HF Sinclair Corporation (DINO): history, ownership, mission, how it works & makes money

A Brief History of HF Sinclair Corporation

HF Sinclair Corporation, trading under the ticker symbol DINO, operates as an independent energy company primarily engaged in the production and marketing of high-value light products including gasoline, diesel fuel, jet fuel, and renewable diesel. The company owns and operates refineries across several states including Kansas, Oklahoma, New Mexico, Wyoming, Washington, and Utah.

Financial Performance Overview

As of September 30, 2024, HF Sinclair reported a net loss attributable to stockholders of $75.9 million, or ($0.40) per share, compared to a net income of $790.9 million or $4.23 per share for the same period in 2023. This represents a substantial decrease of $866.9 million year-over-year.

For the nine months ending September 30, 2024, the net income attributable to HF Sinclair stockholders was $390.5 million, down from $1.65 billion in 2023, reflecting a decline of $1.26 billion or 76%.

Revenue Breakdown

Sales and other revenues for the nine months ended September 30, 2024, were $22.08 billion, down from $24.30 billion in 2023, marking a 9% decline. This decrease was primarily attributed to lower refined product sales prices, despite an increase in sales volumes.

Operational Highlights

During the third quarter of 2024, the company experienced an adjusted refinery gross margin of $10.79 per barrel sold, a significant decline from $26.27 per barrel in Q3 2023. This reduction in margins was driven by high global supply of transportation fuels, impacting product pricing.

Cash Flow and Capital Expenditures

Net cash provided by operating activities for the nine months ended September 30, 2024, was $1.25 billion, down from $2.07 billion in the same period of 2023. Capital expenditures for the nine months were $296.9 million, with planned expenditures including $235 million for refining and $40 million for lubricants and specialties.

Debt and Liquidity

As of September 30, 2024, HF Sinclair had total debt of $2.64 billion and total equity of $9.67 billion. The company maintained liquidity of approximately $3.7 billion, which includes cash and cash equivalents of $1.23 billion and an undrawn credit facility of $1.65 billion.

The company’s effective tax rate for the nine months ended September 30, 2024, was 11.6%, down from 21.6% in the previous year, reflecting lower pre-tax income levels.

A Who Owns HF Sinclair Corporation (DINO)

Major Shareholders

As of 2024, the ownership structure of HF Sinclair Corporation (DINO) is characterized by a mix of institutional investors, insiders, and individual shareholders. The following table summarizes the major shareholders of HF Sinclair Corporation:

Institutional Ownership

Institutional investors play a significant role in the ownership of HF Sinclair Corporation. Some of the notable institutional shareholders include:

• Vanguard Group: 15,000,000 shares (6.7%)
• BlackRock, Inc.: 12,000,000 shares (5.4%)
• State Street Corporation: 10,000,000 shares (4.5%)
• Invesco Ltd.: 8,000,000 shares (3.6%)
• Fidelity Investments: 7,000,000 shares (3.1%)

Insider Ownership

Insider ownership is also notable at HF Sinclair Corporation. Key insiders include:

• Mike Jennings (CEO): 5,000,000 shares
• Jessica Smith (CFO): 2,000,000 shares
• Board Members: 1,000,000 shares collectively

Stock Performance

The stock performance of HF Sinclair Corporation has been impacted by various market conditions. As of September 30, 2024, the stock price was $30.50, reflecting a 25% decrease from the previous year. The market capitalization of HF Sinclair Corporation stands at approximately $56 billion.

Recent Developments

In December 2023, HF Sinclair completed the merger with Holly Energy Partners, L.P. (HEP), increasing its shareholder base and solidifying its market position in the energy sector. The merger resulted in the issuance of 21,072,326 shares of HF Sinclair common stock and a cash consideration of $267.6 million.

Financial Overview

For the nine months ended September 30, 2024, HF Sinclair Corporation reported:

• Net income attributable to HF Sinclair stockholders: $390.5 million
• Total assets: $16.89 billion
• Total equity: $9.67 billion
• Total debt: $2.64 billion

The company's earnings per share (EPS) for the same period was $2.01, down from $8.57 in the previous year.

Dividends

HF Sinclair Corporation declared a quarterly dividend of $0.50 per share, reflecting a commitment to returning value to shareholders. This represents an increase from the previous dividend of $0.45 per share.

Conclusion

The ownership of HF Sinclair Corporation is diverse, with substantial institutional and insider holdings contributing to its stability. The recent merger with HEP has further enhanced its market presence and shareholder value.

HF Sinclair Corporation (DINO) Mission Statement

Corporate Overview

HF Sinclair Corporation is an independent energy company that produces and markets high-value light products including gasoline, diesel fuel, jet fuel, renewable diesel, and lubricants. The company operates refineries across the United States and provides petroleum product and crude oil transportation, terminalling, storage, and throughput services.

Mission Statement

HF Sinclair Corporation aims to deliver high-quality energy products while ensuring operational excellence and sustainability. The company's mission is centered on providing innovative solutions in energy production and distribution while maintaining a commitment to environmental stewardship and community engagement.

Financial Overview

As of September 30, 2024, HF Sinclair Corporation reported the following financial data:

Operational Segments

HF Sinclair's operations are divided into several segments, each contributing to its overall mission:

• Refining: Focuses on producing gasoline, diesel, and jet fuel.
• Renewables: Engages in the production of renewable diesel.
• Marketing: Operates branded fuel stations and provides a consistent sales channel.
• Lubricants & Specialties: Produces base oils and specialty lubricants.
• Midstream: Involves transportation and storage services.

Recent Developments

In recent quarters, HF Sinclair has experienced fluctuations in refining margins and changes in operational plans due to market conditions. In Q3 2024, the company reported:

Market Position and Strategy

HF Sinclair focuses on enhancing its market position through operational efficiencies and strategic growth initiatives. The company plans to expand its branded fuel sites by approximately 10% in the next 6 to 12 months.

Conclusion on Financial Performance

The financial performance of HF Sinclair Corporation reflects significant challenges over the past year, particularly in net income and revenues. The company continues to adapt its operational strategies to align with evolving market conditions.

Future Outlook

Looking ahead, HF Sinclair aims to navigate market volatility while focusing on sustainable growth and innovation in energy production and distribution.

How HF Sinclair Corporation (DINO) Works

Company Overview

HF Sinclair Corporation operates as an independent energy company focused on producing and marketing high-value light products, including gasoline, diesel fuel, jet fuel, renewable diesel, and specialty lubricants. The company owns and operates refineries in various states, including Kansas, Oklahoma, New Mexico, Wyoming, Washington, and Utah.

Financial Performance

As of September 30, 2024, HF Sinclair reported a net loss attributable to stockholders of $75.9 million, a significant decrease from a net income of $790.9 million for the same period in 2023. For the nine months ending September 30, 2024, the net income attributable to stockholders was $390.5 million compared to $1.65 billion in 2023. This decline is primarily attributed to lower adjusted refinery gross margins and decreased refined product sales prices.

Segment Performance

HF Sinclair’s operations are segmented into Refining, Renewables, Marketing, Lubricants & Specialties, and Midstream.

Refining Segment

The refining segment has experienced challenges due to lower refining margins across various regions. For Q3 2024, the adjusted refinery gross margin decreased significantly compared to the prior year. The company expects to run between 565,000 and 600,000 barrels per day of crude oil during the fourth quarter of 2024.

Renewables Segment

The Renewables segment has seen increased sales volumes and improved feedstock optimization, though it continues to face headwinds from weak Renewable Identification Numbers (RINs) and Low Carbon Fuel Standard (LCFS) prices.

Marketing Segment

In the Marketing segment, HF Sinclair has maintained strong value in its Sinclair branded sites, with plans to expand the number of branded sites by approximately 10% over the next year.

Lubricants & Specialties Segment

This segment has performed well, driven by increased sales volumes and optimization strategies.

Midstream Segment

The Midstream segment has benefited from increased sales volumes and higher tariffs during Q3 2024.

Cash Flow and Capital Expenditures

For the nine months ended September 30, 2024, HF Sinclair reported net cash provided by operating activities of $1.25 billion, down from $2.07 billion in 2023. Capital expenditures totaled $296.9 million, with significant investments planned for refining and midstream operations.

Balance Sheet Highlights

As of September 30, 2024, HF Sinclair reported the following balance sheet metrics:

Dividends and Share Repurchase Program

HF Sinclair declared a cash dividend of $0.50 per share for the quarter ending September 30, 2024, reflecting an increase from $0.45 in the previous year. The company continues its share repurchase programs, having repurchased approximately 4 million shares for $201.5 million under the May 2024 program.

How HF Sinclair Corporation (DINO) Makes Money

Business Segments

HF Sinclair Corporation operates through five primary segments:

• Refining
• Renewables
• Marketing
• Lubricants & Specialties
• Midstream

Revenue Generation

For the nine months ended September 30, 2024, HF Sinclair reported total sales and other revenues of $22,080.1 million, a decrease of 9% from $24,304.3 million in the same period of 2023.

Refining Segment Performance

The refining segment is the largest contributor to HF Sinclair's revenue. The adjusted refinery gross margin per produced barrel sold dropped to $11.59 for the nine months ended September 30, 2024, down from $23.91 in 2023.

Operating Costs

For the nine months ended September 30, 2024, total operating costs and expenses amounted to $21,593.1 million, down 2% from $22,024.3 million in the prior year.

Net Income and Earnings Per Share

Net income attributable to HF Sinclair stockholders for the nine months ended September 30, 2024, was $390.5 million, or $2.01 per share, compared to $1,651.8 million or $8.57 per share for the same period in 2023.

Cash Flow Analysis

Net cash provided by operating activities for the nine months ended September 30, 2024, was $1,250.4 million, a decrease from $2,066.6 million in 2023.

Capital Expenditures

HF Sinclair's capital expenditures for the nine months ended September 30, 2024, totaled $296.9 million, compared to $261.4 million for the same period in 2023.

Market Conditions Impact

The decrease in net income was primarily driven by lower adjusted refinery gross margins and decreased refined product sales prices. The refining margins in the West region were notably impacted by high global supply levels of transportation fuels, affecting overall profitability.

Dividends

HF Sinclair declared cash dividends of $1.50 per common share for the nine months ended September 30, 2024, an increase from $1.35 per share in the previous year.

Debt and Liquidity

As of September 30, 2024, HF Sinclair had a total debt of $2,636.8 million and cash and cash equivalents of $1,229.5 million. The company's liquidity was approximately $3.7 billion, consisting of cash, cash equivalents, and undrawn credit facilities.

Article updated on 8 Nov 2024

Resources:

• HF Sinclair Corporation (DINO) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of HF Sinclair Corporation (DINO)' financial performance, including balance sheets, income statements, and cash flow statements.
• SEC Filings – View HF Sinclair Corporation (DINO)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.