Valero reports increased ethanol production volumes

By Erin Voegele | January 28, 2016

Valero Energy Corp. has released 2015 financial results, reporting the company’s ethanol segment achieved increased production volumes, but decreased operating income. Overall, Valero reported increased adjusted net income.

Valero reported $862 million, or $1.79 per share, in adjusted net income from continuing operations attributable to Valero stockholders for the fourth quarter, compared to $952 million, or $1.83 per share, for the same quarter of the prior year. Actual net income from continuing operations attributable to Valero stockholders was $298 million, or 62 cents per share, for the fourth quarter, compared to $1.2 billion, or $2.22 per share, for the fourth quarter of 2014.

For the full year, adjusted net income from continuing operations attributable to Valero stockholders was $4.6 billion, or $9.24 per share, compared to $3.5 billion, or $6.68 per share. Actual net income from continuing operations attributable to Valero stockholders was $4 billion, or $7.99 per share, in 2015 compared to $3.7 billion, or $6.97 per share, in 2014.

The company’s ethanol segment reported adjusted operating income of $37 million for the fourth quarter, compared to $154 million during the same period of 2014. The $117 million decrease was mainly due to lower gross margin per gallon driven by a decline in ethanol prices versus relatively stable corn prices. For the full year, the ethanol segment reported $192 million in operating income, down from $782 million in 2014.

Ethanol production volumes were 3.88 million gallons per day during the fourth quarter of 2015, an increase of 131,000 gallons per day compared to the fourth quarter of 2014, when production was 3.75 million gallons per day. According to Valero, the increase was due to ongoing optimization and plant improvements. The company produced approximately 3.83 million gallons of ethanol per day in 2015, compared to 3.42 million gallons per day in 2014.

Gross margin per gallon of production was 45 cents in the fourth quarter and 49 cents for the full year, compared to 86 cents in the fourth quarter of 2014 and $1.06 for the full year 2014. Operating income per gallon of ethanol production was 11 cents during the fourth quarter, down from 45 cents during the same quarter of 2014. For the full year, operating income per gallon of production was 14 cents, compared to 63 cents in 2014.

Total ethanol operating income was a $13 million loss for the fourth quarter, compared to $158 million during the same period of 2014. For the full year 2015, total ethanol operating income was $142 million, down from $786 million in 2014.