Calumet Tries to Right The Ship After Big Loss

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Calumet has several facilities in the U.S. and Mexico, including a refinery in Shreveport, Louisiana that produces specialty lubricating oils and waxes, as well as fuel products like gasoline, diesel and jet fuel. Calumet has several facilities in the U.S. and Mexico, including a refinery in Shreveport, Louisiana that produces specialty lubricating oils and waxes, as well as fuel products like gasoline, diesel and jet fuel.
INDIANAPOLIS -

As volatility continues to plague the crude oil industry, Indianapolis-based Calumet Specialty Products Partners LP (Nasdaq: CLMT) has announced a second quarter loss of $148 million, compared to net income of $2.5 million during the second quarter of 2015. Chief Executive Officer Tim Go says the company has taken several "decisive actions" to get the balance sheet back on track.

Calumet attributes much of the loss to events including more than $147 million in charges related to the divestiture of a 50 stake in Dakota Prairie Refining, LLC, a partnership that first got underway early last year. It also cites what is says is a favorable lower of cost or market inventory adjustment of $36.3 million, an $8.2 million hit related to U.S. Renewable Fuel Standard compliance efforts and a $7.1 million loss from unconsolidated affiliates connected to Dakota Prairie Refining. It officially divested from DPR June 27.

In commentary from the quarterly earnings report released this week, Go said "we remain focused on strengthening balance sheet liquidity, reducing operating costs and pursuing self-help margin capture throughout our portfolio of assets. We made meaningful progress in each of these areas during the second quarter, despite a material year-over-year decline in benchmark refined product margins, elevated RFS compliance costs and continued commodity price volatility."

Go was named CEO of Calumet in September. He says measures taken to return to profitability include divesting from the DPR joint venture, raising $400 million from a senior secured note offering and suspending a quarterly shareholder distribution that totaled nearly $225 million last year.

You can connect to the earnings release by clicking here.

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