Summary
Valero Energy Corporation (VLO) reported solid financial results for the second quarter of 2012, demonstrating a recovery in profitability compared to the previous year. Net income attributable to stockholders from continuing operations increased by 11.5% to $831 million, or $1.50 per diluted share, up from $745 million, or $1.30 per diluted share, in the second quarter of 2011. This improvement was primarily driven by a significant increase in operating income within the refining segment, largely due to the contributions from recently acquired Meraux and Pembroke refineries. However, the first six months of 2012 saw a notable decline in net income to $399 million ($0.72 per diluted share) compared to $849 million ($1.48 per diluted share) in the same period of 2011. This year-over-year decrease was significantly influenced by a substantial asset impairment loss of $595 million related to the Aruba Refinery, coupled with reduced operating income in the refining and ethanol segments, the latter affected by lower margins due to excess ethanol supply and higher corn prices.
Financial Highlights
46 data points| Operating Expenses | $33.30B |
| Operating Income | $1.36B |
| Interest Expense | $74.00M |
| Net Income | $831.00M |
| EPS (Basic) | $1.50 |
| EPS (Diluted) | $1.50 |
| Shares Outstanding (Basic) | 550.00M |
| Shares Outstanding (Diluted) | 555.00M |
Key Highlights
- 1Second quarter 2012 net income attributable to Valero stockholders from continuing operations rose to $831 million ($1.50 per diluted share), an increase from $745 million ($1.30 per diluted share) in Q2 2011, driven by strong refining segment performance.
- 2The refining segment's operating income increased by $111 million in Q2 2012 compared to Q2 2011, largely due to the operational contributions of the Meraux and Pembroke refineries acquired in late 2011.
- 3The ethanol segment experienced a significant decline in operating income, falling by $59 million in Q2 2012 year-over-year, attributed to lower margins caused by excess ethanol supply and higher corn prices.
- 4Valero recognized a significant asset impairment loss of $595 million in March 2012 related to the Aruba Refinery, which led to a substantial decrease in net income for the first six months of 2012 compared to the prior year.
- 5The company announced plans to separate its retail business as part of a strategy to maximize shareholder value, with several potential separation transactions under review.
- 6Valero's Board of Directors increased the quarterly cash dividend to $0.175 per share in July 2012, signaling confidence in the company's financial position.
- 7Total assets decreased to $41.2 billion as of June 30, 2012, from $42.8 billion as of December 31, 2011, largely due to a reduction in current assets, including accounts payable and receivables.