PBF Holding Company LLC
08/04/2026 | Press release | Distributed by Public on 08/04/2026 09:28
Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the audited financial statements of PBF Holding included in the Annual Report on Form 10-K for the year ended December 31, 2025 and the unaudited financial statements and related notes included in this report. The following discussion contains "forward-looking statements" that reflect our future plans, estimates, beliefs and expected performance. Our actual results may differ materially from those currently anticipated and expressed in such forward-looking statements as a result of a number of factors. We caution that assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Please see "Cautionary Note Regarding Forward-Looking Statements."
Unless the context indicates otherwise, the terms "we," "us," and "our" refer to PBF Holding and its consolidated subsidiaries.
Overview
We are one of the largest independent petroleum refiners and suppliers of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants, and other petroleum products in the United States. We sell our products throughout the Northeast, Midwest, Gulf Coast and West Coast of the United States, as well as in other regions of the United States, Canada and Mexico and are able to ship products to other international destinations. We own and operate six domestic oil refineries and related assets. Our refineries have a combined processing capacity, known as throughput, of approximately 1,000,000 barrels per day ("bpd"), and a weighted-average Nelson Complexity Index of 12.8 based on current operating conditions. The complexity and throughput capacity of our refineries are subject to change dependent upon configuration changes we make to respond to market conditions, as well as a result of investments made to improve our facilities and maintain compliance with environmental and governmental regulations. Our six oil refineries are aggregated into one reportable segment.
Our six refineries are located in Delaware City, Delaware, Paulsboro, New Jersey, Toledo, Ohio, Chalmette, Louisiana, Torrance, California and Martinez, California. Each refinery is briefly described in the table below:
| Refinery | Region |
Nelson Complexity Index (1)
|
Throughput Capacity (in bpd) (1)
|
PADD |
Crude Processed (2)
|
Source (2)
|
||||||||||||||
| Delaware City | East Coast | 13.6 | 180,000 | 1 | light sweet through heavy sour | water, rail | ||||||||||||||
| Paulsboro | East Coast |
9.1 (3)
|
155,000 (3)
|
1 | light sweet through heavy sour | water | ||||||||||||||
| Toledo | Mid-Continent | 11.0 | 180,000 | 2 | light sweet | pipeline, truck, rail | ||||||||||||||
| Chalmette | Gulf Coast | 13.0 | 185,000 | 3 | light sweet through heavy sour | water, pipeline | ||||||||||||||
| Torrance | West Coast | 13.8 | 166,000 | 5 | medium and heavy | pipeline, water, truck | ||||||||||||||
| Martinez | West Coast | 16.1 | 157,000 | 5 | medium and heavy | water | ||||||||||||||
__________________________
(1) Reflects operating conditions at each refinery as of the date of this filing. Changes in complexity and throughput capacity reflect the result of current market conditions, in addition to investments made to improve our facilities and maintain compliance with environmental and governmental regulations. Configurations at each of our refineries are evaluated periodically and updated accordingly.
(2) Reflects the typical crude and feedstocks and related sources utilized under normal operating conditions and prevailing market environments.
(3) At full operating capacity and prevailing market environments, our Nelson Complexity Index and throughput capacity for the Paulsboro refinery would be 13.1 and 180,000, respectively. As a result of the reconfiguration of our East Coast refineries in 2020, and subsequent restart of several idled processing units at the Paulsboro refinery in 2022, our Nelson Complexity Index and throughput capacity were adjusted.
We are a wholly-owned subsidiary of PBF LLC and an indirect subsidiary of PBF Energy. PBF Finance is a wholly-owned subsidiary of PBF Holding. We are the parent company for PBF LLC's refinery operating subsidiaries.
PBF Logistics LP Transactions
PBFX GP serves as the general partner of PBFX. PBFX is an affiliate of ours. PBFX, an indirect wholly-owned subsidiary of PBF Energy and PBF LLC, owns or leases, operates, develops, and acquires crude oil and refined products terminals, pipelines, storage facilities and similar logistics assets. PBFX engages in the receiving, handling, storage and transferring of crude oil, refined products, natural gas, and intermediates from sources located throughout the United States and Canada for PBF Energy in support of its refineries, as well as for third-party customers. The majority of PBFX's revenues are derived from long-term, fee-based commercial agreements with us, which include minimum volume commitments, for receiving, handling, storing, and transferring crude oil, refined products, and natural gas. PBF Energy also has agreements with PBFX that establish fees for certain general and administrative services and operational and maintenance services provided by us to PBFX. From time to time, we have distributed to PBF LLC, which in turn contributed to PBFX, certain assets.
St. Bernard Renewables LLC Transactions
On June 27, 2023, PBF Energy and Enilive US Inc. (f/k/a Eni Sustainable Mobility US Inc.), a subsidiary of Eni SpA, consummated the closing of the equity method investment transaction and the capitalization of SBR, a jointly held investee designed to own, develop, and operate a biorefinery co-located with our Chalmette refinery in Louisiana. In connection with this transaction, we distributed to PBF LLC, which in turn contributed to SBR, certain assets. We have no interest in SBR.
Recent Developments
Martinez Refinery Fire
On February 1, 2025, the Martinez refinery fire occurred. As a result of the Martinez refinery fire, the Martinez refinery was fully shut down until April 2025, when certain unaffected units, including the crude unit, were restarted and the Martinez refinery began producing limited quantities of gasoline, jet fuel, and intermediates. Investigations are being conducted by various regulatory agencies, including the California Department of Industrial Relations - the Division of Occupational Safety and Health ("CalOSHA"), the Bay Area Air District ("BAAD"), Contra Costa County ("CCC"), the Department of Justice ("DOJ"), the United States Attorney's Office ("USAO"), and the Environmental Protection Agency ("EPA"). There are uncertainties around these inquiries and investigations and potential results and consequences, including whether any financial penalties will be assessed or changes to the operations of the Martinez refinery will result therefrom. At this time, the potential liabilities, including regulatory penalties, arising from the incident are unknown, and the full financial impact of this incident cannot reasonably be estimated.
Upon completion of construction activities, the Martinez refinery returned to full operations in May 2026. All units affected by the Martinez refinery fire have returned to operational status and are operating at planned rates, which are expected to continue through the planned turnaround of the Martinez refinery's hydrocracker complex. Following the successful completion of extensive inspections and operational evaluations, the hydrocracker complex turnaround, previously scheduled for late in the second quarter of 2026, has been rescheduled to late in the third quarter of 2026.
We expect that the cost of repairs to the fire-damaged units and restoring the Martinez refinery to full operational status will be largely covered under our property insurance coverage, subject to our deductible and retentions totaling $30.0 million. Our insurance policy also includes business interruption coverage, which contains a 60-day waiting period. This coverage commenced on April 3, 2025. While we expect our insurance coverage will significantly offset the financial impact of the Martinez refinery fire, other than for the business interruption waiting period, deductibles and retentions, the timing of insurance proceeds may impact our results and our cash flow in a given reporting period.
Anticipated costs and insurance recoveries related to the Martinez refinery fire are based on information available to us as of the date of this filing, and are preliminary and subject to revision. In addition, neither the total amount nor timing of insurance recoveries is certain. During the three and six months ended June 30, 2026, we received $250.0 million and $356.5 million, respectively, of unallocated insurance proceeds. Since the date of the Martinez refinery fire, we have received cumulative insurance proceeds, net of deductibles and retentions, of $1.25 billion.
Factors Affecting Comparability Between Periods
Our results have been affected by the following events, the understanding of which will aid in assessing the comparability of our period to period financial performance and financial condition.
Martinez Refinery Fire
The Martinez refinery fire occurred on February 1, 2025. As a result, the Martinez refinery was fully shut down until April 2025, when certain unaffected units, including the crude unit, were restarted and the Martinez refinery began producing limited quantities of gasoline, jet fuel, and intermediates, while the remaining units remained offline. During the second quarter in 2026, assets were transferred to refinery operations for commissioning and restart. All units affected by the Martinez refinery fire have returned to operational status and are running at planned rates. Investigations by various regulatory agencies are ongoing. Consequently, throughput volumes at the Martinez refinery in 2026 were significantly above 2025 levels.
During the three and six months ended June 30, 2026, we received $250.0 million and $356.5 million of unallocated insurance proceeds, respectively, which were recognized as a Gain on insurance recoveries on the Condensed Consolidated Statements of Operations. During the three and six months ended June 30, 2025, we received an unallocated installment of $250.0 million after deductibles and retentions. As a result, we recorded a Gain on insurance recoveries of $189.0 million on the Condensed Consolidated Statements of Operations, which was net of the $61.0 million receivable that was recorded at March 31, 2025.
In addition, during the three and six months ended June 30, 2026, we incurred operating expenses associated with the Martinez refinery fire of approximately $22.7 million and $34.2 million, respectively (compared to $30.4 million and $108.5 million, respectively, during the three and six months ended June 30, 2025).
Debt and Credit Facilities
Senior Notes
2034 7.25% Senior Notes
On May 28, 2026, we issued $500.0 million aggregate principal amount of 7.25% senior unsecured notes due 2034 (the "2034 7.25% Senior Notes"). Net proceeds from the offering were $492.1 million after deducting the initial purchasers' discount and offering expenses. We used the net proceeds from the offering and available cash to fully redeem the 6.00% senior unsecured notes due 2028 (the "2028 6.00% Senior Notes"), plus accrued and unpaid interest.
2028 6.00% Senior Notes
On June 25, 2026, we exercised our rights under the indenture governing the 2028 6.00% Senior Notes to redeem all outstanding 2028 6.00% Senior Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest up to, but excluding, the redemption date. The aggregate redemption price for the 2028 6.00% Senior Notes was approximately $801.6 million plus accrued and unpaid interest. The difference between the carrying value of the 2028 6.00% Senior Notes on the date they were redeemed and the amount for which they were redeemed was $2.2 million and was recorded as a Loss on extinguishment of debt on the Condensed Consolidated Statements of Operations.
2030 9.875% Senior Notes
On March 17, 2025, we issued $800.0 million aggregate principal amount of 9.875% senior unsecured notes due 2030 (the "2030 9.875% Senior Notes"). Net proceeds from the offering were $776.0 million after deducting the initial purchasers' discount and offering expenses. We used the net proceeds from the offering to repay outstanding borrowings under the PBF Holding's asset-based revolving credit facility (the "Revolving Credit Facility") and for general corporate purposes.
PBF Holding Revolving Credit Facility
The Revolving Credit Facility matures in August 2028 and has a maximum commitment of $3.5 billion, as stated in the amended and restated asset-based revolving credit agreement (the "Revolving Credit Agreement"). We may borrow or repay outstanding amounts on the Revolving Credit Facility from time to time depending on working capital or other cash flow needs of the business. There were no outstanding borrowings under the Revolving Credit Facility as of June 30, 2026, compared with $100.0 million as of December 31, 2025.
Costs Related to RBI Initiative
During the second quarter of 2025, we launched our RBI initiative as part of our ongoing strategic efforts to generate incremental value across our business. For the three and six months ended June 30, 2026, we recognized $9.2 million and $18.6 million, respectively, of expenses related to this initiative, compared to $13.6 million for both the three and six months ended June 30, 2025. These charges are included in General and administrative expenses on the Condensed Consolidated Statements of Operations.
Geopolitical Conflicts
Recent hostilities involving the United States, Israel, the Gulf States, and Iran have disrupted global energy markets and trade flows, contributing to increased volatility in crude oil and refined product prices. Actions affecting regional shipping routes, including through the Strait of Hormuz, and impacts to certain Middle Eastern energy infrastructure have led to higher freight costs, longer transit times and supply chain disruptions. These conditions have supported higher global refining margins and increased demand for U.S. refined products during the period, while also resulting in higher and more volatile crude oil prices, increased feedstock costs and elevated working capital requirements. The net impact on our results of operations has varied based on the timing and magnitude of changes in crude oil prices and refined product margins. The extent to which these conditions will continue remains uncertain and dependent on future developments, including the duration and scope of the conflict, potential further disruptions to supply or transit routes and the response of global markets. We continue to monitor the situation and adjust our operations as appropriate.
Transactions with PBFX and SBR
We and our subsidiaries have entered into a series of agreements with PBFX, including contribution, commercial and operational agreements. We and our subsidiaries have also entered into various agreements with SBR, primarily related to the sale and purchase of environmental credits and hydrocarbon products. Refer to "Note 5 - Related Party Transactions" of our Notes to Condensed Consolidated Financial Statements for transactions with PBFX and SBR.
Results of Operations
The following tables reflect our financial and operating highlights for the three and six months ended June 30, 2026 and 2025 (amounts in millions):
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenues | $ | 11,676.3 | $ | 7,465.6 | $ | 19,576.1 | $ | 14,522.7 | |||||||||||||||
| Cost and expenses: | |||||||||||||||||||||||
| Cost of products and other | 9,786.9 | 6,825.5 | 16,649.8 | 13,490.9 | |||||||||||||||||||
| Operating expenses (excluding depreciation and amortization expense as reflected below) | 646.0 | 607.5 | 1,307.2 | 1,313.8 | |||||||||||||||||||
| Depreciation and amortization expense | 151.2 | 148.8 | 297.9 | 307.4 | |||||||||||||||||||
| Cost of sales | 10,584.1 | 7,581.8 | 18,254.9 | 15,112.1 | |||||||||||||||||||
| General and administrative expenses (excluding depreciation and amortization expense as reflected below) | 146.3 | 77.3 | 233.3 | 145.2 | |||||||||||||||||||
| Depreciation and amortization expense | 2.1 | 2.1 | 4.4 | 4.2 | |||||||||||||||||||
| Gain on insurance recoveries, net | (250.0) | (189.0) | (356.5) | (189.0) | |||||||||||||||||||
| (Gain) loss on sale of assets | - | (0.2) | 0.3 | (0.2) | |||||||||||||||||||
| Total cost and expenses | 10,482.5 | 7,472.0 | 18,136.4 | 15,072.3 | |||||||||||||||||||
| Income (loss) from operations | 1,193.8 | (6.4) | 1,439.7 | (549.6) | |||||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||
|
Interest expense (net of interest income of $7.5, $3.5, $10.7, and $7.7, respectively)
|
(42.5) | (54.4) | (85.0) | (89.9) | |||||||||||||||||||
| Loss on extinguishment of debt | (2.2) | - | (2.2) | - | |||||||||||||||||||
| Other non-service components of net periodic benefit cost | 1.3 | 0.3 | 2.3 | 0.6 | |||||||||||||||||||
| Income (loss) before income taxes | 1,150.4 | (60.5) | 1,354.8 | (638.9) | |||||||||||||||||||
| Income tax benefit | (1.5) | (0.3) | (8.8) | - | |||||||||||||||||||
| Net income (loss) | 1,151.9 | (60.2) | 1,363.6 | (638.9) | |||||||||||||||||||
| Less: net income (loss) attributable to noncontrolling interest | (0.2) | - | (0.1) | - | |||||||||||||||||||
| Net income (loss) attributable to PBF Holding Company LLC | $ | 1,152.1 | $ | (60.2) | $ | 1,363.7 | $ | (638.9) | |||||||||||||||
| Consolidated gross margin | $ | 1,092.2 | $ | (116.2) | $ | 1,321.2 | $ | (589.4) | |||||||||||||||
|
Gross refining margin (1)
|
$ | 1,889.4 | $ | 640.1 | $ | 2,926.3 | $ | 1,031.8 | |||||||||||||||
_____________________
(1) See Non-GAAP Financial Measures.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
|
Operating Highlights
|
2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Key Operating Information | |||||||||||||||||||||||
| Production (bpd in thousands) | 893.5 | 845.8 | 867.5 | 789.5 | |||||||||||||||||||
| Crude oil and feedstocks throughput (bpd in thousands) | 887.3 | 839.1 | 865.9 | 785.1 | |||||||||||||||||||
| Total crude oil and feedstocks throughput (millions of barrels) | 80.7 | 76.4 | 156.7 | 142.1 | |||||||||||||||||||
| Consolidated gross margin per barrel of throughput | $ | 13.53 | $ | (1.53) | $ | 8.43 | $ | (4.15) | |||||||||||||||
|
Gross refining margin, excluding special items, per barrel of throughput (1)
|
$ | 23.40 | $ | 8.38 | $ | 16.67 | $ | 7.26 | |||||||||||||||
| Refining operating expense, per barrel of throughput | $ | 8.00 | $ | 7.96 | $ | 8.34 | $ | 9.25 | |||||||||||||||
|
Crude and feedstocks (% of total throughput) (2)
|
|||||||||||||||||||||||
| Heavy | 31 | % | 25 | % | 28 | % | 27 | % | |||||||||||||||
| Medium | 29 | % | 35 | % | 33 | % | 35 | % | |||||||||||||||
| Light | 24 | % | 26 | % | 23 | % | 24 | % | |||||||||||||||
| Other feedstocks and blends | 16 | % | 14 | % | 16 | % | 14 | % | |||||||||||||||
| Total throughput | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||
| Yield (% of total throughput) | |||||||||||||||||||||||
| Gasoline and gasoline blendstocks | 42 | % | 44 | % | 43 | % | 46 | % | |||||||||||||||
| Distillates and distillate blendstocks | 36 | % | 34 | % | 35 | % | 35 | % | |||||||||||||||
| Lubes | 1 | % | 1 | % | 1 | % | 1 | % | |||||||||||||||
| Chemicals | 1 | % | 2 | % | 1 | % | 1 | % | |||||||||||||||
| Other | 21 | % | 20 | % | 20 | % | 18 | % | |||||||||||||||
| Total yield | 101 | % | 101 | % | 100 | % | 101 | % | |||||||||||||||
_____________________
(1) See Non-GAAP Financial Measures.
(2) We define heavy crude oil as crude oil with American Petroleum Institute ("API") gravity of less than 24 degrees. We define medium crude oil as crude oil with an API gravity between 24 and 35 degrees. We define light crude oil as crude oil with an API gravity higher than 35 degrees.
The table below summarizes certain market indicators relating to our operating results as reported by Platts, a division of The McGraw-Hill Companies.
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (dollars per barrel, except as noted) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Dated Brent crude oil | $ | 104.86 | $ | 67.70 | $ | 93.28 | $ | 71.64 | |||||||||||||||
| West Texas Intermediate (WTI) crude oil | $ | 93.11 | $ | 63.81 | $ | 83.00 | $ | 67.60 | |||||||||||||||
| Light Louisiana Sweet (LLS) crude oil | $ | 95.64 | $ | 66.12 | $ | 85.57 | $ | 70.22 | |||||||||||||||
| Alaska North Slope (ANS) crude oil | $ | 103.05 | $ | 68.82 | $ | 90.40 | $ | 72.30 | |||||||||||||||
| Crack Spreads | |||||||||||||||||||||||
| Dated Brent (NYH) 2-1-1 | $ | 43.48 | $ | 22.24 | $ | 35.05 | $ | 19.58 | |||||||||||||||
| WTI (Chicago) 4-3-1 | $ | 44.62 | $ | 21.16 | $ | 32.11 | $ | 17.47 | |||||||||||||||
| LLS (Gulf Coast) 2-1-1 | $ | 48.66 | $ | 20.26 | $ | 39.39 | $ | 18.77 | |||||||||||||||
| ANS (West Coast-LA) 4-3-1 | $ | 53.28 | $ | 28.85 | $ | 45.03 | $ | 26.00 | |||||||||||||||
| ANS (West Coast-SF) 3-2-1 | $ | 58.27 | $ | 36.07 | $ | 49.67 | $ | 30.85 | |||||||||||||||
| Crude Oil Differentials | |||||||||||||||||||||||
| Dated Brent (foreign) less WTI | $ | 11.75 | $ | 3.90 | $ | 10.27 | $ | 4.04 | |||||||||||||||
| Dated Brent less Maya (heavy, sour) | $ | 16.08 | $ | 9.22 | $ | 15.12 | $ | 9.86 | |||||||||||||||
| Dated Brent less WTS (sour) | $ | 13.04 | $ | 4.03 | $ | 11.64 | $ | 3.95 | |||||||||||||||
| Dated Brent less ASCI (sour) | $ | 10.98 | $ | 3.19 | $ | 9.07 | $ | 3.26 | |||||||||||||||
| WTI less WCS (heavy, sour) | $ | 20.25 | $ | 10.65 | $ | 18.03 | $ | 11.86 | |||||||||||||||
| WTI less Bakken (light, sweet) | $ | 0.32 | $ | 0.65 | $ | 1.15 | $ | 1.19 | |||||||||||||||
| WTI less Syncrude (light, sweet) | $ | (2.83) | $ | (0.93) | $ | (0.66) | $ | 0.83 | |||||||||||||||
| WTI less LLS (light, sweet) | $ | (2.53) | $ | (2.31) | $ | (2.56) | $ | (2.61) | |||||||||||||||
| WTI less ANS (light, sweet) | $ | (9.93) | $ | (5.01) | $ | (7.40) | $ | (4.69) | |||||||||||||||
| Effective RIN basket price | $ | 13.78 | $ | 6.14 | $ | 11.30 | $ | 5.45 | |||||||||||||||
| Natural gas (dollars per MMBTU) | $ | 2.94 | $ | 3.51 | $ | 3.20 | $ | 3.69 | |||||||||||||||
Three Months Ended June 30, 2026 Compared to the Three Months Ended June 30, 2025
Overview- Net income was $1,151.9 million for the three months ended June 30, 2026 compared to net loss of $60.2 million for the three months ended June 30, 2025.
Our results for the three months ended June 30, 2026 were positively impacted by a special item consisting of a gain on insurance recoveries of $250.0 million, partially offset by expenses associated with the Martinez refinery fire of approximately $22.7 million, costs related to the RBI initiative of approximately $9.2 million, and a loss on extinguishment of debt of $2.2 million, related to the redemption of the 2028 6.00% Senior Notes. Our results for the three months ended June 30, 2025 were positively impacted by special items consisting of a gain on insurance recoveries of $189.0 million, partially offset by expenses associated with the Martinez refinery fire of approximately $30.4 million, and costs related to the RBI initiative of approximately $13.6 million.
Excluding the impact of special items, our results for the three months ended June 30, 2026 reflect an overall increase in refining margins compared to the same period in 2025. The refining margins increase was primarily driven by favorable crack spreads and certain crude oil differentials, as well as higher throughput volumes across the majority of our refineries, partially offset by higher RFS compliance costs. Ongoing geopolitical conflicts affecting global supply and trade flows also contributed to these dynamic market conditions.
Revenues- Revenues totaled $11.7 billion for the three months ended June 30, 2026 compared to $7.5 billion for the three months ended June 30, 2025, an increase of approximately $4.2 billion, or 56.0%. Revenues per barrel were $127.37 and $81.20 for the three months ended June 30, 2026 and 2025, respectively, an increase of 56.9% directly related to higher hydrocarbon commodity prices. For the three months ended June 30, 2026, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 309,100 bpd, 130,900 bpd, 177,400 bpd, and 269,900 bpd, respectively. For the three months ended June 30, 2025, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 299,800 bpd, 162,200 bpd, 173,600 bpd and 203,500 bpd, respectively. For the three months ended June 30, 2026, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 346,300 bpd, 145,800 bpd, 163,700 bpd, and 351,500 bpd, respectively. For the three months ended June 30, 2025, the total barrels sold at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 348,800 bpd, 166,600 bpd, 169,700 bpd and 325,300 bpd, respectively. Total refined product barrels sold were higher than throughput rates, reflecting sales from inventory as well as sales and purchases of refined products outside our refineries.
Overall average throughput rates at our refineries were higher for the three months ended June 30, 2026, primarily due to the restart of the Martinez refinery, partially offset by unplanned downtime at our Mid-Continent refinery. In the prior-year period, increased maintenance activity and unplanned downtime resulting from the Martinez refinery fire negatively impacted throughput. We plan to continue operating our refineries in line with demand and prevailing market conditions.
Consolidated gross margin- Consolidated gross margin totaled $1,092.2 million for the three months ended June 30, 2026 compared to $(116.2) million for the three months ended June 30, 2025, an increase of approximately $1,208.4 million. Gross refining margin totaled $1,889.4 million, or $23.40 per barrel of throughput for the three months ended June 30, 2026 compared to $640.1 million, or $8.38 per barrel of throughput for the three months ended June 30, 2025, an increase of approximately $1,249.3 million. During the three months ended June 30, 2026 and 2025, our refining margin calculations were not impacted by special items.
Consolidated gross margin and gross refining margin increased compared to the three months ended June 30, 2025, primarily due to favorable crack spreads and certain crude oil differentials, higher throughput volumes across the majority of our refineries, and increased overall throughput at our refineries. These favorable impacts were partially offset by unplanned downtime at our Mid-Continent refinery and higher RFS compliance costs.
Additionally, our results continue to be impacted by significant costs to comply with the RFS. On March 27, 2026, the EPA finalized new RFS requirements for 2026 and 2027, which included a partial reallocation of small refinery exemptions that were granted for years 2023 to 2025 and revised renewable fuel volume requirements for 2026. Total RFS compliance costs were $331.3 million for the three months ended June 30, 2026 compared to $165.0 million for the three months ended June 30, 2025. The increase was primarily attributable to the newly finalized RFS requirements for 2026 and 2027, which has resulted in higher RIN prices in 2026 compared to 2025.
Average industry margins were notably more favorable during the three months ended June 30, 2026 in comparison to the same period in 2025, primarily due to geopolitical conflicts negatively impacting supply with demand remaining relatively resilient.
Favorable movements in benchmark crude differentials typically result in lower crude costs and positively impact our earnings, while reductions in these benchmark crude differentials typically result in higher crude costs and negatively impact our earnings.
On the East Coast, the Dated Brent (NYH) 2-1-1 industry crack spread was approximately $43.48 per barrel, or 95.5% higher, in the three months ended June 30, 2026, as compared to $22.24 per barrel in the same period in 2025. Our margins were positively impacted from our refinery specific slate on the East Coast by a widening Dated Brent/Maya differential, which increased by $6.86 per barrel, slightly offset by a weakened WTI/Bakken differential, which decreased by $0.33 per barrel, in comparison to the same period in 2025. The WTI/WCS differential widened to $20.25 per barrel in the three months ended June 30, 2026 compared to $10.65 in the same period in 2025, which favorably impacted our cost of heavy crude.
Across the Mid-Continent, the WTI (Chicago) 4-3-1 industry crack spread was $44.62 per barrel, or 110.9% higher, in the three months ended June 30, 2026 as compared to $21.16 per barrel in the same period in 2025. Our margins were negatively impacted from our refinery specific slate in the Mid-Continent by weakened WTI/Syncrude and WTI/Bakken differentials, which decreased by $1.90 and $0.33 per barrel, respectively, in comparison to the same period in 2025.
On the Gulf Coast, the LLS (Gulf Coast) 2-1-1 industry crack spread was $48.66 per barrel, or 140.2% higher, in the three months ended June 30, 2026 as compared to $20.26 per barrel in the same period in 2025. Margins on the Gulf Coast were positively impacted from our refinery specific slate by an expanded Dated Brent/WTS differential, which averaged a discount of $13.04 per barrel for the three months ended June 30, 2026 as compared to a discount of $4.03 per barrel in the same period of 2025.
On the West Coast, the ANS (West Coast - LA) 4-3-1 industry crack spread was $53.28 per barrel, or 84.7% higher, in the three months ended June 30, 2026 as compared to $28.85 per barrel in the same period in 2025. Additionally, the ANS (West Coast - SF) 3-2-1 industry crack spread was $58.27 per barrel, or 61.5% higher, in the three months ended June 30, 2026 as compared to $36.07 per barrel in the same period in 2025. Our margins on the West Coast were negatively impacted from our refinery specific slate by weakened WTI/ANS differential, which averaged a premium of $9.93 per barrel for the three months ended June 30, 2026 as compared to a premium of $5.01 per barrel in the same period of 2025, slightly offset by an expanded Dated Brent/WTS differential, which averaged a discount of $13.04 per barrel for the three months ended June 30, 2026 as compared to a discount of $4.03 per barrel in the same period of 2025.
Operating expenses- Operating expenses totaled $646.0 million, or $8.00 per barrel of throughput, for the three months ended June 30, 2026 compared to $607.5 million, or $7.96 per barrel of throughput, for the three months ended June 30, 2025, an increase of $38.5 million, or 6%. The increase in operating expenses in comparison to the same period in 2025 was mainly attributable to higher outside services as well as higher maintenance, catalysts and chemical costs driven by the Martinez refinery restart.
General and administrative expenses- General and administrative expenses totaled $146.3 million for the three months ended June 30, 2026 compared to $77.3 million for the three months ended June 30, 2025, an increase of approximately $69.0 million, or 89%. The increase in general and administrative expenses in comparison to the same period in 2025 was primarily due to higher employee-related expenses, including the recognition of incentive compensation, and outside services, including higher legal costs. General and administrative expenses are comprised of personnel, facilities, and other infrastructure costs necessary to support our refineries and related logistics assets.
Depreciation and amortization expense- Depreciation and amortization expense totaled $153.3 million for the three months ended June 30, 2026 (including $151.2 million recorded within Cost of sales) compared to $150.9 million for the three months ended June 30, 2025 (including $148.8 million recorded within Cost of sales), representing an increase of approximately $2.4 million. The increase was primarily attributable to an increase in the fixed asset base resulting from capital projects and turnarounds completed since the second quarter of 2025.
Gain on insurance recoveries, net- For the three months ended June 30, 2026 and 2025, we recognized gains on insurance recoveries associated with the Martinez refinery fire of $250.0 million and $189.0 million, respectively.
(Gain) loss on sale of assets- For the three months ended June 30, 2025, we recognized a gain of $0.2 million, primarily related to the sale of non-operating refinery assets. There was no such gain for the three months ended June 30, 2026.
Interest expense, net- Interest expense, net totaled $42.5 million for the three months ended June 30, 2026 compared to $54.4 million for the three months ended June 30, 2025, a decrease of approximately $11.9 million. The net decrease was primarily attributable to lower interest expense resulting from lower average outstanding borrowings under our Revolving Credit Facility and increased capitalized interest related to the Martinez refinery rebuild, partially offset by increased interest expense from the issuance of the 2034 7.25% Senior Notes in May 2026 prior to the redemption of the 2028 6.00% Senior Notes in June 2026. Additionally, interest income increased by $4.0 million during the three months ended June 30, 2026, driven by higher interest rates and higher cash deposits compared with the same period in the prior year. Interest expense for the three months ended June 30, 2026 includes interest on long-term debt, letter of credit fees associated with the purchase of certain crude oils, and the amortization of deferred financing costs.
Loss on extinguishment of debt- For the three months ended June 30, 2026, there was a loss on the extinguishment of debt of $2.2 million, related to the redemption of the 2028 6.00% Senior Notes.
Income tax benefit - As PBF Holding is a limited liability company treated as a "flow-through" entity for income tax purposes, our Condensed Consolidated Financial Statements generally do not include a benefit or expense for income taxes for the three months ended June 30, 2026 and 2025, respectively, apart from the income tax attributable to two subsidiaries acquired in connection with the Chalmette refinery in the fourth quarter of 2015 and PBF Energy Limited ("PBF Ltd."). These subsidiaries are treated as C-Corporations for income tax purposes. An income tax benefit of $1.5 million was recorded for the three months ended June 30, 2026 in comparison to $0.3 million for the three months ended June 30, 2025.
Six Months Ended June 30, 2026 Compared to the Six Months Ended June 30, 2025
Overview- Net income was $1,363.6 million for the six months ended June 30, 2026 compared to net loss of $638.9 million for the six months ended June 30, 2025.
Our results for the six months ended June 30, 2026 were positively impacted by special items consisting of a lower of cost or market ("LCM") inventory adjustment of $313.0 million, and a gain on insurance recoveries of $356.5 million, partially offset by expenses associated with the Martinez refinery fire of approximately $34.2 million, costs related to the RBI initiative of approximately $18.6 million, and loss of extinguishment of debt of $2.2 million, related to the redemption of the 2028 6.00% Senior Notes. Our results for the six months ended June 30, 2025 were positively impacted by special items consisting of a gain on insurance recoveries of $189.0 million, partially offset by expenses associated with the Martinez refinery fire of approximately $108.5 million, and costs related to the RBI initiative of approximately $13.6 million.
Excluding the impact of special items, our results for the six months ended June 30, 2026 reflect an overall increase in refining margins compared to the same period in 2025. The refining margins increase was primarily driven by favorable crack spreads and certain crude oil differentials, as well as higher throughput volumes and increased barrels sold across the majority of our refineries, partially offset by higher RFS compliance costs. Ongoing geopolitical conflicts affecting global supply and trade flows also contributed to these dynamic market conditions.
Revenues- Revenues totaled $19.6 billion for the six months ended June 30, 2026 compared to $14.5 billion for the six months ended June 30, 2025, an increase of approximately $5.1 billion, or 35.2%. Revenues per barrel were $110.74 and $84.46 for the six months ended June 30, 2026 and 2025, respectively, an increase of 31.1% directly related to higher hydrocarbon commodity prices and sale volumes. For the six months ended June 30, 2026, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 306,800 bpd, 137,400 bpd, 181,200 bpd, and 240,500 bpd, respectively. For the six months ended June 30, 2025, the total throughput rates at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 281,000 bpd, 149,900 bpd, 165,800 bpd and 188,300 bpd, respectively. For the six months ended June 30, 2026, total barrels sold at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 339,300 bpd, 150,000 bpd, 166,200 bpd, and 316,000 bpd, respectively. For the six months ended June 30, 2025, total barrels sold at our East Coast, Mid-Continent, Gulf Coast, and West Coast refineries averaged approximately 324,600 bpd, 154,900 bpd, 161,900 bpd and 308,500 bpd, respectively. Total refined product barrels sold were higher than throughput rates, reflecting sales from inventory as well as sales and purchases of refined products outside our refineries.
Overall average throughput rates at our refineries were higher for the six months ended June 30, 2026, primarily due to the restart of the Martinez refinery. In the prior-year period, increased maintenance activity and unplanned downtime resulting from the Martinez refinery fire negatively impacted throughput. We plan to continue operating our refineries in line with demand and prevailing market conditions.
Consolidated gross margin- Consolidated gross margin totaled $1,321.2 million for the six months ended June 30, 2026 compared to $(589.4) million for the six months ended June 30, 2025, an increase of approximately $1,910.6 million. Gross refining margin totaled $2,926.3 million, or $18.67 per barrel of throughput for the six months ended June 30, 2026 compared to $1,031.8 million, or $7.26 per barrel of throughput for the six months ended June 30, 2025, an increase of approximately $1,894.5 million. Gross refining margin excluding special items totaled $2,613.3 million, or $16.67 per barrel of throughput for the six months ended June 30, 2026. During the six months ended June 30, 2025, our refining margin calculations were not impacted by special items.
Consolidated gross margin and gross refining margin for the six months ended June 30, 2026 were positively impacted by the reversal of a prior-year non-cash LCM adjustment of approximately $313.0 million, driven by the increase in crude oil and refined product prices compared to the prior year. Consolidated gross margin, gross refining margin, and gross refining margin excluding special items increased due to favorable movements in crack spreads and certain crude oil differentials, as well as higher barrels sold at the majority of our refineries, partially offset by higher RFS compliance costs.
Additionally, our results continue to be impacted by significant costs to comply with the RFS. On March 27, 2026, the EPA finalized new RFS requirements for 2026 and 2027, which included a partial reallocation of small refinery exemptions that were granted for years 2023 to 2025 and revised renewable fuel volume requirements for 2026. Total RFS compliance costs were $609.3 million for the six months ended June 30, 2026 compared to $285.0 million for the six months ended June 30, 2025. The increase was primarily attributable to the newly finalized RFS requirements for 2026 and 2027, which has resulted in higher RIN prices in 2026 compared to 2025.
Average industry margins were notably more favorable during the six months ended June 30, 2026 in comparison to the same period in 2025, primarily due to geopolitical conflicts negatively impacting supply with demand remaining relatively resilient.
Favorable movements in benchmark crude differentials typically result in lower crude costs and positively impact our earnings, while reductions in these benchmark crude differentials typically result in higher crude costs and negatively impact our earnings.
On the East Coast, the Dated Brent (NYH) 2-1-1 industry crack spread was approximately $35.05 per barrel, or 79.0% higher, in the six months ended June 30, 2026, as compared to $19.58 per barrel in the same period in 2025. Our margins were positively impacted from our refinery specific slate on the East Coast by widening WTI/WCS and Dated Brent/Maya differentials which increased by $6.17 and $5.26 per barrel, respectively, in comparison to the same period in 2025, which favorably impacted our cost of heavy crudes.
Across the Mid-Continent, the WTI (Chicago) 4-3-1 industry crack spread was $32.11 per barrel, or 83.8% higher, in the six months ended June 30, 2026 as compared to $17.47 per barrel in the same period in 2025. Our margins were negatively impacted from our refinery specific slate in the Mid-Continent by a weakened WTI/Syncrude differential, which decreased by $1.49 per barrel, in comparison to the same period in 2025.
On the Gulf Coast, the LLS (Gulf Coast) 2-1-1 industry crack spread was $39.39 per barrel, or 109.9% higher, in the six months ended June 30, 2026 as compared to $18.77 per barrel in the same period in 2025. Margins on the Gulf Coast were positively impacted from our refinery specific slate by an expanded Dated Brent/WTS differential, which averaged a discount of $11.64 per barrel for the six months ended June 30, 2026 as compared to a discount of $3.95 per barrel in the same period of 2025.
On the West Coast, the ANS (West Coast) 4-3-1 industry crack spread was $45.03 per barrel, or 73.2% higher, in the six months ended June 30, 2026 as compared to $26.00 per barrel in the same period in 2025. Additionally, the ANS (West Coast) 3-2-1 industry crack spread was $49.67 per barrel, or 61.0% higher, in the six months ended June 30, 2026 as compared to $30.85 per barrel in the same period in 2025. Our margins on the West Coast were negatively impacted from our refinery specific slate by a weakened WTI/ANS differential, which averaged a premium of $7.40 per barrel for the six months ended June 30, 2026 as compared to a premium of $4.69 per barrel in the same period of 2025, slightly offset by an expanded Dated Brent/WTS differential, which averaged a discount of $11.64 per barrel for the six months ended June 30, 2026 as compared to a discount of $3.95 per barrel in the same period of 2025.
Operating expenses- Operating expenses totaled $1,307.2 million, or $8.34 per barrel of throughput, for the six months ended June 30, 2026 compared to $1,313.8 million, or $9.25 per barrel of throughput, for the six months ended June 30, 2025, a decrease of $6.6 million, or 0.5%. The decrease in operating expenses in comparison to the same period in 2025 was mainly attributable to lower maintenance expenses at our Martinez refinery related to the Martinez refinery fire, partially offset by higher outside services.
General and administrative expenses- General and administrative expenses totaled $233.3 million for the six months ended June 30, 2026 compared to $145.2 million for the six months ended June 30, 2025, an increase of approximately $88.1 million or 60.7%. The increase in general and administrative expenses in comparison to the same period in 2025 was primarily due to higher employee-related expenses, including the recognition of incentive compensation, and outside services, including higher legal costs, and costs incurred in connection with the RBI initiative. General and administrative expenses are comprised of personnel, facilities, and other infrastructure costs necessary to support our refineries and related logistics assets.
Depreciation and amortization expense- Depreciation and amortization expense totaled $302.3 million for the six months ended June 30, 2026 (including $297.9 million recorded within Cost of sales) compared to $311.6 million for the six months ended June 30, 2025 (including $307.4 million recorded within Cost of sales), representing a decrease of approximately $9.3 million. The decrease was primarily attributable to certain catalyst and turnaround costs that became fully amortized in 2025, partially offset by an increase in the fixed asset base resulting from capital projects and turnarounds completed since the second quarter of 2025.
Gain on insurance recoveries, net- For the six months ended June 30, 2026 and 2025, we recognized gains on insurance recoveries associated with the Martinez refinery fire of $356.5 million and $189.0 million, respectively.
(Gain) loss on sale of assets- For the six months ended June 30, 2026 and 2025, we recognized a loss of $0.3 million and a gain of $0.2 million, respectively, primarily related to the sale of non-operating refinery assets.
Interest expense, net- Interest expense, net totaled $85.0 million for the six months ended June 30, 2026 compared to $89.9 million for the six months ended June 30, 2025, a decrease of approximately $4.9 million. The net decrease was primarily attributable to lower interest expense resulting from lower average outstanding borrowings under our Revolving Credit Facility and increased capitalized interest related to the Martinez refinery rebuild, partially offset by increased interest expense from the issuance of the 2034 7.25% Senior Notes in May 2026 prior to the redemption of the 2028 6.00% Senior Notes in June 2026. Interest expense also reflects the issuance of the 2030 9.875% Senior Notes in March 2025. Additionally, interest income increased by $3.0 million during the six months ended June 30, 2026, driven by higher interest rates and higher cash deposits compared with the same period in the prior year. Interest expense for the six months ended June 30, 2026 includes interest on long-term debt, letter of credit fees associated with the purchase of certain crude oils, and the amortization of deferred financing costs.
Loss on extinguishment of debt- For the six months ended June 30, 2026, there was a loss on the extinguishment of debt of $2.2 million, related to the redemption of the 2028 6.00% Senior Notes.
Income tax benefit - As PBF Holding is a limited liability company treated as a "flow-through" entity for income tax purposes, our Condensed Consolidated Financial Statements generally do not include a benefit or expense for income taxes for the six months ended June 30, 2026 and 2025, respectively, apart from the income tax attributable to two subsidiaries acquired in connection with the Chalmette refinery in the fourth quarter of 2015 and PBF Ltd. These subsidiaries are treated as C-Corporations for income tax purposes. An income tax benefit of $8.8 million was recorded for the six months ended June 30, 2026 in comparison to a de minimis income tax benefit for the six months ended June 30, 2025.
Non-GAAP Financial Measures
Management uses certain financial measures to evaluate our operating performance that are calculated and presented on the basis of methodologies other than in accordance with GAAP ("Non-GAAP"). These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and our calculations thereof may not be comparable to similarly entitled measures reported by other companies.
Special Items
The Non-GAAP financial measures presented include Adjusted fully-converted net income (loss) excluding special items, gross refining margin excluding special items, EBITDA excluding special items, and net debt to capitalization ratio excluding special items. Special items for the periods presented relate to LCM inventory adjustments, expenses associated with the Martinez refinery fire, gain on insurance recoveries, costs related to the RBI initiative, and loss on extinguishment of debt. See "Notes to Non-GAAP Financial Measures" below for more details on all special items disclosed. Although we believe that Non-GAAP financial measures, excluding the impact of special items, provide useful supplemental information to investors regarding the results and performance of our business and allow for helpful period-over-period comparisons, such Non-GAAP financial measures should only be considered as a supplement to, and not as a substitute for, or superior to, the financial measures prepared in accordance with GAAP.
Gross Refining Margin and Gross Refining Margin Excluding Special Items
Gross refining margin is defined as consolidated gross margin excluding refining depreciation and operating expenses. We believe both gross refining margin and gross refining margin excluding special items are important measures of operating performance and provide useful information to investors because they are helpful metric comparisons to the industry refining margin benchmarks, as the refining margin benchmarks do not include a charge for refining operating expenses and depreciation. In order to assess our operating performance, we compare our gross refining margin (revenues less cost of products and other) to industry refining margin benchmarks and crude oil prices as defined in the table below.
Neither gross refining margin nor gross refining margin excluding special items should be considered an alternative to consolidated gross margin, income from operations, net cash flows from operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP. Gross refining margin and gross refining margin excluding special items presented by other companies may not be comparable to our presentation, since each company may define these terms differently.
The following table presents our GAAP calculation of gross margin and a reconciliation of gross refining margin, and gross refining margin excluding special items, to the most directly comparable GAAP financial measure, consolidated gross margin, on a historical basis, as applicable, for each of the periods indicated (in millions, except per barrel amounts):
| Three Months Ended June 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| $ | per barrel of throughput | $ | per barrel of throughput | ||||||||||||||||||||
| Calculation of consolidated gross margin: | |||||||||||||||||||||||
| Revenues | $ | 11,676.3 | $ | 144.60 | $ | 7,465.6 | $ | 97.77 | |||||||||||||||
| Less: Cost of sales | 10,584.1 | 131.07 | 7,581.8 | 99.29 | |||||||||||||||||||
| Consolidated gross margin | $ | 1,092.2 | $ | 13.53 | $ | (116.2) | $ | (1.53) | |||||||||||||||
| Reconciliation of consolidated gross margin to gross refining margin and gross refining margin excluding special items: | |||||||||||||||||||||||
| Consolidated gross margin | $ | 1,092.2 | $ | 13.53 | $ | (116.2) | $ | (1.53) | |||||||||||||||
| Add: Refining operating expense | 646.0 | 8.00 | 607.5 | 7.96 | |||||||||||||||||||
| Add: Refining depreciation expense | 151.2 | 1.87 | 148.8 | 1.95 | |||||||||||||||||||
| Gross refining margin | $ | 1,889.4 | $ | 23.40 | $ | 640.1 | $ | 8.38 | |||||||||||||||
| Gross refining margin excluding special items | $ | 1,889.4 | $ | 23.40 | $ | 640.1 | $ | 8.38 | |||||||||||||||
| Six Months Ended June 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| $ | per barrel of throughput | $ | per barrel of throughput | ||||||||||||||||||||
| Calculation of consolidated gross margin: | |||||||||||||||||||||||
| Revenues | $ | 19,576.1 | $ | 124.91 | $ | 14,522.7 | $ | 102.21 | |||||||||||||||
| Less: Cost of sales | 18,254.9 | 116.48 | 15,112.1 | 106.36 | |||||||||||||||||||
| Consolidated gross margin | $ | 1,321.2 | $ | 8.43 | $ | (589.4) | $ | (4.15) | |||||||||||||||
| Reconciliation of consolidated gross margin to gross refining margin and gross refining margin excluding special items: | |||||||||||||||||||||||
| Consolidated gross margin | $ | 1,321.2 | $ | 8.43 | $ | (589.4) | $ | (4.15) | |||||||||||||||
| Add: Refining operating expense | 1,307.2 | 8.34 | 1,313.8 | 9.25 | |||||||||||||||||||
| Add: Refining depreciation expense | 297.9 | 1.90 | 307.4 | 2.16 | |||||||||||||||||||
| Gross refining margin | $ | 2,926.3 | $ | 18.67 | $ | 1,031.8 | $ | 7.26 | |||||||||||||||
|
Special items: (1)
|
|||||||||||||||||||||||
| Add: LCM inventory adjustment | (313.0) | (2.00) | - | - | |||||||||||||||||||
| Gross refining margin excluding special items | $ | 2,613.3 | $ | 16.67 | $ | 1,031.8 | $ | 7.26 | |||||||||||||||
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See Notes to Non-GAAP Financial Measures.
EBITDA, EBITDA Excluding Special Items and Adjusted EBITDA
Our management uses earnings before interest, income taxes, depreciation and amortization ("EBITDA"), EBITDA excluding special items and Adjusted EBITDA as measures of operating performance to assist in comparing performance from period to period on a consistent basis and to readily view operating trends, as a measure for planning and forecasting overall expectations and for evaluating actual results against such expectations, and in communications with our Board of Directors, creditors, analysts and investors concerning our financial performance. Our outstanding indebtedness for borrowed money and other contractual obligations also include similar measures as a basis for certain covenants under those agreements which may differ from the Adjusted EBITDA definition described below.
EBITDA, EBITDA excluding special items and Adjusted EBITDA are not presentations made in accordance with GAAP and our computation of EBITDA, EBITDA excluding special items, and Adjusted EBITDA may vary from others in our industry. In addition, Adjusted EBITDA contains some, but not all, adjustments that are taken into account in the calculation of the components of various covenants in the agreements governing our senior notes and other credit facilities. EBITDA, EBITDA excluding special items, and Adjusted EBITDA should not be considered as alternatives to income from operations or net income as measures of operating performance. In addition, EBITDA, EBITDA excluding special items, and Adjusted EBITDA are not presented as, and should not be considered, an alternative to cash flows from operations as a measure of liquidity. Adjusted EBITDA is defined as EBITDA before adjustments for items such as stock-based compensation expense, LCM inventory adjustment, expenses associated with the Martinez refinery fire, gain on insurance recoveries, costs related to RBI initiative, loss on extinguishment of debt, and certain other non-cash items. Other companies, including other companies in our industry, may calculate EBITDA, EBITDA excluding special items and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures. EBITDA, EBITDA excluding special items and Adjusted EBITDA also have limitations as analytical tools and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations include that EBITDA, EBITDA excluding special items and Adjusted EBITDA:
•do not reflect depreciation expense or our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
•do not reflect changes in, or cash requirements for, our working capital needs;
•do not reflect our interest expense, or the cash requirements necessary to service interest or principal payments, on our debt;
•do not reflect realized and unrealized gains and losses from certain hedging activities, which may have a substantial impact on our cash flow;
•do not reflect certain other non-cash income and expenses; and
•exclude income taxes that may represent a reduction in available cash.
The following tables reconcile net income (loss) as reflected in our results of operations to EBITDA, EBITDA excluding special items and Adjusted EBITDA for the periods presented (in millions):
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Net income (loss) | $ | 1,151.9 | $ | (60.2) | $ | 1,363.6 | $ | (638.9) | ||||||||||||||||||
| Add: Depreciation and amortization expense | 153.3 | 150.9 | 302.3 | 311.6 | ||||||||||||||||||||||
| Add: Interest expense, net | 42.5 | 54.4 | 85.0 | 89.9 | ||||||||||||||||||||||
| Add: Income tax benefit | (1.5) | (0.3) | (8.8) | - | ||||||||||||||||||||||
| EBITDA | $ | 1,346.2 | $ | 144.8 | $ | 1,742.1 | $ | (237.4) | ||||||||||||||||||
|
Special Items: (1)
|
||||||||||||||||||||||||||
| Add: LCM inventory adjustment | - | - | (313.0) | - | ||||||||||||||||||||||
| Add: Martinez refinery fire expenses | 22.7 | 30.4 | 34.2 | 108.5 | ||||||||||||||||||||||
| Add: Gain on insurance recoveries, net | (250.0) | (189.0) | (356.5) | (189.0) | ||||||||||||||||||||||
| Add: Costs related to RBI initiative | 9.2 | 13.6 | 18.6 | 13.6 | ||||||||||||||||||||||
| Add: Loss on extinguishment of debt | 2.2 | - | 2.2 | - | ||||||||||||||||||||||
| EBITDA excluding special items | $ | 1,130.3 | $ | (0.2) | $ | 1,127.6 | $ | (304.3) | ||||||||||||||||||
| Reconciliation of EBITDA to Adjusted EBITDA: | ||||||||||||||||||||||||||
| EBITDA | $ | 1,346.2 | $ | 144.8 | $ | 1,742.1 | $ | (237.4) | ||||||||||||||||||
| Add: Stock-based compensation expense | 9.0 | 10.0 | 17.4 | 21.4 | ||||||||||||||||||||||
|
Special Items: (1)
|
||||||||||||||||||||||||||
| Add: LCM inventory adjustment | - | - | (313.0) | - | ||||||||||||||||||||||
| Add: Martinez refinery fire expenses | 22.7 | 30.4 | 34.2 | 108.5 | ||||||||||||||||||||||
| Add: Gain on insurance recoveries, net | (250.0) | (189.0) | (356.5) | (189.0) | ||||||||||||||||||||||
| Add: Costs related to RBI initiative | 9.2 | 13.6 | 18.6 | 13.6 | ||||||||||||||||||||||
|
Add: Loss on extinguishment of debt
|
2.2 | - | 2.2 | - | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 1,139.3 | $ | 9.8 | $ | 1,145.0 | $ | (282.9) | ||||||||||||||||||
----------
See Notes to Non-GAAP Financial Measures.
Notes to Non-GAAP Financial Measures
The following notes are applicable to the Non-GAAP Financial Measures above:
(1) Special items:
LCM inventory adjustment - LCM is a GAAP requirement for inventory valuation that mandates inventory to be stated at the lower of cost or market. Our inventories are valued at the lower of cost or market with cost determined using the last-in, first-out ("LIFO") inventory valuation methodology, under which the most recently incurred costs are charged to cost of sales and inventories are valued at base layer acquisition costs. Market price is determined based on an assessment of the current estimated replacement cost and net realizable selling price of the inventory. When the market price of our inventory declines substantially, cost values of inventory may exceed market values. In such instances, we record an adjustment to write down the value of inventory to market value in accordance with GAAP. In subsequent periods, the value of inventory is reassessed and an LCM inventory adjustment is recorded to reflect the net change in the LCM inventory reserve between periods. The net impact of these LCM inventory adjustments is included in the Refining segment's income from operations, but excluded from the operating results presented, as applicable, to ensure comparability between periods.
During the six months ended June 30, 2026, we reversed the $313.0 million LCM inventory reserve recorded at December 31, 2025. This reversal increased both income from operations and net income by $313.0 million, and resulted in no LCM inventory reserve at June 30, 2026. There were no such adjustments in any of the other periods presented.
Martinez refinery fire expenses - During the three and six months ended June 30, 2026, we recorded operating expenses associated with the Martinez refinery fire that decreased both income from operations and net income by $22.7 million and $34.2 million, respectively. During the three and six months ended June 30, 2025, we recorded operating expenses associated with the Martinez refinery fire that decreased both income from operations and net income by $30.4 million and $108.5 million, respectively.
Gain on insurance recoveries, net - During the three and six months ended June 30, 2026, we recorded gains on insurance recoveries associated with the Martinez refinery fire that increased both income from operations and net income by $250.0 million and $356.5 million, respectively. During both the three and six months ended June 30, 2025, we recorded a gain on insurance recoveries associated with the Martinez refinery fire that increased both income from operations and net income by $189.0 million.
Costs related to RBI initiative - During the second quarter of 2025, we launched our RBI initiative as part of our ongoing strategic efforts to extract incremental value across our business. As a result, for the three and six months ended June 30, 2026, we recorded expenses related to the execution of this initiative that decreased both income from operations and net income by $9.2 million and $18.6 million, respectively. For both the three and six months ended June 30, 2025, we recorded expenses related to the execution of this initiative that decreased both income from operations and net income by $13.6 million. These charges are included within General and administrative expenses.
Loss on extinguishment of debt - During both the three and six months ended June 30, 2026, we recorded a pre-tax loss on extinguishment of debt related to the redemption of our 2028 6.00% Senior Notes, which decreased both income before income taxes and net income by $2.2 million. There were no such adjustments in any of the other periods presented.
Liquidity and Capital Resources
Overview
Our primary sources of liquidity are our cash flows from operations, cash and cash equivalents and borrowing availability under our credit facility, as described below. We believe that our cash flows from operations and available capital resources will be sufficient to meet our and our subsidiaries' capital expenditures, working capital needs, future distributions, and debt service requirements, for the next twelve months. However, our ability to generate sufficient cash flow from operations depends, in part, on petroleum oil market pricing and general economic, political, and other factors beyond our control. As of June 30, 2026, we are in compliance with all covenants, including financial covenants, in all our debt agreements.
Cash Flow Analysis
Cash Flows from Operating Activities
Net cash provided by operating activities was $1,149.0 million for the six months ended June 30, 2026 compared to net cash used in operating activities of $460.4 million for the six months ended June 30, 2025. Our operating cash flows for the six months ended June 30, 2026 include our net income of $1,363.6 million. This amount reflects a gain on insurance recoveries of $356.5 million. Of the $356.5 million insurance proceeds, $111.3 million relates to operating activities. In addition, operating cash flows include depreciation and amortization of $311.7 million, pension and other post-retirement benefits costs of $26.8 million, stock-based compensation expense of $17.4 million, loss on extinguishment of debt of $2.2 million related to the redemption of the 2028 6.00% Senior Notes, and a loss on sale of assets of $0.3 million, partially offset by a non-cash LCM inventory adjustment of $313.0 million, deferred income taxes of $9.4 million, and net changes in operating assets and liabilities of $5.4 million, primarily driven by the timing of collection of accounts receivable and inventory purchase, partially offset by the timing of payments of accrued expenses. Our operating cash flows for the six months ended June 30, 2025 included our net loss of $638.9 million. This amount reflected a gain on insurance recoveries of $189.0 million, which was net of the $61.0 million receivable that was recorded at March 31, 2025. Of the $250.0 million insurance proceeds, $118.0 million related to operating activities. In addition, operating cash flows included net changes in operating assets and liabilities reflecting uses of cash of $117.6 million, primarily driven by the timing of inventory purchases and payments of accrued expenses, deferred income taxes of $0.5 million, and a gain on sale of assets of $0.2 million, partially offset by depreciation and amortization of $320.2 million, pension and other post-retirement benefits costs of $26.2 million, and stock-based compensation expense of $21.4 million.
Cash Flows from Investing Activities
Net cash used in investing activities was $504.8 million for the six months ended June 30, 2026 compared to net cash used in investing activities of $362.4 million for the six months ended June 30, 2025. The net cash used in investing activities for the six months ended June 30, 2026 was comprised of cash outflows for capital expenditures totaling $472.7 million, expenditures for refinery turnarounds of $242.4 million, and expenditures for other assets of $34.9 million, partially offset by insurance proceeds of $245.2 million. The net cash used in investing activities for the six months ended June 30, 2025 was comprised of cash outflows for capital expenditures totaling $256.5 million, expenditures for refinery turnarounds of $198.1 million, and expenditures for other assets of $39.8 million, partially offset by insurance proceeds of $132.0 million.
Cash Flows from Financing Activities
Net cash used in financing activities was $267.5 million for the six months ended June 30, 2026 compared to net cash provided by financing activities of $872.9 million for the six months ended June 30, 2025. For the six months ended June 30, 2026, net cash used in financing activities consisted of the redemption of the 2028 6.00% Senior Notes of $801.6 million, net payments of our Revolving Credit Facility of $100.0 million, payments on distributions to members of $36.5 million, deferred financing costs and other of $7.9 million, and payments on finance leases of $6.0 million, partially offset by cash proceeds of $500.0 million from the issuance of the 2034 7.25% Senior Notes, proceeds from contributions from PBF LLC of $127.0 million and net proceeds from insurance premium financing of $57.5 million. For the six months ended June 30, 2025, net cash provided by financing activities consisted of cash proceeds of $788.5 million from the issuance of the 2030 9.875% Senior Notes, net proceeds from our draws on our Revolving Credit Facility of $150.0 million, proceeds from contributions from PBF LLC of $110.0 million, and net proceeds from insurance premium financing of $43.9 million, partially offset by distributions to members of $201.1 million, deferred financing costs and other of $12.7 million, and payments on finance leases of $5.7 million.
Debt and Credit Facilities
Senior Notes
On May 28, 2026, we issued $500.0 million aggregate principal amount of our 2034 7.25% Senior Notes. Net proceeds from this offering were $492.1 million after deducting the initial purchasers' discount and offering expenses. We used the net proceeds from the offering and available cash to fully redeem our outstanding 2028 6.00% Senior Notes.
On June 25, 2026, we exercised our rights under the indenture governing the 2028 6.00% Senior Notes to redeem all outstanding 2028 6.00% Senior Notes at a redemption price equal to 100% of the aggregate principal amount thereof, plus accrued and unpaid interest up to, but excluding, the redemption date. The aggregate redemption price for the 2028 6.00% Senior Notes was approximately $801.6 million, plus accrued and unpaid interest.
Liquidity
As of June 30, 2026, our operational liquidity was over $3.5 billion (approximately $2.3 billion as of December 31, 2025) which consists of more than $800.0 million of cash, and approximately $2.7 billion of borrowing availability under our Revolving Credit Facility, which includes our cash on hand.
As of June 30, 2026, outstanding letters of credit totaled approximately $163.3 million.
We may incur additional indebtedness in the future, including secured indebtedness, subject to the satisfaction of any debt incurrence and, if applicable, lien incurrence limitation covenants in our existing financing agreements. Although we were in compliance with incurrence covenants during the six months ended June 30, 2026, there are no assurances in the future that we will be able to meet these incurrence covenants at the time we are required to do so. Failure to meet the incurrence covenants could impose certain incremental restrictions on, among other matters, our ability to incur new debt (including secured debt) and also may limit the extent to which we may pay future dividends, make acquisitions or investments, repurchase our outstanding debt or stock or incur new liens.
Working Capital
Our working capital at June 30, 2026 was $1,412.1 million, consisting of $5,813.3 million in total current assets, and $4,401.2 million in total current liabilities. Our working capital at December 31, 2025 was approximately $586.4 million, consisting of $4,419.5 million in total current assets, and $3,833.1 million in total current liabilities.
Capital Spending
Capital spending was $504.8 million for the six months ended June 30, 2026, net of $245.2 million in costs related to the rebuild of units damaged in the Martinez refinery fire that were reimbursed by insurance proceeds. Net capital spend was primarily comprised of annual maintenance and turnaround activities across our refineries, including a planned turnaround at the Torrance refinery. Capital spending also included costs associated with safety-related enhancements and facility improvements at our refineries and logistics assets, as well as expenditures to meet environmental, regulatory and safety requirements. After careful evaluation and safety inspections, we elected to move the scheduled Martinez second quarter hydrocracker complex turnaround to the end of the third quarter. Additionally, after further diligent review, we elected to move the planned fourth quarter turnarounds at both Chalmette and Toledo to 2027. As a result, we are reducing our 2026 capital expenditure guidance to $825.0 million to $875.0 million for the year, excluding capital related to the Martinez refinery rebuild.
Martinez Refinery Fire
We expect that the cost of repairs to the fire-damaged units and restoring the Martinez refinery to full operational status will largely be covered under our property insurance coverage, subject to our deductible and retentions totaling $30.0 million. Our insurance policy also includes business interruption coverage, which contains a 60-day waiting period. This coverage commenced on April 3, 2025. While we expect our insurance coverage will significantly offset the financial impact of the Martinez refinery fire, other than for the business interruption waiting period, deductibles and retentions, the timing of insurance proceeds may impact our results and our cash flow in a given reporting period.
During the three and six months ended June 30, 2026, we received $250.0 million and $356.5 million of unallocated insurance proceeds, respectively. Since the date of the Martinez refinery fire, we have received cumulative insurance proceeds, net of deductibles and retentions, of $1.25 billion. We expect to be able to negotiate future interim payments through final settlement of the claim. The timing and amount of any agreed future interim payments will be dependent on the quantum of actual, covered expenditures and calculated losses.
Air Products Asset Purchase
On July 20, 2026, we entered into an agreement with Air Products and Chemicals, Inc. to acquire two hydrogen production plants located at the Torrance refinery that were subject to operating lease arrangements as of June 30, 2026. Upon closing, we will become the owner and operator of the hydrogen plants.
The transaction includes a secured promissory note to be issued by PBF LLC that will become effective upon closing. The discounted value of the promissory note is estimated to range between $320.0 million - $340.0 million, including consideration of certain contingent payment amounts, dependent upon timing of closing.
The transaction is expected to close in the second half of 2026 and is subject to customary closing conditions and certain regulatory approvals.
Crude and Feedstock Supply Agreements
We currently purchase all of our crude and feedstock needs from various suppliers, primarily through short-term and spot market agreements.
Distributions
We make, from time to time, distributions to PBF LLC, if necessary, in order for PBF LLC to make pro rata distributions to its members, including PBF Energy, necessary to fund in excess of one year's cash dividend payments by PBF Energy.
On July 30, 2026, PBF Energy, our indirect parent, announced a dividend of $0.275 per share on its outstanding Class A common stock. The dividend is payable on August 28, 2026 to PBF Energy Class A common stockholders of record at the close of business on August 14, 2026. If necessary, we may need to make cash distributions to PBF LLC to the extent necessary for PBF Energy to pay this dividend. PBF Energy will then use this distribution to fund the dividend payments to the stockholders of PBF Energy.
In cases when there is sufficient cash and cash equivalents and borrowing capacity, we are permitted under our debt agreements to make these distributions; however, our ability to continue to comply with our debt covenants is, to a significant degree, subject to our operating results, which are dependent on a number of factors outside of our control.
Supplemental Guarantor Financial Information
As of June 30, 2026, PBF Services Company LLC, Delaware City Refining Company LLC, PBF Power Marketing LLC, Paulsboro Refining Company LLC, Toledo Refining Company LLC, Chalmette Refining L.L.C., PBF Energy Western Region LLC ("PBF Western Region"), Torrance Refining Company LLC ("Torrance Refining"), Martinez Refining Company LLC ("MRC"), PBF International Inc. and PBF Investments LLC are 100% owned subsidiaries of PBF Holding and guarantee the obligations under the 2034 7.25% Senior Notes, the 2030 7.875% Senior Notes and the 9.875% senior unsecured notes due 2030 (the "2030 9.875% Senior Notes") (collectively, the "Guarantor Subsidiaries"). These guarantees are full and unconditional and joint and several. The guarantees are set forth in the indentures dated May 28, 2026, August 21, 2023, and March 17, 2025 among PBF Holding, PBF Finance, the Guarantors Subsidiaries, Wilmington Trust, National Association, as trustee and Deutsche Bank Trust Company Americas, as Paying Agent, Registrar, Transfer Agent, and Authenticating Agent. PBF Ltd., PBF Transportation Company LLC, PBF Rail Logistics Company LLC, MOEM Pipeline LLC, Collins Pipeline Company, T&M Terminal Company, Torrance Basin Pipeline Company LLC, Torrance Logistics Company LLC, Torrance Pipeline Company LLC, Martinez Terminal Company LLC, Martinez Pipeline Company LLC and PBFWR Logistics Holdings LLC are consolidated subsidiaries of the Company that are not guarantors of the 2034 7.25% Senior Notes, the 2030 7.875% Senior Notes, and the 2030 9.875% Senior Notes. The 2034 7.25% Senior Notes, the 2030 7.875% Senior Notes and the 2030 9.875% Senior Notes were co-issued by PBF Holding and PBF Finance. For purposes of the following information, PBF Holding is referred to as "Operating Issuer" and PBF Finance is referred to as "Co-Issuer." The Co-Issuer has no independent assets or operations.
The following tables present summarized information for the Operating Issuer and the Guarantor Subsidiaries on a combined basis after elimination of (i) intercompany transactions and balances among the Operating Issuer and the Guarantor Subsidiaries and (ii) equity in earnings from and investments in any subsidiary that is a non-guarantor.
| Summarized Balance Sheets (in millions) |
June 30, 2026 |
December 31, 2025 |
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| ASSETS | |||||||||||
|
Current assets (1)
|
$ | 5,629.9 | $ | 4,243.1 | |||||||
| Non-current assets | 7,167.0 | 6,932.3 | |||||||||
| Due from non-guarantor subsidiaries | 27,312.0 | 26,177.0 | |||||||||
| LIABILITIES AND EQUITY | |||||||||||
|
Current liabilities (1)
|
$ | 4,197.5 | $ | 3,585.9 | |||||||
| Long-term liabilities | 2,580.1 | 2,982.8 | |||||||||
| Due to non-guarantor subsidiaries | 27,183.6 | 26,143.8 | |||||||||
| ____________________________ | |||||||||||
|
(1) Includes $50.3 million and $124.2 million of accounts receivable and accounts payable, respectively, related to transactions with PBFX and SBR as of June 30, 2026. Includes $49.4 million and $78.3 million of accounts receivable and accounts payable, respectively, related to transactions with PBFX and SBR as of December 31, 2025. Refer to "Note 5 - Related Party Transactions" of our Notes to Condensed Consolidated Financial Statements for further information.
|
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| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| Summarized Statements of Operations (in millions) | 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||
| Revenues | $ | 11,605.5 | $ | 7,444.1 | $ | 19,472.9 | $ | 14,447.7 | |||||||||||||||
| Cost of sales | 9,922.9 | 7,168.2 | 17,094.0 | 14,106.2 | |||||||||||||||||||
| Gross margin | 1,682.6 | 275.9 | 2,378.9 | 341.5 | |||||||||||||||||||
| Income from operations | 1,785.1 | 385.1 | 2,499.0 | 381.6 | |||||||||||||||||||
| Net income | 1,730.6 | 326.0 | 2,376.2 | 285.1 | |||||||||||||||||||
| Net income attributable to PBF Holding Company LLC | 1,730.8 | 326.0 | 2,376.3 | 285.1 | |||||||||||||||||||
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Non-guarantor intercompany sales with the Operating Issuer and Guarantor subsidiaries
|
$ | 579.8 | $ | 389.3 | $ | 1,015.0 | $ | 928.2 | |||||||||||||||
|
Non-guarantor intercompany cost of sales with the Operating Issuer and Guarantor subsidiaries
|
(1.1) | (5.3) | (2.4) | (4.2) | |||||||||||||||||||
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Affiliate revenues related to transactions with PBFX and SBR (1)
|
70.9 | 57.6 | 169.3 | 117.9 | |||||||||||||||||||
|
Affiliate expenses related to transactions with PBFX and SBR (1)
|
(345.9) | (212.4) | (592.1) | (363.2) | |||||||||||||||||||
| ___________________________ | |||||||||||||||||||||||
| (1) Refer to "Note 5 - Related Party Transactions" of our Notes to Condensed Consolidated Financial Statements for further information. | |||||||||||||||||||||||
PBF Holding Company LLC published this content on August 04, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on August 04, 2026 at 15:28 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]