HF Sinclair Corporation

07/30/2026 | Press release | Distributed by Public on 07/30/2026 06:32

Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
This Item 2 contains "forward-looking" statements. See "Forward-Looking Statements" at the beginning of Part I of this Quarterly Report on Form 10-Q. In this document, the words "we," "our," "ours" and "us" refer only to HF Sinclair and its consolidated subsidiaries or to HF Sinclair or an individual subsidiary and not to any other person, with certain exceptions.
We use certain non-GAAP financial measures in our Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A"). For a description of each of the non-GAAP measures used in this MD&A, please refer to the discussion under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q. This Item 2 should be read in conjunction with our consolidated financial statements and the notes thereto included in this interim report. In addition, this Item 2 should be read in conjunction with our audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2025.
OVERVIEW
We are an independent energy company that produces and markets high-value light products such as gasoline, diesel fuel, jet fuel, renewable diesel and lubricants and specialty products. We own and operate refineries located in Kansas, Oklahoma, New Mexico, Wyoming, Washington and Utah. We provide petroleum product and crude oil transportation, terminalling, storage and throughput services to our refineries and the petroleum industry. We market our refined products principally in the Southwest United States, the Rocky Mountains extending into the Pacific Northwest and in other neighboring Plains states, and we supply high-quality fuels to more than 1,800 branded stations and license the use of the Sinclair brand to more than 350 additional locations throughout the country. We produce renewable diesel at two of our facilities in Wyoming and one facility in New Mexico. In addition, we produce and market base oils and other specialized lubricants in the United States, Canada and the Netherlands, and export products to more than 80 countries.
On July 28, 2026, we announced plans to pursue a separation of our Lubricants & Specialties segment through the capital markets, creating a new independent, publicly traded company (the "Potential Separation"). As part of this transformation, we also made the decision to retire our Mississauga, Ontario base oil refining assets, with the transition expected to be substantially completed over the course of 2027 (the "Mississauga Asset Retirement"). The Lubricants & Specialties business will maintain the continued operations of its R&D laboratory, lubricant blending and packaging, as well as supply chain, logistics, and commercial operations, in the Ontario region, and will also continue to deliver base oil solutions through strategic third-party commercial arrangements, complemented by continued access to Group I and specialty products from HF Sinclair's Tulsa refinery.
Market Developments
For the three months ended June 30, 2026, Net income attributable to HF Sinclair stockholders was $892 million, compared to a Net income attributable to HF Sinclair stockholders of $208 million for the three months ended June 30, 2025. For the six months ended June 30, 2026, Net income attributable to HF Sinclair stockholders was $1,540 million, compared to $204 million for the six months ended June 30, 2025.
Adjusted refinery gross margin per barrel sold increased $9.45, or 57%, from $16.50 for the three months ended June 30, 2025 to $25.95 for the three months ended June 30, 2026. Adjusted refinery gross margin per barrel sold increased $5.22, or 40%, from $12.91 for the six months ended June 30, 2025 to $18.13 for the six months ended June 30, 2026.
In the Refining segment, we saw strong refining margins and volumes in the Mid-Continent and West regions as a result of steady demand, tight supply and favorable crack spreads. Additionally, our results were impacted by planned maintenance at our Parco and Navajo refineries and unplanned maintenance at our El Dorado refinery. For the third quarter of 2026, we expect to run between 590,000-620,000 barrels per day of crude oil, which reflects the planned turnaround at our El Dorado refinery.
In the Renewables segment, margins were favorably impacted in the second quarter of 2026 from improved RINs prices, higher Producer's Tax Credit ("PTC") benefits and increased volumes. During the second quarter of 2025, we were only able to recognize partial benefits from the PTC.
In the Marketing segment, we continued to realize strong value from our Sinclair branded sites during the second quarter of 2026, as the marketing business provided a consistent sales channel with margin uplift for our produced fuels. We expect to grow the number of branded sites by approximately 10% annually.
In the Lubricants & Specialties segment, we saw solid performance (excluding first-in, first out ("FIFO") impacts), driven by higher sales volumes and product prices during the three months ended June 30, 2026.
In the Midstream segment, our results continued to benefit from higher pipeline revenues and throughput volumes, partially offset by higher operating expenses during the three months ended June 30, 2026.
We continue to review and adjust our operational plans to evolving market conditions. The extent to which our future results are affected by volatile regional and global economic conditions, including ongoing tariff and trade negotiations and global hostilities, such as the ongoing military conflict in the Middle East, will depend on various factors and consequences beyond our control.
On July 28, 2026, our Board of Directors declared a regular quarterly dividend in the amount of $0.525 per share, an increase of 5% over our previous dividend of $0.50 per share. The dividend is payable on September 2, 2026 to holders of record of common stock on August 11, 2026.
Renewable Fuel Standard Regulations
Pursuant to the 2007 Energy Independence and Security Act, the EPA promulgated the Renewable Fuel Standard ("RFS") regulations, which increased the volume of renewable fuels mandated to be blended into the nation's fuel supply. The regulations, in part, require refiners to satisfy annual renewable volume obligations calculated as a percentage of their petroleum fuel shipments or imports, which may be met through physical blending of renewable fuels or by purchasing and retiring RINs. Compliance with RFS regulations significantly increased our Cost of materials and other, with RINs costs totaling $638 million and $996 million for the three and six months ended June 30, 2026, respectively. For the three and six months ended June 30, 2026, the Refining segment recognized $163 million and $183 million in revenues related to RINs sales which are included in Sales and other revenues in our consolidated statement of operations. In addition, during the six months ended June 30, 2026, we recognized $21 million in Sales and other revenues related to the small refinery RINs waivers granted by the EPA in the fourth quarter of 2025. At June 30, 2026, our open RINs credit obligations were $493 million. For additional information regarding the RFS and small refinery RINs waivers, refer to the discussion under "Renewable Fuel Standard" in Item 1 of Part II of this Quarterly Report on Form 10-Q.
A more detailed discussion of our financial and operating results for the three and six months ended June 30, 2026 and 2025 is presented in the following sections.
RESULTS OF OPERATIONS
Financial Data
Three Months Ended June 30,
Change from 2025
2026 2025 Change Percent
(In millions, except share and per share data)
Sales and other revenues $ 10,390 $ 6,784 $ 3,606 53 %
Operating costs and expenses:
Cost of sales: (1)
Cost of materials and other (2)
8,133 5,440 2,693 50 %
Lower of cost or market inventory valuation adjustments 30 148 (118) (80) %
Operating expenses 654 572 82 14 %
8,817 6,160 2,657 43 %
Selling, general and administrative expenses (1)
130 114 16 14 %
Depreciation and amortization 228 226 2 1 %
Other operating expenses, net 47 9 38 422 %
Total operating costs and expenses 9,222 6,509 2,713 42 %
Income from operations 1,168 275 893 325 %
Other income (expense):
Earnings of equity method investments 6 10 (4) (40) %
Interest income 15 7 8 114 %
Interest expense (20) (53) 33 (62) %
Other income, net 3 7 (4) (57) %
4 (29) 33 NM
Income before income taxes 1,172 246 926 376 %
Income tax expense:
Current 249 32 217 678 %
Deferred 30 4 26 650 %
279 36 243 675 %
Net income 893 210 683 325 %
Less: net income attributable to noncontrolling interests 1 2 (1) (50) %
Net income attributable to HF Sinclair stockholders $ 892 $ 208 $ 684 329 %
Earnings per share attributable to HF Sinclair stockholders:
Basic $ 4.93 $ 1.10 $ 3.83 348 %
Diluted $ 4.93 $ 1.10 $ 3.83 348 %
Average number of common shares outstanding (in thousands):
Basic 179,417 188,110 (8,693) (5) %
Diluted 179,417 188,110 (8,693) (5) %
Six Months Ended June 30, 2026
Change from 2025
2026 2025 Change Percent
(In millions, except per share data)
Sales and other revenues $ 17,513 $ 13,154 $ 4,359 33 %
Operating costs and expenses:
Cost of sales: (1)
Cost of materials and other (2)
14,113 10,916 3,197 29 %
Lower of cost or market inventory valuation adjustments (642) 31 (673) NM
Operating expenses 1,278 1,168 110 9 %
14,749 12,115 2,634 22 %
Selling, general and administrative expenses (1)
245 218 27 12 %
Depreciation and amortization 457 451 6 1 %
Other operating expenses, net 47 14 33 236 %
Total operating costs and expenses 15,498 12,798 2,700 21 %
Income from operations 2,015 356 1,659 466 %
Other income (expense):
Earnings of equity method investments 14 21 (7) (33) %
Interest income 25 16 9 56 %
Interest expense (61) (102) 41 (40) %
Other income (expense), net
18 (46) 64 NM
(4) (111) 107 (96) %
Income before income taxes 2,011 245 1,766 721 %
Income tax expense:
Current 345 32 313 978 %
Deferred 123 5 118 2,360 %
468 37 431 1,165 %
Net income 1,543 208 1,335 642 %
Less: net income attributable to noncontrolling interests 3 4 (1) (25) %
Net income attributable to HF Sinclair stockholders $ 1,540 $ 204 $ 1,336 655 %
Earnings per share attributable to HF Sinclair stockholders:
Basic $ 8.48 $ 1.07 $ 7.41 693 %
Diluted $ 8.48 $ 1.07 $ 7.41 693 %
Average number of common shares outstanding (in thousands):
Basic 180,032 188,298 (8,266) (4) %
Diluted 180,032 188,298 (8,266) (4) %
(1) Exclusive of Depreciation and amortization.
(2) Exclusive of Lower of cost or market inventory valuation adjustments.
Balance Sheet Data
June 30, 2026 December 31, 2025
(In millions)
Cash and cash equivalents $ 2,262 $ 978
Working capital $ 3,639 $ 2,327
Total assets $ 18,994 $ 16,510
Total debt $ 2,772 $ 2,769
Total equity $ 10,350 $ 9,249
Other Financial Data
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
(In millions)
Net cash provided by operating activities $ 1,510 $ 587 $ 1,967 $ 498
Net cash used for investing activities $ (119) $ (108) $ (280) $ (193)
Net cash used for financing activities $ (275) $ (159) $ (400) $ (239)
Capital expenditures $ 118 $ 111 $ 220 $ 197
EBITDA (1)
$ 1,404 $ 516 $ 2,501 $ 778
(1)Earnings before interest, taxes, depreciation and amortization, which we refer to as "EBITDA," is calculated as Net income attributable to HF Sinclair stockholders plus (i) Income tax expense, (ii) Interest expense, net of Interest income and (iii) Depreciation and amortization. EBITDA is not a calculation provided for under GAAP; however, the amounts included in the EBITDA calculation are derived from amounts included in our consolidated financial statements. EBITDA should not be considered as an alternative to Net income or Income from operations as an indication of our operating performance or as an alternative to operating cash flow as a measure of liquidity. EBITDA is not necessarily comparable to similarly titled measures of other companies. EBITDA is presented here because it is a financial indicator widely used by investors and analysts to measure performance. EBITDA is also used by our management for internal analysis and as a basis for financial covenants. EBITDA presented above is reconciled to Net income under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Supplemental Segment Operating Data
Our operations are organized into five reportable segments, Refining, Renewables, Marketing, Lubricants & Specialties and Midstream. See Note 17 "Segment Information" in the Notes to Consolidated Financial Statements for additional information on our reportable segments.
Refining Segment Operating Data
The disaggregation of our refining geographic operating data is presented in two regions, Mid-Continent and West, to best reflect the economic drivers of our refining operations. The Mid-Continent region is comprised of the El Dorado and Tulsa refineries. The West region is comprised of the Puget Sound, Navajo, Woods Cross, Parco and Casper refineries. The following tables set forth information, including non-GAAP performance measures, about our consolidated refinery operations. Adjusted refinery gross margin per produced barrel sold is total Refining segment gross margin plus Lower of cost or market inventory valuation adjustments, Depreciation and amortization and Operating expenses, divided by sales volumes of produced refined products. This margin measure does not include the non-cash effects of Lower of cost or market inventory valuation adjustments, which relate to inventory held at the end of the period. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Mid-Continent Region
Crude charge (BPD) (1)
272,430 252,690 268,180 256,630
Refinery throughput (BPD) (2)
287,200 269,850 284,800 273,150
Sales of produced refined products (BPD) (3)
266,690 259,220 269,730 257,300
Refinery utilization (4)
104.8 % 97.2 % 103.1 % 98.7 %
Average per produced barrel sold: (5)
Gross margin (6)
$ 9.64 $ 2.29 $ 9.22 $ 1.76
Adjusted refinery gross margin (7)
$ 19.00 $ 15.52 $ 11.24 $ 11.61
Less: operating expenses (8)
7.23 6.28 7.22 6.69
Adjusted refinery gross margin, less operating expenses $ 11.77 $ 9.24 $ 4.02 $ 4.92
Operating expenses per throughput barrel (9)
$ 6.72 $ 6.03 $ 6.83 $ 6.31
Feedstocks:
Sweet crude oil 54 % 50 % 52 % 50 %
Sour crude oil 26 % 25 % 26 % 25 %
Heavy sour crude oil 15 % 19 % 16 % 19 %
Other feedstocks and blends 5 % 6 % 6 % 6 %
Total 100 % 100 % 100 % 100 %
Sales of produced refined products:
Gasolines 49 % 51 % 50 % 52 %
Diesel fuels 33 % 32 % 32 % 31 %
Jet fuels 7 % 7 % 7 % 7 %
Fuel oil 1 % 1 % 1 % 1 %
Asphalt 4 % 3 % 4 % 3 %
Base oils 4 % 4 % 4 % 4 %
LPG and other 2 % 2 % 2 % 2 %
Total 100 % 100 % 100 % 100 %
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
West Region
Crude charge (BPD) (1)
367,250 363,240 358,260 354,430
Refinery throughput (BPD) (2)
393,950 390,790 384,300 380,500
Sales of produced refined products (BPD) (3)
401,980 389,990 387,740 378,280
Refinery utilization (4)
87.9 % 86.9 % 85.7 % 84.8 %
Average per produced barrel sold: (5)
Gross margin (6)
$ 19.33 $ 4.89 $ 15.13 $ 2.53
Adjusted refinery gross margin (7)
$ 30.57 $ 17.15 $ 22.93 $ 13.80
Less: operating expenses (8)
8.65 8.23 8.65 8.63
Adjusted refinery gross margin, less operating expenses $ 21.92 $ 8.92 $ 14.28 $ 5.17
Operating expenses per throughput barrel (9)
$ 8.82 $ 8.21 $ 8.72 $ 8.58
Feedstocks:
Sweet crude oil 29 % 30 % 29 % 31 %
Sour crude oil 49 % 47 % 49 % 45 %
Heavy sour crude oil 10 % 11 % 10 % 11 %
Wax crude oil 5 % 5 % 5 % 6 %
Other feedstocks and blends 7 % 7 % 7 % 7 %
Total 100 % 100 % 100 % 100 %
Sales of produced refined products:
Gasolines 51 % 52 % 51 % 53 %
Diesel fuels 30 % 31 % 30 % 32 %
Jet fuels 7 % 6 % 7 % 6 %
Fuel oil 3 % 2 % 3 % 2 %
Asphalt 3 % 3 % 2 % 2 %
LPG and other 6 % 6 % 7 % 5 %
Total 100 % 100 % 100 % 100 %
Consolidated
Crude charge (BPD) (1)
639,680 615,930 626,440 611,060
Refinery throughput (BPD) (2)
681,150 660,640 669,100 653,650
Sales of produced refined products (BPD) (3)
668,670 649,210 657,470 635,580
Refinery utilization (4)
94.3 % 90.8 % 92.4 % 90.1 %
Average per produced barrel sold: (5)
Gross margin (6)
$ 15.46 $ 3.85 $ 12.70 $ 2.22
Adjusted refinery gross margin (7)
$ 25.95 $ 16.50 $ 18.13 $ 12.91
Less: operating expenses (8)
8.08 7.45 8.06 7.85
Adjusted refinery gross margin, less operating expenses $ 17.87 $ 9.05 $ 10.07 $ 5.06
Operating expenses per throughput barrel (9)
$ 7.93 $ 7.32 $ 7.92 $ 7.63
Feedstocks:
Sweet crude oil 40 % 38 % 39 % 39 %
Sour crude oil 39 % 38 % 39 % 37 %
Heavy sour crude oil 12 % 14 % 13 % 14 %
Wax crude oil 3 % 3 % 3 % 3 %
Other feedstocks and blends 6 % 7 % 6 % 7 %
Total 100 % 100 % 100 % 100 %
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Consolidated
Sales of produced refined products:
Gasolines 51 % 52 % 51 % 52 %
Diesel fuels 31 % 31 % 31 % 31 %
Jet fuels 7 % 6 % 7 % 7 %
Fuel oil 2 % 2 % 2 % 2 %
Asphalt 3 % 2 % 3 % 2 %
Base oils 2 % 2 % 2 % 2 %
LPG and other 4 % 5 % 4 % 4 %
Total 100 % 100 % 100 % 100 %
(1)Crude charge represents the barrels per day of crude oil processed at our refineries.
(2)Refinery throughput represents the barrels per day of crude and other refinery feedstocks input to the crude units and other conversion units at our refineries.
(3)Represents barrels sold of refined products produced at our refineries (including Asphalt and intersegment sales) and does not include volumes of refined products purchased for resale or volumes of excess crude oil sold.
(4)Represents crude charge divided by total crude capacity (BPSD). Our consolidated crude capacity is 678,000 BPSD.
(5)Represents the average amount per produced barrel sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
(6)Gross margin represents total Refining segment Sales and other revenues less Cost of materials and other, Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization, divided by sales volumes of produced refined products.
(7)Adjusted refinery gross margin is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
(8)Represents total Refining segment Operating expenses, exclusive of Depreciation and amortization, divided by sales volumes of produced refined products.
(9)Represents total Refining segment Operating expenses, exclusive of Depreciation and amortization, divided by refinery throughput.
Renewables Segment Operating Data
The following table sets forth information, including non-GAAP performance measures, about our renewables operations. Adjusted renewables gross margin per produced gallon sold is total Renewables segment gross margin plus Lower of cost or market inventory valuation adjustments, Depreciation and amortization and Operating expenses, divided by sales volumes of produced renewables products. This margin measure does not include the non-cash effects of Lower of cost or market inventory valuation adjustments, which relate to volumes in inventory at the end of the period. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Renewables
Sales of produced renewables products (in thousand gallons) 59,905 54,786 112,353 99,250
Average per produced gallon sold: (1)
Gross margin (2)
$ 1.31 $ (0.05) $ 2.32 $ (0.42)
Adjusted renewables gross margin (3)
$ 2.46 $ 0.36 $ 2.69 $ 0.27
Less: operating expenses (4)
0.37 0.39 0.40 0.45
Adjusted renewables gross margin, less operating expenses $ 2.09 $ (0.03) $ 2.29 $ (0.18)
(1)Represents the average amount per produced gallon sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
(2)Gross margin represents total Renewables segment Sales and other revenues less Cost of materials and other, Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization, divided by sales volumes of produced renewables products.
(3)Adjusted renewables gross margin is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
(4)Represents total Renewables segment Operating expenses, exclusive of Depreciation and amortization, divided by sales volumes of produced renewables products.
Marketing Segment Operating Data
The following table sets forth information, including non-GAAP performance measures, about our marketing operations and includes our Sinclair branded fuel business. Adjusted marketing gross margin per gallon sold is total Marketing segment gross margin plus Depreciation and amortization, divided by sales volumes of marketing products. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Marketing
Number of branded sites at period end (1)
1,832 1,719 1,832 1,719
Sales of refined products (in thousand gallons) 386,656 337,147 711,279 631,012
Average per gallon sold: (2)
Gross margin (3)
$ 0.08 $ 0.08 $ 0.08 $ 0.09
Adjusted marketing gross margin (4)
$ 0.10 $ 0.10 $ 0.11 $ 0.11
(1)Includes certain non-Sinclair branded sites.
(2)Represents the average amount per gallon sold, which is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
(3)Gross margin represents total Marketing segment Sales and other revenues less Cost of materials and other and Depreciation and amortization, divided by sales volumes of marketing products.
(4)Adjusted marketing gross margin is a non-GAAP measure. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Lubricants & Specialties Segment Operating Data
The following table sets forth information about our lubricants and specialties operations.
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Lubricants & Specialties
Sales of produced refined products (BPD) 39,847 31,963 36,480 30,460
Sales of produced refined products:
Finished products 44 % 51 % 46 % 52 %
Base oils 29 % 24 % 27 % 25 %
Other 27 % 25 % 27 % 23 %
Total 100 % 100 % 100 % 100 %
Midstream Segment Operating Data
The following table sets forth information about our midstream operations.
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
Midstream
Volumes (BPD)
Pipelines:
Affiliates-refined product pipelines 149,081 145,940 162,217 154,916
Affiliates-intermediate pipelines 136,780 133,296 144,060 135,835
Affiliates-crude pipelines 469,267 383,374 458,573 404,018
755,128 662,610 764,850 694,769
Third parties-refined product pipelines 33,313 42,458 29,900 41,113
Third parties-crude pipelines 180,580 189,918 181,316 194,445
969,021 894,986 976,066 930,327
Terminals and loading racks:
Affiliates 1,026,169 969,791 1,031,184 980,271
Third parties 27,608 41,258 26,827 38,104
1,053,777 1,011,049 1,058,011 1,018,375
Total for pipelines and terminal assets (BPD)
2,022,798 1,906,035 2,034,077 1,948,702
Results of Operations - Three Months Ended June 30, 2026 Compared to Three Months Ended June 30, 2025
Summary
Net income attributable to HF Sinclair stockholders for the three months ended June 30, 2026, was $892 million ($4.93 per basic and diluted share), a $684 million increase compared to $208 million ($1.10 per basic and diluted share) for the three months ended June 30, 2025. The increase in Net income attributable to HF Sinclair stockholders was primarily driven by stronger product demand and higher sales prices which resulted in an increase in adjusted refinery gross margins and higher refined products sales volumes. Lower of cost or market inventory valuation adjustments decreased $118 million from a $148 million charge related to our Refining and Renewables segment inventories for the three months ended June 30, 2025, to a $30 million charge related to Renewables segment inventories for the three months ended June 30, 2026. Adjusted refinery gross margins for the three months ended June 30, 2026 increased to $25.95 per produced barrel sold as compared to $16.50 for the three months ended June 30, 2025, primarily due to higher crude oil and feedstock prices and higher average sales prices per barrel during the three months ended June 30, 2026. Adjusted renewables gross margins reflect higher RINs pricing and PTC benefits during the three months ended June 30, 2026, compared to the three months ended June 30, 2025. These favorable impacts were partially offset by a $243 million increase in Income tax expense.
Sales and Other Revenues
Sales and other revenues increased $3,606 million, or 53%, from $6,784 million for the three months ended June 30, 2025, to $10,390 million for the three months ended June 30, 2026, principally due to higher average refined product sales prices and sales volumes of refined products. Revenues from external customers included $243 million, $1,370 million, $998 million and $32 million related to our Renewables, Marketing, Lubricants & Specialties and Midstream segments, respectively, for the three months ended June 30, 2026. Revenues from external customers included $131 million, $826 million, $641 million and $28 million related to our Renewables, Marketing, Lubricants & Specialties and Midstream segments for the three months ended June 30, 2025.
Cost of Materials and Other
Cost of materials and other, exclusive of Lower of cost or market inventory valuation adjustments, increased $2,693 million, or 50%, from $5,440 million for the three months ended June 30, 2025, to $8,133 million for the three months ended June 30, 2026, principally due to higher crude oil and feedstock costs and higher sales volumes of refined products. Within our Lubricants & Specialties segment, the FIFO impact was a benefit of $46 million and a charge of $20 million for the three months ended June 30, 2026 and 2025, respectively.
During the second quarter of 2026, we recognized a lower of cost or market inventory valuation adjustment charge of $30 million compared to a charge of $148 million during the second quarter of 2025.
Adjusted Refinery Gross Margin
Adjusted refinery gross margin per barrel sold increased $9.45, or 57%, from $16.50 for the three months ended June 30, 2025, to $25.95 for the three months ended June 30, 2026. The increase was primarily driven by improved market crack spreads and volumes of refined products in both the Mid-Continent and West regions for the three months ended June 30, 2026.
Adjusted refinery gross margin per barrel excludes the cash effects of Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Operating Expenses
Operating expenses increased $82 million, or 14%, from $572 million for the three months ended June 30, 2025, to $654 million for the three months ended June 30, 2026, primarily due to higher employee benefits, environmental remediation, maintenance and other miscellaneous costs, partially offset by lower natural gas expenses.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased $16 million, or 14%, from $114 million for the three months ended June 30, 2025, to $130 million for the three months ended June 30, 2026, primarily due to higher employee and professional services costs, partially offset by foreign currency gains.
Earnings of Equity Method Investments
Earnings of equity method investments decreased $4 million, or 40% from $10 million for the three months ended June 30, 2025, to $6 million for the three months ended June 30, 2026, primarily due to the divestiture of our investment in Cheyenne Pipeline, LLC in June 2025.
Depreciation and Amortization Expenses
Depreciation and amortization remained relatively consistent and was $228 million and $226 million for the three months ended June 30, 2026 and 2025, respectively.
Other Operating Expenses, Net
Other operating expenses, net increased $38 million, or 422% from $9 million for the three months ended June 30, 2025, to $47 million for the three months ended June 30, 2026, primarily due to impairment charges related to the abandonment of certain assets under construction in our Renewables segment. For the three months ended June 30, 2025 Other operating expenses, net primarily relates to decommissioning and closure costs of $8 million in our Refining segment.
Interest Income
Interest income increased from $7 million for the three months ended June 30, 2025, to $15 million for the three months ended June 30, 2026, primarily due to higher cash balances.
Interest Expense
Interest expense decreased $33 million, or 62%, from $53 million for the three months ended June 30, 2025, to $20 million for the three months ended June 30, 2026, primarily due to unrealized gains on precious metals financing arrangements during the period.
Income Taxes
For the three months ended June 30, 2026, Income tax expense of $279 million was recorded on pre-tax income of $1,172 million, compared to Income tax expense of $36 million on pre-tax income of $246 million for the three months ended June 30, 2025. The increase was primarily due to higher pre-tax earnings year-over-year. For the three months ended June 30, 2026, our effective tax rate of 23.9% was higher than the statutory rate of 21.0%, primarily due to state and local income taxes on pre-tax earnings, partially offset from the benefits of nontaxable renewable fuel incentives. For the three months ended June 30, 2025, our effective tax rate of 14.5% was lower than the statutory rate of 21.0% primarily due to the relationship between pre-tax results and a discrete tax benefit associated with the revaluation of deferred tax liabilities from state tax law changes enacted in the second quarter of 2025. Due to rounding of reported numbers, some amounts may not calculate exactly.
Results of Operations - Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
Summary
Net income attributable to HF Sinclair stockholders for the six months ended June 30, 2026, was $1,540 million ($8.48 per basic and diluted share), a $1,336 million increase compared to $204 million ($1.07 per basic and diluted share) for the six months ended June 30, 2025. The increase in Net income attributable to HF Sinclair stockholders was principally driven by higher adjusted refinery gross margins and higher refined product sales volumes. Lower of cost or market inventory valuation adjustments related to our Refining and Renewables segments' inventories decreased by $673 million, from a $31 million charge for the six months ended June 30, 2025, to a $642 million benefit for the six months ended June 30, 2026. Adjusted refinery gross margins for the six months ended June 30, 2026 increased to $18.13 per produced barrel sold as compared to $12.91 for the six months ended June 30, 2025, primarily due to higher crude oil and feedstock prices and higher average sales prices per barrel during the six months ended June 30, 2026. Adjusted renewables gross margins reflect higher RINs pricing and PTC benefits during the six months ended June 30, 2026, compared to the six months ended June 30, 2025. These favorable impacts were partially offset by a $431 million increase in Income tax expense.
Sales and Other Revenues
Sales and other revenues increased 33% from $13,154 million for the six months ended June 30, 2025, to $17,513 million for the six months ended June 30, 2026, principally due to higher average refined product sales prices and higher refined product sales volumes. Revenues from external customers included $451 million, $2,162 million, $1,651 million, and $63 million related to our Renewables, Marketing, Lubricants & Specialties, and Midstream segments, respectively, for the six months ended June 30, 2026. Revenues from external customers included $225 million, $1,512 million, $1,278 million, and $58 million related to our Renewables, Marketing, Lubricants & Specialties, and Midstream segments, respectively, for the six months ended June 30, 2025.
Cost of Materials and Other
Cost of materials and other, exclusive of Lower of cost or market inventory valuation adjustments, increased 29% from $10,916 million for the six months ended June 30, 2025, to $14,113 million for the six months ended June 30, 2026, principally due to higher crude oil and feedstock costs and higher refined product sales volumes. Within our Lubricants & Specialties segment, the FIFO impact was a benefit of $99 million and a charge of $12 million for the six months ended June 30, 2026 and 2025, respectively.
During the six months ended June 30, 2026, we recognized a lower of cost or market inventory valuation adjustment benefit of $642 million compared to a charge of $31 million during the six months ended June 30, 2025.
Adjusted Refinery Gross Margins
Adjusted refinery gross margin per produced barrel sold increased 40% from $12.91 for the six months ended June 30, 2025, to $18.13 for the six months ended June 30, 2026. The increase was primarily driven by improved market crack spreads and volumes of refined products in both the Mid-Continent and West during the six months ended June 30, 2026.
Adjusted refinery gross margin per barrel excludes the cash effects of Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization. Reconciliations to amounts reported under GAAP are provided under "Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles" following Item 2 of Part I of this Quarterly Report on Form 10-Q.
Operating Expenses
Operating expenses increased 9% from $1,168 million for the six months ended June 30, 2025, to $1,278 million for the six months ended June 30, 2026, primarily due to higher employee benefits, environmental remediation and miscellaneous costs, partially offset by lower natural gas costs.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased 12% from $218 million for the six months ended June 30, 2025, to $245 million for the six months ended June 30, 2026 primarily due to higher employee benefits and professional service costs, partially offset by foreign currency gains.
Depreciation and Amortization Expenses
Depreciation and amortization increased 1% from $451 million for the six months ended June 30, 2025, to $457 million for the six months ended June 30, 2026, principally due to depreciation and amortization attributable to additional capitalized refinery turnaround costs and capitalized improvement projects as compared to the prior period.
Other Operating Expenses, Net
Other operating expenses, net increased $33 million, or 236% from $14 million for the six months ended June 30, 2025, to $47 million for the six months ended June 30, 2026, primarily due to impairment charges related to the abandonment of certain assets under construction in our Renewables segment. For the six months ended June 30, 2025 Other operating expenses, net primarily relates to decommissioning and closure costs of $8 million in our Refining segment.
Interest Income
Interest income was $25 million for the six months ended June 30, 2026, compared to $16 million for the six months ended June 30, 2025. The increase in Interest income was primarily due to the increase in average cash balance.
Interest Expense
Interest expense decreased $41 million, or 40%, from $102 million for the six months ended June 30, 2025, to $61 million for the six months ended June 30, 2026, primarily due to unrealized gains on precious metals financing arrangements during the period.
Other Income (Expense), Net
Other income (expense), net was $18 million of income for the six months ended June 30, 2026, compared to $46 million of expense for the six months ended June 30, 2025. The income for the six months ended June 30, 2026 was primarily due to a $14 million gain on settlement of precious metals. The expense for the six months ended June 30, 2025, was primarily due to a $40 million loss on sale of equity method investment in Cheyenne Pipeline, LLC, and a $15 million loss on the early extinguishment of debt.
Income Taxes
For the six months ended June 30, 2026, Income tax expense of $468 million was recorded on pre-tax income of $2,011 million, compared to Income tax expense of $37 million on pre-tax income of $245 million for the six months ended June 30, 2025. For the six months ended June 30, 2026, our effective tax rate of 23.3% was higher than the statutory rate of 21% primarily due to state and local income taxes on pre-tax earnings, partially offset from the benefits of nontaxable renewable fuel incentives. For the six months ended June 30, 2025, our effective tax rate of 15.1% was lower than the statutory rate of 21.0% primarily due to the relationship between pre-tax results and a discrete tax benefit associated with the revaluation of deferred tax liabilities from state tax law changes enacted in the second quarter of 2025. Due to rounding of reported numbers, some amounts may not calculate exactly.
LIQUIDITY AND CAPITAL RESOURCES
We have a disciplined capital allocation strategy focused on preserving financial flexibility, enabling us to execute our capital priorities and generate long-term value for our stockholders. Consistent with that strategy, we seek to self-fund development projects and make strategic decisions focused on profitable growth, while reducing our debt and returning cash to stockholders through dividends and share repurchases.
HF Sinclair Credit Agreement
We have a $2.0 billion senior unsecured revolving credit facility maturing in April 2030 (the "HF Sinclair Credit Agreement") which contains an extension feature that allows us to extend the term of the commitment from time to time in increments of up to one year, subject to the terms and conditions set forth in the HF Sinclair Credit Agreement. The HF Sinclair Credit Agreement includes an accordion feature that allows us to increase such commitments to an aggregate principal amount of up to $2.75 billion. The HF Sinclair Credit Agreement may be used for revolving credit loans and letters of credit and is available to fund general corporate purposes.
At June 30, 2026, we were in compliance with all covenants and had no outstanding borrowings or letters of credit under the HF Sinclair Credit Agreement.
Senior Notes
Our unsecured senior notes and unsubordinated obligations rank equally with all future unsecured and unsubordinated indebtedness. We may, from time to time, seek to retire some or all of our outstanding debt agreements through cash purchases, and/or exchanges, open market purchases, privately negotiated transactions, tender offers or otherwise. Such transactions, if any, may be material and will depend on prevailing market conditions, our liquidity requirements and other factors.
Financing Arrangements
Certain of our wholly owned subsidiaries entered into financing arrangements whereby such subsidiaries sold a portion of their precious metals catalyst to a financial institution in exchange for cash and then financed the use of the precious metals catalyst for a term not to exceed one year. During the six months ended June 30, 2026, we received proceeds of $71 million, made principal payments of $25 million and realized non-cash settlements on obligations of $19 million.
We may, from time to time, issue letters of credit pursuant to uncommitted letters of credit facilities, which are unrelated to the HF Sinclair Credit Agreement. At June 30, 2026, we had letters of credit totaling a nominal amount under such credit facilities.
See Note 12 "Debt" in the Notes to Consolidated Financial Statements for additional information on our debt instruments.
Liquidity
We believe our current Cash and cash equivalents, along with future internally generated cash flow and funds available under our credit facilities, will provide sufficient resources to fund currently planned capital projects and our current liquidity needs. We expect that, to the extent necessary, we can raise additional funds through equity or debt financings in the public and private capital markets. Further, we may seek to retire some or all of our outstanding debt agreements through cash purchases, and/or exchanges, open market purchases, privately negotiated transactions, tender offers or otherwise. Such transactions, if any, may be material and depend on prevailing market conditions, our liquidity requirements and other factors. In addition, components of our long-term growth strategy include the optimization of existing units at our facilities, the Potential Separation and the Mississauga Asset Retirement, expansion of our Midstream footprint and selective acquisition of complementary assets for our operations intended to capture synergies and increase earnings and cash flow. We also expect to use cash for payment of cash dividends, which are at the discretion of our Board of Directors, and for the repurchase of common stock under the 2024 Share Repurchase Program.
Our liquidity was approximately $4.3 billion at June 30, 2026, consisting of Cash and cash equivalents of $2.3 billion and $2.0 billion available under the HF Sinclair Credit Agreement.
We consider all highly liquid instruments with a maturity of three months or less at the time of purchase to be cash equivalents. These primarily consist of investments in liquid, highly rated instruments issued by financial institutions, government and corporate entities with strong credit standings and money market funds. Cash equivalents are stated at cost, which approximates market value.
Share Repurchases
In May 2024, our Board of Directors approved a $1.0 billion share repurchase program (the "2024 Share Repurchase Program"), which replaced all existing share repurchase programs. The 2024 Share Repurchase Program authorizes us to repurchase common stock in the open market or through privately negotiated transactions. Privately negotiated repurchases from REH Advisors Inc. ("REH") are also authorized under the 2024 Share Repurchase Program, subject to REH's interest in selling its shares and other limitations. The timing and amount of share repurchases, including those from REH, will depend on market conditions and corporate, tax, regulatory and other relevant considerations. In addition, we are authorized by our Board of Directors to repurchase shares in an amount sufficient to offset shares issued under our compensation programs. The 2024 Share Repurchase Program may be discontinued at any time by our Board of Directors.
During the six months ended June 30, 2026, we made open market and privately negotiated purchases of 4,024,728 shares for $251 million, exclusive of excise tax, under our 2024 Share Repurchase Program. As of June 30, 2026, we had remaining authorization to repurchase up to $208 million under the 2024 Share Repurchase Program.
Cash Flows - Operating Activities
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
Net cash flows provided by operating activities were $1,967 million for the six months ended June 30, 2026, compared to Net cash flows provided by operating activities of $498 million for the six months ended June 30, 2025, an increase of $1,469 million. Excluding non-cash impacts reflected in the reconciliation to net cash provided by operating activities, the increase was primarily driven by higher net income, favorable changes in working capital and a decrease in turnaround expenditures. Changes in working capital increased operating cash flows by $668 million for the six months ended June 30, 2026, and increased operating cash flows by $33 million for the six months ended June 30, 2025. Additionally for the six months ended June 30, 2026, turnaround expenditures were $175 million compared to $284 million for the six months ended June 30, 2025.
Cash Flows - Investing Activities and Planned Capital Expenditures
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
For the six months ended June 30, 2026, our Net cash flows used for investing activities were $280 million, which was inclusive of our acquisition of Industrial Oils Unlimited, LLC and our investment in Green Trail Fuels, LLC. Cash expenditures for Properties, plants and equipment for the six months ended June 30, 2026 were $220 million.
For the six months ended June 30, 2025, our Net cash flows used for investing activities were $193 million. Cash expenditures for Properties, plants and equipment for the six months ended June 30, 2025 were $197 million.
Our current expected capital and turnaround cash spending for 2026, subject to certain capital and other strategic projects under evaluation, is as follows:
Expected Cash Spending
(In millions)
Capital Expenditures:
Refining $ 225
Renewables 6
Marketing 30
Lubricants & Specialties 25
Midstream 30
Corporate 9
Turnarounds and catalyst 325
Total sustaining $ 650
Growth capital 125
Total $ 775
Cash Flows - Financing Activities
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025
For the six months ended June 30, 2026, our Net cash flows used for financing activities were $400 million. During the six months ended June 30, 2026, we paid $180 million in Dividends, we repurchased $255 million of our Common stock and we received net proceeds of $46 million from financing arrangements.
For the six months ended June 30, 2025, our Net cash flows used for financing activities were $239 million. During the six months ended June 30, 2025, we paid $190 million in Dividends, repurchased $50 million of our Common Stock, repaid $350 million under the now-terminated revolving credit facility of our subsidiary, Holly Energy Partners, L.P., and had net proceeds from the issuance and redemption of certain senior notes of $387 million.
Contractual Obligations and Commitments
As of June 30, 2026, our contractual obligations included debt obligations, interest payments related to debt obligations, financing arrangements, supply agreements, transportation and storage agreements, operating and finance leases, and other long-term obligations and commitments. In the ordinary course of business, we had debt-related activities during the six months ended June 30, 2026, as described in Note 12 "Debt" of the Consolidated Financial Statements.
As of June 30, 2026, there have been no material changes outside the ordinary course of business, in our contractual obligations since December 31, 2025. For additional information on our contractual obligations, refer to Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of these financial statements requires us to make estimates and judgments that affect the amounts reported in our consolidated financial statements and accompanying notes. Actual results may differ from those estimates. There have been no changes to the critical accounting policies or estimates disclosed in "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Policies and Estimates" in our Annual Report on Form 10-K for the year ended December 31, 2025.
RISK MANAGEMENT
We use certain strategies to reduce some commodity price and operational risks. We do not attempt to eliminate all market risk exposures when we believe that the exposure relating to such risk would not be significant to our future earnings, financial position, capital resources or liquidity or that the cost of eliminating the exposure would outweigh the benefit.
Commodity Price Risk Management
Our primary market risk is commodity price risk. We are exposed to market risks related to the volatility in the price of crude oil, other feedstocks and refined products and volatility in the price of natural gas used in our refining operations. We periodically enter into derivative contracts in the form of commodity price swaps, collar contracts, forward contracts and futures contracts to mitigate price exposure with respect to our inventory positions, natural gas purchases, sales prices of refined products and crude oil costs.
Foreign Currency Risk Management
We are exposed to market risk related to the volatility in foreign currency exchange rates. We periodically enter into derivative contracts in the form of foreign exchange forward contracts to mitigate the exposure associated with fluctuations on intercompany notes with our foreign subsidiaries that are not denominated in the U.S. dollar.
As of June 30, 2026, we have the following notional amounts related to all outstanding derivative instruments used to mitigate commodity price and foreign currency risk:
Notional Contract Volumes
by Year of Maturity
Contract Description
Total Outstanding Notional 2026 2027 Unit of Measure
Commodity contracts - long 1,544,847 1,544,847 - Barrels
Commodity contracts - short 1,753,765 1,753,765 - Barrels
Foreign currency forward contracts 522,000,000 240,589,800 281,410,200
Canadian dollar
Forward platinum contracts (1)
62,371 27,445 34,926 Troy ounces
(1)Represents an embedded derivative within our precious metals financing arrangements, which may be refinanced or require repayment under certain conditions. See Note 12 "Debt" in the Notes to Consolidated Financial Statements for additional information on these financing arrangements.
Counterparty financial information is reviewed to monitor financial stability and assess the ongoing ability to honor commitments under derivative contracts. We have not experienced, nor do we expect to experience, any difficulty in counterparties honoring their commitments.
The following sensitivity analysis provides the hypothetical effects of market price fluctuations related to outstanding derivative instruments:
June 30,
Derivative Fair Value Gain (Loss)
2026 2025
(In millions)
10% increase in underlying commodity prices $ (5) $ (6)
10% decrease in underlying commodity prices $ 5 $ 6
Interest Rate Risk Management
The market risk inherent in our fixed-rate debt is the potential change arising from increases or decreases in interest rates, as discussed below.
For the fixed rate HF Sinclair, HollyFrontier and HEP Senior Notes (each as demarcated in Note 12 "Debt" in the Notes to Consolidated Financial Statements), changes in interest rates will generally affect the fair value of the debt, but not earnings or cash flows.
The outstanding principal, estimated fair value and estimated change in fair value (assuming a hypothetical 10% change in the yield-to-maturity rates) for this debt as of June 30, 2026, are presented below:
Outstanding
Principal 		Estimated
Fair Value 		Estimated Change in Fair Value
(In millions)
HF Sinclair, HollyFrontier and HEP Senior Notes $ 2,800 $ 2,834 $ 69
For the variable rate under the HF Sinclair Credit Agreement, changes in interest rates would affect cash flows, but not the fair value. At June 30, 2026, there were no amounts outstanding under the HF Sinclair Credit Agreement. A hypothetical 10% change in interest rates applicable to the HF Sinclair Credit Agreement would not materially affect cash flows.
Operational Interruption Risk Management
Our operations are subject to catastrophic losses, operational hazards and unforeseen interruptions, including but not limited to fire, explosion, releases or spills, cyberattacks, weather-related perils, vandalism, power failures, mechanical failures and other events beyond our control. We maintain various insurance coverages, including general liability, property damage, business interruption and cyber insurance, subject to certain deductibles and insurance policy terms and conditions. We are not fully insured against certain risks because such risks are not fully insurable, coverage is unavailable, or premium costs, in our judgment, do not justify such expenditures.
We have a risk management oversight committee consisting of members from our senior management. This committee oversees our risk enterprise program, monitors our risk environment and provides direction for activities to mitigate identified risks that may adversely affect the achievement of our goals.
Reconciliations to Amounts Reported Under Generally Accepted Accounting Principles
Reconciliations of earnings before interest, taxes, depreciation and amortization ("EBITDA") to amounts reported under generally accepted accounting principles in the financial statements.
Earnings before interest, taxes, depreciation and amortization, referred to as EBITDA, is calculated as Net income attributable to HF Sinclair stockholders plus (i) Interest expense, net of Interest income, (ii) Income tax expense and (iii) Depreciation and amortization. EBITDA is not a calculation provided for under GAAP; however, the amounts included in the EBITDA calculation are derived from amounts included in our consolidated financial statements. EBITDA should not be considered as an alternative to Net income or Income from operations as an indication of our operating performance or as an alternative to operating cash flow as a measure of liquidity. EBITDA is not necessarily comparable to similarly titled measures of other companies. EBITDA is presented here because it is a financial indicator widely used by investors and analysts to measure our operating performance. EBITDA is also used by our management for internal analysis and as a basis for financial covenants.
Below is our calculation of EBITDA:
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
(In millions)
Net income attributable to HF Sinclair stockholders $ 892 $ 208 $ 1,540 $ 204
Add: interest expense 20 53 61 102
Less: interest income (15) (7) (25) (16)
Add: income tax expense
279 36 468 37
Add: depreciation and amortization 228 226 457 451
EBITDA $ 1,404 $ 516 $ 2,501 $ 778
Reconciliation of refinery operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in the financial statements.
Adjusted refinery gross margin is a non-GAAP performance measure that is used by our management and others to compare our refining performance to that of other companies in our industry. We believe this margin measure is helpful to investors in evaluating our refining performance on a relative and absolute basis, including against publicly available crack spread data. Adjusted refinery gross margin per produced barrel sold is total Refining segment gross margin plus Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization, divided by sales volumes of produced refined products. This margin measure excludes the non-cash effects of Lower of cost or market inventory valuation adjustments, which relate to inventory held at the end of the period. Adjusted refinery gross margin is a non-GAAP performance measure and should not be considered in isolation or as a substitute for Refining segment gross margin. The GAAP measure most directly comparable to adjusted refinery gross margin is Refining segment gross margin. Other companies in our industry may not calculate these performance measures in the same manner. Due to rounding of reported numbers, some amounts may not calculate exactly.
Reconciliation of Refining segment gross margin to adjusted refinery gross margin to adjusted refinery gross margin per produced barrel sold and adjusted refinery gross margin, less operating expenses per produced barrel sold
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
(In millions, except barrel and per barrel amounts)
Refining segment
Sales and other revenues $ 9,228 $ 6,019 $ 15,499 $ 11,670
Cost of sales (1)
8,140 5,658 13,695 11,143
Depreciation and amortization 146 134 291 271
Gross margin $ 942 $ 227 $ 1,513 $ 256
Add: lower of cost or market inventory valuation adjustments
- 172 (604) 56
Add: operating expenses 491 441 959 902
Add: depreciation and amortization 146 134 291 271
Adjusted refinery gross margin $ 1,579 $ 974 $ 2,159 $ 1,485
Sales of produced refined products (BPD) (2)
668,670 649,210 657,470 635,580
Average per produced barrel sold:
Gross margin $ 15.46 $ 3.85 $ 12.70 $ 2.22
Add: lower of cost or market inventory valuation adjustments
- 2.93 (5.08) 0.49
Add: operating expenses 8.08 7.45 8.06 7.85
Add: depreciation and amortization 2.41 2.27 2.45 2.35
Adjusted refinery gross margin $ 25.95 $ 16.50 $ 18.13 $ 12.91
Less: operating expenses 8.08 7.45 8.06 7.85
Adjusted refinery gross margin, less operating expenses $ 17.87 $ 9.05 $ 10.07 $ 5.06
(1)Exclusive of Depreciation and amortization.
(2)Represents barrels sold of refined products produced at our refineries (including Asphalt and intersegment sales) and excludes volumes of refined products purchased for resale or volumes of excess crude oil sold.
Reconciliation of renewables operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in the financial statements.
Adjusted renewables gross margin is a non-GAAP performance measure that is used by our management and others to compare our renewables performance to that of other companies in our industry. We believe this margin measure is helpful to investors in evaluating our renewables performance on a relative and absolute basis. Adjusted renewables gross margin per produced gallon sold is total Renewables segment gross margin plus Lower of cost or market inventory valuation adjustments, Operating expenses and Depreciation and amortization, divided by sales volumes of produced renewables products. This margin measure excludes the non-cash effects of Lower of cost or market inventory valuation adjustments, which relate to volumes in inventory at the end of the period. Adjusted renewables gross margin is not a calculation provided for under GAAP and should not be considered in isolation or as a substitute for Renewables segment gross margin. The GAAP measure most directly comparable to adjusted renewables gross margin is Renewables segment gross margin. Other companies in our industry may not calculate these performance measures in the same manner. Due to rounding of reported numbers, some amounts may not calculate exactly.
Reconciliation of Renewables segment gross margin to adjusted renewables gross margin to adjusted renewables gross margin per produced gallon sold and adjusted renewables gross margin, less operating expenses per produced gallon sold
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
(In millions, except gallon and per gallon amounts)
Renewables segment
Sales and other revenues $ 486 $ 258 $ 820 $ 448
Cost of sales (1)
392 236 524 441
Depreciation and amortization 16 26 35 49
Gross margin $ 78 $ (4) $ 261 $ (42)
Add: lower of cost or market inventory valuation adjustments
30 (24) (38) (25)
Add: operating expenses 23 22 45 45
Add: depreciation and amortization 16 26 35 49
Adjusted renewables gross margin $ 147 $ 20 $ 303 $ 27
Sales of produced renewables products (in thousand gallons)
59,905 54,786 112,353 99,250
Average per produced gallon sold:
Gross margin $ 1.31 $ (0.05) $ 2.32 $ (0.42)
Add: lower of cost or market inventory valuation adjustments
0.50 (0.45) (0.34) (0.26)
Add: operating expenses 0.37 0.39 0.40 0.45
Add: depreciation and amortization 0.28 0.47 0.31 0.50
Adjusted renewables gross margin $ 2.46 $ 0.36 $ 2.69 $ 0.27
Less: operating expenses 0.37 0.39 0.40 0.45
Adjusted renewables gross margin, less operating expenses $ 2.09 $ (0.03) $ 2.29 $ (0.18)
(1) Exclusive of Depreciation and amortization.
Reconciliation of marketing operating information (non-GAAP performance measures) to amounts reported under generally accepted accounting principles in the financial statements.
Adjusted marketing gross margin is a non-GAAP performance measure that is used by our management and others to compare our marketing performance to that of other companies in our industry. We believe this margin measure is helpful to investors in evaluating our marketing performance on a relative and absolute basis. Adjusted marketing gross margin per gallon sold is total Marketing segment gross margin plus Depreciation and amortization, divided by sales volumes of marketing products. Adjusted marketing gross margin is not a calculation provided for under GAAP and should not be considered in isolation or as a substitute for Marketing segment gross margin. The GAAP measure most directly comparable to adjusted marketing gross margin is Marketing segment gross margin. Other companies in our industry may not calculate these performance measures in the same manner. Due to rounding of reported numbers, some amounts may not calculate exactly.
Reconciliation of Marketing segment gross margin to adjusted marketing gross margin to adjusted marketing gross margin per gallon sold
Three Months Ended June 30, Six Months Ended June 30,
2026 2025 2026 2025
(In millions, except gallon and per gallon amounts)
Marketing segment
Sales and other revenues $ 1,370 $ 826 $ 2,162 $ 1,512
Cost of sales (1)
1,332 792 2,088 1,444
Depreciation and amortization 8 7 16 14
Gross margin $ 30 $ 27 $ 58 $ 54
Add: depreciation and amortization
8 7 16 14
Adjusted marketing gross margin $ 38 $ 34 $ 74 $ 68
Sales of refined products (in thousand gallons)
386,656 337,147 711,279 631,012
Average per gallon sold:
Gross margin $ 0.08 $ 0.08 $ 0.08 $ 0.09
Add: depreciation and amortization
0.02 0.02 0.03 0.02
Adjusted marketing gross margin $ 0.10 $ 0.10 $ 0.11 $ 0.11
(1) Exclusive of Depreciation and amortization.
HF Sinclair Corporation published this content on July 30, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on July 30, 2026 at 12:33 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]