million, or $3.50 per share, in 2020. Excluding the adjustments shown in the accompanying earnings release tables, adjusted net income attributable to Valero stockholders was $1,152 million, or $2.81 per share, in 2021, compared to an adjusted net loss of $1,265 million, or $3.12 per share, in 2020.

“We saw continued improvement in our business during the fourth quarter with margins supported by strong product demand,” said Joe Gorder, Valero Chairman and Chief Executive Officer. “Looking ahead, we remain optimistic on refining margins with low global light product inventories, strong demand, global supply tightness due to significant refining capacity rationalization, and wider sour crude oil differentials.”

Refining

The refining segment reported $1.3 billion of operating income for the fourth quarter of 2021, compared to a $377 million operating loss for the fourth quarter of 2020. Fourth quarter 2021 adjusted operating income was $1.1 billion, compared to an adjusted operating loss of $476 million for the fourth quarter of 2020. Refinery throughput volumes averaged 3.0 million barrels per day in the fourth quarter of 2021, which was 483 thousand barrels per day higher than the fourth quarter of 2020. 2021 was Valero’s best year ever for Employee and Process Safety.

“The Employee and Process safety milestones set in 2021 are a testament to our long-standing commitment to safe, reliable and environmentally responsible operations,” said Gorder. “In fact, we have set records for Process Safety for three consecutive years.”

Renewable Diesel

The renewable diesel segment, which consists of the Diamond Green Diesel (DGD) joint venture, reported $150 million of operating income for the fourth quarter of 2021, compared to $127 million for the fourth quarter of 2020. Adjusted renewable diesel operating income was $152 million for the fourth quarter of 2021. Renewable diesel sales volumes averaged 1.6 million gallons per day in the fourth quarter of 2021, which was 974 thousand gallons per day higher than the fourth quarter of 2020. The higher operating income and sales volumes in the fourth quarter of 2021 were primarily attributable to the startup of the DGD expansion project (DGD 2) in the fourth quarter.

Ethanol

The ethanol segment reported $474 million of operating income for the fourth quarter of 2021, compared to $15 million for the fourth quarter of 2020. Fourth quarter 2021 adjusted operating income was $475 million, compared to $17 million for the fourth quarter of 2020. Ethanol production volumes averaged 4.4 million gallons per day in the fourth quarter of 2021, which was 278 thousand gallons per day higher than the fourth quarter of 2020. Higher operating income in the fourth quarter of 2021 was primarily attributed to higher ethanol product prices.

Corporate and Other

General and administrative expenses were $286 million in the fourth quarter of 2021, compared to $224 million in the fourth quarter of 2020. General and administrative expenses were $865 million for the year. The effective tax rate for 2021 was 17 percent, which reflects the benefit from the portion of DGD’s net income that is not taxable to Valero.

Investing and Financing Activities

Net cash provided by operating activities was $2.5 billion in the fourth quarter of 2021. Included in this amount was a $595 million favorable impact from working capital and $82 million associated with the other joint venture member’s share of DGD’s net cash provided by operating activities, excluding changes in DGD’s working capital. Excluding these items, adjusted net cash provided by operating activities was $1.8 billion in the fourth quarter of 2021.

Net cash provided by operating activities in 2021 was $5.9 billion. Included in this amount was a $2.2 billion favorable impact from working capital and $381 million associated with the other joint venture member’s share of DGD’s net cash provided by operating activities, excluding changes in DGD’s working capital. Excluding these items, adjusted net cash provided by operating activities in 2021 was $3.3 billion.

Capital investments totaled $752 million in the fourth quarter of 2021, of which $353 million was for sustaining the business, including costs for turnarounds, catalysts and regulatory compliance. Excluding capital investments attributable to the other joint venture member’s 50 percent share of DGD and those related to other variable interest entities, capital investments attributable to Valero were $545 million in the fourth quarter of 2021 and $1.8 billion in 2021.

Valero returned $401 million to stockholders through dividends in the fourth quarter of 2021. In 2021, Valero returned $1.6 billion to stockholders, or 50 percent of adjusted net cash provided by operating activities.

Valero continues to target a long-term total payout ratio between 40 and 50 percent of adjusted net cash provided by operating activities. Valero defines total payout ratio as the sum of dividends and stock buybacks divided by net cash provided by operating activities adjusted for changes in working capital and DGD’s net cash provided by operating activities, excluding changes in its working capital, attributable to the other joint venture member’s ownership interest in DGD.

In the fourth quarter, Valero completed a series of debt reduction and refinancing transactions that together reduced Valero’s long-term debt by $693 million. These debt reduction and refinancing transactions, combined with the redemption of the $575 million Floating Rate Senior Notes due 2023 in the third quarter, collectively reduced Valero’s long-term debt by $1.3 billion in 2021.

Liquidity and Financial Position

Valero ended 2021 with $13.9 billion of total debt and finance lease obligations and $4.1 billion of cash and cash equivalents. The debt to capitalization ratio, net of cash and cash equivalents, was 33 percent as of December 31, 2021.

Strategic Update

The DGD 2 expansion project at Valero’s St. Charles refinery commenced operations in the fourth quarter, on-budget and ahead of schedule. DGD 2’s annual renewable diesel production capacity has been increased as a result of process improvement and optimization and now stands at 410 million gallons per year, compared to the 400 million gallons per year design capacity. Total DGD renewable diesel production capacity is now 700 million gallons per year.

The DGD project at Valero’s Port Arthur refinery (DGD 3), which is expected to have a renewable diesel production capacity of 470 million gallons per year, is progressing ahead of schedule and is now expected to commence operations in the first quarter of 2023, increasing DGD’s total annual production capacity to approximately 1.2 billion gallons of renewable diesel and 50 million gallons of renewable naphtha.

BlackRock and Navigator’s large-scale carbon sequestration project is also progressing on schedule and is still expected to begin startup activities in late 2024. Valero is expected to be the anchor shipper with eight of Valero’s ethanol plants connected to this system, producing a lower carbon intensity ethanol product to be marketed in low-carbon fuel markets that is expected to result in a higher product margin.

Refinery optimization projects that are expected to reduce cost and improve margin capture are progressing on schedule. The Port Arthur Coker project, which is expected to increase the refinery’s utilization rate and improve turnaround efficiency, is expected to be completed in the first half of 2023.

Conference Call

Valero’s senior management will hold a conference call at 10 a.m. ET today to discuss this earnings release and to provide an update on operations and strategy.

About Valero

We are an international manufacturer and marketer of petroleum-based and low-carbon liquid transportation fuels and petrochemical products, and we sell our products primarily in the United States (U.S.), Canada, the United Kingdom (U.K.), Ireland, and Latin America. We own 15 petroleum refineries located in the U.S., Canada, and the U.K. with a combined throughput capacity of approximately 3.2 million barrels per day (BPD). We are a joint venture member in Diamond Green Diesel Holdings LLC (DGD), which owns a renewable diesel plant in Norco, Louisiana with a production capacity of 700 million gallons per year, and we own 12 ethanol plants located in the Mid-Continent region of the U.S. with a combined production capacity of approximately 1.6 billion gallons per year. We manage our operations through our Refining, Renewable Diesel, and Ethanol segments. Please visit www.investorvalero.com for more information.

Valero Contacts

Investors:

Homer Bhullar, Vice President – Investor Relations and Finance, 210-345-1982

Eric Herbort, Senior Manager – Investor Relations, 210-345-3331

Gautam Srivastava, Senior Manager – Investor Relations, 210-345-3992

Media:

Lillian Riojas, Executive Director – Media Relations and Communications, 210-345-5002

Safe-Harbor Statement

Statements contained in this release and the accompanying tables that state the company’s or management’s expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. The words “believe,” “expect,” “should,” “estimates,” “intend,” “target,” “will,” “plans,” “forecast,” and other similar expressions identify forward-looking statements. Forward-looking statements in this release and the accompanying tables include those relating to our greenhouse gas emissions targets, expected timing of completion and performance of projects, future market and industry conditions, future operating and financial performance, and management of future risks. It is important to note that actual results could differ materially from those projected in such forward-looking statements based on numerous factors, including those outside of the company’s control, such as legislative or political changes or developments, market dynamics, cyberattacks, weather events, and other matters affecting our operations or the demand for our products. These factors also include, but are not limited to, the uncertainties that remain with respect to the COVID-19 pandemic, variants of the virus, governmental and societal responses thereto, including requirements and mandates with respect to vaccines, vaccine distribution and administration levels, and the adverse effects the foregoing may have on our business or economic conditions generally. For more information concerning these and other factors that could cause actual results to differ from those expressed or forecasted, see Valero’s annual report on Form 10-K, quarterly reports on Form 10-Q, and other reports filed with the Securities and Exchange Commission and available on Valero’s website at www.valero.com.

Use of Non-GAAP Financial Information

This earnings release and the accompanying earnings release tables include references to financial measures that are not defined under U.S. generally accepted accounting principles (GAAP). These non-GAAP measures include adjusted net income (loss) attributable to Valero stockholders, adjusted earnings (loss) per common share – assuming dilution, refining margin, renewable diesel margin, ethanol margin, adjusted refining operating income (loss), adjusted renewable diesel operating income, adjusted ethanol operating income (loss), adjusted net cash provided by operating activities, and capital investments attributable to Valero. These non-GAAP financial measures have been included to help facilitate the comparison of operating results between periods. See the accompanying earnings release tables for a reconciliation of non-GAAP measures to their most directly comparable U.S. GAAP measures. Note (g) to the earnings release tables provides reasons for the use of these non-GAAP financial measures.

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

OTHER FINANCIAL DATA

(millions of dollars)

(unaudited)

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

 

2021

 

2020

 

2021

 

2020

Statement of income data

 

 

 

 

 

 

 

Revenues

$

35,903

 

 

$

16,604

 

 

$

113,977

 

 

$

64,912

 

Cost of sales:

 

 

 

 

 

 

 

Cost of materials and other (a) (b) (c)

 

31,849

 

 

 

15,101

 

 

 

102,714

 

 

 

58,933

 

Lower of cost or market (LCM) inventory valuation adjustment

 

 

 

 

 

 

 

 

 

 

(19

)

Operating expenses (excluding depreciation and

amortization expense reflected below) (a)

 

1,558

 

 

 

1,167

 

 

 

5,776

 

 

 

4,435

 

Depreciation and amortization expense

 

586

 

 

 

566

 

 

 

2,358

 

 

 

2,303

 

Total cost of sales

 

33,993

 

 

 

16,834

 

 

 

110,848

 

 

 

65,652

 

Other operating expenses

 

18

 

 

 

5

 

 

 

87

 

 

 

35

 

General and administrative expenses (excluding

depreciation and amortization expense reflected below)

 

286

 

 

 

224

 

 

 

865

 

 

 

756

 

Depreciation and amortization expense

 

12

 

 

 

11

 

 

 

47

 

 

 

48

 

Operating income (loss)

 

1,594

 

 

 

(470

)

 

 

2,130

 

 

 

(1,579

)

Other income (loss), net (d)

 

(163

)

 

 

25

 

 

 

16

 

 

 

132

 

Interest and debt expense, net of capitalized interest

 

(152

)

 

 

(153

)

 

 

(603

)

 

 

(563

)

Income (loss) before income tax expense (benefit)

 

1,279

 

 

 

(598

)

 

 

1,543

 

 

 

(2,010

)

Income tax expense (benefit) (e)

 

169

 

 

 

(289

)

 

 

255

 

 

 

(903

)

Net income (loss)

 

1,110

 

 

 

(309

)

 

 

1,288

 

 

 

(1,107

)

Less: Net income attributable to noncontrolling interests

 

101

 

 

 

50

 

 

 

358

 

 

 

314

 

Net income (loss) attributable to Valero Energy Corporation

stockholders

$

1,009

 

 

$

(359

)

 

$

930

 

 

$

(1,421

)

 

 

 

 

 

 

 

 

Earnings (loss) per common share

$

2.47

 

 

$

(0.88

)

 

$

2.27

 

 

$

(3.50

)

Weighted-average common shares outstanding (in millions)

 

408

 

 

 

407

 

 

 

407

 

 

 

407

 

 

 

 

 

 

 

 

 

Earnings (loss) per common share – assuming dilution

$

2.46

 

 

$

(0.88

)

 

$

2.27

 

 

$

(3.50

)

Weighted-average common shares outstanding –

assuming dilution (in millions) (f)

 

408

 

 

 

407

 

 

 

407

 

 

 

407

 

See Notes to Earnings Release Tables.

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

FINANCIAL HIGHLIGHTS BY SEGMENT

(millions of dollars)

(unaudited)

 

 

Refining

 

Renewable

Diesel

 

Ethanol

 

Corporate

and

Eliminations

 

Total

Three months ended December 31, 2021

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

33,521

 

 

$

684

 

$

1,698

 

$

 

 

$

35,903

 

Intersegment revenues

 

7

 

 

 

253

 

 

174

 

 

(434

)

 

 

 

Total revenues

 

33,528

 

 

 

937

 

 

1,872

 

 

(434

)

 

 

35,903

 

Cost of sales:

 

 

 

 

 

 

 

 

 

Cost of materials and other (c)

 

30,342

 

 

 

714

 

 

1,224

 

 

(431

)

 

 

31,849

 

Operating expenses (excluding depreciation and

amortization expense reflected below)

 

1,358

 

 

 

48

 

 

153

 

 

(1

)

 

 

1,558

 

Depreciation and amortization expense

 

543

 

 

 

23

 

 

20

 

 

 

 

 

586

 

Total cost of sales

 

32,243

 

 

 

785

 

 

1,397

 

 

(432

)

 

 

33,993

 

Other operating expenses

 

15

 

 

 

2

 

 

1

 

 

 

 

 

18

 

General and administrative expenses (excluding

depreciation and amortization expense reflected

below)

 

 

 

 

 

 

 

 

286

 

 

 

286

 

Depreciation and amortization expense

 

 

 

 

 

 

 

 

12

 

 

 

12

 

Operating income by segment

$

1,270

 

 

$

150

 

$

474

 

$

(300

)

 

$

1,594

 

 

 

 

 

 

 

 

 

 

 

Three months ended December 31, 2020

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

15,513

 

 

$

205

 

$

886

 

$

 

 

$

16,604

 

Intersegment revenues

 

2

 

 

 

62

 

 

66

 

 

(130

)

 

 

 

Total revenues

 

15,515

 

 

 

267

 

 

952

 

 

(130

)

 

 

16,604

 

Cost of sales:

 

 

 

 

 

 

 

 

 

Cost of materials and other (b)

 

14,324

 

 

 

107

 

 

800

 

 

(130

)

 

 

15,101

 

Operating expenses (excluding depreciation and

amortization expense reflected below)

 

1,032

 

 

 

22

 

 

113

 

 

 

 

 

1,167

 

Depreciation and amortization expense

 

531

 

 

 

11

 

 

24

 

 

 

 

 

566

 

Total cost of sales

 

15,887

 

 

 

140

 

 

937

 

 

(130

)

 

 

16,834

 

Other operating expenses

 

5

 

 

 

 

 

 

 

 

 

 

5

 

General and administrative expenses (excluding

depreciation and amortization expense reflected

below)

 

 

 

 

 

 

 

 

224

 

 

 

224

 

Depreciation and amortization expense

 

 

 

 

 

 

 

 

11

 

 

 

11

 

Operating income (loss) by segment

$

(377

)

 

$

127

 

$

15

 

$

(235

)

 

$

(470

)

 

See Operating Highlights by Segment.

See Notes to Earnings Release Tables.

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

FINANCIAL HIGHLIGHTS BY SEGMENT

(millions of dollars)

(unaudited)

 

 

Refining

 

Renewable

Diesel

 

Ethanol

 

Corporate

and

Eliminations

 

Total

Year ended December 31, 2021

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

106,947

 

 

$

1,874

 

$

5,156

 

 

$

 

 

$

113,977

 

Intersegment revenues

 

14

 

 

 

468

 

 

433

 

 

 

(915

)

 

 

 

Total revenues

 

106,961

 

 

 

2,342

 

 

5,589

 

 

 

(915

)

 

 

113,977

 

Cost of sales:

 

 

 

 

 

 

 

 

 

Cost of materials and other (a) (c)

 

97,759

 

 

 

1,438

 

 

4,428

 

 

 

(911

)

 

 

102,714

 

Operating expenses (excluding depreciation and

amortization expense reflected below) (a)

 

5,088

 

 

 

134

 

 

556

 

 

 

(2

)

 

 

5,776

 

Depreciation and amortization expense

 

2,169

 

 

 

58

 

 

131

 

 

 

 

 

 

2,358

 

Total cost of sales

 

105,016

 

 

 

1,630

 

 

5,115

 

 

 

(913

)

 

 

110,848

 

Other operating expenses

 

83

 

 

 

3

 

 

1

 

 

 

 

 

 

87

 

General and administrative expenses (excluding

depreciation and amortization expense reflected

below)

 

 

 

 

 

 

 

 

 

865

 

 

 

865

 

Depreciation and amortization expense

 

 

 

 

 

 

 

 

 

47

 

 

 

47

 

Operating income by segment

$

1,862

 

 

$

709

 

$

473

 

 

$

(914

)

 

$

2,130

 

 

 

 

 

 

 

 

 

 

 

Year ended December 31, 2020

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

Revenues from external customers

$

60,840

 

 

$

1,055

 

$

3,017

 

 

$

 

 

$

64,912

 

Intersegment revenues

 

8

 

 

 

212

 

 

226

 

 

 

(446

)

 

 

 

Total revenues

 

60,848

 

 

 

1,267

 

 

3,243

 

 

 

(446

)

 

 

64,912

 

Cost of sales:

 

 

 

 

 

 

 

 

 

Cost of materials and other (b)

 

56,093

 

 

 

500

 

 

2,784

 

 

 

(444

)

 

 

58,933

 

LCM inventory valuation adjustment

 

(19

)

 

 

 

 

 

 

 

 

 

 

(19

)

Operating expenses (excluding depreciation and

amortization expense reflected below)

 

3,944

 

 

 

85

 

 

406

 

 

 

 

 

 

4,435

 

Depreciation and amortization expense

 

2,138

 

 

 

44

 

 

121

 

 

 

 

 

 

2,303

 

Total cost of sales

 

62,156

 

 

 

629

 

 

3,311

 

 

 

(444

)

 

 

65,652

 

Other operating expenses

 

34

 

 

 

 

 

1

 

 

 

 

 

 

35

 

General and administrative expenses (excluding

depreciation and amortization expense reflected

below)

 

 

 

 

 

 

 

 

 

756

 

 

 

756

 

Depreciation and amortization expense

 

 

 

 

 

 

 

 

 

48

 

 

 

48

 

Operating income (loss) by segment

$

(1,342

)

 

$

638

 

$

(69

)

 

$

(806

)

 

$

(1,579

)

 

See Operating Highlights by Segment.

See Notes to Earnings Release Tables.

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

RECONCILIATION OF NON-GAAP MEASURES TO MOST COMPARABLE AMOUNTS

REPORTED UNDER U.S. GAAP (g)

(millions of dollars, except per share amounts)

(unaudited)

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

 

2021

 

2020

 

2021

 

2020

Reconciliation of net income (loss) attributable to Valero

Energy Corporation stockholders to adjusted net income

(loss) attributable to Valero Energy Corporation

stockholders

 

 

 

 

 

 

 

Net income (loss) attributable to Valero Energy Corporation

stockholders

$

1,009

 

 

$

(359

)

 

$

930

 

 

$

(1,421

)

Adjustments:

 

 

 

 

 

 

 

Modification of renewable volume obligation (RVO) (c)

 

(190

)

 

 

 

 

 

 

 

 

 

Income tax expense related to modification of RVO

 

43

 

 

 

 

 

 

 

 

 

 

Modification of RVO, net of taxes

 

(147

)

 

 

 

 

 

 

 

 

 

Changes in estimated useful lives of two ethanol plants

 

 

 

 

 

 

 

48

 

 

 

30

 

Income tax benefit related to the changes in estimated

useful lives of two ethanol plants

 

 

 

 

 

 

 

(11

)

 

 

(6

)

Changes in estimated useful lives of two ethanol plants,

net of taxes

 

 

 

 

 

 

 

37

 

 

 

24

 

Gain on sale of MVP interest (d)

 

 

 

 

 

 

 

(62

)

 

 

 

Income tax expense related to gain on sale of MVP interest

 

 

 

 

 

 

 

14

 

 

 

 

Gain on sale of MVP interest, net of taxes

 

 

 

 

 

 

 

(48

)

 

 

 

Diamond Pipeline asset impairment (d)

 

 

 

 

 

 

 

24

 

 

 

 

Income tax benefit related to Diamond Pipeline asset

impairment

 

 

 

 

 

 

 

(5

)

 

 

 

Diamond Pipeline asset impairment, net of taxes

 

 

 

 

 

 

 

19

 

 

 

 

Loss on early redemption and retirement of debt (d)

 

193

 

 

 

 

 

 

193

 

 

 

 

Income tax benefit related to loss on early redemption and

retirement of debt

 

(43

)

 

 

 

 

 

(43

)

 

 

 

Loss on early redemption and retirement of debt, net of taxes

 

150

 

 

 

 

 

 

150

 

 

 

 

Income tax expense related to changes in statutory tax rates (e)

 

 

 

 

 

 

 

64

 

 

 

 

Last-in, first-out (LIFO) liquidation adjustment (b)

 

 

 

 

(102

)

 

 

 

 

 

224

 

Income tax expense (benefit) related to the LIFO liquidation

adjustment

 

 

 

 

32

 

 

 

 

 

 

(76

)

LIFO liquidation adjustment, net of taxes

 

 

 

 

(70

)

 

 

 

 

 

148

 

LCM inventory valuation adjustment

 

 

 

 

 

 

 

 

 

 

(19

)

Income tax expense related to the LCM inventory

valuation adjustment

 

 

 

 

 

 

 

 

 

 

3

 

LCM inventory valuation adjustment, net of taxes

 

 

 

 

 

 

 

 

 

 

(16

)

Total adjustments

 

3

 

 

 

(70

)

 

 

222

 

 

 

156

 

Adjusted net income (loss) attributable to

Valero Energy Corporation stockholders

$

1,012

 

 

$

(429

)

 

$

1,152

 

 

$

(1,265

)

 

See Notes to Earnings Release Tables.

 

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

RECONCILIATION OF NON-GAAP MEASURES TO MOST COMPARABLE AMOUNTS

REPORTED UNDER U.S. GAAP (g)

(millions of dollars, except per share amounts)

(unaudited)

 
 

Three Months Ended

December 31,

Year Ended

December 31,

2021

2020

2021

2020

Reconciliation of earnings (loss) per common share –

assuming dilution to adjusted earnings (loss) per common

share – assuming dilution

 

 

 

 

 

 

 

Earnings (loss) per common share – assuming dilution (f)

$

2.46

 

 

$

(0.88

)

 

$

2.27

 

 

$

(3.50

)

Adjustments:

 

 

 

 

 

 

 

Modification of RVO (c)

 

(0.36

)

 

 

 

 

 

 

 

 

 

Changes in estimated useful lives of two ethanol plants

 

 

 

 

 

 

 

0.09

 

 

 

0.06

 

Gain on sale of MVP interest (d)

 

 

 

 

 

 

 

(0.12

)

 

 

 

Diamond Pipeline asset impairment (d)

 

 

 

 

 

 

 

0.04

 

 

 

 

Loss on early redemption and retirement of debt (d)

 

0.37

 

 

 

 

 

 

0.37

 

 

 

 

Income tax expense related to changes in statutory tax rates (e)

 

 

 

 

 

 

 

0.16

 

 

 

 

LIFO liquidation adjustment (b)

 

 

 

 

(0.18

)

 

 

 

 

 

0.36

 

LCM inventory valuation adjustment

 

 

 

 

 

 

 

 

 

 

(0.04

)

Total adjustments

 

0.01

 

 

 

(0.18

)

 

 

0.54

 

 

 

0.38

 

Adjusted earnings (loss) per common share –

assuming dilution (f)

$

2.47

 

 

$

(1.06

)

 

$

2.81

 

 

$

(3.12

)

 

See Notes to Earnings Release Tables.

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

RECONCILIATION OF NON-GAAP MEASURES TO MOST COMPARABLE AMOUNTS

REPORTED UNDER U.S. GAAP (g)

(millions of dollars)

(unaudited)

 

 

Three Months Ended

December 31,

 

Year Ended

December 31,

 

2021

 

2020

 

2021

 

2020

Reconciliation of operating income (loss) by segment to

segment margin, and reconciliation of operating income

(loss) by segment to adjusted operating income (loss) by

segment

 

 

 

 

 

 

 

Refining segment

 

 

 

 

 

 

 

Refining operating income (loss)

$

1,270

 

 

$

(377

)

 

$

1,862

 

$

(1,342

)

Adjustments:

 

 

 

 

 

 

 

Modification of RVO (c)

 

(190

)

 

 

 

 

 

 

 

 

LIFO liquidation adjustment (b)

 

 

 

 

(104

)

 

 

 

 

222

 

LCM inventory valuation adjustment

 

 

 

 

 

 

 

 

 

(19

)

Operating expenses (excluding depreciation and

amortization expense reflected below) (a)

 

1,358

 

 

 

1,032

 

 

 

5,088

 

 

3,944

 

Depreciation and amortization expense

 

543

 

 

 

531

 

 

 

2,169

 

 

2,138

 

Other operating expenses

 

15

 

 

 

5

 

 

 

83

 

 

34

 

Refining margin

$

2,996

 

 

$

1,087

 

 

$

9,202

 

$

4,977

 

 

 

 

 

 

 

 

 

Refining operating income (loss)

$

1,270

 

 

$

(377

)

 

$

1,862

 

$

(1,342

)

Adjustments:

 

 

 

 

 

 

 

Modification of RVO (c)

 

(190

)

 

 

 

 

 

 

 

 

LIFO liquidation adjustment (b)

 

 

 

 

(104

)

 

 

 

 

222

 

LCM inventory valuation adjustment

 

 

 

 

 

 

 

 

 

(19

)

Other operating expenses

 

15

 

 

 

5

 

 

 

83

 

 

34

 

Adjusted refining operating income (loss)

$

1,095

 

 

$

(476

)

 

$

1,945

 

$

(1,105

)

 

 

 

 

 

 

 

 

Renewable diesel segment

 

 

 

 

 

 

 

Renewable diesel operating income

$

150

 

 

$

127

 

 

$

709

 

$

638

 

Adjustments:

 

 

 

 

 

 

 

Operating expenses (excluding depreciation and

amortization expense reflected below)

 

48

 

 

 

22

 

 

 

134

 

 

85

 

Depreciation and amortization expense

 

23

 

 

 

11

 

 

 

58

 

 

44

 

Other operating expenses

 

2

 

 

 

 

 

 

3

 

 

 

Renewable diesel margin

$

223

 

 

$

160

 

 

$

904

 

$

767

 

 

 

 

 

 

 

 

 

Renewable diesel operating income

$

150

 

 

$

127

 

 

$

709

 

$

638

 

Adjustment: Other operating expenses

 

2

 

 

 

 

 

 

3

 

 

 

Adjusted renewable diesel operating income

$

152

 

 

$

127

 

 

$

712

 

$

638

 

 

See Notes to Earnings Release Tables.

 

VALERO ENERGY CORPORATION

EARNINGS RELEASE TABLES

RECONCILIATION OF NON-GAAP MEASURES TO MOST COMPARABLE AMOUNTS

REPORTED UNDER U.S. GAAP (g)

(millions of dollars)

(unaudited)

 
 

Three Months Ended

December 31,

Year Ended

December 31,

2021

 

2020

 

2021

 

2020

Reconciliation of operating income (loss) by segment to

segment margin, and reconciliation of operating income

(loss) by segment to adjusted operating income (loss) by

segment (continued)

 

 

 

 

 

 

 

Ethanol segment

 

 

 

 

 

 

 

Ethanol operating income (loss)

$

474

 

 

$

15

 

 

$

473

 

$

(69

)

Adjustments:

 

 

 

 

 

 

 

LIFO liquidation adjustment (b)

 

 

 

 

2

 

 

 

 

 

2

 

Operating expenses (excluding depreciation and

amortization expense reflected below) (a)

 

153

 

 

 

113

 

 

 

556

 

 

406

 

Depreciation and amortization expense

 

20

 

 

 

24

 

 

 

131

 

 

121

 

Other operating expenses

 

1

 

 

 

 

 

 

1

 

 

1

 

Ethanol margin

$

648

 

 

$

154

 

 

$

1,161

 

$

461

 

 

 

 

 

 

 

 

 

Ethanol operating income (loss)

$

474

 

 

$

15

 

 

$

473

 

$

(69

)

Adjustments:

 

 

 

 

 

 

 

Changes in estimated useful lives of two ethanol plants

 

 

 

 

 

 

 

48

 

 

30

 

LIFO liquidation adjustment (b)

 

 

 

 

2

 

 

 

 

 

2

 

Other operating expenses

 

1

 

 

 

 

 

 

1

 

 

1

 

Adjusted ethanol operating income (loss)

$

475

 

 

$

17

 

 

$

522

 

$

(36

)

 

See Notes to Earnings Release Tables.

Contacts

Valero Contacts

Investors:

Homer Bhullar, Vice President – Investor Relations and Finance, 210-345-1982

Eric Herbort, Senior Manager – Investor Relations, 210-345-3331

Gautam Srivastava, Senior Manager – Investor Relations, 210-345-3992

Media:

Lillian Riojas, Executive Director – Media Relations and Communications, 210-345-5002

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